What I Learned in 20 Years of Building Direct-to-Consumer Healthcare Companies
Rule one: make sure the space you’re entering is one worth owning.
I’ve been in the consumer healthcare space for over two decades. Before co-founding Tend, I was the founding CEO of SmileDirectClub. I’ve also founded and led several other consumer health companies, including DiabetesCareClub, CPAPCareClub, and HearingPlanet.
During this journey, I learned a few lessons. These lessons now inform how I lead Tend, the company disrupting the $156 billion dental industry that I co-founded in 2019 and now have the pleasure of leading as we expand nationwide.
Here, I go over each of the lessons I’ve learned in greater detail, and how they apply to what we’re doing at Tend.
If you’re entering a new space, make sure it’s one worth owning.
When you’re building businesses in healthcare, you have to make sure the space is worth going after. Dental is now a $156 billion industry, and it’s growing over 5% every year. It isn’t something that’s going away, ever. You can build something massive here.
In my opinion, there are some major opportunities for improvement in dentistry (more on that in a moment). So, if we can substantially improve patients’ experiences, they’ll come back to us. Tend offers hygiene, restorative, orthodontics, oral surgery, and cosmetic treatments. There’s nothing we can’t do from a services perspective, and when patients see what we offer and how we offer it, it’s highly likely that they’ll come back every six months. There’s a huge recurrence opportunity.
I’ve had brands in the past where this wasn’t the case. While HearingPlanet became the largest online hearing aid distributor in the U.S. during my tenure, the average person was only buying the product every three to five years. They also weren’t talking about it with their friends. But at Tend, we have an opportunity to shatter the old NPS standards associated with dentistry. We offer an elevated experience that our members talk about with their friends, family, and colleagues. People talk about us, and that’s why our waitlists are so long.
There’s also a built-in CPG opportunity. We offer dentist-designed mouthwash, toothbrushes, and toothpaste to keep patients’ smiles healthy 365 days a year. That’s huge, and offers us another space to own.
Experience the patient journey yourself.
Once you’re sure you want to enter a DTC healthcare space, you have to go into it and experience it like a patient would. I’m not being abstract about this: you literally need to go in and experience the patient journey yourself.
For me, that meant going to New York City and scheduling a whole lot of dental appointments. New York was our first target market, and I wanted to see what the competition was like. Spoiler alert: the competition left a lot to be desired.
The first place I went to had me fill out twenty minutes of redundant paperwork in an overly-clinical waiting room. When I was finally treated, nothing about the care I received felt remarkable. The fact that I filled out so much paperwork — much of it with information I already gave to the provider — stuck with me.
The next experience was with a high-end dentist uptown. It was tough to get an appointment, and very expensive (they didn’t take insurance). When I finally got in there, it was underwhelming. Although the care I received was good, the practice was small and cramped, and the people who worked there were continuously trying to upsell me on procedures I didn’t need. Although the staff was nice enough, my interactions with them felt overtly profit-driven. Because of this, I wouldn’t feel comfortable referring a friend there.
I visited another dentist who was delightful, but when I walked into the waiting room, there was a broken chair with a sign on it that said “do not sit here.” When I went back six months later, the chair — and the sign — were still there. While I was being treated, there was no privacy at all, and I could hear everything that was happening in the next room. Again, not a great experience.
Then there was the dental office I visited in a Midtown high-rise. The staff was rude, and the space was poorly decorated. It just didn’t feel good.
I remember leaving New York and thinking: I can’t believe a category this big — dental — is so poorly served. I called a personal friend who’s very prominent in the dental industry and asked him what the deal was. Was it really this bad in big cities? He told me that it was, and that there was a massive opportunity to do it better. That sealed it for me.
Map out the patient journey, identify its pain points, and create a better experience.
For us, this meant mapping out how people find a dentist, how they book appointments, what it feels like when they show up there, what the care is like, how they pay, and what it’s like afterward.
The next step is to look at what’s unpleasant and inefficient about the journey. I found plenty of these examples during my time in New York.
But it’s not just about minimizing pain points, it’s also about sparking unexpected joy. There’s a great book called “The Power of Moments,” about how certain experiences can be made more impactful. When these experiences have emotionally resonant anchor points, people tend to remember them. We really focused on that when mapping out the patient journey at Tend.
Yes, we minimize pain points by infusing hospitality into the experience, providing great care that’s anchored with cutting-edge technology, and making sure members don’t fill out redundant paperwork. But we also interject things that are unexpectedly fun, in areas like The Brushery and The Welcome Bar.
After my trip to New York, I realized the $156 billion dental industry is ripe for disruption and is poorly underserved in big cities.
Needless to say, the space is worth owning. I couldn’t be more excited about what’s ahead.
-
Doug Hudson is the co-founder and CEO of Tend. Born out of the need for systemic change across the dental industry, Doug’s vision is for Tend to set a new standard for oral health, starting at the dentist. As CEO, Doug applies his past experience spearheading numerous high-growth healthcare ventures to bring a hospitality mindset to the dental industry. Previously, he was the founding CEO of SmileDirectClub. Prior to this, he founded and led several consumer health companies including DiabetesCareClub, CPAPCareClub, Inc., and HearingPlanet, Inc. He is currently on the Board of Directors at Modern Age and Relode.com.
