Membersy Raises $66M for Its Subscription Dentistry Platform
Membersy, an Austin-based startup that offers dental subscription plans, announced Tuesday that it plans to build out its product marketing with a $66 million minority growth investment from Spectrum Equity.
Membersy is the nation’s largest platform for dental subscription plans, which dental offices offer to uninsured patients. For an annual subscription fee, the plan allows patients to receive a package of dental services at a reduced cost with no waiting period.
The company’s platform manages the subscriptions, billing, plan compliance and other administrative tasks associated with those membership plans.
“When patients enroll in a subscription and become a member of an office or group of offices, they come back for regularly scheduled visits at a higher frequency than non-members,” Membersy CEO Eric Johnson told Built In. “They’re utilizing more dental services. They’re renewing their plan each year and coming back for six-month visits. The platform enables dental professionals to have a more connected experience with their patient because there’s not a third-party insurance company in the middle of them.”
A licensed plan provider in 41 states, Membersy has nearly 1 million members across 4,000 dental offices. Its clients are dental service organizations such as Heartland Dental, which provides administrative support services to 1,400 supported dentists across 37 states.
Membersy is headquartered in a 5,300-square-foot office at 811 Barton Springs Rd. Twenty-two employees work in Austin, six employees work in Santa Barbara, California and eight engineers work from Pakistan.
Johnson said he expects to hire another 20 to 30 employees in the next two years, with 90 percent of those employees based out of the Austin office.
Johnson, a former college football player, was first introduced to the industry out of college when he got a job at a dental benefits company. He was then hired as the first employee at CDI Group, a California-based company that pioneered the concept of dental membership plans.
Sensing a business opportunity, Johnson started Membersy in 2015 by raising $20,000 through a friends-and-family event.
In its first year in business, in 2016, the company generated $400,000 in sales, followed by $1.1 million in 2017, $2.1 million in 2018 and more than $5 million in 2019.
In 2020, he purchased his former employer, the CDI Group, and went on to earn $22 million in sales that year. Johnson plans to generate upward of $30 million in sales this year.
Johnson said he will use the funding to build out the product and marketing side of the business. In November, Membersy also plans to compete against DentalPlans.com by launching the direct-to-consumer Membersy Marketplace, where dental patients can compare and enroll in more than 30 dental subscriptions.