SOMOS on Republic 2022 – KingsCrowd



SOMOS is operating in the United States DNA testing market, which is worth more than $960 million in 2022. The company does not provide health information related to genetic data yet, though it does intend to offer those services in the future. For now, its home kits can only be used to find the tribal ancestry of customers. SOMOS is also only targeting the 62 million Latino and 6.8 million Native American descendants in the United States, with an emphasis on Mexican Americans. The company mostly has data on Mexican tribes, but it is working to extend its indigenous DNA database to more tribes across Latin America. In the future, the company can try extending to high-income earners of other countries in Latin America. But in the meantime, SOMOS’ target market is small.

Despite a restricted niche, the United States DNA testing market is quickly growing at an annual rate of 12.6%. This market emerged in 2005 when National Geographic and Wells launched the first direct-to-consumer genetic testing kit. Consumers responded more enthusiastically than companies expected, and over the years, the price went down from $2,500 to around $99. One of the reasons for this success is that the American population was built on immigration. Aside from Native Americans, most Americans descend from voluntary or forced immigration to the United States and may not know the details of their extended ancestry. In Latin America, many might be descended from some mixture of indigenous tribes, Europeans, and Sub-Saharan Africans. As a result, Latinos may have difficulties knowing where their ancestors came from. The history of immigration to North and South America drives interest in DNA testing.

AncestryDNA has already collected data from 20 million customers, and 23andMe has been utilized by 12 million customers. This high level of market saturation can limit the possibilities for SOMOS to attract new customers. The company aims to address this difficulty by offering a reanalysis of genetic data provided by competitors. It can use these existing tests to identify the tribal ancestry of Latinos and Native Americans for $39, a discounted price compared to the cost of a complete analysis. Thanks to this service, SOMOS can expand its potential pool of customers.

As of February 2022, SOMOS has collected about 4,700 DNA samples from customers. After collecting more than 50,000 genetic data samples, the company plans to partner with drug developers and extend its revenue stream. SOMOS could then access the global drug discovery informatics market. This market is valued at $2.4 billion and is expected to grow at a healthy rate of 11.3% every year until 2028. While it isn’t a large market, SOMOS hopes to get from $100,000 to $500,000 per deal with drug companies.

SOMOS’ traget markets are relatively small but have a steady growth rate. The company’s partnerships with indigenous tribes give it a unique product that can be used by customers testing their DNA for the first or second time. Therefore, SOMOS has market potential. However, the DNA testing market is crowded. SOMOS will need to spread brand awareness in order to acquire customers – especially those that have already used competing products – and get a good share of the market.