Align: Selling Innovation to Late Adopters
Executive Summary
Dentistry and orthodontics have been largely untouched by significant recent product development, and thus have not attracted much interest from medical device venture investors. Align Technology emerged from an unlikely source--two second-year Stanford business students with no previous start-up experience who were able to attract major venture backers. The founders' idea was that, by using advanced product design and manufacturing processes, the company could produce the Invisalign system of removable, clear plastic dental appliances that, for certain orthodontic patients, particularly adults--a large untapped market--could take the place of traditional metal braces. The company's founders invested heavily in direct-to-consumer marketing that resulted in patients favoring the product before many doctors were familiar with it. After a successful IPO, Align's channel problems, along with other missteps, drove the company's stock down to the one-dollar range. A new management team has restructured the company and implemented a more focused strategy. For Align, traditional braces are now no longer the enemy. Instead, the company promotes Invisalign as another tool in the orthodontists' and dentists' armamentarium, an approach that appears to be capturing support among customer groups not known for embracing new technology.
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