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Jaanuu, an El Segundo-based startup that designs and produces medical scrubs and apparel for health care professionals, has landed a $75 million investment from French private equity firm Eurazeo.
Eurazeo’s minority investment in Jaanuu brings the startup’s total capital raised to approximately $100 million since its founding in 2013, the companies announced Tuesday. Jaanuu is Paris-based Eurazeo’s first investment in the consumer health care realm.
The direct-to-consumer brand was started by siblings Shaan Sethi and Dr. Neela Sethi, and has looked to make a name for itself by offering a stylish yet comfortable spin on medical scrubs through digital ecommerce channels. Jaanuu isn’t the only local D2C medical apparel startup to have found success in its space; Santa Monica-based FIGS, which also launched in 2013, went public on the New York Stock Exchange last May.
Representatives for Jaanuu did not immediately return a request for comment. Eurazeo’s investment will support the startup’s brand marketing and product development initiatives as it looks to grow its footprint globally, the companies said.
Jaanuu’s previous investors include billionaire Ron Burkle of West Hollywood-based private equity firm Yucaipa Companies, as well as West Los Angeles-based BAM Ventures and New York-based Cult Capital.
People are assessing their smile after the pandemic moved meetings online and forced workers to stare at themselves for hours on end as they chat with colleagues.
Orthodontists and the American Association of Orthodontics say that's what's partially behind the 92.5% surge of orthodontics patients. Many are asking for teeth-straightening treatments. They call it the "Zoom Effect."
Orthodontist John Pham sees the cosmetic appeal of teeth straightening. He thinks it will become as commonplace among the well-heeled, body conscious set as Botox or CoolSculpting treatment. Pham founded InBrace, an Irvine-based orthodontic company that was originally his thesis as an orthodontist at USC. His startup announced Wednesday it raised $102 million in a Series D round.
It's one of many startups in the surprisingly competitive orthodontics space dominated by clear teeth aligners and lingual braces, which go on the back of teeth but it often costs more than aligners or traditional braces.
"Lingual braces are regular braces put on the inside (or behind the teeth)," said Pham. "So they took something bad and made it worse."
InBrace's "smartwire" dental brace.
InBrace works differently. The company puts braces on the back of the teeth too, but uses a "smartwire" made out of nitinol, material different from the metal usually associated with braces. The nitinol remembers its original shape and returns to it after being manipulated -- kind of like a stretched slinky bouncing back into shape. The smartwire aligns teeth over time using gentle pressure.
The market has long been dominated by Align Technology (makers of Invisalign) and Smile Direct Club. Aligners have often been used as an alternative to traditional braces that sit at the front of the teeth due to their low profile aesthetic. The pandemic has only bolstered their popularity, as direct-to-consumer companies have boomed.
InBrace CEO and co-founder John Pham
But teeth straightening is not just a cosmetic procedure - the process involves understanding and observing facial bones and jawbones to make sure the person undergoing treatment isn't being harmed, and cosmetic teeth straightening can lead to an open bite where the back teeth don't align and cause chewing problems, or even loss of teeth. The AAO has long been wary of direct-to-consumer teeth-straightening companies, emphasizing that check ups and proper monitoring are necessary for dental health.
"They can't fix their teeth with a selfie. Any patient at any age, should be wary of quick-fix claims," said Dr. Ken Dillehay, AAO president in an email. "While the convenience of DTC/DIY [direct-to-consumer/do-it-yourself] may sound tempting, convenience should not come at the risk of patient health and well-being by bypassing important patient protections."
Clients are matched to an orthodontist through InBrace, and the orthodontist takes a scan of the inside of the person's mouth for the company to use as a model to develop a treatment plan. After the orthodontist implements it, patients come in every two to three months for checkups, but there is rarely a need to adjust and no need to tighten the braces.
InBrace said the price is comparable to regular braces or aligners - the treatment runs $4,000 to $6,000 before insurance.
A 12-month treatment with braces or aligners would take 3 months with its product. The company says it uses significantly less pressure to move the teeth than aligners and braces, which use the most pressure when they are first put in or adjusted, and then quickly lose pressure over time. Pham said teeth don't need a lot of pressure to move, and most peoples' teeth realign after braces simply because of tongue pressure.
"This is known in orthodontics: heavy forces actually move teeth more inefficiently because it impedes the blood flow to your teeth," Pham said.
The oversubscribed Series D is more than the company made in its previous funding rounds combined, and the company is using that money to build its sales force and marketing department to grow its base of hundreds of orthodontists around the country who offer this treatment.
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A London-based marketing agency known for its work with brands like Duolingo and Popchips is launching a $2 million fund for direct-to-consumer ventures and tech startups in Los Angeles. And no, the firm isn't looking to cut you an actual check.
Instead, And Rising is in the business of trading its creative services for stock. Call it what you'd like — sweat equity, services for equity or co-founder Jonathan Trimble's preferred term, creative capital – the model isn't exactly new.
"We are, in part, copying models from agencies like Red Antler and Gin Lane," said Trimble, who credits Jules Ehrhardt, founder of a New York firm called FKTRY, with coining "creative capital" term. Ehrhardt (also a former co-owner of ustwo) sketched out a case for creative capital studios on his website, arguing the model makes sense when agencies offer "premium, pivotal, 'money can't buy' expertise" that typically "early-stage companies would find it impossible to assemble."
And Rising co-founder Jonathan Trimble
Gin Lane (which relaunched under the name Pattern) is known to have traded its brand marketing services for an early stake in direct-to-consumer shaving company Harry's, which later sold to the owner of Schick. Likewise, Red Antler took a stake in Casper, the trendy mattress maker that eventually listed on the New York Stock Exchange.
And Rising is comparatively newer to the game. It launched in 2018 out of 18 Feet & Rising and started trading its services for equity a year later, before building an entire business around the creative capital concept.
And Rising argues that it offers "a more patient, invested and equity-efficient alternative to traditional capital." It aims to put the idea to work in Los Angeles by partnering with ventures based in or around the city that jive with its B Corporation certification and fund philosophy.
"We're looking for brands that are clean and conscious in the direct-to-consumer space, or consumer tech for good," said Trimble of the new fund called LA-Rising. The theme may fit right at home in the city that's productized everything from juice cleanses to yoga. The agency's portfolio to date includes a hard seltzer brand backed by musician Ellie Goulding and a popped lotus seed snacks maker, both part of a focus on "clean comfort foods."
As for scale, And Rising says the brands in its portfolio are bringing in "just under $500k" and "just over $145 million" in annual revenue.
"A lot of our portfolio brands are coming over to the states, and we've been scaling brands from the states back in the U.K. as well, specifically the brands Halo Top and Popchips come to mind," said Trimble. "So it's just making a ton of sense for us to have a second base, and we really love Los Angeles as the home for that, in part because New York is quite taken care of with some companies there that do [the services for equity model] well."
And Rising plans to establish a physical presence in Los Angeles this fall, and it's eyeing Silver Lake as a potential counterpart to its home office in London's trendy Camden borough.
"L.A. has a lot of similarities with London, we think. It has the big creative culture around it," said Trimble. "Both cities are trendsetting in slightly different ways, and therefore they're really good testbeds for whether you're onto something. They have a lot of similarities and they're also quite different, so it should be quite an enriching couple, if you know what I mean."
Editor's Note: This article has been updated to clarify And Rising's relationship with 18 Feet & Rising