Across America, tens of millions of people fear going to the dentist. For many this fear is not driven by the expectation of poking- and drilling-induced pain, but rather by the expectation of the budget busting bill that comes afterward. The problem is that more than 40 percent of Americans lack dental insurance, and even those who are covered find themselves blinded by a complete lack of price transparency.
Brighter, a three year old Santa Monica-based startup, offers a solution by offering its members access to preferred pricing from a network of vetted local dentists – with discounts averaging 53 percent compared to standard out-of-pocket rates across all procedures – while also providing comprehensive reviews and profile information for each physician. The company is relaunching its platform today with a new business model, a new network of physicians, and an expanded list of patient services.
When Brighter launched initially members paid an annual fee on the order of $99 to access the group buying benefits. This is no longer the case, with membership available for free to all consumers. With today’s re-launch, it’s dentists that pay to access the company’s community of direct-pay (aka, non-insurance) patients.
“We decided that our initial model was too similar insurance and not disruptive enough. Why should you need to pay to access care at affordable prices? So we created the first free alternative to paid insurance,” says founder and CEO Jake Winebaum, who previously founded Business.com, eCompanies, and FamilyFun and once served as the Chairman of Walt Disney-owned Buena Vista Internet Group.
The change is a win-win for all parties, according to the Winebaum, who says dentists – most of whom are small business owners – loathe dealing with insurance companies almost as much as do their patients. At the same time, most are in constant search of solutions to acquiring new patients.
“We simply offered to deliver [dentists] patients who are knowledgeable about price and will pay directly, and they were very receptive,” Winebaum says.
As part of this pivot, Brighter decided to build its own network of participating dentists, rather than continue to license one from a third-party network operator. The benefit of this move was twofold, Winebaum says. First, the company was able to better vet the caregivers that it allowed onto its platform. Second, was the ability to expand the number of services offered to include more than 400 procedures across the preventative, restorative, emergency, and cosmetic care categories – many of which aren’t even covered by standard dental insurance.
As part of its review process, Brighter compiles a comprehensive profile of each physician including educational and work histories and images and videos of the dental practice, making this information available for consumers to review. The company also provides a comprehensive list of available services and their associated costs. Finally, the company offers its members a money-back guarantee on appointments made through the service.
At launch, Brighter has 350 participating LA dentists, all of which have agreed to offer pre-negotiated discount prices on appointments booked through the platform. The network has been live for nearly four weeks in a quiet public beta. With today’s launch, those in the area will begin encountering a more aggressive advertising campaign including radio, print, and digital channels. Winebaum anticipates expanding to other major metropolitan areas across California by the end of the year and across the country in 2014. While the service is limited to discovery and booking today, Brighter may one day offer payment processing and patient financing, its founder says.
The biggest challenge with the relaunch has been the need to build out integrations with each flavor of practice management software, and also refining communications with providers, according to the company’s CEO. Brighter’s employees are divided across network development, customer service, technology, and management functions. Winebaum’s lieutenants include former PatientFYI President Jason Szczuka as his SVP and General Manager, and former CarePayment VP of Marketing and Product Allison Yazdian as his Vice President of Sales & Strategic Planning.
Brighter has raised $15 million across two rounds of venture financing with its backers including Mayfield Fund and Benchmark Capital. The company’s board of directors includes Mayfield partner Navin Chaddha and Benchmark partner Bill Gurley, as well as LowerMyBills founder Matt Coffin and former Hulu CEO Jason Kilar. Gurly is considered by many to be the foremost marketplaces expert within the VC community, while Coffin, Kilar, and Chadda each have substantial experience in delivering innovative consumer services.
The vast majority of innovation in the medical sector has missed the dental category. And while this may be explained away as a result of its total size relative to the reset of the healthcare category, a $100 billion per year opportunity in the US alone is nothing to laugh at. Further, while the Affordable Care Act (aka, Obamacare) may result in more Americans with health insurance, it could very likely have the opposite effect on dental insurance, as the act only requires employers to provide dental coverage to the children of their employees.
“I had been following Jake from afar for a while and finally decided to reach out last year after reading an Inc Magazine article talking about what he was up to,” Kilar says. “I love the fact that he’s tackling an industry that most don’t view as shiny, or sexy. I view Brighter as similar to Amazon, both of which striving to increase consumer transparency and provide access to reduced prices.”
The good news for Brighter is that all 350 million plus Americans need dental care. Similarly, every dentist can benefit from access to more well-informed customers and a more simplified billing and fee schedule. The problem, however, is two-sided marketplaces are difficult, requiring both scale and balance to deliver appropriate value to all participants. This is achievable in a single market, although still not easy, but achieving the same level of coverage and buy-in nationwide will be a far taller order.
“The two main challenges when introduce something new is to let people know you exist and to cross the chasm of introducing a new type behavior,” Kilar says. “There was a time when depositing a check via an ATM was terrifying for most consumers, and the same can be said for booking a restaurant reservation online or using an app. The same is true today about booking dentists appointments. But there are proven ways of overcoming these obstacles.”