Investor Outlook
The oral health space is proving to be an exciting arena for investments, innovation and change
By Revere Partners
[ORIGINALLY APPEARED IN MDNEXT Q4-2022]
Currently, the oral health industry is severely underinvested with innovation opportunities often left on the table. Revere Partners is hoping to change that as first-movers in the space.
Revere invests with two major timeline-based categories in mind: short-term prospects and long-term prospects.
Short-term opportunities already have integration and are being used with significant underlying whitespace. The capital employed is primarily for growing the company and a great deal of effort is put toward sales and marketing. These companies are often derived from achievements and have some foundation.
Conversely, long-term prospects are sometimes no more than viable concepts. These types of ventures require a great deal of thought, expertise and manpower for testing the viability of innovation. They offer much greater long-term reward prospects but also hold a great deal of risk stemming from uncertainty in more milestones toward success..
Whether short or long term, the future looks especially bright in the oral health space. When the combination of industry experts is adjacent to the strategic capital and earnest deployment pace, the results are prime to perform—even during a recession. Dentistry has always fared well in economic downturns. In the 2008 recession, patients continued to visit the dentist and the industry thrived. We do not expect any different in the coming years.
What we are looking for right now
“We see gaps within the industry as well as synergies, and bring several solutions together to form a more comprehensive and/or operable whole,” says Revere managing partner Dr. Jeremy Krell.
Simply put, Revere takes a thematic approach to investing—breaking oral health into subcategories that complement each other to solve a previously unsolved challenge where it believes there is big upside value creation and investment potential to this strategy.
Yet how does this thematic approach benefit investors? Essentially, Revere has to anticipate market risk—not just product risk in dentistry, that is, the go-to-market strategy and consumer/provider adoption. A recent article in the Harvard Business Review states: “Strategic opportunities for new ventures can be categorized along two dimensions: attitude toward incumbents (collaborate or compete?) and attitude toward innovation (build a moat or storm a hill?).” Revere couldn’t agree more.
For fintech, that challenge has traditionally been payment solutions that take limited payment mechanisms, as well as the merchant processing fees shaving percentage points of the practice’s revenue. Other frustrations included financing with high interest and low approval rates, wait times of hours to weeks to confirm insurance benefits, and claims that “get lost” in the practice’s priorities, leading to lower than initially expected reimbursement without knowing it.
The microbiome is another area ripe with innovation—educating the patient, quantifying the problem, and devising a precise therapeutic, delivered in a platform they like to use. Startup Bristle Health uses genomics to measure the “good, the bad and the ugly,” and provides coaching and personalized care plans to help improve oral health. BrickBuilt Therapeutics uses live biotherapeutic products for the prevention and treatment of periodontal disease, caries (cavities) and oral candidiasis (thrush). And, Twice combines cutting-edge science and clean ingredients to create a holistic oral health system for a healthy mouth. Lastly, startup Lura Health has brought the world’s first salivary diagnostic, wearable sensor to market, allowing for ongoing biometric monitoring (more details on some of the startups referenced above can be found in our “Top Picks” beginning on p. 46).
Being specialty focused provides an advantage as subject matter experts when selecting optimal investments. But it also helps with post-investment support and strategic partnerships. Every situation is unique, but lately, Revere prefers collaborating and building a moat. If the company sees that a product or service is part of a set of parallel or sequential solutions, then “vertically investing” can be a strategy that pays off with an end-to-end solution that drives value to its target market across the continuum.
Clearly, the oral health space is rich with bright ideas and innovation, solving problems that benefit patient, practice and investor. While not the first area you might consider as an investment or startup space, this space has proven to be an especially exciting arena in which to invest, grow and bring change for the better.
Revere Partners is the first Venture Capital fund exclusively focused on oral health, identifying opportunities for investors and providing capital for cutting-edge innovations in the oral and systemic health sectors. Founded by Dr. Jeremy Krell and David Arena, Revere Partners fosters strategic partnerships that improve care delivery as well as patient and provider experiences—maximizing value for investors. To learn more, visit www.reverepartnersvc.com or on LinkedIn.
