Today, we will be breaking down Invisalign. Founded in 1997, Invisalign pioneered clear aligners as an alternative to metal braces. Today, Invisalign generates over $2bn of revenue and accounts for roughly 20% of the orthodontic market.   To break down Invisalign, I am joined by Nick Greenfield, CEO of Candid. Nick co-founded Candid in 2017 as an e-commerce solution to teeth aligners. Candid now offers a broad range of clear aligners and teeth whitening solutions across retail, e-commerce, and the professional market.   Nick's experience in the industry makes him an ideal person to explore Invisalign. We dive deep into the origin of the business, the unique relationship between Invisalign and orthodontists, the economics of orthodontics, and how Invisalign successfully used its patents to maintain its lead in the clear aligner industry.   For the full show notes, transcript, and links to the best content to learn more, check out the episode page here. ----- This episode is brought to you by Canalyst. Canalyst is the leading destination for public company data and analysis. If you enjoy our exploration of what makes a company tick on Business Breakdowns, Canalyst should be the foundation for your quantitative analysis. For more information and access to the Canalyst model on the business we break down in this episode, go to canalyst.com/breakdowns. ----- Business Breakdowns is a property of Colossus, Inc. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.   Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here.   Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss   Show Notes [00:02:43] - [First question] - Overview of Align Technologies and their scale [00:03:31] - What Invisalign is and the problem it solves [00:04:43] - The footprint Invisalign has in the dental industry [00:08:40] - Defining orthodontics and the size of the market [00:09:49] - Why market penetration may double over the coming years [00:14:42] - What the market was missing in the 90s and allowed Invisalign to arise [00:16:20] - Unit economics across the value chain of orthodontics [00:19:40] - Economics of an entire practice built on Invisalign [00:20:34] - How they came to dominate and cement their market position [00:22:44] - Vertical integration and other ways held a majority in the clear liner space [00:25:02] - Branding, distribution and further means of competitive advantage [00:27:05] - Why not move further up the value chain and buy orthodontic businesses [00:28:40] - Invisalign’s P&L in gross margin and major item categories [00:31:49] - What share of chair means and why it’s important [00:32:56] - How many cases can currently be handled by clear alignment trays [00:34:52] - Orthodontists will remain employed once aligners achieve widespread adoption  [00:37:16] - Driving factors for Invisalign doubling over the next five to ten years [00:39:03] - China’s push for training orthodontists and clear aligner adoption [00:39:50] - Other reasons Invalisgn may double their market cap over the coming years [00:40:26] - Competitors and disruptors that may hinder their growth [00:42:01] - Joy dichotomy between patients and businesses [00:43:40] - What happened in 2017, how it changed the marketplace, and the road ahead [00:45:08] - Market share and penetration in today’s landscape [00:46:23] - An analog that can be used to explain Invisalign writ large [00:47:31] - What could revert Invisalign’s growth and market share [00:50:22] - uLab and orthodontists making aligners themselves  [00:51:53] - Other potential threats to Invisalign [00:53:26] - Patenting your IP and gaining an advantage in healthcare [00:55:28] - Lessons for builders and entrepreneurs from the Invisalign story [00:56:39] - Lessons for investors watching Invisalign’s growth over t