23andMe has dropped their price by $600, and some have cited this and me as harbingers of doom.

First, when I say that an industry is “dead,” that doesn’t mean that all businesses shut down overnight and nobody buys anything ever again. It means that the assumptions of a business model seemed flawed with reasonable confidence. So, by that model, new businesses are unlikely, and existing businesses will evolve or fade away. Fly-by-nights may vanish overnight, but that’s why they’re called fly-by-nights.

So, relax.

Second, everybody knew that 23andMe would drop their price from day one. The test was too expensive. The science was getting cheaper. Everybody said so; everybody knew this. BEHOLD! 23andMe’s new product is marginally better and 60% cheaper. If you paid $1000 for 23andMe.v1, and you are pissed, and you demand a refund —you are a fool.

So, as expected.

Yes, I’ve heard the chatter. “But you know, DTC genomics really makes their money from selling the results to pharma…” But that’s speculative revenue from a product that doesn’t quite exist, not cash flow from paying customers now, and companies pay expenses in cash, not VP BIZDEV! “partnerships.” If investors actually believed this story, they would fund companies that sold tests for much less than thousands of dollars to build this database and sell it. They don’t believe this, so instead they funded companies that sold tests for thousands of dollars, hoping that the brand and operational experience built in the meantime would give them an advantage if a market for genomic databases materialized.

The story is that Coriell is building that genomic database. GO PAY ATTENTION TO CORIELL. They offer real medicine and do real science!

Not relevant to the “database sale discussion” is deCODE Genetics, a genomics research company, who probably trusts itself to use its own deCODEme genomic data for its own genomic research

Now: The faerie tale about DTC startups selling data to pharma is dead; let’s talk like adults about real customers who pay cash money for real products.

Which startup can make sales?

23andMe.

Which startup has the best product?

23andMe.

Which startup has the best brand?

23andMe.

Which startup has money and talent to operate and evolve despite an increasingly skeptical investor community and a dead business model?

23andMe.

Which startup is so loved by the media that Rupert Murdoch will smell his own piss to be in their blog?

23andMe.

Which startup was founded by one of the most powerful, richest families in the world?

You’re right, I did lose a million dollars last year. I expect to lose a million dollars this year. I expect to lose a million dollars *next* year. You know, Mr. Thatcher, at the rate of a million dollars a year, I’ll have to close this place in… 60 years.

Haha, I was just kidding. Real customers paying for real products doesn’t matter in this business.

People, 23andMe isn’t going anywhere. They are the Bill & Melinda Gates Sergey & Anne Brin Foundation, Silicon Valley style. Anne Wojcicki is married to Sergey Brin, so 23andMe has access to all the talent, connections, and capital 23andMe would ever need to make 23andMe work. Thus, assuming 23andMe doesn’t do anything egregious, they will exist for as long as Mrs. Anne Wojcicki Brin pleases it to be so. If 23andMe shuts down, it won’t be for some mundane reason like the bills weren’t paid, it will be because Anne felt like it. One thousand Coriells wouldn’t change that.

What, does that offend your meritocratic, democratic, American dream sensibilities? Too bad. Go get an Ivy+ degree and marry your own richest man in the world.

People like 23andMe. I like 23andMe. People buy 23andMe tests. I bought a 23andMe test. They’re the best, they can make sales, they have the best product, and someday, they might even “sell” their database to Google. So what? Doesn’t matter. All of that is just something plus infinity.

End of story.

History Remembers Navigenics:

Navigenics thought that they could be Internet Doctors, but they sell premium commodity non-medical medical information, exclusively available to everyone on the web. What do medical specialists charge? Durrr, let’s put a picture of a doctor on our website charge that!

If anybody in medicine was ever going to take Navigenics seriously, Coriell quite clearly dispelled that idea. They don’t have customers, doctors hate them, scientists don’t trust them, Navigenic’s product sucks compared to 23andMe, and unicorns carried their database-pharma-sale story back over a rainbow to happy magic land. Who cares what Navigenics thinks anymore?

As for consumers? I am a fan and customer of 23andMe. You found me. We exist. I challenge anyone to find a single happy customer of Navigenics.

Navigenics: at least they didn’t commit insurance fraud.

History Remembers deCODEme:

I really want to like deCODEme. I do. Not because deCODEme is so great, but because they flew me to Iceland once for a job interview, and I appreciate that. Sure, too many people gave me the “run away unless they pay” speech, but they still have a special place in my heart because, let’s face it, Iceland is kind of a cool country. Maybe the Icelandic government will bail them out, or maybe Kari will hop into a viking ship and raid England or something. But, sorry, deCODEme is just not competitive with 23andMe, and until I’m convinced otherwise, when I say DTC genomics, I mean 23andMe. But, they’ll continue to exist as long as deCODE does someway or another. Running a Ruby-on-Rails website is cheap.

deCODE did start a new blog, though. Check it out! deCODEyou

NOTE: “VP BIZ DEV!” is to be read as if you are barking a college football slogan while chugging a natty and wearing a jersey featuring no less than one food stain.