Business & Startups

Why We Invested in Bento

Ram Sudireddy is the quintessential entrepreneur. When he sees a problem, he needs to identify why it exists — and the best way to solve it.

Having founded and exited three startups (two in the chip/semiconductor industry and one in IT/disaster recovery), Sudireddy’s always on the lookout for a new problem to solve. About five years ago he found his new calling when he took his son in for a dental appointment. He was shocked to receive a significant out-of-pocket bill even though he had dental insurance for his family.

After digging in to figure out how that could be, he discovered a lack of transparency in the industry and determined that dental insurance isn’t really what most people would consider insurance. There is no pooling of risk, and coverage limits are very low compared to annual premiums.

The further Sudireddy dug into dental insurance, and the oral care industry in general, the more inefficiencies he found. He decided to utilize his engineering expertise and entrepreneurial experience to build a solution to this unnecessary cost on society and bring affordable dental care to the masses, starting with the 80 million Americans who work for small businesses or in the gig economy and are underserved by insurance companies.

York IE is proud to announce that we invested in Sudireddy’s company, Bento. York IE participated in Bento’s $8.1 million Series A that was led by Schooner Capital with additional participation from Companyon Ventures and strategic angels.

The Bento Team

Sudireddy leads a growing team of 30 employees on their mission to disrupt dental insurance. Joining him on the executive team are accomplished industry veterans and technologists. As illustrated by the bulleted resumes below, the complementary talent and experiences held by this leadership team positions them to disrupt the antiquated and inefficient dental insurance industry while simultaneously navigating the status quo.

  • Chief Operating Officer Kevin Klein
    • Senior vice president at DentaQuest (Delta Dental of Massachusetts)
    • Chief marketing, sales and strategy officer at Boston Medical
    • Vice president of dental networks and quality at Guardian Insurance
  • Chief Growth Officer Landon Lemoine
    • Director of sales and growth, global markets at Modo Labs
    • Senior business development manager at Endurance International Group
    • Business development and mergers and acquisitions at Constant Contact (acquired by Endurance International)
  • Chief Product Officer Prem Yerabothu
    • Executive director at IBM
    • Founding member and director of development at Netezza
    • Director of development at Applix
    • 20-plus years of building world-class engineering teams
  • Chief Sales Officer Chip Huffman
    • President at Northwest Insurance Agency Group
    • Vice president of business development at NCD
    • Senior vice president of sales at TruAssurance Insurance Company
    • Chief sales and marketing officer at Dental Select

The Bento Platform

Bento’s HIPAA-compliant SaaS platform will cause this disruption by enabling anyone (dentist practices and offices, unions, associations and organizations, companies) to build, launch and administer their own dental plans without the need for traditional dental insurance providers. The platform removes the middleman in the industry (insurance companies) by providing a benefit builder, cloud-based adjudication, payment processing and transparency, and a mobile app. This results in costs that are 30% less than traditional dental insurance for plan administration and claims processing while offering greater transparency and value to members.

With almost 100,000 of the 160,000 dentists in the country in its network, Bento possesses the third-largest provider network behind Delta Dental and Cigna. Additionally, the American Dental Association has endorsed Bento and even uses the platform to provide dental benefits to its own employees.

After initial go-to-market (GTM) efforts in 2019, the shake-up of in-person healthcare driven by the pandemic forced Bento to alter its strategy, because consumers were not able to see dentists and utilize their benefits. Now the company is utilizing a two-pronged approach to gain market share. First, Bento is targeting organizations such as HealthShares, Health Plans and associations that represent 7 million Americans underserved by the status quo. The company is also rolling out a state-by-state GTM plan to sell to gig economy workers, small and medium-size businesses, and enterprises, starting in Colorado with plans to expand into Georgia, Arizona, Texas and Florida in the near term.

Bento monetizes the platform via subscriptions and transaction fees. For groups (associations, unions, employers, etc.) or dental practices and offices providing plans to their members, employees or customers, Bento charges $5 per person per month. If an individual with no group affiliation signs on to be a Bento customer, their fee is 7% of any transaction.

Bento is not alone in trying to modernize the antiquated dental insurance industry. In addition to the obvious competition from traditional insurance companies, there are startups such as BEAM Dental and Level that are offering alternative solutions. Bento’s key differentiator is the platform nature of its offering. Bento enables dentists, employers and other groups to build and administer flexible dental plans in a cost-effective manner, providing a better, more transparent experience for everyone involved.

With the potential for disrupting an archaic industry and helping millions of patients worldwide, we are thrilled to partner with Sudireddy and the Bento team on their journey.

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