Ancestry, a leading company in the growing industry of at-home genetics testing, has filed for a confidential initial public offering (IPO), according to a recent article in Fortune Magazine.
The Utah-based company submitted a draft registration statement on their proposed IPO to the U.S. Securities and Exchange Commission in late June. They didn’t disclose the number of shares to be offered or the price range. The company is valued at about $2.6 billion, according to Fortune.
The at-home genetics testing business is booming these days, and companies like Ancestry and 23andMe are reaping the benefits. Consumers are eager to learn about their genetic history, including their health tendencies, thanks to the ease at which they can obtain reports.
Customers can order the at-home testing kits, and with a few easy steps and a sign-up process, can obtain the results in a matter of weeks. Tests run about $99 per kit.
Ancestry has been under fire recently for its terms and conditions, which some legal experts claim is exploitation because the company has granted itself a “perpetual license” to use customers’ genetic material. However, Ancestry claims that it gives consumers the power to choose whether Ancestry can keep their DNA in a database (currently 4 million customers), or if they would like their DNA samples to be destroyed. It is also changing its terms and conditions to remove the perpetual license clause.
The company recently hired a new marketing firm, Droga5, to help shift the focus of its brand, which started off as a way for amateur genealogists to trace their ancestry back generations. Now, the bulk of its customers are interested in genetics testing, so the company wants to focus its marketing efforts on customers using genetics reports to inform decisions about the future, according to AdAge Magazine.
Competitors like 23andMe are factoring into the company’s strategic decisions. Recently, 23andMe created a marketing campaign tie-in for "Despicable Me 3" movie, with an ad depicting super-villain Gru exploring his DNA. The ad features Gru finding family through 23andMe's DNA Relatives Tool, where his results reflect the existence of his long-lost twin brother Dru.
Ancestry wants to focus its next marketing campaign on using history to inspire the future. Given the current political climate and divisiveness, Ancestry sees an opportunity to bring customers together through humanity and culture. The brand will focus on “cultural moments” according to AdAge, such as July 4th, to “celebrate how we all came to be.”