All seven independent directors of 23andMe resigned from the company’s board this week, a move that raises concerns about the future of the genetic-testing company and the protection of its customers’ personal data. The resignations came after months of negotiations with CEO and co-founder Anne Wojcicki, who seeks to take the company private. In a letter to Wojcicki, the directors expressed frustration over the lack of a fully financed, actionable proposal that would benefit non-affiliated shareholders. Despite their belief in the company’s mission, they stated that Wojcicki’s concentrated voting power and a clear difference in opinion over the company’s future led them to step down.

Wojcicki, who holds 49% of the voting power at 23andMe, is now the sole remaining board member. In a memo to employees, she expressed disappointment over the directors’ decision to resign but maintained that taking the company private would allow it to operate outside the pressures of the public markets. She believes this would benefit 23andMe in the long run. Despite this optimism, the timing of the resignations, coupled with Wojcicki’s control, raises concerns about the company’s future transparency and governance, especially as it navigates ongoing privacy issues.

Financially, 23andMe has faced significant challenges since going public in 2021. The company has reported substantial losses, including a net loss of $667 million last fiscal year, and its stock has plummeted by over 97% since its initial market debut. Wojcicki’s plan to take the company private has led to questions about whether this move is truly in the best interest of shareholders or simply an effort to maintain control as the company struggles financially.

At the same time, the company is grappling with serious privacy concerns. In 2023, 23andMe experienced a significant data breach, exposing the personal information of many of its customers. The company recently agreed to a $30 million settlement to resolve a class-action lawsuit over its failure to protect customer data. While the company claims the settlement is in the best interest of its customers, the breach highlights vulnerabilities in 23andMe’s data security infrastructure.

The departure of the independent directors, who are meant to provide oversight and serve as a check on the CEO, adds another layer of concern. With Wojcicki consolidating control and the company potentially going private, there may be less incentive to prioritize customer privacy. A private company is not subject to the same level of regulatory scrutiny as a public one, which could reduce transparency and accountability when it comes to protecting sensitive genetic data.

Customers may also worry about how 23andMe’s financial struggles could impact its data protection policies. Faced with growing losses, the company could be tempted to monetize its customer data in new ways, raising further concerns about privacy. Even if Wojcicki’s intentions are genuine, the absence of independent board oversight and the pressures of keeping the company afloat in a challenging market could lead to risky decisions regarding customer data.

In an era where data breaches are increasingly common, the security of personal genetic information is critical. If 23andMe becomes a private company, customers should be vigilant about how their data is handled. The potential for reduced transparency and oversight means that consumers must demand stronger protections for their sensitive information.

As 23andMe continues to navigate these financial and leadership challenges, the priority must be the security of its customers’ genetic data. Without the accountability that comes with being a public company, there is a real risk that data protection could take a back seat to other concerns. The next steps the company takes will be crucial, not only for its financial future but also for ensuring that its customers’ personal information remains safe.