- Over $1 million in revenue and 1,000 customers serviced since launching mid-2017
- Gross margins of over 50%
- Royalty agreements in place for licensing in both Canada and Hong Kong
- Serial entrepreneur founders who have self-funded business to date
- FDA approved, with a 4.7 star rating from ShopperApproved.com (over 365 reviews)
- Total Amount Raised: US $736,075
- Total Round Size: US $2,000,000
- Seed :
- Minimum Investment: US $1,000 per investor
- : Crowd Note
- US $9,000,000 :
- Side by Side Offering
Smilelove is bringing the benefits of straight teeth and a confident smile direct to individual consumers. Customers can enjoy the benefits of our product in the comfort and privacy of their own home, without sacrificing any dental expertise. We offer step-by-step instructions and outstanding customer service to walk each customer through the entire process. Our product is made of the clearest material on the market, minimizing discomfort and maximizing the cosmetic benefits of our aligners. Smilelove offers the lowest price point in the industry.
- One-third of US adults (~80mm) are unhappy with their smile(American Assn of Orthodontics)
- 8% of Americans ages 18-24 have untagged a picture of themselves on Facebook because they didn’t like their smile (American Assn of Orthodontics)
- Only 4 million people are presently undergoing orthodontic treatment in the US (American Assn of Orthodontics) due, in part, to affordability issues
- Current teeth straightening treatments are costly and time-consuming, averaging $5,000 - $7,400 with multiple visits (Oral B)
The Smilelove Solution
- Technological advancements allow us to provide superior orthodontic treatment and an enhanced cosmetic experience
- Limited overhead and overseas manufacturing reduces our costs significantly, allowing Smilelove to pass along savings to consumers that would find traditional orthodontic treatments out of reach
- Each treatment is approved by a licensed dentist
- Satisfied customers like their new look and are inclined to sign up for ongoing Smilelove services including monthly teeth whitening treatments and annual retainers
How it Works
Our customers order an impression kit from our website. They follow an instructional video and complete the impressions at home and send them back to us along with photos of their teeth. Customers can call us for assistance at any time. Smilelove takes the impressions, photos and medical history provided by the customer, obtains case approval from a licensed dentist, and creates a digital preview of what the customer's straight teeth will look like at the end of treatment. We send the preview to the customer and once we have their approval, we produce and sends the aligners in the mail.
The cost is $1,699. Customers can pay up front (60%) or obtain financing provided by Affirm (40%). In the latter case, Affirm bears all credit risk and pays us the full price immediately.
Depending on case severity, customers will receive 8-20 aligner trays. Each tray is worn for 2 weeks. The entire treatment period lasts 6-12 months (8 month average).
After treatment is completed, Smilelove customers typically want to protect their new look and can subscribe to monthly whitening treatments ($39.99/mo) and/or an annual retainer program ($100/yr).
Our business model is simple. We charge $1,699 to straighten teeth. It costs us about $350 to acquire a customer through our current marketing channels, and the cost of the aligners averages $650. This leaves a margin of $700 per case - a 60% gross margin. We've served over 1,000 customers since launching in 2017.
Marketing Channels - current and expansion plan
The business to this point has been bootstrapped with funds from the founders. In our current channels we can increase our spend by close to 10x without seeing an increase in customer acquisition cost. This is one of the primary reasons we are seeking capital - to fuel the fire.
There are several marketing channels that we plan to expand into which will increase brand recognition, and lead to more conversions. Some of those include a radio advertising partnership with Dave Ramsey, and increasing spend with social media influencers.
We’ve signed a license agreement with a Hong Kong based partner who will be leading efforts to build the brand in Canada, Hong Kong, and soon China. We receive an 8% royalty on all revenue created there.
Scan Booth Kiosks
We plan on rolling out self-service kiosks that will allow for a better customer experience, increase customer conversion, and broaden our brand recognition.
"... I went with Smilelove and I have no regrets. Excellent customer service and friendly people, simple process (extremely simple), and the clear aligners are nice, high quality. Oh... and the best price out of everybody that I found, by far. They were flexible with a few custom requests I made along the way as well. You can go do your research and look into every company out there, or just trust me because I've already done that! Overall a perfect experience, and I have perfect teeth now. Thanks!"
"This entire process has been so simple and gratifying, I couldn’t speak higher of it. I’m a mom of two very young girls and to say I never have time for myself is an understatement. If I went through this process the “traditional” way with multiple trips to the dentist and triple the cost, it would never work for me. I got to fix my smile in the convenience of home which was my biggest selling point besides the cost.... I would recommend this to anyone, if you’re considering it, do it!"
"Customer service is absolutely 110% on point. I honestly think they have the best customer service that I have ever dealt with"
The above individuals were not compensated in exchange for their testimonials. In addition, their testimonials should not be construed as and/or considered investment advice.
For us it was never about vanity. Don't straighten your teeth for the sake of beauty - do it for the sake of confidence. If your teeth are crooked, but you're completely confident in your smile, that's great! It's that kind of confidence that we believe everyone deserves to have. By looking at the statistics, far too many people are holding back, covering their teeth when they laugh, smiling with their mouth closed for pictures. Those are the people that we started Smilelove for. Being confident in your smile is simply life changing.
Dave and I met while working together at Lendio. With his background in finance and my background in user experience, we make a great team. Our weaknesses and strengths balance each other perfectly. Responsibilities and tasks fall naturally between us and together we're able to solve all kinds of problems.
When we're not working we spend a lot of time with our families. For us, family is number one. It's our families that drive us to work hard, to be successful, to be our best. Between Dave's 6 kids and my 2, we have a lot of people depending on us to be successful.
- Spencer Grider, Co-Founder
A Side by Side offering refers to a deal that is raising capital under two offering types. If you plan on investing less than US $20,000.00, you will automatically invest under the Regulation CF offering type. If you invest more than US $20,000.00, you must be an accredited investor and invest under the Regulation D offering type.
US $364,075 (under Reg CF only)
All non-Major Purchasers will be subject to an Investment Proxy Agreement "IPA". The IPA will authorize SeedInvest to act as representative for each non-Major Purchaser and take certain actions for their benefit and on their behalf. Please see a copy of the IPA included with the Company's offering materials for additional details.
$1,000 ("Starter") - Free whitening treatment
$10,000 ("Premium") - Half off aligner treatment + free whitening treatment
$20,000 ("Bronze") - Free aligner treatment + free whitening treatment
$50,000 ("Silver") - Everything in "Bronze" + dinner with management + quarterly management calls
$150,000 ("Gold") - Everything in "Silver" + 2 day ski trip for two at Snowbird Mountain Resort - One of the world’s best ski areas. Guided skiing by local experts (Smilelove founders) on the best terrain and best snow found anywhere. Includes airfare from anywhere in the US. 2 nights stay at The Cliff Lodge at Snowbird.
$250,000 ("Platinum") - Everything in "Silver" + 4 day Lake Powell trip for 2 on a houseboat with Smilelove team and other investors. Wake surfing, water skiing, wave runners, great food, unparalleled beauty. See video for a taste of what Lake Powell is all about. Includes airfare from anywhere in the US.
Option to waive perk and instead donate the value of the gift to Operation Smile.
It is advised that you consult a tax professional to fully understand any potential tax implications of receiving investor perks before making an investment.
Smilelove LLC (“the Company”) is a limited liability company organized on May 10, 2017 under the laws of the State of Utah, and is headquartered in Salt Lake City, Utah. The Company is creating a cost‐effective process for straightening customers’ teeth through the use of clear aligners sent through the mail. The Company has developed a cheaper way for customers to straighten their teeth without visiting a dentist.
Liquidity and Capital Resources
The proceeds from the Offering are essential to our operations. We plan to use the proceeds as set forth above under "Use of Proceeds", which is an indispensable element of our business strategy. The Offering proceeds will have a beneficial effect on our liquidity, as we have approximately $16,000 in cash on hand as of July 2018 which will be augmented by the Offering proceeds and used to execute our business strategy.
The Company currently does not have any additional outside sources of capital other than the proceeds from the Combined Offerings.
Capital Expenditures and Other Obligations
The Company does not intend to make any material capital expenditures in the future.
Trends and Uncertainties
After reviewing the above discussion of the steps the Company intends to take, potential Purchasers should consider whether achievement of each step within the estimated time frame is realistic in their judgment. Potential Purchasers should also assess the consequences to the Company of any delays in taking these steps and whether the Company will need additional financing to accomplish them.
The financial statements are an important part of this Form C and should be reviewed in their entirety. The financial statements of the Company are attached hereto as Exhibit B.
Of the roughly 100 million people in the US who are dissatisfied with their smile, 4 million people are undergoing orthodontic treatment - 25% are adults and 70-80% are treatable with aligners (Class 1 cases). By decreasing the cost and and increasing accessibility, this addressable market is even bigger.
Nationally the average cost for a service like ours is $5K+. We offer the same results, with the same dental expertise for just $1699.
We have not prepared any audited financial statements. Therefore, you have no audited financial information regarding the Company’s capitalization or assets or liabilities on which to make your investment decision. If you feel the information provided is insufficient, you should not invest in the Company.
The Company’s cash position is relatively weak. The Company currently has only $16,000 in cash balances as of July 31, 2018. The Company could be harmed if it is unable to meet its cash demands/requirements, and the Company may not be able to continue operations if it is not able to raise additional funds.
The Company operates in a business that is highly regulated and subject to liability concerns. Compliance with regulatory requirements or changes in regulations could result in expenses and/or in diversion of management attention from the operations of the business.
The Company’s success is dependent on consumer adoption of direct-to-consumer aligners, a relatively unproven market. The Company may incur substantial operating costs, particularly in sales and marketing and research and development, in attempting to develop these markets. If the market for the Company’s products develops more slowly than it expects, its growth may slow or stall, and its operating results would be harmed. This market is still evolving, and the Company depends on continued growth of this market. It is uncertain whether the trend of adoption of direct-to-consumer aligners that the Company has experienced in the past will continue in the future.
In general, demand for our products and services is highly correlated with general economic conditions. A substantial portion of our revenue is derived from discretionary spending by individuals, which typically falls during times of economic instability. Declines in economic conditions in the U.S. or in other countries in which we operate may adversely impact our consolidated financial results. Because such declines in demand are difficult to predict, we or the industry may have increased excess capacity as a result. An increase in excess capacity may result in declines in prices for our products and services.
The Company does not have an employment contract in place with David Frazier or Spencer Grider, the Managers. Employment agreements typically provide protections to the Company in the event of the employee’s departure, specifically addressing who is entitled to any intellectual property created or developed by those employees in the course of their employment and covering topics such as non-competition and non-solicitation. As a result, if David or Spencer were to leave Smilelove, the Company might not have any ability to prevent his direct competition, or have any legal right to intellectual property created during his employment. There is no guarantee that an employment agreement will be entered into.
The Company forecasts for projected growth are aggressive. If its assumptions are incorrect and it fails to meet projections, Company viability may be jeopardized. wrong, and its projections regarding market penetration are too aggressive, its financial projections may overstate its viability. In addition, the forward-looking statements are only predictions. The Company has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
The Company’s expenses will significantly increase as they seek to execute their current business model. Although the Company estimates that it has enough runway until end of year, they will be ramping up cash burn to promote revenue growth, initiate/expand payroll, further develop increase R&D, and fund other Company operations after the raise. Doing so could require significant effort and expense or may not be feasible.
The Company has had transactions with related parties. During 2018, the Company executed a financing agreement with a member for cash proceeds of $40,000. The agreement carries an interest rate of 5% per annum and is due 24 months from execution.
Quality management plays an essential role in determining and meeting customer requirements, preventing defects, improving the Company’s products and services and maintaining the integrity of the data that supports the safety and efficacy of our products. Our future success depends on our ability to maintain and continuously improve our quality management program. An inability to address a quality or safety issue in an effective and timely manner may also cause negative publicity, a loss of customer confidence in us or our current or future products, which may result in the loss of sales and difficulty in successfully launching new products. In addition, a successful claim brought against us in excess of available insurance or not covered by indemnification agreements, or any claim that results in significant adverse publicity against us, could have an adverse effect on our business and our reputation.
The Company’s founders have a post-raise salary that is high relative to the stage of the Company’s business. High executive compensation results in a higher overall salary burn, which in turn shortens the runway for achieving desired traction and company milestones. High executive compensation can leave a negative impression with new or potential investors who may believe that conservatively compensated founder-CEOs are more focused on driving towards the long-term success of the business. It may therefore negatively impact the ability of the Company to raise funds.
We depend on profitable royalty-bearing licenses of our technology, and if we are unable to maintain and generate such license agreements, then we may not be able to sustain existing levels of revenue or increase revenue. We depend upon the identification, investment in and license of new patents for our revenues. If we are unable to maintain such license agreements and to continue to develop new license arrangements, then we may not have the resources to identify new technology-based opportunities for future patents and inventions in order to maintain sustainable revenue and growth.
Our current or future license agreements may not provide the volume or quality of royalty revenue to sustain our business. In some cases, other technology sources may compete against us as they seek to license and commercialize technologies. These and other strategies may reduce the number of technology sources and potential clients to whom we can market our services. Our inability to maintain current relationships and sources of technology or to secure new licensees, may have a material adverse effect on our business and results of operations.
We may not be successful in obtaining patents. Our success depends significantly on our ability to obtain, and protect our proprietary rights to the technologies used in our services. We will file a provisional patent application for our unique retail kiosk in November 2018. Filing a provisional patent application only indicates that we are pursuing protection, but the scope of protection, or whether a patent will even be granted, is still undetermined. We are not currently protected from our competitors. Moreover, any patents issued to us may be challenged, invalidated, found unenforceable or circumvented in the future. Any intellectual enforcement efforts the Company seeks to undertake, including litigation, could be time-consuming and expensive and could divert management’s attention.
Governmental regulation and associated legal uncertainties may adversely affect the Company’s business. Many of the services that the Company offers are regulated by federal and state governments, and its ability to provide these services is and will continue to be affected by government regulations. The implementation of unfavorable regulations or unfavorable interpretations of existing regulations by courts or regulatory bodies could require the Company to incur significant compliance costs, cause the development of the affected markets to become impractical and otherwise have a material adverse effect on the business, results of operations and financial condition. In addition, its business strategy involves expansion into regions around the world, many of which have different legislation, regulatory environments, tax laws and levels of political stability. Compliance with foreign legal, regulatory or tax requirements will place demands on the Company’s time and resources, and it may nonetheless experience unforeseen and potentially adverse legal, regulatory or tax consequences.
Start-up investing is risky. Investing in startups is very risky, highly speculative, and should not be made by anyone who cannot afford to lose their entire investment. Unlike an investment in a mature business where there is a track record of revenue and income, the success of a startup or early-stage venture often relies on the development of a new product or service that may or may not find a market. Before investing, you should carefully consider the specific risks and disclosures related to both this offering type and the company which can be found in this company profile and the documents in the data room below.
Your shares are not easily transferable. You should not plan on being able to readily transfer and/or resell your security. Currently there is no market or liquidity for these shares and the company does not have any plans to list these shares on an exchange or other secondary market. At some point the company may choose to do so, but until then you should plan to hold your investment for a significant period of time before a “liquidation event” occurs. A “liquidation event” is when the company either lists their shares on an exchange, is acquired, or goes bankrupt.
The Company may not pay dividends for the foreseeable future. Unless otherwise specified in the offering documents and subject to state law, you are not entitled to receive any dividends on your interest in the Company. Accordingly, any potential investor who anticipates the need for current dividends or income from an investment should not purchase any of the securities offered on the Site.
Valuation and capitalization. Unlike listed companies that are valued publicly through market-driven stock prices, the valuation of private companies, especially startups, is difficult to assess and you may risk overpaying for your investment. In addition, there may be additional classes of equity with rights that are superior to the class of equity being sold.
You may only receive limited disclosure. While the company must disclose certain information, since the company is at an early-stage they may only be able to provide limited information about its business plan and operations because it does not have fully developed operations or a long history. The company may also only obligated to file information periodically regarding its business, including financial statements. A publicly listed company, in contrast, is required to file annual and quarterly reports and promptly disclose certain events through continuing disclosure that you can use to evaluate the status of your investment.
Investment in personnel. An early-stage investment is also an investment in the entrepreneur or management of the company. Being able to execute on the business plan is often an important factor in whether the business is viable and successful. You should be aware that a portion of your investment may fund the compensation of the company's employees, including its management. You should carefully review any disclosure regarding the company's use of proceeds.
Possibility of fraud. In light of the relative ease with which early-stage companies can raise funds, it may be the case that certain opportunities turn out to be money-losing fraudulent schemes. As with other investments, there is no guarantee that investments will be immune from fraud.
Lack of professional guidance. Many successful companies partially attribute their early success to the guidance of professional early-stage investors (e.g., angel investors and venture capital firms). These investors often negotiate for seats on the company's board of directors and play an important role through their resources, contacts and experience in assisting early-stage companies in executing on their business plans. An early-stage company may not have the benefit of such professional investors.
Representatives of SI Securities, LLC are affiliated with SI Advisors, LLC (“SI Advisors”). SI Advisors is an exempt investment advisor that acts as the General Partner of SI Selections Fund I, L.P. (“SI Selections Fund”). SI Selections Fund is an early stage venture capital fund owned by third-party investors. From time to time, SI Selections Fund may invest in offerings made available on the SeedInvest platform, including this offering. Investments made by SI Selections Fund may be counted towards the total funds raised necessary to reach the minimum funding target as disclosed in the applicable offering materials.
Frequently Asked Questions
A Side by Side offering refers to a deal that is raising capital under two offering types. This Side by Side offering is raising under Regulation CF and Rule 506(c) of Regulation D.
The Form C is a document the company must file with the Securities and Exchange Commission (“SEC”) which includes basic information about the company and its offering and is a condition to making a Reg CF offering available to investors. It is important to note that the SEC does not review the Form C, and therefore is not recommending and/or approving any of the securities being offered.
Before making any investment decision, it is highly recommended that prospective investors review the Form C filed with the SEC (included in the company's profile) before making any investment decision.
Rule 506(c) under Regulation D is a type of offering with no limits on how much a company may raise. The company may generally solicit their offering, but the company must verify each investor’s status as an accredited investor prior to closing and accepting funds. To learn more about Rule 506(c) under Regulation D and other offering types check out our blog and academy.
Title III of the JOBS Act outlines Reg CF, a type of offering allowing private companies to raise up to $1 million from all Americans. Prior capital raising options limited private companies to raising money only from accredited investors, historically the wealthiest ~2% of Americans. Like a Kickstarter campaign, Reg CF allows companies to raise funds online from their early adopters and the crowd. However, instead of providing investors a reward such as a t-shirt or a card, investors receive securities, typically equity, in the startups they back. To learn more about Reg CF and other offering types check out our blog and academy.
When you complete your investment on SeedInvest, your money will be transferred to an escrow account where an independent escrow agent will watch over your investment until it is accepted by Smilelove. Once Smilelove accepts your investment, and certain regulatory procedures are completed, your money will be transferred from the escrow account to Smilelove in exchange for your securities. At that point, you will be a proud owner in Smilelove.
To make an investment, you will need the following information readily available:
- Personal information such as your current address and phone number
- Employment and employer information
- Net worth and income information
- Social Security Number or passport
- ABA bank routing number and checking account number (typically found on a personal check or bank statement)
If you are investing under Rule 506(c) of Regulation D, your status as an Accredited Investor will also need to be verified and you will be asked to provide documentation supporting your income, net worth, revenue, or net assets or a letter from a qualified advisor such as a Registered Investment Advisor, Registered Broker Dealer, Lawyer, or CPA.
An investor is limited in the amount that he or she may invest in a Reg CF offering during any 12-month period:
- If either the annual income or the net worth of the investor is less than $100,000, the investor is limited to the greater of $2,000 or 5% of the lesser of his or her annual income or net worth.
- If the annual income and net worth of the investor are both greater than $100,000, the investor is limited to 10% of the lesser of his or her annual income or net worth, to a maximum of $100,000.
Separately, Smilelove has set a minimum investment amount of US $1,000.
Accredited investors investing $20,000 or over do not have investment limits.
You are a partial owner of the company, you do own securities after all! But more importantly, companies which have raised money via Regulation CF must file information with the SEC and post it on their websites on an annual basis. Receiving regular company updates is important to keep shareholders educated and informed about the progress of the company and their investment. This annual report includes information similar to a company’s initial Reg CF filing and key information that a company will want to share with its investors to foster a dynamic and healthy relationship.
In certain circumstances a company may terminate its ongoing reporting requirement if:
- The company becomes a fully-reporting registrant with the SEC
- The company has filed at least one annual report, but has no more than 300 shareholders of record
- The company has filed at least three annual reports, and has no more than $10 million in assets
- The company or another party purchases or repurchases all the securities sold in reliance on Section 4(a)(6)
- The company ceases to do business
However, regardless of whether a company has terminated its ongoing reporting requirement per SEC rules, SeedInvest works with all companies on its platform to ensure that investors are provided quarterly updates. These quarterly reports will include information such as: (i) quarterly net sales, (ii) quarterly change in cash and cash on hand, (iii) material updates on the business, (iv) fundraising updates (any plans for next round, current round status, etc.), and (v) any notable press and news.
Currently there is no market or liquidity for these securities. Right now Smilelove does not plan to list these securities on a national exchange or another secondary market. At some point Smilelove may choose to do so, but until then you should plan to hold your investment for a significant period of time before a “liquidation event” occurs. A “liquidation event” is when Smilelove either lists their securities on an exchange, is acquired, or goes bankrupt.
You can return to SeedInvest at any time to view your portfolio of investments and obtain a summary statement. If invested under Regulation CF you may also receive periodic updates from the company about their business, in addition to monthly account statements.
This is Smilelove's fundraising profile page, where you can find information that may be helpful for you to make an investment decision in their company. The information on this page includes the company overview, team bios, and the risks and disclosures related to this investment opportunity. If the company runs a side by side offering that includes an offering under Regulation CF, you may also find a copy of the Smilelove's Form C. The Form C includes important details about Smilelove's fundraise that you should review before investing.
For offerings made under Regulation CF, you may cancel your investment at any time up to 48 hours before a closing occurs or an earlier date set by the company. You will be sent a reminder notification approximately five days before the closing or set date giving you an opportunity to cancel your investment if you had not already done so. Once a closing occurs, and if you have not canceled your investment, you will receive an email notifying you that your securities have been issued. If you have already funded your investment, your funds will be promptly refunded to you upon cancellation. To cancel your investment, you may go to your portfolio page
If you invest under any other offering type, you may cancel your investment at any time, for any reason until a closing occurs. You will receive an email when the closing occurs and your securities have been issued. If you have already funded your investment and your funds are in escrow, your funds will be promptly refunded to you upon cancellation. To cancel your investment, please go to your portfolio page.