Damon Baker (00:14)
Eric, I think of this as stepping into your do or die moment. When you joined EnVista to lead the launch of Spark, it wasn't just a product, it was meant to be a growth engine, which was the challenger brand to InVisalign. And I have to admit, I am an InVisalign customer, so please don't hold that against me.

And it was the catalyst for competing against a line technology. From the outside, it looks promising, FDA approval, a great product, 200 enthusiastic trial customers, but behind the scenes demand was exploding faster than you could produce and lead times were double the market standard. Can you take us back to that moment in time and tell us what did you walk into?

Eric Conley (00:55)
Yeah, I mean, to be honest, Damon, it wasn't immediately apparent, you know, that the challenges that we're going to become very real, very fast. I we were, I started in May, early May of 2020. the orthodontist offices globally were closed for, you know, a good part of April. And, and � I think the business was sort of breathing a little bit easier from an operational perspective than and then what happened, you know, after that is that the offices came back up pretty quick and ramped up pretty quick for a couple of reasons. One is, you know, orthodontists are by and large small business people, right? And so they're, they are very, very eager. They move fast, they adjust fast. And so they got their business up and running quick. And then we had, you know, what started to kick in pretty quickly. People were home, couldn't travel. I had, you know, were generally cashed up population because they weren't spending and there was some extra money in their pockets, maybe in some cases from government subsidies. You know, so there was really, you know, people stare at their face all day on Zoom or Teams or something. There was a big ramp in demand that came not immediately, but pretty fast thereafter. it was a bit of...perfect storm but didn't quite realize it at first and it was a little bit of a lull right in the beginning and so you know what we what we found was you know those 200 pilot customers we had very close relationships with and I spent most of my time right in the beginning getting to know all of them I mean I talked to every single one of them some before I even started as I did my diligence in the company and sort of just started into learning mode. It was only about a month or so after that, and when the demand hit, that I realized that we had some challenges ahead.

Damon Baker (02:55)
Amir Agde was the CEO of EnVista at the time and when he called you and asked you to lead the Spark initiative, what made you say yes?

Eric Conley (03:05)
It was a good question. mean, I was coming out of, you know, I was president at Fluke, and, you know, coming out of a, you know, large global business. And he started talking to me about Spark. And, you know, I asked him questions. said, well, we don't really have much of any revenue yet. So, it was a very different thing. You know, I...

First thing I did was I saw it was an opportunity to join the leadership team of a brand new public company that spun out from Danaher. I had had history with Amir, so there was a lot of trust there already. And then as I started to do diligence and talking to a lot of some of the Spark pilot customers, but also just orthodontists, that my kids are orthodontists and others out there and ask questions, I learned very quickly that even if an orthodontist was happy with what they had, which was Invisalign, they all said, hey, we need some competition here. This is a monopoly. feels like customer service isn't there. The rate of innovation is not there. And so it became very clear to me that there was space. There was an umbrella for a competitor to come in, even though it was dominated by Invisalign so far. So that was exciting for me.

And to have the opportunity to go into something that I knew would be well-funded, aggressively funded, with a lot of support from Amir and also the board. I felt like it was a great opportunity and it was up to me and the team to make it happen.

Damon Baker (04:40)
What was your preparation mentally for stepping into this role where by frankly failure isn't an option knowing a mirror?

Eric Conley (04:49)
Fair, yeah. I'm not sure I really quite grasped it beforehand. It was a realization that came over the first six weeks or so. And that business, Damon, everything's made to order, right? I mean, we're making custom medical devices at the end of the day. And there's a rapid clock.

Right, so for us to compete against the norm, ⁓ the orthodontist sends in all of the patient materials, scans, prescription, all those things. And we've got a matter of two weeks to turn that around to get to a patient plan and manufacture the product and get it out to the orthodontist in time for their next patient visit.

And those come in, it's unyielding. mean, every day you've got more and more and more. So there's no opportunity at all to fall just didn't have the capacity. Even for those 200 or so pilot customers, we had the capacity on paper, but we weren't performing.

Damon Baker (05:54)
So the pressure to scale is very real and this is when speed starts to meet reality. So as you indicated, Spark had more patient cases coming in than you could manufacture. Lead times were two months when the market expected two weeks. I was an Invisalign customer and that felt about right. Two weeks seemed like when I got my impressions back and everything. So that's really existential pressure. It's real. It's not, this is a potential growth opportunity. There's a motor backlog that's...piling up like overdue books. What were those first 90 days like in trying to expand capacity at hyper speed?

Eric Conley (06:32)
Yeah, was a pretty wild time and something I've never experienced before and probably never will again. The demand came faster than we thought, even from the 200 patients. So we suspended any sort of push to bring on new doctors. We wanted to make sure that the pilot customers had a great experience. And they all believed what we were trying to do. They knew we...we had some things to work through. But they had patients on their side, they were running a business and they couldn't wait forever. And so for us, looking at it, we had a couple of challenges. On paper, we had enough lines, we were building out manufacturing at that time in Southern California, and we had enough lines on paper to go do it. The problem was only one of the...four lines we had at the time was running anywhere close to the design capacity. We were up and down every day and had some really big sort of internal yield problems as we were working out the kinks of our own manufacturing and technology and everything else. And so, you know, really what we tried to do there was one, stay very close to those customers. And so I was, I spent half my days on the phone with customers.

And being very open and transparent about what we're, you know, what are we running into now? What issues do we have? What we're doing about it? When do we expect to kind of be back on track? Which is a very hard thing to predict. And then, you know, on the manufacturing side, really focused on a couple of things. One is a little bit of a Bob Wow scenario of like, hey, this line's running okay. You know, what are we doing different?

There versus other places. And we started to move people around to really make sure that the operators were better trained, well trained. And one of the early signs that I felt like Amir and the leadership team at Envista was really behind this was I did an initial assessment of additional lines that we needed to go and manufacture. I put a, I mean, it must have been a five, six, $7 million car in front of in front of a mirror, it two slides and it was approved in five minutes. And so we had support, we had, but it was tough, right? And even getting a new equipment for the lines coming out of COVID, the supply chain challenges, it took a really long time to get the technology up and running. So we were in a scary spot for sure.

Damon Baker (09:10)
In moments like this when everything seems like it's on fire, what do you think the most common mistake leaders make when trying to scale under extreme pressure or circumstances like this in Spark?

Eric Conley (09:22)
Yeah, I mean, for me, my sort of winning mantra for my entire career is I'm the big believer in speed wins, right? And mistakes are okay. But if you're going fast and learning along the way, right? And pivoting as soon as you realize you're making a mistake, you're gonna be ahead of everybody else. In this case, speed was absolutely necessary. And so for us, we just made decisions really quickly and we really focused on the short term success of the business knowing that if we lost these pilot customers, we were never gonna be able to scale up down the road. so staying really close to the customers and as a team, we were at GIMBA all the time. We were on site with our customers, we were in the factories. I spent, I'd say in the first four months, five months there, I was at the factory 80 % of the time.

Right? With the team there pulling the engineers in, you know, and really trying to drive internal yield improvements, mainly quality improvements until we could get additional lines up and running. And that was the key thing. I mean, it was at GIMBA focusing on having the leaders across the company focusing on getting things right, helping the team learn, and then also just transparent communication with customers.

Doing those things, fast decisions that help the near term was really critical for success.

Damon Baker (10:52)
To some degree, I would characterize this phase as leading through chaos and just some stats here to kind of bolster what I just said. In seven months, you launched seven production lines. You moved to three shift operation. You hired over 500 people in California, one of the easiest states to do business in, and all during a global pandemic. ⁓

Eric Conley (11:15)
Yeah, not exactly manufacturing hotbed.

Damon Baker (11:21)
Any other things that you did? It's almost like you felt like a one-legged man in an ass-kicking contest, Eric. Were you doing some of this to yourself?

Eric Conley (11:29)
Well, yeah, I mean, and we had to we had to build a team, right? I mean, it wasn't just about the manufacturing organization and the lines up and running, but we were we had, you know, one of the things that I think Amir made the call on early, which is important is in the beginning, he separated out Spark to be its own business inside of EnVista. So it wasn't part of Ormco or some other company. It's an important change. And so we, you know, we were able to operate on our own and really build out

Damon Baker (11:49)
That's a key change.

Eric Conley (11:56)
A set of processes that, you know, wouldn't work for any other company inside of a public company, you know, where, you know, we were able to take some risks and we were able to do some things fast. The other thing I did was we recruited almost a brand new team. so manufacturing, R &D, sales, on and on and on. We had some people that came over from EnVista, but, you know, it was largely a new team.

And so we were able to build, I mean, it was an exciting story, right? We were able to build a pretty stellar team very quickly. I definitely had some help. But, you know, I mean, the key through that was we just needed to go, right? I mean, we had to lead through action and you make some mistakes for sure when you're going that fast, but we knew. 

Even though California isn't a place long term we wanted to be, we knew in order to build scale, it made the most sense because, you know, the factory, had a site there that we had room to build out in. Our engineers were in California and they could be right there with the operations team. It gave us the best chance of scaling up.

Damon Baker (13:09)
At a growth at all cost strategy, think sometimes companies lose sight of quality. How did you keep quality intact when scaling headcount and production so aggressively during this time period?

Eric Conley (13:23)
Just brute force. mean, was, quality was a critical thing, right? Because if we shipped a case to our orthodontist, so what that looks like is they get a case, they don't know if it's good or bad, right? Because all of the aligners are packaged up. And so what happens is their patients come in for their fitting, all of a sudden something doesn't fit or there's something missing.

They got to reschedule that person all over again. They've got to miss school. They've got to take a time off from work and it's painful. And so you got it. so that really mattered. And what we did is we had a big internal yield problem. And we in the beginning for, I'd say for a good year, we were checking every part.

Damon Baker (13:57)
And that's lost practice revenue as well.

Eric Conley (14:12)
we were going through QA on every single piece and we did that as the brute force and we did that two times during the entire cycle, manufacturing cycle. that was a brute force. And so we had, you walk in that California manufacturing site, was an area that was probably about, I would say 2000 square feet that just had people.

Damon Baker (14:16)
That's the brute force part of it.

Eric Conley (14:39)
with loop glasses and a bright light checking every single part before it was packaged up.

Damon Baker (14:45)
Or scoptic, I hope.

Eric Conley (14:47)
Those are probably too good for what we needed.

So, but definitely had some help because it's, the aligners themselves are, I mean, you we don't necessarily need to get into all of the quality aspects of it, but, you know, one of the key value propositions we had was, you know, we had smoothed what was called scalloping on the aligners. So where it touched against your gums, it was smooth, it wasn't sharp, so it was comfortable for the patients.

and teaching a quality person what good looks like there in terms of a soft scalloped edge but effective edge, you can't write that down. And so we struggled a lot with some of those aspects to get that.

Damon Baker (15:30)
Looking back on that time, do you think that the leadership behaviors that you modeled daily to keep the team grounded were different than maybe just a non kind of fog of war chaotic kind of situation? like, you know, I needed to be a certain way in this situation versus how I am in other times. Kind of like, what were some of the key behaviors that stood out to you?

Eric Conley (15:54)
Yeah, I what I tried to model and teach the team was amid all of the chaos of everything that was kind of coming in and trying to get out and the challenges we had is to have a kind of a standard work for everything that we did and across the lines, across leaders, that was consistent, right? I mean, we had to have consistently consistency at least in what we were doing on a day-to-day basis, hour-to-hour basis. And so we talked about getting to GIMBA, we talked about helping the team, we talked about getting into the lines, not necessarily to be part of manufacturing process, but to see for ourselves what the team was struggling with so that we could drive resources towards the problems quickly, right? And that level of support of the team and helping to build the standard work across the different lines because it was important for us that every single line, certainly in that site in California and then later in different sites globally, looked exactly the same, operated exactly the same, no change. You could go in and out. And in that way, when we saw problems with one line but another line was working well, it was a lot easier to see, right? And we had people who were even senior leaders in the team very knowledgeable on what it was supposed to look like, right? What that future state was.

Damon Baker (17:21)
Now you're at a point where you're making some big bets. Global expansion, low cost scale. So you didn't just scale in California, you expanded into Europe and Asia, then shifted manufacturing into Mexico and China while scaling the business globally. So how did you make global decisions around expansion at speed without burning the organization out? Because they just went through this intense period that you just got done describing. And now you're like, hey gang, let's go do it again, but let's go do it again in another country.

Eric Conley (17:48)
Yeah, yeah, I mean, I think, you know, that business as much as any in the past, and I, you know, I spent 10 years doing, you know, venture-backed which felt similar. You become very, it's easy to become very mission-oriented, which is helpful, right? And, we're very close to customers. A customer intimacy is high. So it doesn't feel like we're in middle of, know, carpet land in an office trying to just work really hard to get things done. We knew the customers, right? My team knew our customers. We knew what we were, you know, trying to do. We knew what we were up against. And so the team, you know, we had a lot of fresh faces, which helped too. You know, a lot of people coming off the bench, so to speak. But the team had a clear mission, had a clear purpose and they knew who we were doing this for, right? And so that all helped. And we also talked a lot about competition and we kept waiting for the competition to do a heavy pivot and just crush us in some way. And so we needed to, in this kind of catch up mode where, we really know the passion that our customers had in our products, it's really a big

So to get back to, you know, kind of your question about, you know, those things that happened, there was a couple of things we had to do at the same time. I mean, the, the, the need to continue to scale at a, at a rapid, rapid pace never went away. And, you know, Europe, we had pilot customers in Europe, probably about 15 or 20 at the time. And, and they, you know, the, the team there's, you know, said, we've got a ton of opportunity. You know, now's the time. And really it was just a question of did we feel like we were going to have the capacity in the manufacturing side to go do it. And so we started to scale quickly and Europe moved very fast. It was a place for us, it was a little bit easier to bring customers over from Invisalign because it wasn't their backyard. They were stronger in North America.

And we brought in customers quickly. At the same time, as we started to build some scale, the manufacturing in California was expensive. And we were, every time, those early days, every time we shipped a product, we were writing a check, covering ourselves even at the gross margin level. And so we knew we needed to get to, as we were fixing the plane, we had to keep driving the plane hard, flying the plane hard. We knew we had to get to low cost region and Ormco had manufacturing, a manufacturing site in Mexicali and one in Shuzhou, China as well. And we're still in the middle of COVID, this is still late 2020.

And we started to plan for moving lines as well as scaling up in both of those locations, which was interesting, right? And we could travel back and forth to Canada. There was no way in or out of China. And so we brought on a lot of interesting new technology, really live sort of augmented reality cameras and things like that so that our engineers could teach.

the China team, which is a very talented team, how to set up these lines and run them. So we did all of that at the same time because if we continue to manufacture in California, it was gonna bury us financially and it would just get harder and harder to.

Damon Baker (22:02)
think there's sometimes in business this false paradigm that exists around complex manufacturing shouldn't be moved to a low cost region for a multitude of reasons. So the simple things go to those areas that are not requiring highly skilled labor and technical things, but

You really did move a complex manufacturing process to a low-cost region. I'm sure that there's a lot of lessons learned through that. Can you share some of those lessons learned? think you just highlighted one, like a new technology enabler that you guys created to allow you to teach people faster as an example. I'm sure there are many others.

Eric Conley (22:39)
Yeah, there were. mean, we, you know, in the case of Mexicali, because we were able to travel, we brought it, we brought the engineers and the leadership team from the Mexicali site and they stayed with us in California, the lines alongside our California team for about six or seven weeks. And so they really understand the processes, understand, you know, how to solve the problems. What we had learned over time to overcome yield issues, which hadn't totally gone away. And so, you know, they were able to learn and prep. And there was a combination of things that happened. We started to get some new equipment in and we diverted it instead of coming to California, to Mexicali and to China. And so they were a part of bringing some new lines up and running before we had to actually bring a line down, which was scary a proposition at the time. And so we started to build capacity there first. so, you know, over the course of, you know, maybe four or six weeks really taught that team what to do. And it was, you know, a lot of shadowing training in that way. And then and then working with them and our engineering group there. China was different because we couldn't travel, as I said. But, you know, our engineers would we started to work off shifts on the engineering side and working with kind of the first shift, the only shift at the time in China to get the lines up and running and then make sure that they could really run. And in China in particular, great engineering talent there in the factory, right? We run into a lot of issues in the US and other places where there's great engineering talent, but they want to be in R &D. They don't want to be in the manufacturing sites. And so in China, that's not the case at all. And we had great talent over there to help us overcome this sort of remote setup. And they got up to run pretty darn quickly. And it was only after that that we actually started moving lines out of California and shipping them off.

Damon Baker (24:52)
I want to talk for a bit about the commercial strategy. You made a conscious choice strategically to focus on a subset of dental professionals, orthodontists in particular. And I can't remember from my worst gothic days, roughly how many there are, but I know there's a lot more GPs than there are orthodontists. And I think it was like 160,000 back when I was there. So you chose to ignore that and focus on orthodontist. So that's a pretty big bet. So in 2022, you made that deliberate call. Spark would focus on orthodontist rather than chase the general dentist. And in addition to that, you did not go the Smile Direct Club channel strategy route. So assuming you went a direct to user, direct to the orthodontist strategy.

Eric Conley (25:34)
Right.

Damon Baker (25:43)
So what was that focus like and how was that critical in your mind to Spark's overall success?

Eric Conley (25:49)
Yeah, there was a big debate at the board level, even on where we should focus. And, you know, looking back now in hindsight, you know, it's easy to see that we made some really good calls there. But at the time, you know, in Smile Direct Club, right, is gone. mean, they're they they bankrupt. And so, but at the time they were they were a rocket ship and there were companies coming out of nowhere doing direct to consumer.

Damon Baker (26:06)
Yeah, they're defunct.

Eric Conley (26:17)
all over the place and having very fast ramp to revenue success. And, you know, the business model was reasonable, right? I mean, it was, you cut out the middle person, right? The orthodontist takes a pretty big chunk of the value.

Damon Baker (26:32)
That is until you look at their customer acquisition costs, then you say like, this company doesn't make any money. They're growing fast, but they don't make any money.

Eric Conley (26:38)
Yes, that's right. And so, there's an interesting case study there, I'm sure that will be coming on how COVID disrupted that customer capture and acquisition for those direct to consumer companies. they could charge, even if they were charging a third of what an orthodontist would charge.

They captured all of that, right? And versus we were selling, you know, kind of you know, wholesale price, right? Effectively to the, to the orthodontist. And so, so it was, it was an easy decision. Let's put it that way. And, and you're right, orthodontists, I mean, there's about 10,000 orthodontists in the United States, probably under 30,000 globally. There are hundreds of thousands of, of general deaths all over the world. And Invisalign opened the market up to them.

And then there was a direct to consumer. so, the board really looked at that and said, why aren't we focusing across everywhere, right? I mean, why limit ourselves to such a small customer group? And for us, I mean, those business models meant a lot of different ways to go and sell, a lot of different sort of go to market structures and strategies.

The support models were completely different for a GP and totally different again for direct to consumer. And so we looked at it as our heritage, Ormco heritage is 65 years focused on the specialist, focused on the orthodontist. And we can leverage that. Orthodontists by and large were upset about Invisalign creating competition for them with the GP.

Damon Baker (28:05)
on the cheapy side.

Eric Conley (28:06)
Yeah, so they were upset, right? And they were looking for alternatives.

Damon Baker (28:09)
So you didn't want to alienate your core customer.

Eric Conley (28:11)
Exactly, and they opened the door for us, right? Because if we went out and said, we're an orthodontist focused company, that meant something, that mattered, right? And they believed us because there was a long history there. And so, we also knew that when you bring on an orthodontist, they're your channel, right? So they're gonna bring on, on average an orthodontist will bring on 60 to 70 new patient cases a year.

Some a lot more, some a little less, you you bring out, do the hard work of converting an orthodontist over, that's an annuity, right, for us. And so we decided to focus there knowing that there was a ton of business to go get. We could grow, we could see the path, you know, for us to get reasonable share gain, to grow to 800, 900 million dollars with a segment, you know, keep a very tight focus, build the relationships with them and just build, you know, the key then commercially was to build an acquisition engine, right? It was the, I'm a big fan of growth equations and the growth equation there was simple. It was acquiring new orthodontists onto the Spark platform. And then, you know, we broke out sort of the process on how to do that. And we learned over time how to do that as effectively as possible. But if you do that, sort of the rest of the math takes care of itself to revenue.

Damon Baker (29:33)
Were you the only one advocating for this strategy? Do you have ever supporters and how did you more importantly navigate the pushback from others on the board who maybe didn't agree with that strategy? Because it's, it's hard to kind of say no to all these growth opportunities when you're in this rapid scaling phase. Like everything looks interesting.

Eric Conley (29:54)
Yeah, it's all there for the taking it seems like. I was definitely in the minority, let's put it that way, in terms of my view of if we needed to focus. And we spent, we looked hard at what it would take to build different, some of these different models, especially direct to consumer. We even built out a...kind of a projection and investment model and thought about, you know, if there are different structures, then maybe even, you know, partnering with an outside company who was just getting started in those things. And we made some small minority investments in some direct to consumer companies to help us learn a little bit more about it. But at the end of the day, you know, we did a lot of VOC and kept very close to our specialist customer base. And there was such an appetite from them for us and to have a focused business. And we knew both from our own research and from Invisalign's history, documented public history.

It's a, you start to go direct to consumer and you create even more competition and maybe even ethical concerns as far as the orthodontist are concerned. You've got a customer riot out there potentially. And so for us, you know, my logical path on it was, hey, look, focusing allows us the fastest path to delivering what the customer wants because you're just dealing with one customer one type of customer. There's a lane for us from a brand perspective because we are trusted in the orthodontist space and nobody was saying we're only gonna focus on orthodontists. And there was a long runway. mean, just, you know, if the market for that was $100 million, we would have never done it, right? But it was a big business for us to go out to. And effectively what we did is we could kick the can down the road and say, hey, we can focus grow really fast, build a great business, and then seven years from now we can maybe look at expanding, but we don't need to yet.

Damon Baker (31:56)
Yeah, I think the closure of Smile Direct Club is the ultimate proof point, at least for the channel strategy and not going down that path. And one could say there's parallels on focusing on the orthodontist as well. to your point, hindsight is always 20-20. Now you have built a growth engine.

And it's all about customer acquisition and onboarding at this point and making sure you have solid processes around that. So to remind folks, you went from 200 early trial customers, now to over 5,000 active orthodontists that are using this Spark solution by 2024. So it didn't just grow, it exploded and the revenue was zero. And what is the revenue now at this point, roughly?

Eric Conley (32:38)
No beginning. Was never public, but lot of analysts pegged it in the several hundred millions.

Damon Baker (32:47)
What did you learn over that time in building a world-class acquisition in a highly competitive market? Because you did have Smile Direct Club, you had Invisalign, and it seemed like there's two entrenched players that were just battling it out to the death, and now you guys emerge onto the scene. It seems like the least attractive market that somebody would want to get into with a startup, but you guys decided to do it anyway.

Eric Conley (33:12)
Yeah, yeah, I mean, we, you know, there's a lot of, I mean, there's a lot of cases along the way where there was a strategy that we just talked about, or a number of other things were just folk, we just created a lot of focus. And, and there were other players out there who were focusing on, you know, not the direct to consumer path, but the professional path, other startups. But we just said, we are, you know, Invisalign and the aligner space and the professional side, not direct to consumer, but dealing with orthodontists and in their case, General Dennis, they're 90 plus percent share. So we said, we're just going to create an acquisition engine, a commercial engine, just targeting their customers. We're going to worry about everybody else. And so we did that. And we spent a time

And this, by the way, for me was the fun part. mean, as we had some capacity, we solved a lot of our internal yield problems. Quality was good. We were able to deliver. That's when it got fun, when we were just purely focused on growth from probably 2022 on. A lot of that was behind us. We spent a lot of time segmenting the market, understanding which customers were the easiest to convert from Invisalign to Spark.

And built an engine that had really its basis in education, right? And so we spent a lot of resources and time and engaged the community in how do you succeed at the same level an orthodontist could do historically with braces? How do you get the same outcomes or better outcomes with aligners? What are those mechanics?

because the physics of moving teeth with aligners is the opposite, it's upside down from braces. And so there was a learning cycle for orthodontists there and we wanted to lead from the front in terms of clinical education primarily. And so we did that, got people excited about Spark because our speakers who were orthodontists, our best salespeople were other orthodontists. They would talk about, know, hey, here's how I treat my cases and by the way, I used to use Invisalign.

I did thousands of cases. It's easier with Spark and here's why. And they would walk through that. And that education model really was the conversion engine for us as we tried to acquire new customers. From there, did some great work, Kaizen work around how do you onboard in the most fastest, most successful way. Spent a bunch of time in our customers on location in their...in their offices saying how can we onboard not only the doctor but their team in the most kind of the easiest, most kind of least disruptive way possible because they're running a business every day. got 50, 60, 70 customers, patients coming in every day, can't exactly shut down for a day, right? And so we got great at that and we learned over time what worked, what didn't. We measured every single piece of it. It's kind of thought of as a conversion funnel and knew what worked. And then after that, it was about feeding that model. But it was a great time. And the team was really, really good at, once we figured out, we really had an angle, conversion angle, tied to clinical education. And we would do these workshops. We got great at capturing the right information coming into the workshops, had people in some of our treatment planners actually in all of these education events where all North Adonis had to do was just turn around, go to the back. We would create an account. We would do some practice cases. I mean, they were already off and running before they even let the education event on Spark. Totally. And so that's what really drove it. And we were, know, as we expanded geographies, you know, we were bringing on bringing on customers.

Damon Baker (37:01)
Yeah, remove the friction points.

Eric Conley (37:13)
Several worth it on us a day and certain times of the year. The other thing we've, you learn some different things along the way, right? We learned one of the beauties of this business was that, you know, there are only 30,000 or so worth it on us in the world. And, you know, thanks to, you know, the tools that are out there that our competitors had, you know, you can go on today and, you know, if you want to try to find a doctor who...does, Spark or Invisalign or anybody else in your town, right? You just go on and the Invisalign website, the doctor locators show here's the doctors. It will tell the patient here's how many cases they're doing. So they wouldn't have a tier, they were diamond or gold or whatever tier they were. And we knew that tier meant certain numbers of cases a year that they would do. We knew what equipment they had, we knew what had. 

Damon Baker (38:05)
So now you have your hit list.

Eric Conley (38:08)
We also hired a high school kid to come in and do web scrapes twice a year every time they updated that. And that was our new target list. And so we were tracking that. We were tracking when doctors dropped a tier, lost some discount. There was a lot of guerrilla tactics, I would say, for us to go and segment and win customers.

Damon Baker (38:28)
Did you do anything on the end user demand generation side to market to the patients themselves to try to create pull through into the like, go ask your orthodontist XYZ.

Eric Conley (38:36)
No, no.

Yeah, and that was probably our biggest weakness that Invisalign would, once they wised up that they had some real competition that they tried to exploit. Because Invisalign was very good at driving, you know, they had a great brand. I mean, they're the official aligner of the NFL, right? And all that kind of stuff. They would drive patient traffic. And when they did their sort of know, business reviews with customers, they would show them, like, here's how many patients we brought to you, here's, and what we ended up doing there, because there was just no way to compete. We did a little bit of work to try to drive patients, but to the end of the day, we couldn't compete. We said, you know, hey, great clinical outcomes will help you drive more volume, more flow through your office. You get a limited number of chairs. So if you can, you know, do something in what normally takes 18 months, if you can do it in 12 or 13 months, you're gonna make more money. So then the question is, you lose the leads, the patient leads, when you come over to Spark? And we would regularly survey our existing customers and we would look at their patient flow before and after. Even afterwards, all of them had more patients than they could handle. And so while Invisalign was sending customers, they were great at that. They had plenty of business anyway, they didn't need those leads. And so once we started to show that data, that the practice wasn't losing out on business, and actually could make more money just based on the efficacy of the product itself, because they could turn chairs faster, right? And so that helped us overcome where customers were concerned.

Damon Baker (40:23)
The part of this story we haven't touched on yet is while you're driving Hyperscale in a star business using the BCG Matrix, you're also running a cash cow business or a legacy business that was core to Ormco at the same time. So even as Spark exploded, you're still responsible for driving the traditional brackets and wires that we're all used to in terms of braces as a business which was the profit engine, quite frankly, that was probably funding a lot of the story that we're talking about most likely. So how did you balance the needs to protect the core while building the future of what, well, it's not even Ormco, it's like what Spark would be, right? Because these are two separate companies at this point.

Eric Conley (40:57)
That's right.

Yeah.

Yeah. So, yeah, so that was an interesting thing, right? So when I first got there and the business had been Spark, it's sort of been pulled out of Ormco to be its own, you know, stand up organization with rights level of strategic focus investment, a focused team. You know, we were running like crazy for a couple of years to get things stood up and really launched.

And by the time we got into 2022, know, things were a lot of a lot of the challenges and change was behind us and really was about managing the growth at that point. And so we decided to put the businesses back together. And so, you know, there was there was some work in the beginning to, know, because we had two leadership teams, we had a separate business to kind of bring that together. Almost felt like, you know, kind of a acquisition integration in a way. But you know kind of sort out what that team looked like from a leadership level taking you know great talent from both different businesses internally to build one leadership team and the way we way we thought about that you know kind of just thinking about the structure in the beginning was you need one leadership team across both to drive you know kind of a strategy. But I wanted to keep the product side separate. you we started to combine operations, all these different parts, but product, so product management and R &D, we kept as separate, totally separate groups reporting to an R &D leader. They did, they did. So we had to cross train and do those things. the idea with there was, you know, you're an orthodontist, we always took this from a customer perspective, right? If you're an orthodontist, I don't want a,

Damon Baker (42:36)
What about sales? Did sales carry both products in the bag?

Eric Conley (42:53)
a Spark salesperson showing up one day and then an Ormco salesperson showing up the next day. It's silly. Let's talk about both, right? And the reality was, we could do a better job of converting legacy Ormco customers to the Spark platform.

Damon Baker (43:02)
Yeah, best solution for the problem.

In effect, was that what you were doing, which kind of motivated the change back?

Eric Conley (43:19)
Yeah, it was a big part of it. by mid-2022, we actually had enough scale on the Spark side where there was a lot of Spark-only customers, right? And they were using a competitor to Ormco on the Braces side. And so there was an opportunity to go both directions. And so we had to do it off-screen.

Damon Baker (43:20)
Yeah.

Imagine you had a lot of conflict internally you had to deal with.

Eric Conley (43:37)
A little bit, a little bit. mean, it was, there was definitely a great opportunity for a symbiotic relationship there though. So, you know, the sharing of leads really only helped both businesses. But, you know, there was a challenge in sort of cross-selling because the salesperson who'd spent, you know, we had, we had plenty of 20, 30 year veteran salespeople in Ormco who had spent a career telling that doctor that aligners are bad idea do more braces. And so, so you know, that was the challenges were more internal and external and sort of combining that. But we, you know, managed to work through those things. And then, you know, back to your question about managing to, you know, that really, one was a profit driver, low growth, and the other was a hyper growth, not a profit driver at all yet. It was a challenge, you know, and I think

You know, we always start with, you know, very clear customer segmentation and call plans with the sales team. And, you know, what are we trying to each individual orthodontist we're going to go see what is it we're trying to sell, right? And so make sure we don't, even if we're trying to cross sell, we don't confuse the two. not trying to do both in the same. And so, you know, we still had separate sort of customer segment targets that we went after.

We had a focus and every visit we went to. And remember that on the Spark side, the real funnel conversion engine was clinical education. And so the salespeople for Spark, we always said, hey, your job, we broke it down very simply. Your job is to put butts in seats at Education of Buts. So we told them, we showed them the math. We said, if you put two,

Damon Baker (45:22)
Yep.

Eric Conley (45:27)
New orthodontist and education event every single month, you'll beat your numbers. You'll blow your numbers out. And so that's what we said, that's what you have to do. The Ormco side was different. were selling, you know, were, you know, selling braces, you know, and trying to get in there and get the doctor to try it. And so, so yeah, that helped a little bit because it was more of a team sale on the, on the Spark side and the, you know, the hurdle to get them into the funnel, the sales funnel for Spark was pretty low. know, clinical education is something that orthodontists typically don't say no to. And so, that's how we manage that. As time passed, we really saw a need to start to rethink the product side because it was just really hard to tell a story, you know, kind of treating it as two separate businesses.

Orthodontists, you know, we found really loved the workflow, the digital workflow that came with, you know, aligners. It meant they spent a little bit more time off the chair in front of a computer doing treatment planning, but the patient flow was fast and it was more in their control, right? So, you know, your teenager at home who was wearing braces,

You they break a wire, they do something, they gotta come in, right? mean, so that doctor's gotta reserve a certain amount of chair time for emergency cases. They're not in control of their schedule. Aligners is not a problem. know, I've, worst case, you lose your aligners, right? You just say, go into the next one. Stay home.

Damon Baker (47:05)
Yeah, I lived it personally. know exactly what you're talking about.

Eric Conley (47:09)
Yeah, so they have control, right? And the visits were fast, right? Is it working or not? Are you tracking or not? And they had a treatment plan to compare it against. And so they liked that workflow. And so we had an opportunity over time to really capture some space being the only company who had a successful aligner business plus the legacy braces business. We started to digitize the workflow for braces too, which is an important innovation in the space. And as we did that, it sort of brought everything together more and more because doctors could use the SPARK software and by the time I left they were in a place where they could drive either a braces case or a liners case from the software.

Damon Baker (47:51)
The Spark story wasn't without its cultural challenges. So one of the turning points is around Mexicali and the cultural shift that was made there. And if I remember correctly, Mexicali wasn't a Greenfield, correct? You were moving Spark into Mexicali, which already was making products for Envista. And I don't remember which ones. Is that an accurate statement?

Eric Conley (48:11)
Yeah, in the beginning we had an existing site in Mexicali. It had been there for decades. And it was an Ormco site. So they were manufacturing. It was the primary manufacturing site for the braces business.

Damon Baker (48:24)
So their turnover was, their regrettable turnover with employees was 50 % and you're able to drive that down to 10 % as part of a cultural turnaround. So how did that happen? What was the strategy around that?

Eric Conley (48:29)
Kaleah.

Yeah, there's a few things happened there and maybe a little bit more background. You know, we had that legacy site which had some challenges and we were hiring in building lines and hiring into that site, but we quickly ran out of space there. And so we also, we built another site, it's probably about 15, 20 minutes away, a brand new site that we stood up in five months from shoveling the ground to producing aligners.

That was a Spark only site and we had a little bit of a, we had better turnover numbers. We still had an issue, but our attrition there wasn't quite as high. it was really due to the, you had a new space, had a nice big cafeteria, nice facilities, right? And so automatically we got some improvement there. But the biggest thing we did, biggest difference we made was some changes we made from a leadership perspective. mean, turnover, engagement, all of those things is leader driven, right? And for us, you know, the situation we had in Mexicali, very seasoned management team. They were very talented in a lot of ways, but they weren't on the floor, weren't building the right relationships with the team didn't show that they cared. And we were probably on the low end of the pay scale, even in Mexicali from a manufacturing perspective. And so we had to change a lot of things. And it started with bringing in different leadership on site and making sure that we were leading from the floor. And one of the things, I did when I got there was the plant managers office and desks, I took them away and I moved them, I moved their desk on the floor. And I said, this is where you work, right? If you have to take a call, go find a room. But you know, you need to be on the floor. I don't want you in meetings and you need to be walking the lines all the time, you know, and spending time with the team, helping them. And we also started to build, I think a more robust bottoms up funnel of Kaizen. And so we taught folks who were running the lines or on the lines that if they saw something that wasn't working, either for the product or for themselves, right, in ergonomics or whatever it could be, they can make a difference, right? They can change it. They had permission. And so we started to draw Kaizen ideas from that group. And as they started to see change being driven, not just from us, because we were changing all the time, but they could institute, they could start the change.

Damon Baker (51:08)
Yeah.

Eric Conley (51:21)
That mattered a ton. And we started to make it fun. We started to do, ⁓ you know, we would have two o'clock, you know, kind of ⁓ as shifts, you know, sort of came on and off. We would have, you know, 10 minutes of loud music and exercise and stretching, you know, so leave yourself, come out. You know, we would have the leaders out there stretching the loud music along with everybody else. I mean, it was, you know, we became visible as leadership team.

There's a lot of other stuff we did, right? I mean, working with transportation improvements and food improvements and on and on and on. But I think the leader engagement on the floor was probably the thing that drove the biggest change.

Damon Baker (51:58)
It seems like you put the associate at the center of what was important versus before. seemed like the leaders created their own self-importance and the employees weren't the center of that priority.

Eric Conley (52:11)
And it wasn't necessarily always, I it wasn't the leaders fault, right? I mean, in a lot of cases, you know, the plant managers in Mexicali, know, once we started to kind of look into their calendars every day, they were booked full of meetings that my team was scheduling, right? And so they were just accepting stuff from corporate in a lot of cases. And it meant that they were on a team's call all day every day.

Damon Baker (52:29)
Hmm.

Eric Conley (52:36)
And so we had to do a little bit of 5S around their schedules, right? And I can't remember who it was that started to see it, but we started to do a little bit of an audit of like, show me your schedule for the last month. And we realized that they didn't have time to be on the floor. mean, they would do their walk around, their daily walk, gimbal walk at 6.30 in the morning, and then they were stuck in an office. And so that was a big part of it, right? We said, hey, you've got to reserve, you've got to dedicate times. We cut out a ton of meetings, told them they got to dedicate times for gimbal walks. We moved their office just to make it easier. They're on the floor. so that was an important thing. It wasn't just them. We were doing it to them from California and didn't even realize it.

Damon Baker (53:23)
Looking back on it, what did you learn about yourself through this Spark journey in terms of your leadership style and...how that went.

Eric Conley (53:33)
Yeah, I mean, think the thing for me that changed ⁓ through that was, you know, a little bit of a, I think a better, a better sense of where the line between, you know, speed, decision making, how to make those fast decisions and risk and where to better place that, right? And so I came from a world where, you know, 10 years of startups, a long time ago, right? Where there's a lot of risk and very fast decision making to Danaher and Fortiv and especially a business like Fluke, which is a big cash engine for both of them, even Danaher, where the risk tolerance is not high. Yeah, exactly. And so I think coming into this, was really about how do you not break in VISTA, right, as a public company, but go the pace we need to.

Damon Baker (54:11)
Yeah, don't screw it up.

Eric Conley (54:23)
�take advantage of the opportunity we had in front of us. And we didn't know if, you know, we felt like every, any could pivot and squash us in some way. And so, you we didn't, we had to take advantage of it. And so, so for me, you know, thinking through that really got comfortable with, you know, thinking about how do you make decisions? In a very fast way. What are the things that, you know, and with a lot of ambiguity, what do you really need to understand and know in order to make a decision and at what point do you get really diminishing returns on kind of continued analysis? Knowing that if you make a decision and you set up your metrics in the right way and your daily management in right way, you're gonna know in a week or two if it's the wrong decision. You're gonna know.

And so you get, and then you got to get the team comfortable to pivot, right? It's okay to say we screwed up, right? And I made a point to talk about every time I talked to the team broadly, I would talk about one or two mistakes I'd made in the last week or month, right? But you know, I messed up, right? It was a wrong decision. And here's how we figured that out. And here's what we did. And so, you know, I think for me it was, how do you, you creating a fast paced environment where mistakes are okay, right? But also building a culture where the team before we embark on something, if it's important, we're go spend some real time or money to go do it. We set the metrics up to where if it's a mistake, we know and we know why, right? And then at that point, you know, what's the downside, right, of just trying. If it works, put more fuel to the fire, go even faster. If it doesn't work, you pivot, right? I'd rather do that. That's a faster way to learn than, you know, spending the next month evaluating and analyzing in a vacuum.

Damon Baker (56:20)
What I love about the story is the recognition and realization by the leadership team that we had to set up the company and lead in a different way apart from what we were used to and how we were used to running the core businesses that were part of EnVista. To me, that takes a lot of humility to recognize that that was necessary to make the decision, first of all, but then to stick with that and allow Spark.

The room to grow and isolate them maybe from all the rigor that you were referring to earlier with your other experiences at Fluke and those kinds of things, which one would argue that that's sort of the downfall of being too rigorous is that you don't nurture these growth opportunities like this because it never can get off the ground because of the way the company runs. What's your reaction to that?

Eric Conley (57:09)
I think that's right. I think the biggest, the most important thing that helped us launch this and the most important thing to be in place before I even started was, you know, by then the management team of Envista, Amir Agdi, the board were convicted. I mean, they were, they'd done their own research over a number of years into this space and VOC. They had a hundred percent conviction before I walked in the door. And so, you know, for me, it was about how do you, you know, create a new way of doing business and a little bit of teaching, you know, the Envista organization, here's how we think about risk tolerance in a very different way for this business. Because if we think about Spark, like we think about managing risk at Ormco or Nobel Biocare, one of these businesses, we'll never get anywhere. We can't go fast enough. But let's create.

You know, a sort of risk management environment that is appropriate. And what I told my team is, we're not going fast by cutting corners. We're gonna go fast, be 100 % kind of compliant internally, but we're gonna have a different set of rules and different set of guidelines that we operate under, right? That makes sense for the business. And so that support was invaluable for us.

Damon Baker (58:23)

It was really showing the power of and. It wasn't either or trade off. You can grow profitably and do it with high quality and not burn people out.

Eric Conley (58:38)
Yeah.

Yeah. And that's how, I mean, you know, companies all the time try to build startups internally. They all get killed by the risk sort of management teams, right? In an organization because they're just not, they're doing their job. And their job is to, to, you know, a lot of times heal things, but you know, in their minds, what they're doing is they're trying to, you know, minimize risk to the company in a lot of different ways. And, and, you know, I think the important thing that we did was show them that, hey, let's think about the scope of mistakes that we can make, right? How much does that really cost? And early on, it didn't cost much, right? So, you know, because we were so small, you know, there was really not a lot we could do to break in VISTA. That changed over time, but early on, that acceptance, that understanding, and, you know, and Amir and the team. giving us, having the conviction that he did and support that he did was hugely important.

Damon Baker (59:41)
So by 2024, Spark becomes the story inside of EnVista. It's featured in board meetings, analyst calls as the growth engine of the business. As you look backward on that time, what's the single biggest lesson that you'd share with CEOs about scaling a business under extreme pressure like you experienced with Spark?

Eric Conley (1:00:06)
Yeah, think it's, I kind of go back to the beginning of the conversation. I mean, I think it really is two things. Customer intimacy is huge, right? So understanding who your key customers are, understanding what their experience is, making sure that there's an open line, clear communication there. You know, I probably had by the end of year three,

I don't know, maybe 1,500 orthodontist numbers in my cell phone, right? mean, and so that's critical. And not every market is 30,000 customers, right? That's pretty rare. But whether it's your key distributors or your top 50 customers, 100 customers, whoever that is, be close, right? Stay close to them and understand kind of what their challenges are and how you play a role in. Either solving or making a problem for them. That's number one. Number two is making the time for, we talk about GIMBA, but it's making the time to get out of the office. I mean, the worst place to make a decision is in a conference room. Worst place. You've got no information, you can't see anything. And so we would all the time, I used to have a...a rule where if it took us more than a week to make a decision on something, no matter how big or small, we had to get up and go to wherever the work is being done and make it there. And so, you know, getting out to the factories, getting out to customer sites, getting to, you know, sitting with the R &D team to figure out what they're working on, what they're struggling those things, that's critical, right, for you to have.

Right information to make those kind of decisions, best decisions possible. I would say those two things. mean, it's, there's a lot we learned. There's a lot I've taken with me from that, but you know, I think for any leader, really close to customers and spend time with the frontline team,

Damon Baker (1:02:10)
Eric, I think the spark story is a blueprint for what's possible when bold strategy meets flawless execution and very few leaders get the chance to build something this ambitious and even fewer pull it off at this scale. You showed us how speed, focus and people first leadership can turn a challenger brand into category contender in just under four years.

Fantastic job. Thank you for sharing the story. Where can people who are listening to this podcast learn more about you and your work? didn't get a chance to talk to you about your new company. Maybe that can be the next podcast episode.

Eric Conley (1:02:45)
on LinkedIn and haven't gotten to the point where I'm like turned off the don't connect

happy to connect. we moved, I lived in Seattle for 12 years, close to Fluke and Fortive, traveling up and down. mean, in Vista headquarters in Ormco and Spark, we're in Southern California, Orange County.

Spending a lot of time down there before, now we're out in the Boston area. And so, you know, I mean, if somebody wants to, wants to reach out and chat through, through LinkedIn or otherwise, certainly happy to, happy to, to, to share, share more. And yeah, and Chase, you know, I mean, where I am today, this is a, this is a really interesting business. Needs, you know, it's not, I don't think I'll ever see anything that has the sort of urgency around.

Hyper growth like Spark did, but it's a growth story, right? And this is a KKR sponsored business, owned business. And I think here we're also really, really excited about the growth opportunity. It's a great business. And one of the unique things that we have here is every employee is an owner in the business. And so some of the things that we can't do even at a place like Spark around incentivizing an organization.

And kind of coupling that, hey, let's make decisions like we're owners, make decisions fast, let's do the right things for the business, just take care of each other from an engagement perspective. Here it matters just a little bit more, right? Because we've got close to 1,000 employees and every one of them are in.

Damon Baker (1:04:11)
I'm excited to watch this growth story unfold. So, we'll be watching. for everyone listening, this is what bold leadership looks like when the stakes are highest.

as always, stay focused, stay lean.