SmileDirectClub Files for Bankruptcy, Capping Years of Losses

(Bloomberg) — Dental aligner company SmileDirectClub Inc. filed for bankruptcy four years after raising $1.35 billion in an initial public offering.

Most Read from Bloomberg

• Europe’s Richest Royal Family Builds $300 Billion Finance Empire

• Pakistan Rupee Set to Become Top Performing Currency Globally

• Top Chinese Scientist Claims India Moon Landing Nowhere Near South Pole

• Stock Optimism Fizzles as Quarterly Losses Pile Up: Markets Wrap

• Dianne Feinstein, Longest-Serving Female Senator, Dies at 90

The Chapter 11 filing in Texas on Friday allows the company to continue operating while it works out a play to repay creditors. The company’s founders will invest at least $20 million into the company as part of its reorganization, according to a statement.

Nashville, Tennessee-based SmileDirectClub listed $499 million of assets and more than $1 billion of liabilities in its bankruptcy petition.

The company makes plastic aligners that can straighten teeth at a fraction of the price of conventional braces and markets its wares directly to consumers. Its 2019 initial public offering valued the company at $8.9 billion, and made its founders billionaires.

But in the years since, the company struggled with declining revenues, and never turned a profit. It ended up marred in a patent fight with a rival, and cut sales and marketing drastically during the pandemic shutdowns.

Most Read from Bloomberg Businessweek

• Huawei Takes Revenge as China Catches Up on Semiconductors

• A Nobel Laureate Offers a Biting Critique of Economics

• Google User Data Has Become a Favorite Police Shortcut

• Got Plastic With a No. 2 Recycling Symbol? Beware a Toxic Problem

• A $12 Million Request to Cover a Crypto Scam Sank a Bank CEO

©2023 Bloomberg L.P.