[HN Gopher] 23andMe to merge with VG Acquisition Corp. to become...
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23andMe to merge with VG Acquisition Corp. to become publicly-
traded company
Author : breck
Score : 115 points
Date : 2021-02-05 14:15 UTC (8 hours ago)
(HTM) web link (mediacenter.23andme.com)
(TXT) w3m dump (mediacenter.23andme.com)
| brutal_chaos_ wrote:
| Cool, how will they be monetizing your genome next? Cynical,
| perhaps, realistic, I don't think laws are stopping them (I'm no
| lawyer, I could be wrong).
| KoftaBob wrote:
| The long game for 23andMe will likely be using their valuable
| dataset for something called Personalized Medicine.
|
| "Personalized medicine is based on using an individual's genetic
| profile to make the best therapeutic choice by facilitating
| predictions about whether that person will benefit from a
| particular medicine or suffer serious side effects."
|
| In other words, they will become a platform for data-driven
| healthcare decisions and even development of new medicine.
|
| Those who think their endgame is to indiscriminately sell users'
| data, as if they're a healthcare Mark Zuckerberg, are being
| unimaginative.
| notRobot wrote:
| > _Those who think their endgame is to indiscriminately sell
| users ' data, as if they're a healthcare Mark Zuckerberg, are
| being unimaginative._
|
| No, they're being realistic.
| diveanon wrote:
| DNA is your identity, it's not some password you can change.
|
| And now it's contents will be traded as a commodity.
| RocketSyntax wrote:
| The data they gathered was less than 1% of the genome. Don't buy
| in.
| iblaine wrote:
| SPACs are today's ICOs. For every good company like 23andMe we
| should expect dozens of bad ones.
| monkeydust wrote:
| You can look at the SEC filings for the SPAC as it will provide
| indication but it will be thematic at best.
| runako wrote:
| Here's a thread of basic diligence on the company:
|
| https://twitter.com/BluthCapital/status/1357469113422069761?...
|
| Possibly of interest if you're considering investing.
| breck wrote:
| Thanks! It does explain why the stock price is low.
|
| I do have some problems with 23andme (and I've sent Anne a few
| emails about things over the years about a few simple things
| that they still haven't corrected, which is a bit worrisome),
| but that being said, who else comes close to doing what they
| do?
|
| I invested a lot in FitBit (lost a lot), but also Garmin and
| AAPL and MSFT (I just liked the wearable sector).
|
| Similarly, I'd like to do a similar play in consumer genomics.
| Just bought some 23andMe (via the SPAC, not sure if I did it
| right), but what else is out there? I liked uBiome but not sure
| what is happening there. Ancestry.com I should probably look
| into, what else? Oxford Nanopore would be great (are they
| public?).
|
| 23andme is great because of the network effects. If someone
| comes out with better sequencing tech, they still have a huge
| distribution problem, which 23andme has solved (if they don't
| blow the trust of their users).
|
| Anyway, I'm long.
| runako wrote:
| I don't know the space well, but I have been in a position to
| have purchased a few (IIRC at least 4) genetic tests used in
| clinical diagnoses. 23andMe was not a vendor that was used in
| any of those situations. Also, those tests cost a lot more
| than 23andMe's tests (this can be good if you are an
| investor).
|
| Even if you suspect something based on a 23&M test, your
| doctor will likely require confirmation from a clinical
| testing company. That's IMHO where the money is. 23&me is
| analogous to the over-the-counter tests they sell in the
| drugstore, which we know are a cheaper alternative than a
| "real" lab test.
|
| > who else comes close to doing what they do?
|
| The other vendors in the space who are used in clinical
| environments ("real" lab tests). Think Lab Corp (LH) as an
| example. You might also look at the constituents of the ARKG
| ETF for other options. These are companies that have demand
| locked in through relationships with healthcare providers and
| are also able to charge more for their tests.
|
| None of this is investment advice. Obviously you should not
| take investment advice from strangers on the Internet.
| breck wrote:
| Yeah Lab Corp and all them work a lot on the supply side,
| but last mile consumer experience is awful. I think it's
| equally as hard to perfect that last mile consumer UX and
| distribution challenge, and probably more valuable long run
| (if you own the customer relationship, you have a lot of
| leverage to negotiate prices with vendors, and swap them
| out lego lego pieces, a la Apple).
|
| Not to say that 23andMe will be the Apple of the space (and
| realistically Apple with Apple Health has a good shot at
| it), but I definitely don't think anyone wasting time with
| the B2B businesses will be the big gorilla in 10 - 20
| years, and instead it will be a consumer facing company
| like 23andMe or someone.
| runako wrote:
| > last mile consumer experience is awful
|
| Interesting perspective. When we used labs similar to
| LabCorp in the past, the last mile was our physician (who
| we like!). I'm curious what part of the last mile is
| negative with traditional labs?
|
| > if you own the customer relationship
|
| I'm not sure any testing provider is ever going to be in
| a position to own the customer relationship. The
| physician and healthcare team will by definition always
| be closer to the customer.
|
| Also I should have noted above: I don't have to worry
| about Lab Corp or my doctor selling my health information
| due to HIPAA compliance. That may be generational;
| perhaps younger generations will not care about this
| aspect of privacy.
| breck wrote:
| > I'm curious what part of the last mile is negative >
| with traditional labs?
|
| Well for one, why do I even have to go a mile? I've spent
| some time on the bench. All of this stuff will eventually
| be done at home (won't even need to mail in things!).
|
| Last February when I got COVID I couldn't get a test
| because "I hadn't been to China". But they tested me for
| perhaps everything else (even though I had been exposed
| to COVID folks, and had the symptomns). Not surprisingly
| everything was negative (except for typical metabolic
| changes you see in fighting viruses). The best part was 6
| months later I got a bill in the mail for I kid you not,
| ~$1,800, for these lab tests! Insurer says "if it was
| March then those tests would have been covered, but
| because it was February we didn't have those policieis in
| place yet". Still fighting that one, lol.
|
| But recent events aside, let's just take a typical lab
| results report. Where's the "go to definitions" on these
| things? Where is the ability to drill in and see where my
| measurements fit in regard to my close 8 billion
| relatives?
|
| This industry is still in the stone age.
|
| > The physician and healthcare team will by definition >
| always be closer to the customer.
|
| And the wearables will by definition always be closer to
| the customer.
|
| I am not going to tell my daughter that being a physician
| is a viable future career like it is today (engineer or
| nurse would be 2 good options though).
|
| > perhaps younger generations will not care about this
| aspect of privacy.
|
| I agree. Or at least, I hope younger generations continue
| Obama's work and fix the laws so that your health
| information cannot be used against you. What a sad and
| stupid state of affairs that is. We need to fix that.
| offtop5 wrote:
| I never saw the point of stuff like this.
|
| Aside from misplaced ancestral pride, so what your great great
| great grandpa owned the biggest farm in Spain, doesn't change the
| fact you work at Vons.
| codetrotter wrote:
| Idk, I think it'd be fun to know who my ancestors were. Not for
| any kind of ancestral pride that you talk about but just
| because it's neat. If you don't get it you don't get it, that's
| fine. There's lots of other things that people find interesting
| or meaningful that I don't and same the other way around. It's
| like that for everyone.
| jhardy54 wrote:
| I've flagged your post for being unnecessarily hostile while
| also being ignorant of the type of features that 23andMe has.
| Maybe you're thinking of ancestry.com?
| offtop5 wrote:
| You're handing your most private personal data to a company
| in hopes of finding one of your ancestors did something cool
| ?
|
| Does that make sense to you ?
| jedberg wrote:
| I'm so glad I never did 23andMe for my kids. My wife and I did it
| before all the privacy nightmare revelations (and admittedly I
| didn't think of them myself) and originally I had planned to have
| my kids do it too, just to see what they got from us.
|
| But luckily they won't take a sample from someone under two, and
| in the time between birth and two was when all the privacy issues
| became clear.
| astura wrote:
| What privacy nightmare revelations?
| cheschire wrote:
| Just wait until companies like this become more focused on B2B
| and just get doctors to collect the samples for them for a
| payout.
| cphoover wrote:
| This company is just one big ethical dilemma packaged Silicon
| Valley style to look hip.
| Eric_WVGG wrote:
| The worst thing is that, you can't even really opt out.
|
| My parents tried to gift me a kit for xmas one year, "hey we
| think this is fun, might be useful to know if you're prone to
| eyeball cancer or whatever." I explained all the privacy issues
| and politely declined. But of course they and my sister had
| already gone ahead and done it, so now my family's genetic
| fingerprints are in their databases, nothing to be done about
| it.
|
| This is how the "Golden State Killer" was nabbed, which is
| obviously an example of this kind of thing being put to good
| use... I hope I don't have to argue against the dumb old
| "people who are innocent have nothing to hide" discussion here
| riffic wrote:
| sounds like you need to open a dialog with your congress-
| critters with your concerns then.
|
| these companies are going to do whatever they want in the
| meantime.
| asdff wrote:
| That is in fact not how the golden state killer was nabbed.
| Uploads to GEDmatch are voluntary.
| Eric_WVGG wrote:
| It very much was. His relatives, not knowing who he was,
| voluntarily uploaded their data to GEDmatch. Those
| fingerprints were used to identify him. Did you think he
| voluntarily uploaded his DNA on a lark?
| ape4 wrote:
| PrivacySinkholeAndMe
| engineer_22 wrote:
| Why would a company go through a SPAC instead of an IPO?
|
| Does the SPAC merger constitute a hedge against uncertainty in an
| IPO? What I mean is, 23andMe gets cash NOW and the SPAC gets the
| company at a discount but accepts the risk the IPO might not meet
| its goals?
|
| Could someone please explain the strategy?
| theptip wrote:
| Matt Levine has the best ELI5 on this subject that I've seen:
|
| https://www.bloomberg.com/opinion/articles/2021-01-08/spac-m...
|
| Here's the high-level summary from that article, though there's
| a lot more detail that's worth digging into:
|
| > Here's how a SPAC works:
|
| 1. You give me $10.
|
| 2. I put your $10 in a pool with a bunch of other people's $10,
| held in a trust account at a bank.
|
| 3. I give you back one share in the pool (representing $10 of
| money in the pool), and one-quarter of a warrant to buy another
| share for $11.50. (The combination of the share and part of a
| warrant is sometimes called a "unit.")
|
| 4. I try to find a company to take public within two years.
|
| 5. If I fail, I give you back your $10 with interest.
|
| 6. If I succeed, I merge the pool with the company, giving the
| company the money in the pool and giving you and your fellow
| shareholders shares (and warrants) in the new combined company.
| Also I get a bunch of shares and warrants in the combined
| company, as a reward for my work.
|
| 7. When I do this, I give you the choice to either (a) let your
| money ride and take a share in the new company or (b) get your
| $10 back, with interest.
| mywittyname wrote:
| Can the general public invest in SPACs? Are there SPACs that
| target specific markets, like tech, finance, real-estate,
| etc?
| tedunangst wrote:
| https://spactrack.net/activespacs/
| dehrmann wrote:
| > Can the general public invest in SPACs
|
| Yes. I'm pretty sure the ticker symbol of this one is VGAC.
|
| The problem you get is this:
| https://vgacquisition.com/objective/
|
| > VG Acquisition Corp (VGAC) aims to invest in a strong
| business with a proven track record that can deliver
| attractive returns to public market investors by
| capitalizing on Virgin's brand and global resources.
|
| I'm sure some target specific markets, but this one
| doesn't.
| dehrmann wrote:
| I don't see anything especially wrong with them and what they
| do because they're really just a way around the IPO paperwork
| and restrictions. Usually, a lot of that feels like a
| formality, but it did surface some interesting things about
| Wework. That said, it's a bet on the team, and you have no
| idea what they're going to find. It's a little like investing
| in a less-diversified, late-stage venture fund.
| r00fus wrote:
| The investing public loses out on valuable information.
| It's an end-run around disclosures.
|
| That's not a good thing.
| [deleted]
| brentm wrote:
| One factor is predictability in initial price. The SPAC &
| company negotiate a fixed price to go public. With an IPO the
| company begins the process with a valuation in mind but a lot
| of it still comes down to the roadshow investors, for better or
| worse.
| ffggvv wrote:
| it's because it doesn't have the same regulation or due
| diligence. you can scam retail investors.
| lotsofpulp wrote:
| Retail investors have no business investing in an SPAC. If
| you're not doing your due diligence, you should stick to VOO.
| There's plenty of options for people who don't want to take
| risks.
| yreg wrote:
| Your comment reads as if you suggested that would be the
| only/main reason. Ergo "all spacs are scams"?
|
| That's very much not true.
| [deleted]
| anthuswilliams wrote:
| The major benefit of going public via an SPAC is avoiding the
| onerous disclosure requirements associated with an IPO. In
| particular, the SEC frowns upon projections of imminent, wild
| growth, which is a big part of the valuation of many companies
| seeking to go public these days.
|
| With an SPAC, a company can go public while still hyping the
| stock on YouTube or whatever, and without suffering a lockup
| period during which its executives are not allowed to sell into
| the mania. The SPAC phenomenon why have suddenly seen so many
| overhyped companies (NKLA, anyone?) in the public markets
| lately.
| scary-size wrote:
| Th last twenty Bloomberg Money Stuff [1] columns get into the
| details of SPAC vs IPO. Matt Levine does a pretty good job
| explaining finance stuff to non-finance people.
|
| [1]
| https://www.bloomberg.com/opinion/authors/ARbTQlRLRjE/matthe...
| mason55 wrote:
| > _Does the SPAC merger constitute a hedge against uncertainty
| in an IPO?_
|
| Yes, that's exactly right. You're basically paying for
| certainty.
| gcblkjaidfj wrote:
| so they can continue to hide from public that most of their
| revenue is from secondary use they monetize from their
| database: research & law enforcement (or anyone that wants to
| buy their anonymized database, that still seem to contain
| zipcode)
| detaro wrote:
| In addition to speed and guaranteed price a SPAC merger also
| has less reporting requirements, because the SPAC already did
| go trough the IPO paperwork when it was created. And didn't
| have to explain weird things about the business to investors
| because it had no history or things to be going on. It then can
| relatively easily buy 23andMe, and 23andMe doesn't have to
| explain its business risks etc to the public as much - which
| could have been an issue and risk to the stock price given the
| history of probes about medical claims etc.
| lordnacho wrote:
| Am I the only one who thinks that's a massive hole in the
| rules? You IPO an empty shell, which passes easily because it
| does nothing, and then any old shop with a messy business can
| then be bought by it?
| r00fus wrote:
| No you're not. It's entirely a loophole being regularly
| exploited.
|
| Now whether the existing IPO requirements could/should be
| streamlined is another question.
| lotsofpulp wrote:
| If you're investing in an SPAC, you should know this
| already. Everything is transparent, so I don't see what the
| loophole is, or who or how anyone is getting bamboozled?
|
| Company wants to go public with higher guarantee of price,
| they go with SPAC. Investor wants higher return, they
| invest in SPAC, but there is no higher return without
| higher risk.
| thedudeabides5 wrote:
| Yes, that's pretty much the idea.
|
| Back in markets, we would of called it 'regulatory
| arbitrage.'
| lordnacho wrote:
| Why doesn't every IPO happen this way? Once you want to
| go public, you make a SPAC, get that approved, then have
| it buy your business?
| tachyonbeam wrote:
| Right now it kind of seems like every IPO _does_ happen
| this way. There 's kind of a SPAC mania going on. I can
| name at least 5 companies that are going public through
| SPACs, and two more that are rumored to be doing the same
| soon (Virgin Orbit and Lucid Motors).
| lordnacho wrote:
| What I mean is why don't traditional businesses IPO in
| this way? If it's a pain to do due dilly with a real
| business, why isn't this a back door?
| gamblor956 wrote:
| SPAC acquisitions raise significantly less money for the
| target acquired company, so generally a target only goes
| the SPAC route if their financials aren't in good enough
| shape to go the traditional IPO route (offering, dutch
| auction, or otherwise).
|
| Most SPAC acquisitions involve high-risk companies, for
| recent examples: Lucid (10 years on and still no actual
| product for sale), Nikola (fraud), 23andMe (its
| financials are reportedly not in great shape), Opendoor
| (huge portfolio of risky real properties), EVgo (history
| of massive losses), Clover Health (accusations of fraud,
| under DOJ investigation).
|
| SoFi is the only company I can think of that is going the
| SPAC route that was potentially in the shape to IPO
| (their potential IPO was tenatively valued at $17 billion
| at the start of 2020, but the SPAC acquired them for
| around 8.65 billion). They apparently chose not to IPO
| because they wanted "deal certainty." However, leaving
| that much money on the table is a huge red flag for a
| financial company; it suggests that 2020 was a bad year
| for them and that they wanted to avoid disclosure, or
| that their financials are not in great shape.
| lotsofpulp wrote:
| Theoretically, you get a lower price with an SPAC.
| However, if so much money is looking for returns, then
| the price might not be so low as to discourage it
| compared to other traditional ways to IPO.
| anthuswilliams wrote:
| The sponsors of the SPAC set aside for themselves a big
| chunk of the shares of the newly combined entity. So in
| general, the company gets a worse price than it would if
| it had gone public via an IPO.
| smallscientist wrote:
| Most sponsors don't hold shares unless for the stock pops
| way beyond the $10. For the average company, you may end
| up as a public company with no cash raised. This can be
| mitigated by a concurrent PIPE, but otherwise you're SOL.
| buescher wrote:
| So if the principals involved in a startup set up their
| own SPAC to take the company public, they could screw
| minority shareholders in the original company like, say,
| employees?
| ls612 wrote:
| The laws generally require that these things be "arms
| length transactions", basically meaning that the two
| parties are legitimately at odds over the price. Your
| example would not be that.
| macinjosh wrote:
| No you're not the only one, it is a massive loophole that
| benefits corporations and the perfect example of why
| government regulation can never really work in the end.
| There will always be a way around found.
| tachyonbeam wrote:
| On top of this, SPACs usually have private PIPE investors
| who get shares at the "IPO" price, typically 10 dollars,
| while people who buy the public SPAC shares typically have
| to pay twice that, which feels super scammy.
|
| https://www.investopedia.com/terms/p/pipe.asp
| lupire wrote:
| Why? Earlier investors always get better prices before
| opening to the public, in exchange for helping the
| company go public.
| casefields wrote:
| Check out The China Hustle for a great documentary on this
| topic: https://www.rottentomatoes.com/m/the_china_hustle
|
| It's currently streaming on Hulu and Amazon Prime Video.
| ericmay wrote:
| I wouldn't consider it a hole in the rules, it's more of an
| alternative listing method.
|
| In my view, nothing materially changes. If 23andMe is a
| turd then an IPO through Goldman or JPMorgan isn't going to
| really change that, and neither will an SPAC.
|
| Although it's a little bit "gambling" because you don't
| know what the SPAC acquisition will be ahead of time, I
| think the SPAC vehicle is great for retail investors. If
| you take IPOE and SoFi for example, you could have bought
| Social Capital Hedosophia's IPOE SPAC at $13/share or
| something and watched it grow once the shares were slated
| to be turned into SoFi shares. But in the traditional IPO
| process, well, you get to buy the SoFi shares at the IPO
| price. If you have a high net worth, that's probably fine.
| But if you're a retail investor - well, look at AirBnB's
| IPO price at $68/share and what you could actually get it
| at on IPO which was closer to $140 or something.
|
| In other words, you get a little bit of exposure to the
| game, and of course a little bit of exposure to the risk as
| well which is "I don't know who they will merge with".
| sokoloff wrote:
| So in other words, a SPAC is "a company for carrying out
| an undertaking of great advantage, but nobody to know
| what it is"?
|
| https://en.m.wikipedia.org/wiki/South_Sea_Company#Top_rea
| che...
|
| It was apocryphal during that bubble; it's _real_ now. I
| do not find that to be a good thing...
| kpommerenke wrote:
| Once the SPAC has identified a company to buy, investors
| in the SPAC get a choice to either stay invested or get
| their money back with interest. So it's only a blank
| check initially, but not once it matters. Source: https:/
| /www.bloomberg.com/opinion/articles/2021-01-08/spac-m...
| ethanbond wrote:
| What? At least as described above, the material
| requirements for disclosures changes. Is the description
| above wrong or do you not find disclosures to public
| market investors to be material?
| ericmay wrote:
| I don't think they're material. The IPO prospectus for
| companies is a sales pitch with a bunch of legal "we may
| never make money" comments. If you commit fraud you'll
| wind up in court, disclosures or otherwise. Oh and nobody
| reads any of these documents, let alone any quarterly
| numbers.
|
| I think SPACs are certainly a more risky way to put your
| money to work, but they're fine.
|
| Companies that don't make money, have never made money,
| and to my eyes have absolutely no path to profitability
| IPO too - the banks just like to collect fees to get you
| to the public market. Does it really matter if they do it
| through an SPAC? I don't think it does.
| [deleted]
| freeone3000 wrote:
| I disagree in the importance of an S-1 disclosure.
| Detailing the actual business plan of the company, as to
| what people think the plan is, was invaluable for WeWork.
| Uber's quarterly earnings are a continual source of
| entertainment. I personally wouldn't put any money into a
| public company before an actual SEC-required statement,
| and an SPAC bypasses the first.
| Red_Leaves_Flyy wrote:
| >alternative listing method
|
| I know porn when I see it, and this is a flashing neon
| sign that reads "get in on our definitely not fraudulent
| spacs here to absolutely not lose money to the
| institutional investors juicing a most assuredly not
| failing business"
| lambda_obrien wrote:
| The company I work at, which shall remain nameless, is
| going through or went through this SPAC process, and
| we're assuredly growing and have good fundamentals, so
| it's not _just_ a parlor trick for Wall Street, but
| _some_ of them probably are.
| bhickey wrote:
| My understanding was that SPAC shares came with a warrant
| that could be exercised for shares in the acquisition
| target, rather than transmuted directly into shares.
| After the management fee, market premium and exercise
| cost are you really coming out ahead? Am I
| misunderstanding the mechanics?
| ericmay wrote:
| Depends on the SPAC and the target company.
| smallscientist wrote:
| No, you're not coming out ahead. You're roughly paying a
| 20% cost of capital. In today's frothy markets, you might
| make up for that in the public markets, but it does seem
| that mostly second tier companies are going public
| through SPACs.
| vmception wrote:
| That's why everyone is riding the gravy train as fast as
| possible
| l-lousy wrote:
| 23andMe gets to IPO immediately without having to go through a
| lot of the regulatory work that would normally happen in a
| direct listing because the SPAC acquiring them is already
| public. This means they can get a good percentage of the normal
| cash infusion with half the hassle.
|
| Those creating the SPAC get a discounted price on the stock
| they eventually take public, but for the bill via increased
| risk they might not get a good company.
| mejutoco wrote:
| I believe a SPAC might be cheaper and has less obligations
| before "going public" that an IPO.
| fatherof2 wrote:
| The company gets to go public without having to immediately
| provide all the materials for due diligence for public
| investors. The companies shares get peddled to the general
| public and the SPAC investors and the company both win. The
| public is left holding the bag.
| koolba wrote:
| Don't forget skimping out on the fees and money left on the
| table when dealing with a traditional investment bank.
| gamblor956 wrote:
| SPACs acquire targets for significantly less than the
| potential IPO price, and their are still fees and deal
| costs associated with the merger, so from the target's
| perspective, you still end up with less than you would with
| a traditional IPO even after the fees of a traditional
| investment bank.
|
| So why would a company ever go the SPAC route? SPACs are
| all about avoiding the (financial) disclosure required for
| a company going public the traditional way, and if you take
| a look at the list of companies getting acquired by SPACs
| this year, every single one of them has a red flag that
| would make their IPO risky (see, e.g., We).
| hrez wrote:
| There is direct listing (DPO). Spotify and Slack did that.
| grey-area wrote:
| Wow that seems like the kind of behaviour you'd see in a
| massive speculative bubble.
|
| People buying blank cheque companies without knowing what
| they're going to get.
| kpommerenke wrote:
| Once the SPAC has identified a company to buy, investors in
| the SPAC get a choice to either stay invested or get their
| money back with interest. So it's only a blank check
| initially, but not once it matters. Source: https://www.blo
| omberg.com/opinion/articles/2021-01-08/spac-m...
| grey-area wrote:
| I'm not sure I buy that - you're only likely to find out
| it was a bad idea after the takeover, because the deal is
| deliberately opaque, early investors get special rights,
| it may only be for a small part of the private company's
| value, and the private company has not usually published
| all the data required of a public company.
|
| There are very good reasons IPOs require all sorts of
| public documentation and due diligence. All that
| regulation which SPACs attempt to side-step is there
| because of previous scams run in just the same style as
| SPACs.
|
| They are reminiscent of the weird companies formed during
| the South Sea Bubble e.g. A company for carrying on an
| undertaking of great advantage but no-one to know what it
| is
| mason55 wrote:
| If you don't like what the SPAC is going to do then you can
| get your money back before it's used in the acquisition.
| executive wrote:
| VGAC is currently trading down ~10%
|
| > https://finance.yahoo.com/quote/VGAC/
| breck wrote:
| Thanks for the tip!
|
| Just bought some. Does this mean I own some 23andme now?
|
| I'm a bit ignorant of how SPACs work.
| executive wrote:
| Who cares, the stock went up!
| breck wrote:
| Wow, this is easy!
| runako wrote:
| You shouldn't take investment advice from strangers on the
| Internet, but you also should know what you're buying before
| you buy it.
| elwell wrote:
| > You shouldn't take investment advice from strangers on
| the Internet, but you also should know what you're buying
| before you buy it.
|
| and* you also...
| breck wrote:
| Dan got me invested in some kind of fruit company. So then
| I got a call from him, saying we don't have to worry about
| money no more.
| throw_away wrote:
| Likewise, the film Forrest Gump should not be considered
| sound investment advice
| mdemare wrote:
| Forrest Gump is from 1995. Apple had barely begun going
| up then.
| breck wrote:
| OMG. Back of the envelop. $5K into $APPL because Forrest
| Gump did would be more than $5M today. [1]
|
| [1] https://ycharts.com/companies/AAPL/market_cap
| Wronnay wrote:
| I think too many people don't understand that the $VGAC
| shareholders only get 11 % of 23andMe. At 19 USD that's a
| valuation of nearly 8 billion and completely overvalued - I wrote
| a blog post about this: https://blog.m5e.de/post/on-the-23andme-
| and-vgac-merger/
| trott wrote:
| Genetic testing used to be very expensive: $3B to sequence the
| human genome. So Ancestry/23/etc. tried to guess certain
| properties based on very sparse features of your genome, which
| is hard. But today, whole genome sequencing cost is approaching
| $100. This cost reduction will upend this industry, in my
| opinion.
| Wronnay wrote:
| That's not the point.
|
| The point is: at 19 USD per share you nearly buy at a
| valuation (8 billion) at which the institutional investors
| bought Ancestry ($4.7 billion) and 23andMe ($3.5 billion)
|
| Also: 23andMe had declining revenue in the past years and
| does only make around 200 million revenue.
|
| You buy a business at a valuation at 8 billion which makes
| only around 200 million revenue.
| trott wrote:
| It's a good point. I'm just saying that this coming tech
| revolution is another issue to consider.
| zetazzed wrote:
| The cheapest WGS I can find for consumers is $299 (30x WGS
| from Nebula). Do you know a cheaper alternative? I'd much
| rather get a whole genome that I can download rather than the
| handful of little snips from 23 and me... At $100 I would buy
| in a sec. Would be a nice motivator for bioinformatics
| hobby/learning projects too.
| trott wrote:
| I saw ads for $149/sample. Probably not available to
| consumers yet. But the general trend is precipitous decline
| (10000000x)
| goatcode wrote:
| Remember when the FBI scanned the anonymous DNA database, from
| either this or some similar company, found a match, then used
| that match to get a warrant for the match's personal info? I do.
| astura wrote:
| You're so wrong about the specifics that you're being
| (intentionally?) misleading.
|
| The database they use is GEDmatch, which is a fully volunteer
| non-for-profit operation. The entire point of the database is
| for users to upload their dna to allow anyone from the public
| to conduct genealogical research. GEDMatch does not even
| provide sequencing services, so there's no way someone would
| accidentally share.
| xiphias2 wrote:
| 23andme was a great company, but stopped innovating a long time
| ago. They could gave offered a lot of different products related
| to sequencing, but didn't.
| sjg007 wrote:
| I work in this space and even I have a hard time seeing 23andMe
| being profitable.
| asdff wrote:
| I have a hard time seeing how they won't be. They have name
| recognition. It's like the kleenex of DNA testing. The SNP
| chips they use are cheap at scale. They don't need to spend
| money on innovation, they could continue just running SNP chips
| priced above cost indefinitely. Consumers don't understand the
| current technology, they aren't going to start one day
| clamoring for long read sequencing or anything that requires 23
| and me to change anything at all. IMO, it's the perfect cash
| cow business.
| sjg007 wrote:
| SNP chips for what? Ancestry? Also carrier screening is a
| competitive market.
| offtop5 wrote:
| Monetization of user data. Integration with the Match.com API,
| 'Sure you want to go out with her, you share 12.5% of your
| DNA'.
|
| Open access to various government agencies, ' You share 47% DNA
| with this GUY who owes taxes , WHERE IS HE'.
| elwell wrote:
| With technological progress, the path towards reaping the
| benefits and mitigating the risks is difficult.
| mywittyname wrote:
| My parents both submitted their DNA to 23&Me... :smh:
|
| My mother is otherwise hyper-privacy sensitive. But I guess
| the draw of finding out their ancestry was too great. And,
| surprise-surprise, you can tell exactly where we come from by
| just looking at us.
| strofcon wrote:
| Very much this.
|
| Not to mention, "sorry, <XYZ> Health Insurance won't cover
| you because you show a slight genetic predisposition toward
| fingernail cancer. Good luck."
| Mountain_Skies wrote:
| Has this happened anywhere in the US? If you work for an
| employer with group insurance, how can an insurer reject
| you or even alter your rates? If you don't work for a
| company with a group policy, buying off the ACA marketplace
| also is going to prevent the insurer from implementing
| these types of restrictions on coverage. Maybe this is
| something that would go on in the life insurance market but
| so much of the health insurance marketplace is heavily
| regulated in terms of writing policies and setting rates,
| that it doesn't appear that getting your DNA would do much
| for them.
| astura wrote:
| No, using genetic information as a consideration in
| health insurance is expressly illegal in the US under
| GINA.
| fennecfoxen wrote:
| Notwithstanding that slight predispositions for minor
| conditions could be priced into an underwriting model
| without all that much pain -- I'm not even sure this sort
| of exclusion you propose has been legal in the past decade
| or so.
| gruez wrote:
| > Monetization of user data. Integration with the Match.com
| API, 'Sure you want to go out with her, you share 12.5% of
| your DNA'.
|
| this is confusingly worded. It could be interpreted as
|
| > Sure, you [do] want to go out with her
|
| or
|
| > [Are you] sure you want to go out with her[?]
|
| 12.5% DNA match would be a second-cousin, so I'm assuming you
| meant the latter.
| [deleted]
| Kharvok wrote:
| Now all of China knows your('re) genetics (here)
| TedShiller wrote:
| Say goodbye to your DNA privacy
| elwell wrote:
| Has anyone downloaded their DNA and then asked 23andMe to
| completely delete all records?
| echelon wrote:
| Is there a way to predict which SPACs will merge with which
| startups?
|
| It seems like if you had knowledge of this and you could predict
| a highly profitable business merging with a SPAC, you could get
| in at the ground floor for incredible and almost immediate share
| price growth.
|
| I wouldn't invest in 23andMe, but I would invest in Stripe. Which
| SPAC will it merge with?
| sefrost wrote:
| I've seen it correctly predicted a few times in investing
| subreddits.
| echelon wrote:
| This is what I want to read.
|
| I know WSB banned SPACs. Did you see it on /r/investing?
|
| SeekingAlpha has a lot of writeups on SPACs, but I don't
| think they're as savvy as Reddit. Totally a mixed bag.
| aphextron wrote:
| It's pretty hard to predict when a SPAC will merge, that's
| basically what your risk is: the time value of your money.
| However if you're buying at NAV, there's almost no downside
| risk other than that.
| jonathanjaeger wrote:
| No way Stripe will go public via SPAC.
| Voloskaya wrote:
| > you could get in at the ground floor for incredible and
| almost immediate share price growth
|
| Hence why you can't predict it. If you could, everyone else
| could, and there would be no appreciation of the shares when
| the news is released.
|
| Only way to know in advance is good old insider information.
| echelon wrote:
| It's a new trend.
|
| I didn't have "insider information" to make $300k on
| Gamestop. The evidence was in the open.
|
| Right now I'm thinking that you might be able to connect the
| dots between SPAC owners / founders, their investment
| prospectus, and similar business they've dealt with.
|
| I wonder if anyone's already done this research and found
| correlations.
| Voloskaya wrote:
| > I didn't have "insider information" to make $300k on
| Gamestop. The evidence was in the open.
|
| What evidence? You followed a trend, and the more people
| followed that trend, the higher the price, the more it was
| talked about in wider circles, the more people got in it
| etc. It's just a legal version of a ponzi scheme.
|
| This has nothing to do with predicting a hard fact such as
| which two entities will merge in the future.
| IshKebab wrote:
| > I didn't have "insider information" to make $300k on
| Gamestop. The evidence was in the open.
|
| It _really_ doesn 't work like that. You didn't use public
| knowledge to make money on Gamestop; you used luck.
| gamblor956 wrote:
| Just like how everyone assumed that Virgin Acquisition was
| going to buy Virgin Orbital (both owned by Branson)...but
| instead will acquire 23andme instead?
|
| As it turns out, you really can't connect the dots between
| SPAC owners and the company the SPAC will acquire.
| [deleted]
| mdorazio wrote:
| Check the SPAC subreddit and look at blogs that actually do
| analysis on the SPAC teams themselves. The best indicator is
| usually who runs the SPAC and their connections in SV + focus
| industry. But ultimately, you can't reliably predict it. You
| can do what I do and shotgun investment in several promising
| SPACs and hope that one hits in a reasonable amount of time
| (I'm 1/4 so far this year).
| echelon wrote:
| That's great info! Thanks.
| monkeydust wrote:
| Yea seen a few HF's now pitching SPAC funds which essentially
| is the shotgun approach. There is also an ETF (of course!) -
| SPCX (US19423L6728)
| bushbaba wrote:
| You can also buy spac ETFs. E.g. SPCX and SPAK
| okl wrote:
| > It seems like if you had knowledge of this and you could
| predict a highly profitable business merging with a SPAC, you
| could get in at the ground floor for incredible and almost
| immediate share price growth.
|
| Take care to not fall victim of a pump & dump. Rumours about
| SPAC acquisitions seem to be in fashion recently and I wouldn't
| be surprised if SPAC owners focus on targeting retail since the
| whole WSB/GME thing started.
| jcomis wrote:
| No, there really isn't. I do think SPACs will sometimes seed
| the internet hype machine if they have a target in mind though.
| This particular one has been discussed a few times and doesn't
| seem to be a surprise to most. The problem is people (or more
| specifically holders of the SPAC) seem to often try to pump a
| particular SPAC on speculation for their gain.
|
| For example reddit (along with twitter, stocktwits, seeking
| alpha, etc) was absolutely rife with posts about how "certain"
| PSTH was merging with Stripe. The DD was long, sock puppet
| accounts numerous, but sooo extremely thin it was hilarious.
| $CCIV is another example that has long been hyped to be merging
| with Lucid which has brought the value up 300% since inception
| and really no one has any idea if it's even truly on the table.
|
| I think largely the problem currently with SPACs is there is so
| much interest that nearly any notable SPAC is growing in value
| no matter what info is out there, so it's another "stonks only
| go up" type situation with people just dumping money based on
| an internet whisper and somehow it ends up working.
| TheRealDunkirk wrote:
| In a letter to customers, CEO and co-founder Anne Wojcicki said,
| "We're about to cash out of this bitch, and go kick it on a South
| Pacific island. Just fair warning that the database is going to
| have new owners soon, who will be keen to sell access to your
| most-intimate biological details to anyone with an idea on how to
| make money on it, and a checkbook."
| _Understated_ wrote:
| Did she honestly say this? Do you have a link?
|
| If this is true then, wow... just wow!
|
| Edit: given that Zuck took the piss out of his customers many
| years ago [0] as a teenager and is now a billionaire then I
| guess anything's possible.
|
| [0] - https://www.esquire.com/uk/latest-news/a19490586/mark-
| zucker...
| TheRealDunkirk wrote:
| I'm... how you say?... paraphrasing.
| [deleted]
| rexbee wrote:
| She did not say that
| breck wrote:
| Funny, I have her 2006 letter and there seems to be some
| inconsistencies:
|
| "As you all know, I'm rich enough from Google that I could just
| go kick it on a South Pacific Island. Instead though, I'm going
| to spend the next 15 years of my life grinding, taking flak of
| the press and internet trolls, so that I can set the record for
| helping the most people in the world learn there ancestry and
| pioneer mass genetic testing via the mail, mass SNPs genotyping
| at a level never seen before by orders of magnitude, and pave
| the way for a future where everyone on the planet has access to
| their genetic information for better health"
| throwaway9980 wrote:
| Pretty sure there was some personal interest at play. She was
| married to Sergey Brin. His mother has/had Parkinson's and I
| believe I read that based on genetics he almost certainly
| will also. 23andMe is a data play original conceived, in
| part, to gather genetic data to further research to extend
| the life of a billionaire.
|
| Here's hoping we all benefit from this work. It's easy to
| spin things as sinister if that's what you want to do.
| TheRealDunkirk wrote:
| Fair enough, but however altruistically you might hold her
| motives, it doesn't change the fact that the new owners will
| surely be looking to maximize their returns through new and
| creative ways of using pre-existing assets. I've watched this
| movie many, many times over the past couple of decades.
| breck wrote:
| I get that, and yeah have seen some of the same movies.
|
| I do see a lot of potential in 23andMe (though I loathe the
| name--never put a number in your name! numbers are
| incredibly overloaded--millions of times less
| combinatorics; and they become outdated almost immediately
| --23 is a largely meaningless number).
|
| But 23AndMe at least has built a large number of paying
| users. If they look at where medicine could be in 10-20
| years, and have the courage, they've got a better shot than
| nearly anyone of leading the way. Someone could be a $1T
| universal health care company.
|
| The health privacy issues I think are a red herring. Proper
| medical research entails generating strongly typed data
| that you can synthesize infinite records with one click. An
| individual's personal health data should be of little
| value, and if it's not, then we've got deeper fundamental
| problems with our system (which we do, but has nothing to
| do with 23andme)
| gamblor956 wrote:
| If 23andme had that many paying customers, they would not
| have needed to go the SPAC route to avoid financial
| disclosure. That they have chosen to go public as a SPAC
| after more than a decade of existence does not speak
| highly of their financial situation or their prospects
| for future earnings (and this is generally something that
| nearly all recent SPACs share).
| breck wrote:
| It could be.
|
| It could also be that they just saw no reason to enrich a
| set of insiders and saw a SPAC as a way to stick it to
| the man.
|
| I have zero clue. My DD is basically on this page, and
| though I've been a customer since the beginning and have
| referred a bazillion people, a lot of that has just been
| due to lack of competition and not necessarily because
| I've been thrilled by 23andMe's stuff.
| gamblor956 wrote:
| _It could also be that they just saw no reason to enrich
| a set of insiders and saw a SPAC as a way to stick it to
| the man._
|
| A SPAC is the ultimate way to enrich a set of
| insiders...The SPAC initiators get to buy additional
| shares of the SPAC at discount prices that other SPAC
| investors don't have access to. And unlike with a
| traditional IPO, the targets don't have to disclose those
| arrangements or other sweetheart details that the target
| executives receive as part of the acquisition. Another
| big consideration for a SPAC is that _executives_ get to
| sell their post-acq stock immediately, while normal
| employees are still subject to a lock-up period to
| "protect" the stock price from downward pressure.
| breck wrote:
| Ugh yeah I had a feeling this may be the case. I was
| hoping SPACs might be better, but haven't researched it.
|
| It's almost like we should have a thing called "public
| markets" where the public can invest directly in new
| ventures. /s
|
| (Gotta say I'm with Cuban and Mr Wonderful and Elon with
| the idea that regulators are pretty awful in their
| blindness to 2nd order effects)
|
| Maybe the blockchain is the way to go after all.
| gamblor956 wrote:
| Regulators are aware of these effects. They have limited
| ability under the law to pursue things that only have 2nd
| order effects.
|
| Blockchain won't help; you would have the same problems
| but with even fewer ways to address them.
| mminer237 wrote:
| It's not meaningless. Humans have 23 chromosomes (except
| for those with Down syndrome). That's never going to
| become outdated.
| breck wrote:
| Click "go to definition" enough and you will figure out
| what I'm talking about.
| benkoller wrote:
| Godmode troll activated.
| AlexandrB wrote:
| There's a weird push and pull on Hacker News where if a
| company does something unethical it's: "Well what did you
| expect, they have an obligation to maximize shareholder
| value", but at the same time founder and CEOs are often
| venerated as hard-working, almost selfless individuals who
| dedicated their lives to make the world a better place in
| spite of their own self-interest. It's pretty jarring.
| mountainb wrote:
| It's indicative of the tradeoffs in any human endeavor and
| the shades of gray that come into play when evaluating
| those endeavors in moral terms. It can be both. Also, it's
| way easier to retire young if you have made a good amount
| of money and to live with a higher quality of life than a
| lot of CEOs who just have more property than they can do
| anything with. Being a quiet multimillionaire is great.
| Being a hardworking American Stakhanovite-CEO is, indeed, a
| lot of sacrifice for not a whole lot of real individual or
| familial gain. 23andme has done a lot of good and has
| accomplished a laudable mission, but there are also
| concerns that many people share about its activities or the
| potentially abusive things that could be done with the
| customer data.
| vlovich123 wrote:
| That's because we all see ourselves as the good guys in the
| story. It's remarkable though how often decisions in tough
| situations always somehow end up benefiting yourself within
| whatever constraints are placed on your actions when
| there's any kind of real conflict.
|
| So if you're the outsider, you see the harm. If you're the
| insider you made the best decision possible with the
| information you had and the resources available to you. I
| think both viewpoints are correct in many ways (ignoring
| those that are blatantly dishonest).
| jdpedrie wrote:
| The line runs through about the 7th zero in the founder's
| net worth, I think.
| stickfigure wrote:
| What unethical thing has 23andme done?
| breck wrote:
| There are 100 kinds of people in the world.
|
| 1) People who want to get rich first but also would be
| happy to make the world better
|
| 10) People who care about making the world better first but
| also would be happy to be rich
|
| 11) People who are enlightened and don't care about such
| things
|
| 100) People who just love to troll the other 11 groups
| jcpham2 wrote:
| This is the best answer
| fartcannon wrote:
| Try not thinking of Hackernews, or any forum on the
| internet, as a single entity, but as many individuals. Some
| of them have conflicting views with the others.
|
| Averaging the thoughts of a diverse group will just end up
| as white noise.
| monadic3 wrote:
| Do you not believe in culture?
| fennecfoxen wrote:
| > many individuals. Some of them have conflicting views
|
| This goes double for major political parties, and a key
| reason why all them end up known by their enemies as
| hypocrites.
| buran77 wrote:
| Every successful founder or CEO sees themselves and their
| vision as fundamentally good for society, and at worst they
| may see some evil around their company which they'll chalk
| up to "price or progress". As the money starts rolling in
| and the price never ends up being paid by themselves (or
| the company) it's hard to see it as anything but a fruitful
| vision. One that's "good for all intents and purposes". The
| more money, the more of the bad intents and purposes they
| hand waive or brush aside.
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