Iconic Tour

Quip raises millions from singer Demi Lovato and others for its electric toothbrushes

Quip electric toothbrushes hang on a bathroom mirror by a suction strip on the brush holder.

Simon Enever and Bill May think they've figured out a way to get Americans to actually brush their teeth twice a day. But the Brooklyn, New York-based start-up had to overcome some big challenges on the way to landing a $10 million Series A funding in November.

"I'm a Brit who's trying to improve oral health in America, which is the reverse of how it should be," said Enever, the CEO and co-founder of Quip in an interview at the start-up's headquarters. (For the record: He won't show his teeth when smiling for a photograph.)

Quip officially launched in November 2015. By the end of 2016, it sold 100,000 toothbrushes. Enever said they are now on track to have 1 million customers by the end of 2018.

Consumer product companies that have long dominated retail sales with little competition or pricing pressure have been under attack in recent years by venture-backed start-ups selling direct to consumers online, from razors to eyeglasses. It's not only start-ups that see opportunity in the slow-moving dental market: Amazon is attempting to cut out dental supply companies.

At the time of its launch, Quip was entering a competitive market with brands that had been selling electric toothbrushes for decades, including the duopoly of Sonicare and Oral-B, which together command as much as 70 percent of the online sales market, according to a recent analysis that looked at data in the one-year period up to January 2017.

While the toothbrush sales sector is ripe for competition, the Quip founders had to convince investors they could compete even though they didn't come from a background in business or marketing. "I think there's a lot of nervousness when people start thinking about investing in a designer's company," Enever said. "It didn't really matter how great they thought our idea was necessarily or the business plan, but ... trusting someone that wasn't from their world."

Investors in the November round included pop artist Demi Lovato and Sherpa Capital, whose founders invested in luxury eyewear upstart Warby Parker, as well as Facebook and Uber.

Simon Enever, CEO and co-founder of Quip. The toothbrush start-up secured a $10 million venture investment on National Brush Day, Nov. 1 , 2017.
What is the thing that people actually associate with brushing, with oral care, they pick up every day, and you can build engagement through it? It's the brush. That's the halo of it all.
Simon Enever
CEO and co-founder of Quip

Enever and May come from an industrial design background. Enever worked at Fuseproject, which was responsible for the first bluetooth speaker, Jambox, and home lock system August. May worked for Lifetime Brands, which designs kitchen products for big consumer names, including the Farberware and KitchenAid lines.

The idea for the Quip toothbrush came to Enever in October 2012 while he was sitting in the chair of a dentist in Queens, New York — his first dental appointment in the States. His dentist told him that while electric toothbrushes were guiding Americans to brush better than before, individuals were still not brushing often enough, changing the brush heads or going to the dentist. Enever called May that night, and they started working on the idea that would turn into Quip.

The Quip model inverts the way consumer product companies have traditionally built market share — focusing on the problem first, not just the product.

The problem was that people were not brushing their teeth twice a day, they were not brushing their teeth correctly, they were not changing their brush heads, and they were not going to the dentist.

Spending on dental care neared $120 billion in 2015 but had been on a downward trend since 2002 and flat since 2008, according to the American Dental Association. Dental visits by adults with private dental benefits have been declining in most states, the ADA found. Individuals should be brushing at least twice a day for two minutes, according to the ADA. However, 3 out of 10 Americans are only brushing once a day, said a 2014 survey by Delta Dental.

"The dentists were saying that the electric toothbrush had been great for years," Enever said. "They weren't saying [it] needed to be reinvented for the fiftieth time."

Enever said brushes worked well and served their purpose; he just couldn't find an electric toothbrush he wanted to use. They were big. They had charging stands. They were heavy. They broke. They felt weird in the mouth.

While the oral health problem is deeper than the toothbrush, Enever said that's where the solution would have to begin.

"What is the thing that people actually associate with brushing, with oral care, they pick up every day and you can build engagement through it? It's the brush. That's the halo of it all," Enever said.

The Quip costs $25 to $45 and has one feature: It brushes

The toothbrush market was already saturated with well-established electric toothbrush brands available with a variety of options. The Philips Sonicare electric toothbrush, recommended by O, The Oprah Magazine is $270. It has an app that provides brushing feedback and comes with four different brush heads. Procter & Gamble's Oral-B Genius Pro 8000 electric toothbrush, costing about $140 to $180, includes six different modes and bluetooth capability.

The most popular Quip toothbrushes are metal and have one vibration speed. They cost $45 (there is a $25 plastic version) with a subscription to get a new brush head delivered every three months for $5. A customer can add a tube of Quip toothpaste to the subscription for an additional $5.

Sonicare offers a range of models at lower price points than the high-end model touted by Oprah's magazine — including $14.99, $24.99 and $39.99 plastic models. Oral-B also offers models that are listed as low as $23.99 to $29.99. Models from both companies in this price range are among the best-sellers on Amazon in the oral care category. However, neither feature a design as sleek as the Quip, nor are they built as part of a business model that motivates a person to take a more active role in their oral health, the Quip founders say. The Quip founders didn't want a high price on the brush itself to be the factor that was designed to spur people to use it and become more engaged with dental care overall.

Quip is not the only toothbrush start-up attempting to gain traction in the market. Goby, which started out with $2 million of seed funding in 2015, is selling electric brushes for $50 with a brush head subscription plan. For $130 Kolibree, founded in 2013, is selling Ara, the first toothbrush with artificial intelligence. Oclean, which received $2 million in funding in China and is raising money on Indiegogo to launch in the United States, claims to be "the world's fastest electric toothbrush."

Setting the price was a struggle with investors, who suggested Enever and May should focus on a higher-end consumer and raise their prices. They advised Quip could easily price somewhere between $75 to $100. A lower cost can be counter-productive in the consumer market — shoppers think the product is not worth as much as others, that the price is a reflection of low quality. Warby Parker toyed with a $45 price tag on its glasses, before deciding that this price point might be too low.

"Industrial designers don't think like that," Enever said. "Everyone has a mouth. Most people need to improve their oral health. Why would we be designing a product that felt like it was aimed at one age group or gender, or whatever it is?"

The Brooklyn headquarters of electric toothbrush start-up Quip includes two dentists, dogs and "Scrubs Fridays," when employees are welcome to dress for the "dental" office.

"In a case like toothbrushes, I think branding is an important part of the decision-making process," said Barbara Bickart, associate professor of marketing and departmental chair at Questrom School of Business at Boston University. She said there was no magic number when it came to choosing a price point.

"I think for this product to be successful, you've got to make it pretty easy for people to want to jump in," Bickart said. "A high price point in this case might turn people off. ... You're actually asking them to change their behavior."

Bickart said while the start-up doesn't want to target any particular group, she thinks Quip appeals most to a younger audience who like the design, rather than older consumers who care more about relationships with established brands. Younger customers think it is possible to get a quality product with great design but without the high price tag. Bickart said that brands like Warby Parker and shaving start-up Harry's have shown that many consumers don't buy products in the same way anymore — they are comfortable purchasing online and cutting out the middleman.

Now Quip is looking past the brush. Getting more people to brush their teeth and start paying more attention to their dental care is the goal of a partnership with 10,000 dental providers (two dentists work full-time in the start-up's office). Dental Connect allows Quip subscribers to access dental advice and services. Some dentists offer to pay for their patients' Quip subscription if they come in for six-month check-ups. Subscribers also get monthly newsletters and reminders when it is time to go back to the dentist.

Enever and his team also are currently working on making dental floss to attach to the add-on toothpaste subscription.

"We're trying to build an oral health subscription that, in the end, will do a lot more than just the brush heads," Enever said. "We're trying to make oral health, as much as you can, a bit more interesting."

— By Jessica Mathews, special to CNBC.com