David Katzman | $1B+
Get in touch with David Katzman | David Katzman is the American entrepreneur and venture capitalist behind Camelot Venture Group, and serves as CEO and Chairman of SmileDirectClub. He built Camelot by backing consumer-led disruptors—from Quicken Loans and RealAge to 1‑800‑Contacts and Fathead—and oversaw the Cavaliers business through his vice chair role. Katzman holds a ~10 % stake in SmileDirectClub and maintains a legacy of retail, tech, and sports investing.
David Katzman, is the founder and Managing Partner of Camelot Venture Group. He also is a Managing Board Member for Sharper Image, licensee for Camelot SI LLC and Pvolve.
For 10 years David Katzman was the Managing Partner of Camelot Ventures before forming Camelot Venture Group in October of 2008. Some of Camelot Ventures’ past and current investments have included Smile Direct Club, contact lens retailing companies Lens 1st, Lens Express and 1-800-Contacts; Kintana, a technology chain automation software developer; RealAge, a medical advocate and permission marketing site with more than 5 million registered and active users; Rawlings Sporting Goods; Red Envelope, a leading online and catalog retailer of stylish gifts; Flashseats, an electronic ticketing company; Fathead a life-size graphic wall imaging company; Cleanrest the leading allergen barrier mattress and pillow encasement company; ePrize, the largest on-line promotions company; Quicken Loans, and the Cleveland Cavaliers.
Quicken Loans, Inc. is the No. 1 online lender and one of the Top 10 mortgage companies in the nation. As the former Vice Chairman of Quicken Loans, in calendar year 2007 it closed $19 billion in home loan volume, weathered the downturn in 2008 and emerged in 2009 with record origination volume. In addition, the company was ranked No. 2 on FORTUNE magazine’s “100 Best Companies to Work For” in America and was recently ranked No. 1 in a listing of the “100 Best Places to Work in Technology” by Computerworld magazine. Quicken Loans employs over 10,000 people in its headquarters in downtown Detroit.
As the former Vice Chairman of the National Basketball Association’s Cleveland Cavaliers basketball team and operator of Quicken Loans Arena, Mr. Katzman was responsible for all business operations including sales, marketing, sponsorships as well as all capital improvements into Quicken Loans Arena and the design and construction of the Cleveland Clinic Courts, the new Cavaliers practice facility. Under his leadership, revenues more than doubled during the first four years of ownership.
Fathead LLC, is the leading sports and entertainment life sized wall graphics company. Fathead has exclusive licenses with the NFL, NBA, MLB, and the NHL. Other Fathead licenses include NASCAR, Disney, Star Wars, Marvel and other leading brands. Prior to selling his interests, Mr Katzman was the second largest shareholder and the Managing Operating partner of Fathead.
David Katzman began his career by working in various retail positions with chain store experience until he founded DeeKay Enterprises, Inc., in 1987. This was the start of a 10-year run at successfully launching a variety of consumer-oriented companies including a Midwest home decor retail chain, Habitat; the nation’s second largest direct to consumer contact lens company, Lens1st; and the No. 1 direct-to-consumer home-decor company, National Blinds and Wallpaper. In 1997, The Home Depot purchased DeeKay Enterprises and acquired all of the assets to strategically enter the direct-to-consumer marketplace and strengthen its special-order systems in its stores.
After 12 months of passively investing with Camelot Ventures, Katzman resigned from The Home Depot on April 1, 2000, to pursue venture investing and advising full time. As former President of The Home Depot S.O.C., a division of Home Depot USA, which specializes in the processing of special orders for The Home Depot stores nationwide, his responsibilities included developing The Home Depot’s call center strategy for North America, process flow for handling special orders from initial customer contact to vendor payment, and full systems integration between the call centers, the internet, the vendors and the stores. While President of the division, The Home Depot’s overall store sales in North America grew from $20 billion to $40 billion.
David Katzman currently sits on the boards of directors for Sharper Image, licensee for Camelot SI LLC, and Pvolve. He previously served on the board of Smile Direct Club, 1-800-Contacts (NASDAQ – CTAC), the largest direct-to-consumer contact lens company in the world, RealAge.com, a medical advocate and permission marketing site with more than 1.5 million registered and active users, and was the Vice Chairman for Quicken Loans and the Cleveland Cavaliers.
David Katzman earned a B.A. in accounting/finance at Michigan State University and attended Detroit College of Law for his graduate work.
David is involved in a number of community organizations including as past Chairperson of HAVEN (Help Eliminate Violent Encounters Now), a non-profit that supports domestic-abuse cases; Honorary Host of ORT, an educational non-profit; and, JARC, a non-profit that serves the developmentally disabled. He also is an active fund raiser for several other non-profit organizations.
SmileDirectClub was an American teledentistry company. The company was co-founded in 2014 by Jordan Katzman and Alex Fenkell. It was based in Nashville, Tennessee, United States.[3][4] SmileDirectClub was shut down in December 2023 and was liquidated, less than three months after filing for Chapter 11 bankruptcy.[5][6]
SmileDirectClub, LLC
Company type Public
Traded as OTC Pink: SDCCQ (since 2023)
Nasdaq: SDC (2019–2023)
Industry Teledentistry
Founded 2014; 11 years ago
Founders Jordan Katzman
Alex Fenkell
Defunct December 11, 2023; 19 months ago
Fate Bankruptcy and liquidation
Headquarters Nashville, Tennessee[1], United States
Revenue $750 million (2019)[2]
Number of employees 6,300
Website smiledirectclub.com
Contents
Products
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SmileDirectClub produced 3D-printed clear aligners.[7] SmileDirectClub aligners were a competitor of traditional braces and clear alignment companies like Invisalign.[8]
Communication with licensed orthodontic professionals and other SmileDirectClub staff took place virtually. Impression kits were sent to customers, after which teeth molds were reviewed by dentists or orthodontists who oversaw the treatment process. The company reportedly worked with 225 licensed professionals.[9]
While most business and dentistry was conducted online, the company had 300 retail locations across the United States, Canada, Australia and the United Kingdom.[10][11]
History
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Entrance to a SmileDirectClub SmileShop
The company initially partnered with Align Technology as an exclusive third-party distributor for its aligners.[12] After a dispute over violation of a non-compete clause claiming Align "misused confidential SmileDirectClub information and violated its fiduciary duties," Align was ordered by an arbitrator to close its retail locations and return its ownership stake in SmileDirect.[13] Align filed an additional arbitration to recoup amount the value of the ownership stake. In 2021, the arbitrator ordered SmileDirectClub to pay Align $43.4 million (plus $2.1 million in interest) for the ownership stake.[14]
In October 2018, SmileDirectClub raised $380 million in an investment round led by Clayton, Dubilier & Rice and Kleiner Perkins, for a $3.2 billion valuation according to Bloomberg.[15] SmileDirectClub was initially funded by Camelot Venture Group. NBA player Draymond Green was an early investor in the company, investing in 2015 after personally using its products.[16]
The company expanded into Canada in November 2018,[17] and expanded into the UK and Australia in 2019.[11][18]
During the 61st Annual Grammy Awards, SmileDirectClub announced a collaboration with singer Shawn Mendes on a campaign to show "that confidence is gained with an amazing smile."[19]
In April 2019, CVS announced that the company would add SmileDirectClub locations to hundreds of CVS stores.[20] In May 2019, HP and SmileDirectClub announced a partnership to produce over 20 million 3D-printed molds over the following year.[21]
SmileDirectClub celebrating the company's IPO listing on NASDAQ
In August 2019, the company filed S-1 paperwork to go public.[22] On September 12, 2019, the company went public by offering initial shares at $23, above the expected price of $19–22 per share. SDC's IPO opened at $20.55[23] and closed at $16.67 after the first day, a 28% loss from the initial shares offering.[24] After the loss, the CFO of the company has stated that the focus of the company will remain the same despite market evaluations.[25]
SmileDirectClub was awarded a business model patent on the process used for plastic aligners for customers on April 28, 2020. SmileDirectClub sued a competitor, Candid Care, calling it "a copycat model". U.S. District Judge Colm Connolly invalidated the patent.[26]
On April 14, 2021, the company was the subject of a cyberattack. In a filing, SmileDirectClub reported that they were "able to successfully block the attack, no ransom was paid, and the Company's systems and operations are back online and performing normally." The estimated cost was $10 million to $15 million in revenue "from the cyberattack and the associated downtime in treatment planning and manufacturing."[27][28]
On August 3, 2021, a workplace shooting occurred at the company's manufacturing facility in Nashville. Two security guards and a manager were injured by the gunman, 22-year-old employee Antonio DeQuan King, who was then shot and killed by responding police officers. SmileDirectClub released a statement after the shooting, saying it was saddened by the events.[29][30] The assailant was armed with a .45 caliber handgun with an extended magazine, and he fired more than 20 times, and then he was shot five times, including three shots in the legs, one in the arm, and one in the chest.[31]
On September 29, 2023, SmileDirectClub filed for Chapter 11 bankruptcy. During the bankruptcy procedure, the company expected to continue operations normally.[32] However, on December 8, 2023, after a failed last-ditch sale that would help the company to exit bankruptcy, SmileDirectClub announced that it would cease operations, effective immediately and convert their Chapter 11 bankruptcy into a Chapter 7 Bankruptcy Liquidation.[33]
Criticisms
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The American Association of Orthodontists (AAO) has filed complaints with 36 state dental boards, alleging that SmileDirectClub violates regulatory standards.[34][35] According to SmileDirectClub representatives, 12 of the cases have been closed and no adverse legal action has been taken against the company.[36] The AAO has stated that only five states confirmed closed cases.[36]
In September 2019, a group of customers filed a class-action lawsuit against the company, claiming SmileDirectClub engaged in false advertising and violating FDA regulations. Due to a clause in SmileDirectClub's consent forms that require disputes to be resolved via arbitration, all but two plaintiffs in the lawsuit withdrew.[37][38]
In January 2020, the New York Times published an article revealing SmileDirectClub's usage of non-disclosure agreements worked to limit information about customers' dissatisfaction with its products, including medical concerns. The company sued Lifehacker's parent company for defamation and libel after the site published an article outlining the risks of its products. It also sued state dental boards after making it harder for SmileDirectClub to operate. SmileDirectClub's chief legal officer defended the company's actions, stating, "When we believe that there is an organized campaign to damage our reputation amongst consumers, dentists, or investors, we will defend ourselves and our mission to democratize access to care every chance we get."[37]
In March 2020, CBC News's Marketplace released an investigative report where they found the company had made misleading claims about their aligners and gave questionable treatment plans. Marketplace sent four potential customers wearing hidden cameras to SmileDirectClub locations in the Toronto area. While SmileDirectClub approved all four patients for treatment plans, orthodontists asked to review the treatment plan and said that none should have been approved. In one case, the orthodontist said the proposed treatment plan could increase the likelihood of chips and wear. SmileDirectClub disputed this assessment and stated that the treatment plans would all result in an improved smile appearance. Following the investigative, SmileDirectClub released a list of changes that they were making to the company, including increased training, changes to their forms so customers better understand they need to visit a dentist six months before starting treatment, and making the contact information for treating doctor available as soon as they are approved for treatment.[39]
SmileDirectClub filed a $2.8 billion lawsuit against NBC News in May 2020, accusing the news organization of broadcasting a story with errors. The NBC Nightly News story cited patients who complained of pain after receiving SmileDirectClub's treatment. One patient featured in the report said her orthodontist diagnosed her with a crossbite "possibly caused by" the company's aligners. Another patient gave testimony that his dentist said SmileDirectClub's aligners "moved his teeth so fast that it caused some of them to detach from the bone." SmileDirectClub's lawsuit claims the story contained more than 40 false and misleading statements. An NBC News spokesperson responded in a statement about the case, "We stand by our reporting and believe this is a meritless claim."[40][41] In December 2021, the lawsuit was dismissed after a court ruled SmileDirectClub failed to meet its burden under the Tennessee Public Participation Act, the state's anti-SLAPP law.
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