(Reuters) - Shares of SmileDirectClub SDC.O, a teeth alignment company, tumbled 10.7% in their market debut on Thursday, after the company's initial public offering was priced above expectations.

Shares opened at $20.55, giving it a market capitalization of $7.96 billion, if underwriters exercise their option. The company’s shares rose as high as 2.7% from the opening price to $21.10, in early trading.

SmileDirectClub had priced its initial public offering at $23 per share on Wednesday, above its initial target range of $19-$22, raising about $1.3 billion at a valuation of about $8.9 billion.

The Nashville, Tennessee-based company said it intends to use the proceeds toward redeeming LLC units from its pre-IPO investors and fund a dividend to them and also pay bonuses and funding-related tax obligations. (bit.ly/2mePGsZ)

The online dentistry startup reported total revenue of $423.2 million for the year 2018, a surge of about 190% from 2017. For the first six months of 2019, SmileDirectClub posted total revenue of 373.5 million.

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SmileDirectClub’s losses have also more than doubled to $74.8 million last year, from $32.8 million in 2017. While it posted a loss of $52.9 million for the first six months of 2019.

The offering of SmileDirectClub, which sells teeth aligners to customers, comes on the heels of market debuts of loss-making companies such as Uber Technologies UBER.N and Lyft Inc LYFT.O, whose stocks have struggled since going public.

J.P. Morgan and Citigroup served as lead underwriters to the IPO.

Another IPO hopeful, WeWork owner The We Company, is looking to go public, despite opposition from its largest investor SoftBank Group 9984.T.

WeWork is widely expected to have a disappointing debut that may value its shares at $15 billion, less than a third of its peak valuation of $47 billion.