Byte

By: Boris Groysberg and Julia Kelley and Katherine Connolly Baden

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Synopsis: In January 2021, Byte co-founders Scott Cohen and Blake Johnson reflected on how far their Los Angeles-based direct-to-consumer (DTC) orthodontics company had come since launching its clear aligners just a little over two years earlier. Cohen and Johnson were both serial entrepreneurs who had guided several companies to successful exits. They had planned to take the same approach with Byte, preparing for an exit by focusing on profitability and stable growth and forgoing dilutive venture capital (VC) funding. Neither of them had expected Byte to grow as quickly as it had, but the market opportunity had unexpectedly expanded during the COVID-19 pandemic, when many consumers sought at-home treatment options. Cohen and Johnson thought about what their next move should be. Given Byte's rapid growth, the founders considered whether they should instead consider other options, such as a strategic acquisition or an eventual initial public offering (IPO). Either option would help position Byte for global expansion, which the founders felt would be a promising growth opportunity for the company.