SmileDirectClub, a maker of invisible teeth aligners, is working to improve growth and reach with its product line up. The company, founded in 2013, has a unique business model in its products that allow for the correction of misaligned teeth. These 3-D printed clear aligners offer buyers a range of benefits. Now, CFO Kyle Wailes says the company is expanding its reach even further to offer new technology.
A Profitable IPO
SmileDirectClub went public in August of 2019 and has done well since. In a recent interview with Fox Business, Wailes states that the company’s IPO was an important step in the growth of the business. He says the IPO has helped to give the business new funding power, but it has not changed its overall business plans or mission. The company has raised over $439 million across three funding rounds since its inception.
The company’s mission is to make dental care more accessible to customers remains the focus. SmileDirectClub’s product is a customized, three-dimensional clear aligner that fits snuggly into the mouth. The unique design helps to push teeth into proper alignment over a period of time. Its direct competition is traditional braces and clear alignment products produced in dental offices through companies such as Invisalign.
The unique selling point for SmileDirectClub is, as noted, its ability to reduce the need to pay expensive dentist office costs for this aligning technology. It sells impression kits that are sent directly to the customer. These help to create molds of the teeth. They are then reviewed by professionals who still play a role in the treatment process, but often at a fraction of the cost.
The company, which reported over $750 million in revenue in 2019, also has some 300 local retail locations in the U.S., U.K, Canada, and Australia. This growth is one component of a much larger effort to reach people around the world.
Continued Growth Is the Company’s Current Goal
In his interview, Wailes notes that the company is in the middle of the development of a mass-market opportunity. According to Wailes, this opportunity focuses on 500 million consumers with some type of dental spacing or crowding issues who can pay for products. He says SmileDirectClub is still focused on what it calls its core market, these customers who can comfortably pay the $1899 fee for care.
However, that goal is not holding the company back from future growth and new avenues to pursue. Wailes notes several new initiatives are on the cusp for the business. One of those launched in 2020. The company began expanding more into dental offices. In this business model, SmileDirectClub is partnering with general practitioners to offer their products. He notes this initial effort has proven to be profitable at this point.
A second initiative area for SmileDirectClub is the move towards an international market. Of the 500 million customer base mentioned, Wailes states about 75 percent of that market is in international markets. At the time of the interview, the company has moved into 10 countries and plans to move into numerous other markets. It launched its first international move in late 2018. Its focus is on Europe, Latin America, and then the Asia-Pacific area.
SmileDirectClub has a third initiative: the teen market. In the dental bracing industry, the teen age range makes up about 75 percent of the total industry – a large amount that SmileDirectClub has yet to tap into with its products. The current business model only has teens making up about 10 percent of their offerings. Wailes says this is clearly a potential growth opportunity. The company plans to focus on this area at some point in the near future, though it did not disclose any details on its plans for it.
Partnerships with Insurance Partners
In 2020, SmileDirectClub announced a partnership with MetLife Insurance. This is one of several insurance companies the dental aligner company has partnered with to help cover some of its products' cost. Going in-network with insurance companies has helped streamline consumers' process, making its products more acceptable to the larger consumer base. The company also offers a financing opportunity to cover these products' cost when insurance doesn’t offer enough coverage.
Continued Investments Aid in Bolstering the Company’s Bottom Line
According to Wailes, over SmileDirectClub’s history, it has made a number of investments and doesn’t plan to slow down. A good deal of the investments the company has made in recent years has to do with innovation.
Its newest innovations help to get the company’s customer into treatment using a softer product that’s more comfortable to use. Gradually, it moves to a thicker product, creating a better product for more predictable movements. This product is called SmileDirectClub’s Aligners with Comfort Sense ™ , designed specifically to address concerns over the way the aligners feel during the first months of treatment.
Another way it has innovated is with a new laser method that creates more precise and predictable cut lines and a better fit along the gums. The company has also launched a teeth whitening product and line that aims to touch on another key area of the dental market long held by traditional dentists and over-the-counter kits.
The company owns the largest 3-D printing facility in the United States. Wailes says the company has invested hundreds of millions into the latest technology to improve its products and plans to continue to do so.
SmileDirectClub received funding from six total investors, including Spark Capital and Kleiner Perkins. This for-profit company was founded by Alex Fenkell and Jordan Katzman. It is based in Nashville, Tennessee, as a private equity company. SmileDirectClub has a total of 63 active products and holds a number of patents for new technology.
Must have tools for startups - Recommended by StartupTalky
Subscribe to StartupTalky
Get the latest insights delivered to you right in your inbox