How to Straighten Your Teeth at Home Cheaply
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Must have been a few years ago when a story was going around about a college student who straightened his own teeth using a 3D printer. That sort of do-it-yourself dentistry is probably not advised for a generation that can’t understand how basic interest rates work. Still, the idea of getting your teeth straightened from home without having to deal with expensive braces or countless dentist visits has a certain appeal to it. That’s why when we came across a company that uses 3D printing to straighten people’s teeth for a reasonable price, and we saw that they’ve taken in $380 million in funding, we just had to take a closer look.
SmileDirectClub
Founded in 2013, Nashville Tennessee startup SmileDirectClub just took in a whopping $380 million funding round a few weeks ago which represented the first round of disclosed funding the company has taken in so far. It also values the company at around $3.2 billion, that’s according to an article on Bloomberg which goes on to say that Align Technology owns a 19 percent stake in SmileDirectClub. Does that name sound familiar? Maybe you’re thinking about the article we wrote just over a year ago titled Is Align Technology (ALGN) a 3D Printing Stock? In that article, we talked about how Align Technology (ALGN) is printing cash with their own teeth alignment system which is marketed under the brand name Invisalign. At that time, ALGN was trading at around $186 a share. Fast forward to today and shares trade at around $312, an increase of +68% compared to the +19% return realized by the Nasdaq index over the same time frame. That gives Align a valuation today of more than $25 billion. It’s easy to see why SmileDirectClub has attracted some serious investment dollars, so let’s look at what they’re offering.
Straighten Your Teeth at Home Cheaply
SmileDirectClub offers a series of invisible plastic aligners that gradually shift teeth into their desired position. The low-cost solution can be used in the privacy and comfort of your own home – those of you that are fortunate enough to have a home, that is. SmileDirectClub expects to attract more customers because it is cheaper than alternative solutions, something that one of the founders picked up on when he had his own teeth straightened using Invisalign to the tune of $5,000. That’s according to an interview posted on Relode which talks about SmileDirectClub’s direct-to-consumer approach which connects “a patient seeking invisible aligner therapy with a licensed dental professional who will oversee and prescribe treatment.” The best part is the price tag:
As you can see, paying upfront results in a one-time payment of $1850. If you choose their payment plan, it’s $250 down and then $80 a month for 24 months which will cost you about 17% more in total. As for the process, it’s pretty straightforward. You start out by going to one of their locations and getting your teeth scanned, or you can opt to receive an impression kit by mail which means you’ll never even need to step foot into a dentist’s office. Don’t worry though, as you’ll still have a dentist or orthodontist overseeing the entire process. From the horse’s mouth:
With remote teledentistry, our invisible aligners let you straighten your teeth on your schedule, from the comfort of your own home. You’ll be assigned a dentist or orthodontist that’s licensed in your state. He or she will check in with you every 90 days through your customer account, and monitor your progress remotely.
Aside from the cheaper price, it’s also the small touches – like the free teeth whitening product that accompanies the kit – that may be why 98% of people who use SmileDirectClub would recommend it to a friend.
The whole process takes about 6 months on average, and it’s all made possible by 3D printers that make the custom retainers for each customer. It’s just another example of a mass customization application that could only happen with 3D printing technology. While 3D printing stocks may have flopped for the time being, there’s now a $25 billion company named Align Technology that wouldn’t be here without 3D printing.
Conclusion
As we talked about in our article last year on Align Technology, there is a lot of market share to capture here. We also noted that Align Technology has quite a bit of cash on hand. If you were in an MBA business strategy class, this might be turned into a use case. What should Align Technology do in order to counter this competitive threat? Given that they own 19% of SmileDirectClub, it seems like an acquisition is likely down the road. They certainly have plenty of cash on hand to make this happen. The investors who ponied up $380 million a few weeks back certainly think an exit is likely to happen, it’s just a question of when.
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