Repeat entrepreneurs Scott Cohen and Blake Johnson built this unicorn in record time in what some have called one of the greatest direct-to-consumer success stories of the century.

Forbes

One usual characteristic of a bootstrapped company is that its growth is slower than its VC-backed competitors. Bootstrapped marketing spend relies on revenue, revenue often relies on marketing spend, and the tension between the two can force slower growth. VC-backed companies, in contrast, can afford to spend ahead of revenue, often allowing them to grow more quickly.

Founded in 2017 and launching its products at the beginning of 2019, the company, according to President Neeraj Gunsagar, is on track to achieve a $100 million revenue run rate in Q2 of this year.

The duo brought on Gunsagar, formerly CMO at TrueCar where he spent eight years, to help lead the next phase of growth at the company and prepare the organization for international expansion and the next product rollout.

But let’s back up. Byte is an invisible-aligner-for-teeth company that has entered the ring with behemoths like Invisalign and SmileDirectClub, as well as a smattering of smaller at-home braces startups, like Candid. But there are several big differences between byte and its competition.

HFV treatment is FDA-cleared and offered in orthodontist offices around the country, but usually at a steep price.

HyperByte comes included with the cost of using byte’s service, which comes out to $1,895. (Folks can also pay via payment plan, called BytePay, which comes out to $349 down and $83/month for a little over two years.) The company also includes a whitening solution that can be used in conjunction with aligners.

Each and every time, licensed orthodontists oversee and review Byte’s treatment plans, and if customers encounter any clinical issue during treatment, Byte can connect them to an orthodontist or dentist.

In some cases, insurance may reimburse customers for their byte treatment.

In other words, byte is working to bring down both the cost of aligners and the time it takes to treat patients. Importantly, byte focuses exclusively on Phase 1 malocclusions, or small misalignments in the teeth like tiny gaps or slightly crooked teeth, and not complicated issues like overbites.

Most interestingly, byte saw explosive growth in the first quarter of 2020 — the company saw 10x revenue growth over the last three months, compared to the same period of 2019, and says that it is continuing at that 10x growth rate through Q2. Byte also told TechCrunch that it generated “positive EBITDA business pre-[COVID-19].” (As is the case with all private companies, these numbers come from byte and are not independently verified by TechCrunch.)

Part of that profitability story is improving economics. Toward the end of 2019, byte’s cost to acquire customers (CAC) dropped by 50 percent from end of 2019 through April of this year.

The sharp CAC decline is due to several factors. According to Gunsagar, the price of Google keywords dropped dramatically in the midst of the coronavirus pandemic and the company has seen its direct and organic traffic double, perhaps driven by the coronavirus pandemic spurring increased interest in self-improvement.

Gunsagar explained that, historically, other companies may have thrown even more marketing money at this type of environment to boost growth even more.

“We won’t sacrifice our customer experience and we won’t sacrifice profitability as we grow the business,” said Gunsagar. “We don’t want to have too many impression kits going through the system because we want to make sure we can support it from a technology and experience standpoint. Every dollar we spend is still super profitable. I could spend more money and still stay below our CAC goal of $150, and I could surpass $100 million in revenue this year. However, I just wouldn’t have super confidence that we wouldn’t penalize our NPS score or our customer experience.

One other important piece of byte’s strategy is an upcoming bytePro launch in conjunction with dentists and orthodontists. The idea is to grow alongside the dental and orthodontic industry, rather than cut these healthcare professionals out of the food chain.

BytePro (launch TBD) further involves dentists and orthodontists in the process. Incoming clients can ask to work with their own dentist or orthodontist as they go through the byte aligner process, and even get their impression kits in their dentist’s office rather than order them online. On the flip side, the bytePro network actively allows dentists and orthodontists to join and be matched with new patients. Moreover, folks that purchase byte show an increased interest in caring for their teeth year round, according to the company, whether that be cleanings or other dental work. Byte aims to connect those folks with a good dentist or orthodontist to protect the investment they’ve made in their new smile.

“When exploring avenues to continue expanding my portfolio, I honed in on companies with which I could genuinely take pride in association. This pride stems from the product’s quality and its positive impact on people’s lives,” expressed Washington. “Emphasizing the significance of having a voice, I asserted early on with byte, ‘If you can’t open your mouth, you can’t find your voice.’ Hearing real customer stories reinforced the idea that this tool can significantly enhance people’s lives in numerous ways. People were once afraid to smile and speak, and that realization highlighted the transformative potential of this tool.”

Related Articles