Venture sinks its teeth into oral-care innovation

Startups have disrupted all sorts of personal-care industries: hair, skin, vision, nutrition, even shaving.  Now, a few are sinking their teeth into dental.

It’s a large industry: Spending on oral care is about $40 billion a year, Grand View Research estimates. But for decades it has seen scant innovation.

“It’s amazing that with all the excitement about other areas of personal care, dental care has been left behind,” says Simon Enever, CEO of quip. “It’s one of the most important aspects of daily care, yet it’s relatively untouched by disruption.”

Quip shot sourced from website.
Quip set sourced from website.

The Brooklyn, New York, startup is trying to change that equation with a cutting-edge electric toothbrush. It’s facing some heavy competition in stalwarts Philips and P&G’s Oral-B, but quip’s brush is innovative in several ways.

It’s minimalist and sleek, with one speed, one brush head and a compact base (Enever and Co-Founder Bill May come from a product-design background).

It does not have an app to provide brushing feedback, like the Philips Sonicare. It does not have multiple modes and facial recognition, like the Oral-B Genius.

Instead, it appeals with user-friendly high design, kind of like an Apple iPhone for your teeth.

It’s also cheap: $45 for the metal version, $25 for the plastic. Like razor-industry disrupter Dollar Shave Club, quip offers subscriptions: A new brush head delivered every three months costs $5 and Quip toothpaste costs $5 monthly.

Quip has raised $10 million from Sherpa CapitalBlue Scorpion Investments and, among others, pop star Demi Lovato, who understands a thing or two about gleaming white teeth.

Enever says his VC backers were impressed by quip’s novel subscription offering, steady growth, small team and slow burn rate.

Another factor: quip’s plan to build a community of consumers and dentists around the goal of healthier, more attractive teeth, and to get people more excited about brushing.

The quip site features articles like “The Right (And Wrong) Time to Brush” and “Creatures in Your Mouth: Microbiome Explained.” The startup is also partnering with a new generation of social-media-savvy dentists who are pulling their profession into the digital age.

“No one was waking up in the morning and racing to read the latest tweets and posts from oral-care influencers, like they do a beauty influencer,” Enever says. “The question was, could we bring the same feeling of engagement into oral care? That was a huge opportunity for us.”

A key differentiator for quip is that it is using dentists as a sales channel. Enever notes that dentists typically give out free goody bags of toothbrushes, toothpaste and floss to patients. But dentists are actually paying for those goody bags out of their own pocket.

So quip is positioning itself as a better alternative. Dentists can essentially reward their patients with a six-month subscription to quip. And when patients return, they can extend that subscription as an incentive to keep them coming back.

“Dentists are excited to partner with us because they know their patients are using good products, brushing and replacing worn brush heads regularly, which really is key to good dental hygiene,” Enever says.

Straight-to-consumer orthodontia

Orthodontics is another large and largely undisrupted sector of oral care. Teeth are straightened in an office by an orthodontist. It’s expensive, and for years a lot of people have simply lived with crooked teeth because they can’t afford traditional braces and retainers.

New York City-based Candid hopes to fix that. It delivers clear plastic aligners straight to customers for 65 percent less than traditional in-office teeth-straightening solutions.

Customers buy a modeling kit online to take impressions of their teeth at home, then return the kit to Candid for assessment by the company’s network of orthodontists.

They design a treatment plan, then Candid 3D prints and ships all the necessary aligners at once. Average treatment lasts five months and costs $1,900 up front or $88 a month for 24 months with a financing plan.

Candid says it direct-to-consumer model also undercuts other clear aligners in the market, such as category leader Invisalign, which must be administered by an orthodontist and can cost up to $8,000.

Candid recently raised a $15 million Series A financing round led by Greycroft Partners, Bessemer Venture Partners and e.ventures.

“We’re interested in companies that are disrupting traditional industries with direct-to-consumer models,” says John Elton, a Greycroft partner who invested in Candid.

“There are certain categories that are more appealing than others when it comes to direct-to-consumer and dental care is one of them. The status quo has a lot of middlemen and built-in margins that allow a rapidly innovating company to grow in a profitable manner.”

When some markets went direct-to-consumer, they grew by 10x, adds Elton. Orthodontics could be one of them. Around 4 million Americans are now undergoing orthodontia treatment and about 47 million people don’t access dental care because they don’t live near enough to a dentist.

“There are many treatments that consumers pay a lot of money for through traditional means but would be happy to have a better, less expensive option in the comfort of their own home,” he says. “So that is a very compelling value proposition for a company like Candid.”

Disrupting dental insurance

Dental insurance gets far less attention than health insurance but it’s every bit as much in need of a reset. It’s dominated by legacy carriers and still, surprisingly, paper-driven.

Beam Dental aims to transform the industry with its own dental insurance company built on a toothbrush.

Yes, a toothbrush. But not just any toothbrush. Beam’s connected brush monitors your teeth-cleaning habits. You download the Beam app to your smartphone and a sensor in the toothbrush sends data to the app via Bluetooth. It also sends data to Beam, the dental insurance company, through which your employer has insured you.

Because you and your coworkers are now, presumably, brushing regularly and thoroughly, your employer saves money on its Beam policy — up to 16% if your Beam group achieves an A grade.

In October, Columbus, Ohio-based Beam raised a $5.5 million Series B round from Lewis and Clark Venture Capital and Drive Capital.

“Once we saw Beam, we believed in it pretty quickly,” says Ron Watson, a principal at Lewis and Clark who led his firm’s investment in the company.

“The market here is massive. The group markets in dental insurance alone are around $40 billion and Beam could penetrate a fair portion of that. It really depends how quickly the legacy players catch on to what Beam is doing. But we have very big hopes that Beam can take a big chunk.”

Beam has a nationwide network of dentists and offers dental policies to small and medium-size business in 16 states. It seems an odd venture to have an insurer based on a connected toothbrush, but the idea is not new. Many insurance industry segments now tie rates to behavior: lower premiums for safe drivers, for example.

“Beam is correlating good brushing habits with lower insurance premiums,” Watson says.

“The information they are collecting via their connected toothbrush is extremely valuable. We see a real opportunity in using new kinds of data to gain leverage in the market.”

Tom Stein is a VCJ correspondent from Palo Alto, California. He can be reached at tom.stein@yahoo.com.

Photo courtesy AntonioGuillem/iStock/Getty Images.