Oliver Noel’s DNASimple hopes to capitalize on the growing market for DNA data and he hopes to bring a Shark along for the ride. Companies like 23 and Me and others sprung up over the last few years to let people learn more about their ancestral DNA. They charge anywhere from $49-$200 for a home DNA kit. You swipe some saliva into a vial, send it in, and they provide you with a report. The kits are a big business and they’re capitalizing on people’s natural curiosity.
The big money for such companies isn’t in selling the kits, it’s selling your DNA information to drug companies, government agencies, research facilities, and others. The market for DNA samples for research is poised to explode into a $20 BILLION market over the next few years. DNA samples sell for anywhere from $100-$300. It’s a big business.
Noel decided to create a kind of peer-to-peer marketplace for these samples – that’s where DNASimple comes in. On the website, users identify studies they are interested in selling their DNA to. When you sign up for the study and get accepted, they send you a sampling kit and, once you return it, you get $50. DNASimple makes its money acting as the middleman for the “transaction.” Your privacy is more protected, too. Other companies resell your DNA data to as many entities as they can; DNASimple only sells the info to the study you’re accepted to.
It’s a bold new market and certainly one that has big earnings potential. While there aren’t other companies offering this type of service yet, there will surely be more. DNASimple wants to be first. Whether a Shark finds it in their DNA to invest or not remains to be seen, but Noel will get a lot of attention for his business, and the whole DNA testing industry, in episode 912.
My Take on DNASimple
I probably wouldn’t use this service myself, unless I was really hard up and needed $50. A lot of people will do it for the money alone, but just as many others will to further medical research. Genetic medicine is advancing by leaps and bounds and DNA samples are a big part of the growth. People who have an interest in solving the causes of various diseases will likely gladly participate.
The unique thing about Noel’s company is it’s transparent. Other DNA companies bury their disclosures about selling data. They collect their fees from users, then “double dip” by selling the data to researchers. DNASimple simply acts as a middleman with no pretenses. I admire the business model and recognize its importance, but it simply isn’t for me.
Will Sharks See the Potential?
The market for DNA information is huge and there are a lot of dollars to be made. The Sharks will certainly recognize this. The “newness” of the marketplace and potential privacy issues could prove to be sticking points. While Noel likely has security measures well in place, it could make some of the Sharks a bit skittish.
I really see Mark or Richard Branson as the only two Sharks that would bid. Their likely objections would be the probability of a BIG company doing the same thing and squeezing Noel out of the marketplace. Of course the two billionaires can make it a big company instantly.
The other obstacle I see is the valuation. DNA Simple has other investors and when those types of companies pitch in the Tank, there’s little wiggle room on the valuation. While a Shark could bring some serious credibility and cash to the table, I’m not sure if a Shark’s DNA is that simple.
Entrepreneur, auteur, raconteur. Rob Merlino is a blogger and writer who enjoys the Shark Tank TV show and Hot Dogs. A father of five who freelances in a variety of publications, Rob has a stable of websites including Shark Tank Blog, Hot Dog Stories, Rob Merlino.com and more.
Company phone on website disconnected?!!