Business Administration alumnus Neeraj Gunsagar knows that straight, even teeth aren’t just for looks. Getting access to oral healthcare can greatly improve one’s chances of finding a job, starting a relationship, and even preventing diabetes. And at one point, it even saved a life of a bullied teenager. He talks about his initial meeting with Scott Cohen, and before he realizes it, he is looking into an opportunity that allows him to help more people.
Neeraj also shares some of his experiences growing up in the Bay Area with his immigrant parents, working at DLJ (Donaldson, Lufkin, and Jenrette), and then at TrueCar. He emphasizes how his background in investment banking and focus on tracking and measuring KPIs helped him transition from CRO to CMO and finally as CEO. Make sure to tune in until the end to find out about his 15 minutes of fame with Shaquille O’Neal and Kobe Bryant!
How Haas evened out the playing field for career opportunities at investment banking
[00:03:26] Investment banking was like Google or Facebook, or wherever it was, five, 10 years ago from an undergraduate perspective. And to compete against the East Coast Ivy League Schools from a west coast perspective, Haas really helped level the playing field there.
On how race affects access to healthcare
[00:25:28] So, the U.S. population is about 65% white, 14% Latino, 12% black, and maybe five, or six percent Asian, something like that. But orthodontia work is like 80 to 90% white, the people who are getting it done in the communities that we all know are privileged, the higher income, and all these things. And when I realized that byte®, one of the first things I did was try to analyze. It’s literally 64% to 63% white, 15% Latino, 13% black, 5% to 6% Asians. Literally, that’s our customer base. And you start to realize like, “Wow”. We as a country, we as a company, and we, as individuals, need to figure out a way more and more to break down some of these historic barriers that were created decades ago. And figure out a way to make oral healthcare more accessible and affordable to folks.
Practical areas in life where oral healthcare matters
[00:29:19] I spoke to Bumble and some dating sites as well, they’ve done a lot of analysis on this. Women, I think it’s through a survey that Bumble or Matched did, won’t go on a second date with a guy if they have bad teeth. 72% of women said they wouldn’t do that. Job interviewers, you probably don’t want to say it out loud, but subconsciously, or consciously it makes an impression, right? If that person doesn’t take care of their teeth, how are they going to take care of this job? Right?
When the dentists’ fear became their pivot
[00:30:47] Before the pandemic started, I talked to a bunch of these big DSO, dental service organizations. They hated what we were doing. They said, you can’t do this over, telemedicine or at home. And, and then as soon as the pandemic happened, they realized nobody could come into their offices. What were they doing? They were doing Google hangout, consults, Invisalign over zoom, all these different things because it was interfering with their monthly income.
Making oral healthcare more accessible: byte®’s moving forward goal
[00:35:04] We want to make oral care more accessible to consumers. At scale, we want to build technology and systems to allow that to happen. And we want to bring dentists, GPs, and orthodontist into that platform in the long run.
(Transcripts may contain a few typographical errors due to audio quality during the podcast recording.)
[00:00:06] Sean Li: Welcome to OneHaas Alumni Podcast. I’m your host, Sean Li. And today, we’re joined by Neeraj Gunsagar. He is a BS class of 98, Haasie. Welcome to the podcast.
[00:00:18] Neeraj Gunsagar: Hey, Sean. Great to be here.
[00:00:19] Sean Li: You’re also the president and CEO of byte®.
[00:00:22] Neeraj Gunsagar: Yes, I am.
[00:00:23] Sean Li: Before we jump into all that, can you just tell us a bit of what byte® is?
[00:00:27] Neeraj Gunsagar: Yeah. So byte® is a direct-to-consumer clear aligner company. So our goal and mission are to change the world one smile at a time. And what we do is we make the concept of orthodontia and teeth straightening more accessible and affordable to communities around the US and very soon around the world. Because the current infrastructure of oral care is very much predetermined for wealthier, upper-income folks, and we believe that oral care and overall healthcare should be democratized in a way where everybody has access to these kinds of procedures.
[00:00:58] Sean Li: Couldn’t agree more when I went to go get my Invisalign done years ago, the process was so automated that I was wondering, why is this still so expensive?
[00:01:09] Neeraj Gunsagar: Yeah, so it’s just patent protection and the ability to sell it through orthodontia and insurance and all the complications that you probably all hear about in the healthcare world. The same thing happens in dental. And so we’re trying to since the patents expired of Invisalign 6, 7, 8 years ago, just like you see with hims and hers, and Roman and those folks, we’re trying to make these products more accessible because the reality is teeth straightening is not just a vanity thing. It’s actually a healthcare thing. If you have crooked teeth, food gets stuck, you have higher rates of gingivitis, heart disease, diabetes, a bunch of stuff that the people don’t really know in lower-income communities, but they should have access to. So that’s kind of the real mission of byte®.
[00:01:51] Sean Li: I love it. Before we go back to byte®, I love to go back in time and hear about you, about your origin story. Where are you from? Where’d you grow up?
[00:02:00] Neeraj Gunsagar: Yeah, so I am from Saratoga, California. So in the South Bay, Silicon Valley, the heart of Silicon Valley. Roku was started in Saratoga, and Netflix is in Los Gatos, so I kind of bordered those two towns. My father moved to California in the early ’70s, late ’60s, he was a semiconductor guy from India, and he worked at Fairchild. So, Fairchild, it’s like the godfather of true Silicon Valley. And we grew up there, and that’s where we spent most of our time as children, I was born and raised in Saratoga, and then, I went to Berkeley.
[00:02:36] Sean Li: What did you study at Berkeley?
[00:02:37] Neeraj Gunsagar: I went to the Haas School of Business, and I studied Business, and I really enjoyed it. I mean all the classes there. I mean, I actually wanted to play baseball. So I played baseball in high school. And then I tried out in the freshman team over at Cal as a recruited walk-on, and I threw out my shoulder, and I realized very quickly that I had reached my ceiling of baseball while most of the players there were still at their floors. And I quickly focused on academia and studies. Haas Undergrad, it’s very difficult; I imagine it’s the same way now. It’s a very difficult school to get into. I think a lot of people in the undergrad program try to get in, and many fail. And once I got in, it was truly, truly, truly a game-changing experience because you really got focused on business in a differentiated way, from an undergrad perspective. And back in the late ’90s, investment banking was the thing to do, right? Investment banking was like Google or Facebook or wherever it was 5, 10 years ago from an undergraduate perspective. And in order to compete against the East Coast Ivy League schools from a West Coast perspective, Haas really helped level the playing field there.
[00:03:40] Sean Li: You went to a very famous shop, at least in the finance world, right out of college, DLJ. Can you tell us about your time there in leverage finance as an investment banker?
[00:03:52] Neeraj Gunsagar: So I think it’s best to rewind my junior to senior year, summer. I worked in investment banking at UBS. So, I had a UBS summer job as a summer analyst, and the focus was on technology. And back then, technology meant equity offering, so purely secondary IPOs, equity financings for software companies I had focused on back then. And what I realized was it was mainly just pitched books and comp analysis, meaning comparing other companies to the company you’re taking public, or you’re doing a secondary form to find out valuation. And it wasn’t really that challenging. And so, as I went back to my senior year, I wanted to do more complex finance. So I wanted to really understand how to leverage the balance sheet in a unique way, either through high yield or equity offerings, and have a full kind of capital suite and capital efficiency solution and advise companies on that.
And back then, as you had mentioned, Sean, DLJ was the king of high yield and very complex bankruptcies and stuff like that. And as I interviewed with Goldman and Morgan and everybody like that, the DLJ guys, I just connected with a little bit better, and it was in the San Francisco office. And I also wanted to have a really fun senior year. So I was, I think, the first person in our senior class to accept a job in November at DLJ. And I kind of just took off the rest of the year. So that was that.
[00:05:19] Sean Li: That’s amazing. What’d you do after that? I know you were kind of in banking for two years. It’s funny how nothing has changed in that in that sense for an analyst.
[00:05:28] Neeraj Gunsagar: Yeah, it’s a good question. So at DLJ, I really focused on some cool transactions. So I worked on the bankruptcy of a company called the Iridium. If people remember the satellite company, they had raised about 8, $9 billion worth of debt. And so we had to restructure that, and it was global debt. It wasn’t just like, a bunch of shops here in the US. It was the Saudi government; it was the Chinese government because everybody wanted access to satellite. But what they didn’t realize what cellular would take off very quickly because as more and more base stations were laid across the US, coverage became a lot easier, especially with CDMA technology, which is what Qualcomm had spearheaded through their CEO and founder Irwin Jacobs. And so in 2000, I got the bug to do venture because obviously, 2000 was like the hottest year in the world.
And then it turned into not the hottest year in the world, but I caught the venture bug. And I also understood that if I wanted to get on the buy side, the principal investing side, I’d probably have to go back then. It wasn’t nearly as ubiquitous it is now. So I had to go probably take a different route coming from banking. And so I went down to San Diego and helped found Qualcomm’s Venture Capital Group. I was really interested in wireless technology back then, super interested. In fact, I still remember, I was a bit insecure about not being an engineer at our technologist because, as you know, Qualcomm is a heavy, heavy, heavy engineering shop. They have pat walls everywhere. I still remember this, I bought CDMA for dummies. There was actually a book CDMA for dummies, and I read it, and I started really understanding how our code division multiplexing worked and how it was comparable to TDMA.
And I guess my father’s engineering brain came out and I remember going to a couple of meetings because we were looking at early-stage companies and my bosses at the time I started really drilling into the engineers on like how they were looking at multiplexing and how they were doing base stations versus, MSM chips, which are their mobile chips. And my guys looked at me, going like, “You’re a banker?” And so advice for everybody, those dummy books could get you pretty far. Now you’re not going to go and start designing chips or anything like that. But you can be pretty nasty and dangerous. And so I did that for quite some time, but what I realized, to be honest with you and these are some of the early learnings I had is, and this is why I really truly loved banking as a first job out of undergrad is, and I didn’t talk about this, but DLJ was also considered like the hardest working shop.
So there’s probably, horror stories from people about, a hundred-hour weeks were pretty regular, but as a 21, 22, 23-year-old, you can kind of handle that. It’s just like, oh, it’s your first job at a school. Like this is the way it is. But what you realize is that most other jobs are not like that. And in fact, a great story at Qualcomm was I started on a Monday and my boss at the time who was a really, really interesting guy, really smart guy, but kind of a hard ass, but he and I have still stayed very close. He gave me a project like a look at this space, and you analyze it and gimme some spreadsheets and all these things. And by Monday evening, I had finished the entire thing. It was pretty easy for me. And I remember going into his office.
I said, Hey, you know, here’s the assignment. He’s like, what assignment? I said, oh, the one we talked about this morning in our Monday meeting, he’s like, “What you finished that? That was doing two weeks.” And it was funny. We sat, he’s like, “Oh my God, this is exactly what I wanted. I’m glad the way you looked at this.” And what I realized very quickly was I had to understand different worlds now going forward because certain big and what I realized is big companies are not where my sweet spot was at the time like big companies move very slow in comparison to the agile workforce of either a banking or a startup or whatever it may be. And so I really did that for three years to enjoy by side investing. But to be honest with you, Sean, it was kind of like a vacation in San Diego for a couple of years with a really great, great knowledge base and understanding you’re at a tier blue-chip company, but it did get boring.
And I also realized just from my DLJ experience that I wanted to do later stage more complex transactions. Like I was more of a buyout guy or a growth stage guy. And then I was also debating whether to go get my MBA because, by the way, everybody did MBAs back then it was the thing two years banking. Maybe you get a job, then go do your MBA. And then, in 2004, I was about to put together applications that I was interviewing as well because I was like if I can get a post-MBA job like I don’t need an MBA. And everybody who was doing MBAs was like, oh, it’s about the networking. It’s about networking. And I was like, listen, whatever. And I ended up getting a really, really great job as the first kind of associate of a boutique, newly created tech buyout shop called Garnett and Helfrich Capital.
It was started by two venture capitalists who saw that there was a gap back then of a bunch of the M&A activity that happened in ’98 to 2000. Now with the downturn, everybody remembers that 2001 downturn in the tech space while all of those companies that had been acquired were now somewhat being orphaned inside of the big corporates. And so these guys on the venture side and we brought in a partner of mine, a guy by the name of Mike Guthrie, who’s still very close. He’s actually the CFO of Roblox. Now he was the TPG. He got brought from TPG, and he and I worked together, and we basically carved out businesses from big corporates. We were the first real company to focus on carve-outs back in 2003, 2004, and tech space. So we carved out a business out of what was called computer associates then, but CA we carved out of business out of Nortel.
We ended up selling that, I think to Dell, and then, or no, we carved out of business out of a big Taiwan conglomerate called WYSE, sold that business to Dell actually, sold another business to IBM. And we basically just carved these things out and created a new infrastructure for them and new equity incentive cultures. And the strategy would sometimes take equity back with us. And I was the only guy there, kind of running a lot of the deals with Mike and David and Terry; the founders were doing a lot of deal flow for us. And it was a really great experience. I mean, I traveled the world. I ended up looking at businesses in Germany at Infineon Asian businesses. We looked at businesses in India; we looked at building offshore stuff in India. And that was the private equity side of it.
[00:11:27] Sean Li: But you continued down that journey, it seems like.
[00:11:30] Neeraj Gunsagar: I did. I mean, I can keep going. I don’t know how you want to take this. I mean, I can get us to byte® if you want to do that. So let’s do it. Yeah. So well, as I ended up at Garnett & Helfrich Capital, I spent a lot of time in India because we wanted to build back then. India was a really great, interesting back office for technology support and systems.
[00:11:49] Sean Li: For context, this is mid-2000s.
[00:11:51] Neeraj Gunsagar: This is 2005, 2006. And so my brother actually, who was a UCLA undergrad and then Stanford law guy, he moved out to India in 2001 downturn, and he started an animation company. And so he was there with his wife, and every time I’d go out there, I’d stay in Bombay with them.
And I ended up saying, you know what? I kind of want to try India. India seems like a cool place. And so I joined Matrix Partners, which was a big VC firm in the US. They were building a presence out in India, and I transitioned out to Garnett & Helfrich Capital. And I joined Matrix in India. I moved to Mumbai in 2007. And as I tell everybody, I realized very quickly just because I’m Indian doesn’t mean I wanna live in India. And I think within a year, I had made the, that I wanted to be back in California, and I moved back. I actually moved back in the mid-2008 timeframe, and I had accepted a job at a growth equity VC from a very famous one out here in California. But as we were literally flying back, I took a week in Dubai, and the market crashed, and they rescinded all their offers.
So I came back to the US in mid-2008 with the downturn happening, and I didn’t have a job. And it was a really, really, really unique time for me because I didn’t have a job. Nobody was hiring, especially in private equity and venture and all these things. And so, I ended up partnering up with my old partner at Garnett & Helfrich Capital. He had since moved on to another firm, Mike Guthrie, and we actually started to just consult for a couple of years. We consulted a bunch of public companies, CEOs on M&A advisory we were trying to do back then. This concept of SPACs was a little bit different here. We were looking at doing these things called search funds. I don’t know if you know, search funds. We were looking, putting together search funds at the time, and trying to see if we could flip those into SPACs.
And so we had a couple of interesting ideas actually in 2009, we wanted to buy a couple of assets that we could have bought for nothing. And then those ended up selling for billions of dollars later. We just couldn’t get the capital behind us. We’re going to put some of our own capital, but nobody was writing checks at all. And so I did that for literally almost 18 months. And I got married in combination with that. I had my first kid, and I was just hustling and getting deals flowing. And then finally Mike was like, listen, I think I’m gonna take this job as the CFO of a company called TrueCar down in Los Angeles. Because I think it’s time, let’s go try to run something because we had realized that you sit on boards a lot at a young age without any real experience in operations.
And you give a lot of advice, but you never kind of done it. And you never sat in the chair of a CEO or an entrepreneur. It’s a really different chair. And so he became CFO, and he had thought they were just going to go public right away. That was the goal to bridge to them go public. But I think the first week he started, he realized, well, this company was not ready to go public. A lot of infrastructures needed to work on a lot of things. So he called me up and said, “Hey listen, do you want to do a consulting gig down here and see if you like it.” And so, in January of 2012, I flew down to LA to be a consultant and realized very quickly that they needed more than that. It was a real growth restructuring of a tech company, which is unique because back then, you could grow at all costs.
But if you didn’t have the right business model or if you didn’t have the right KPI metrics, LTV, CAC was still like, nobody really understood it. And it ended up being seven years, eight years at the company. And so I came in, I started out running finance and ops as like a VP of finance or something like that. And Mike was the CFO. We ended up turning the business around and did about 70 million and lost 40 million in EBITDA in 2012 when we came on. Next year, did one 10 and 10 positive, right? So we flipped the business pretty much to focus on the right KPIs. I started to get my hands dirty in all different parts of the business because it was just an analytical focus rather than just a hunch focus. And we took it public with Goldman Sachs in 2014, raised, almost got to a $2 billion valuation at one point.
I ended up transitioning to run marketing. So I ended up becoming the CMO of the company. So we had built a really data-driven culture there focused on customer acquisition, TV metrics. We were one of the first companies to really understand how linear TV could result in traffic bumps on your website. And it was just fun. It was like a math problem. I hired a bunch of bankers and hedge fund guys that wanted to transition over to corporate, and they knew they would be an income drop, but they would learn certain different skill sets, but that was the kind of folks we wanted. Once again, we’re one of the first real introductions of business operations. We sound somebody labeled that later, but we’re like, oh my God, we had built a biz ops team back in ’11 and ’12. That was that and did that for quite some time.
[00:16:27] Sean Li: I was actually just going to ask, what was it like going from finance to marketing? That’s literally from the CRO of the company to the CMO.
[00:16:36] Neeraj Gunsagar: So the titles are an interesting thing. Like I could have asked for whatever title, I wanted to be honest with you because we were involved in so many different parts of the business, but the CMO is an interesting title today. Because marketing has become a really, really, really kind of 360 thing to it, you gotta focus on when you think about a company, right? So you’ve got acquisitions like TV acquisition, radio acquisition, digital acquisition, Google, Facebook, Instagram, all these different things, but it all then flows into a funnel, right? As a consumer internet funnel and that’s all math. So all that math ends up happening, and you have to end up making sure that all that quant works in a funnel. Right? And so when we did that, it ended up realizing that, wow, we should really help the brand marketing side understand their math around those things. And because on the biz-ops side and eventually, it was like, well, I should just run marketing because we want to be more data-driven marketing from that perspective and then go from there. So it was an easy transition, and I had a chief brand officer. So I wasn’t like doing the creative direction. I would give my insights, and we would do a bunch of AB testing across all the different platforms, but it was a natural transition from where I sat.
[00:17:44] Sean Li: That makes sense. I see what you mean, being very ROI-driven from a numbers standpoint on how marketing works. Yeah. Because I normally think marketing is just being creative work.
[00:17:53] Neeraj Gunsagar: You do, everybody does, but it’s not, it’s not. It’s becoming more and more ROAS focused. And you know, even at byte®, as we get into byte® in a little while, like we are super driven on making sure that we’ve got attribution right. We’ve got all the different channels right. Because what we’ll talk about this, I have a real strong opinion about the monopolistic nature of Facebook and Google and all these platforms that become almost taxes on the internet when you try to reach customers. But I understand their business models. So you have to make sure that if you’re buying CPMs and you’re buying CPCs, that you’re really fine-tuning the math around, what’s creative, what’s the landing page. What is the funnel economics of this, especially when you’re trying to sell a $2,000 product as we do at byte®?
[00:18:34] Sean Li: Before we go there, though, we do have an interesting story with the Lakers. You have to tell that story.
[00:18:40] Neeraj Gunsagar: Oh yeah, Sean. I mentioned this earlier. So as we started to buy more media, right? So a good friend of mine, who’s actually in the podcasting space, and the guy, the name of Norm Pattiz, who owns PodcastOne, he owns the four courtside seats next to the Lakers bench. So if you see his face and you’re a Lakers fan, or you’re an NBA fan, you’ll recognize who he is. And at the beginning of the year, this was during Kobe Bryant’s last year; he had offered me a couple of seats to sit with him during games. And he is like, “Well, would you want the last game of the year with the Utah Jazz?” And not knowing that was Kobe’s last game, and all these things were like, I’ll take the last game of the year.
And as it became Kobe’s last game, it became a bigger and bigger deal, right? I mean, it was going to be Kobe Bryant’s last game. And so I had two tickets. He had given me two tickets. I was taking my CFO, Mike Guthrie, again, he was a CFO there, and I get a call the day of the game, and it’s from Norm, and Norm says, ‘Hey, Neer, got some good news. And I got some bad news. And he said the good news is Shaquille O’Neal wants to go to the game with us.’ And he said the bad news is he needs one of your seats. And he is like, ‘It’s up to you. You can do whatever you want.’ And so I thought about it for about a millisecond, and I ended up calling my CFO and going into Mike’s office and saying, Mike, I got some good news, and I got some bad news.
And the good news is that Shaquille Neal to go with us to the game. And the bad news is he wants your seat. And so Mike very quickly said, ‘Hey dude, go with Shaquille O’Neal. Are you kidding me? Like that’s Kobe’s last game. They’re boys. Like it’s Shaq and Kobe. Right. You’re going to be sitting in the middle of this whole thing. So we ended up going to the game. And if everybody, if as a basketball fan, once again, or a Kobe fan, he scored 61 points, the last game of his career. We watched it. Yeah. He won the game. But if you watched it, you’ll see me next to Shaquille O’Neal the entire game. But what was fascinating was before the game, Kobe comes up to Shaq. I’m literally sitting in the middle of this as an epic conversation.
Somehow, if we can NFT this, I think I’d make some money here, but Kobe says, how many do you want me to score? And Shaq says 40, and Kobe goes like this. And then I yell 50. Like I’m just part of the gang. Like, and they’re like, no, shut up, dude. What are you talking about? And then we’re just kind of battering the entire game. It’s like me, Shaq, and Kobe and me in my own mind. But you know, Shaq and Kobe. Right? And he scores 61. And after the game, we’re all on the court together. Because court sides seats get a hit off the court. And this is, you know, obviously once in a lifetime type experience, but like I’m getting hugged by everybody, Rick Fox is there. Shaq’s hugging me; Kobe even hugs me.
I’m like, whoa, this is like, and I’m not, by the way, listen, I’m from the Barry, I’m a Warriors fan. So yeah. I’m not even a Lakers fan, but it was just one of these surreal surreal moments. Like I’ve got pictures on it. I was on Jimmy Kimmel’s show and all these shows because they’d show the screen of Shaq and Kobe talking, and I’m like in every photo. So I like even high school buddies of mine or texting me during the game. Like I haven’t talked to them in 20 years. They’re like, is that you next to Shaq? And it was just; it was a crazy moment. It’s like my five minutes of fame or 15 minutes of fame.
[00:21:33] Sean Li: That’s unreal. So the moral of the story is don’t be the CFO; be the CMO.
[00:21:38] Neeraj Gunsagar: Exactly. If you want good tickets, you should always be the CMO.
[00:21:41] Sean Li: All right. That’s a great segue into your role at byte® as president CEO. What, how did you get from TrueCart to byte®?
[00:21:48] Neeraj Gunsagar: Interesting story. So in 2018, the founders of byte®, the guy by the name of Scott Cohen and Blake Johnson actually really good friends of mine. Actually, I would call them even brothers now, but Scott, our kids, went to the same school in the Pacific Palisades Santa Monica area. And he just pinged me like through a network at the school. And he said you guys were able to market properly at TrueCar and build a brand within this category. How did you do that? And I took them through some of the stuff we did with partners and affiliates that was really unique. I took them through, you know, our really analytical-driven focus. And I think midway through the call, at least, or the meeting in my office, Scott tells me now he realized very quickly that I was the guy they wanted to run this business when they got to a certain stage.
Scott and Blake are very well known to be early-stage guys, but also humble and knowledgeable enough to know that they’re not the right guys to take a company to the growth side of this. Yeah. And I think seven, eight months later, as I started to think about new things after TrueCar, I came into Scott’s offices at byte®, which was one of these surreal moments. I had done all my diligence on the category. I knew it was a big category. I knew I wanted to do something; whatever I did next, I wanted to make sure it helped the world in some way like it had an impact on either people or the environment or something. I had that yearning, and the younger kids all have it today, but you know, the bankers of the ’90s, we didn’t think about those things.
And I was in the offices that byte®, Scott had stepped out for a second, and I could hear a woman. She was crying in our byte® sales team. And I went over as anybody about being recruited to be the president and CEO. I just tapped her on the shoulder, and I said, what’s going on? And she said, and then I could hear a woman on the other end of the phone crying as well. And I said, oh, this has to be an HR issue. And she said, no, no, no. This is just another one of these incredible consumer journey stories. This was a mother whose daughter had tried to commit suicide twice. And the daughter had tried to commit suicide twice because she was bullied and made fun of by how her teeth looked. And you don’t think about it a lot.
I mean, I know mental health and mental health awareness has become bigger and bigger, but people are going through a lot of stuff, and people bully people for a bunch of reasons in late high school or whatever it may be. And like we hear countless times before customer success stories on the byte®, this mother lived in a county without an orthodontist. So only 40% of US counties have orthodontists, which people don’t really know.
[00:24:08] Sean Li: No, I know that. And most of the listeners probably grew up in privileged areas with orthodontists around.
[00:24:15] Neeraj Gunsagar: With orthodontists where oral care and dentistry are all very important, which by the way it is, and she couldn’t afford all the other treatments that, Sean, we mentioned before you think about it, Invisalign, those things are expensive. Especially when you don’t have insurance as well, some folks have insurance, some don’t, but 50 or 60% don’t have orthodontic coverage for sure. I mean, 80% of the country doesn’t have orthodontic coverage.
And she had discovered byte®, and we have a financing program called byte® pay, hundred percent approval because we want to make this concept more accessible and affordable. She discovered that her daughter was now in month five of treatment. Her teeth were straightening. She was regaining her confidence. She was no longer getting bullied. And then the mother said something to me that really changed my idea. She said, I finally have my daughter back, and I’ve got young boys. And if you’re a parent or even if you’re just anybody with an understanding of mental health, that’s a big deal. Like, you don’t know what you probably prevented there.
When it comes to confidence and health and happiness, which is what we kind of hold as a mission statement, and at that moment, I knew this was really interesting. And then, as I unplugged even more interesting data out of this whole business, you start to see a bigger, bigger, bigger story here in regards to access healthcare in general. So the US population is about 65% white, 14% Latino, 12% black, and like 5, 6% Asian, something like in that stage. But orthodontia work is like 80, 85, 90% white, like the people who are getting it done. And in the communities that we all know are privileged and higher income and all these things. And when you create a service or a product or an experience or whatever it may be that’s needed for the masses, and it’s accessible to the masses, and it’s affordable to the masses, your customer base should revert more to the mean or the average of the country.
I mean, that’s just how it should work. And when I realized that byte® and one of the first things I did were try to analyze this is literally 64%, 63% white, 15% Latino, 13% black, 5% Asian, 6% Asian, like literally, that’s our customer base. And you start to realize like, ‘Wow, we as a country or we as a company. And we, as individuals, need to figure out a way more and more to break down some of these historical barriers that were created decades ago and figure out a way to make oral care, healthcare, more accessible and affordable to folks.’ And one of the things that the industry didn’t recognize and, I’ve become a big advocate of this. And I talk to dentists and orthodontists all the time because a lot of them are fearful about what we’re doing. We’re bringing a whole new group of human beings.
So it’s incremental to the industry to focus on oral care for the first time in their lives. And as a doctor or dentist, that’s kind of what you want to do. And I end up always comparing it to like the music industry. When Napster and stuff were started, the entire music industry fought it like crazy. But what they didn’t realize was that everybody would eventually have a jukebox in their pocket. And now the music industry, be it their songs or streaming it’s bigger than ever. And so when I speak more and more to dentists and orthodontists, I say, guys, listen, we’re trying to bring, if you think about banking, the unbankable like we’re trying to build a bridge because you haven’t been able to make a dent in who’s. How many people have seen dentists every year for decades? Like why should the urban city or the African American, who lives in downtown or Compton or whatever, not get access to proper oral care? Like we should, if we can do that in a DC fashion with proper oversight, let’s get it done. Like, let’s focus on that. And now it’s starting to become more and more. We want to bring more dentists to the program. We wanna make the office an opportunity as well, but you have to kind of start the bridge now if you’re really going to make a difference in the long run.
[00:28:00] Sean Li: I think what you just said is really it’s blowing my mind a little bit because you’re absolutely right. Healthcare as a whole is a lot of things. And if you kind of overlook or just give up on one area like oral health, which feels like it’s so easy to give up on, what else can you just skip out on as well, right. In terms of taking care of your body, as they say, oral health, well, at least I’ve read before, oral health leads to your gut health. It just leads so many things, so many decisions that you make as well in terms of your lifestyle. And so I’d love to hear a little bit about, you know, for many listeners listening, they’re probably thinking, oh, teeth straightening is it’s just for a vanity for aesthetic purposes. Tell us a little bit more about the health implications.
[00:28:40] Neeraj Gunsagar: Sean, it’s a great, great segue, right? So as we’ve started to under understand the concepts around oral care and oral health, and I don’t think the industry has done a great job marketing itself, like going to the dentist is one of the things people dread more than anything in the world, but what they don’t realize is teeth straightening. Like I mentioned to you earlier, it’s not only a vanity thing, right? If your teeth are crooked, more food gets stuck in your teeth which leads to gingivitis. It leads to cavities. It leads to diabetes and heart disease, a bunch of different stuff that people don’t fully understand or appreciate. And then, on top of that, there are the interesting vanity-focused things that make an impact. You know, as I spoke to Bumble and some of the dating sites as well, they’ve done a lot of analysis on this.
Like women, I think through a survey that Bumble or Match did, won’t go on a second date with a guy if they have bad teeth, 72% of women said they wouldn’t do that job interviewer. You probably don’t want to say it out loud, but you subconsciously or consciously, it makes an impression, right? If that person doesn’t take care of their teeth, how will they take care of this job? And so, all of those things lead to one thing— confidence. Like if you think about mental health and mental, and self-care and all these things, it’s really about building confidence. It doesn’t need to be ego. It just needs to be; I feel good about who I am. And this is a really important thing. I mean, we have been trying to understand this from a mental health perspective, and can we ladder oral care under self-care and different things like that because self-care has become really big with the pandemic.
You look at the boom of Peloton at-home exercise, all these different things. We want to be at the forefront of that. Like we want people to spend nearly as much time thinking through their oral care needs as they do some of their healthcare needs. Suppose you look at some of the digital health companies that have exploded due to the pandemic; well, what happens if you peel back the onion. What happened was a lot of regulations and laws that are somewhat archaic because of where they were; they broke down for about 12 months, right? Because you go in the office. So you had to think through things like telemedicine and telehealth and all these different things. And a great story on this is before the pandemic started, a bunch of dentists, I talked to a bunch of these big DSOs, dental service organizations. They hated what we were doing.
They said you couldn’t do this over telemedicine or at home. And then, as soon as the pandemic happened and they realized nobody could come into their offices, what were they doing? They were doing Google hangout, consults, Invisalign over zoom, all these different things because it was interfering with their monthly income. Well, so then that wasn’t only happening in oral. It was happening with doctors and everything. I mean, I remember, you know, the big think tank up in Minnesota. I forget, I just forget the name of the thing that he was on CNBC. One morning, I was actually on after him on CNBC, but he talked about, prior to the pandemic, they were doing maybe 50 calls a day through telemedicine, and now they were up to 5,000 and globally. And so you could just imagine like the access to healthcare that is being innovated on probably accelerated by five years, and it’s needed acceleration.
We need to have different ways. I mean, I think we all always wondered why the doctor sets us up for an appointment. And then we go wait in the waiting room for 45 minutes.
[00:31:52] Sean Li: Or it’s just nearly impossible to get a doctor’s appointment.
[00:31:55] Neeraj Gunsagar: It’s nearly impossible to get a doctor’s appointment. It’s nearly impossible to get a dentist appointment when you get it; then, you have to wait for 45 minutes to an hour.
[00:32:01] Sean Li: You have to take time off of work.
[00:32:04] Neeraj Gunsagar: All these different things. They don’t know the productivity loss on top of that, plus like, okay, well, that takes time away from my family. We need to become more efficient. Right? Yeah. And to be honest with you, you like I use when medical is my GP, my doctor, and that service is awesome. Like I have an app, I can schedule an appointment.
I literally can get it, whatever I want with my doctor. And I don’t wait at all. I walk literally right in, and I sit with him, and he already has all my information. Cause I’ve talked to him, what’s wrong with me. And in forward, there are some other guys that are doing the same thing. It’s like, we’re just beginning this transformation. And the biggest thing we need to do is we need to work with the regulators. We need to work with everybody to explain why this benefits consumers at scale because they’re looking at it from a very different lens, a historical lens of like protecting the money, protecting this and that quality of care and quality of care. All those things can get done through remote monitoring through some different stuff. And by the way, at a different scale, and so it’s just accessibility, excessive.
We’re just early right now. We’re working with every regulatory body, our competitors who we respect very much as well. We’re all trying to advance this because we believe in the end, we can make dentists and orthodontists way more efficient as well. Like when do you hear from your dentist, right? Twice. You hear from your dentist when you’re in a chair and then one week before you’re in the chair when the front office woman makes sure that you’re still coming to your appointment, right? That’s it. That’s the only time you hear from dentists, and dentists have the worst NPS, consumer NPS score. Meaning consumers don’t really like them. They won’t recommend them because they haven’t built things like remote monitoring or automated check-ins like, Hey Sean, everything okay one month in our last visit. With your oral care, even if it’s a bot, but it’s the bot from the dentist.
Like it’ll make Sean feel good. Oh, Hey Dr. Neer, I’m good. Teeth are going well; thanks for the cleaning. Whoa, I’m building comradery between the two through the app like that’s great. And so when you come in the appointment, and the dentist is always like, ‘Hey, how are you doing? How are your kids at that one appointment?’ But he doesn’t care about me the other five and a half months. So I think what’s happening with AI and technology, it’s gonna shift to more bedside manners and also remote manners, right? Like I love for, Hey, you know, that tooth cleaning you did. So we’re just in the first inning of this. And I don’t know what’s the solution here, but I want to be able to work with dentists and orthodontists. Explain what our long-term goals are. And the mission is if a dentist sitting in, let’s say, Irvine can now go from seeing ten patients a day to doing 25 patients a day, five in office, five chairs, six in a chair. And then, during their break, they’re literally on their app. They’re checking in on ten others.
Well, what ends up happening? Their revenue per square foot for that dental office goes up exponentially without them really wasting any more time. So their dentists are always focused on dollars per minute, and this is like a great thing. So we have to educate a lot more about the real goal here. We want to make oral care more accessible to consumers. At scale, we wanna build technology and systems to allow that to happen. And we wanna bring dentists and GPS, and orthodontists into that platform in the long run. So all sides win. It’s not like there’s not a zero-sum game. Like both sides can win on this.
[00:35:21] Sean Li: Yeah. And that is accessibility implications of that as a society.
[00:35:27] Neeraj Gunsagar: It’s actually even more interesting. There are not many black dentists. There are not many Hispanic dentists. There are a lot of Asian dentists, but there are not a lot of black and Hispanic dentists. Well, why is that? Well, it’s not in their communities, but black and Hispanic consumers would love to go to a black or Hispanic dentist. Well, if you start bridging the gap here, what’s going to happen. Like a young kid in high school, or junior high that happens to be black or Latino will be like, oh yeah, I love dentistry. I’ve been reading about it in our neighborhood. My father used this platform. You’re just going to start potentially an education process as well, where you’re going to enrich the lives and enrich the focus of some of these different demographics and different cultures to start, like looking up to dentists, and caring and studying, studying, I mean, like access in education. So that’s like my meta vision and what I’d love to get done in the category, but you gotta go through a lot of hurdles to get there. And the hurdles are not always easy to fight, right? Without proper education and the proper thing, the establishment looks at us as, oh, you’re just bypassing the dentist. Ordon, that’s not what our goal is at all. We want to bring it. And that’s why we were required by like the largest dental equipment company in the world.
[00:36:34] Sean Li: I want to share this episode with all my banking analysts and buddies and say, this is where you can end up, guys, this is where you should end up. My last question is, what are you looking forward to as president CEO of byte®?
[00:36:46] Neeraj Gunsagar: I’m looking forward to the day where we continue to make this more accessible and more forwardable globally. So I tend always to tell people that my mother is actually from a small village in India, and it’ll be really nice one day because, by the way, manufacturing of aligners and 3d printing is somewhat commoditized now, right? The technology is there, the ability to deliver it, and you have a global supply chain. Now I would love for one day for a company, for a consumer or an Indian in her neighborhood, in her village to get their teeth straightened by byte®. Like that would mean me or we arrived, right? Like that would be a reality on the global platform. And so I’m looking forward to that, and I’m looking forward to spending more time with dentists and orthodontists, and you know, explaining to I have a good childhood friend.
Who’s an orthodontist, an Asian guy lives in the Bay Area, actually, and convincing them that this is a good idea is an interesting challenge because their business is somewhat commoditized as technology and stuff gets better and better, but they don’t realize that then they have more access. They can make their services more accessible, and it might be less time because orthodontists love the golf on Thursday and Fridays, and they love to use their time wisely, and they’re really well-needed function, but I’m super, super excited about bridging the gap and making sure they’re all kind of understanding of the long term mission and goals.
[00:38:05] Sean Li: I love it. Well, it’s been a real pleasure having you on Neeraj. This is just inspiring to hear his story.
[00:38:09] Neeraj Gunsagar: Well, Sean, thanks for having me on and all the past alumni here, you guys, we all picked a great school. It really sets you up for a long-term foundation and the ability. And I think Sean mentioned earlier the ability to be nimble in your career, right? I mean, nobody would’ve expected me as a DLJ restructuring banker to eventually be a CMO of an internet consumer internet auto company and then the CEO of a consumer orthodontic company. It’s a great journey, and I wish you guys.
[00:38:35] Sean Li: All success. Thank you. Thanks again for tuning in to this episode of the One Haas Podcast. If you enjoyed our show today, please remember to hit that subscribe or follow button on your favorite podcast player. We’d also really appreciate you giving us a five-star rating and review. Really looking for more content. Please check out our website at haas.fm that’s spelled H-A-A-S dot FM. You can subscribe to our monthly newsletter and check out some of our other Berkeley Haas podcasts. And until next time, Go Bears!