Most of us spend time thinking about resolutions this time of year, and I’ve been considering my personal and business goals. As you certainly know, running a business isn’t easy at the best of times. But the current economic climate demands more focus and effort than ever before. With that in mind, my partner and I have been reviewing our strategy to give clients exceptional service in 2023.
A colleague and I were talking recently, and the conversation turned to DSOs, as they often do these days. We weighed a few questions, and he asked, “What do you think the future looks like as it relates to transitions? Is everyone going to sell to a DSO?”
No.
“Are valuations going to keep going up?”
I’m not sure.
But ultimately, his last question made me pause. He said it seems like many doctors don’t want to sell to a DSO. If that’s true, he wondered if I’d ever considered making that my niche – focusing only on clients wanting to sell to an individual dentist.
It’s certainly a potential strategy and likely a financially viable one. But it goes against our actual mission.
An Exceptional Opportunity Today
We’re committed to our mission; we want to help doctors transition their practice on their terms after being fully educated on all options. We want them to make an informed decision about exiting their life’s work and selling one of their largest investments/assets. Limiting our scope to only dentists wanting to sell to private parties would directly conflict with our mission.
One aspect of the transitions’ space is how dynamic it is currently. Some owners sell their practice for 70% of collections, and others sell them for 250% or more. Some dentists prefer a very short transition and want to walk away. Others want to continue working to participate in the practice’s future growth via an equity rollover.
What an incredible time to own a dental practice!
However, for some dentists, the evolving dynamics are causing anxiety and uncertainty. When is the right time to transition? Should I sell to a dentist or a DSO? All my friends are doing or saying [fill in the blank with the latest buzzword or trend]. Should I make the same move?
For other dentists, the dynamics are creating a significant information gap. These are the dentists I’m most concerned about as they often don’t really know what their practice is worth or could be worth. They don’t fully understand how more significant deals are coming together or how we help customize deals for every situation. This information gap has caused many dentists to sell their practice unrepresented, and ultimately, often agree to a price that doesn’t accurately represent the value of the practice and/or agree to contractual terms that don’t correlate with the market.
We Hear This Often. We Can Help.
On nearly every initial call with a practice owner talking about potential ideas for their transition, we inevitably hear, “I didn’t realize that was an option.”
And rightfully so.
Your primary responsibility is running a practice and taking care of patients. It’s not knowing every nuance of a practice transition. And it’s definitely not knowing the complexities of DSOs, equity rollovers, and valuations.
That’s what we do.
To bring this full circle, one of my resolutions this year is to stick to our mission. To help dentists carefully craft their practice transition for maximum gain and fulfillment. To encourage dentists to start the process early enough to allow them to design a plan, develop a strategy, and execute it on their desired timeline.
You don’t have to know your next move or when it will happen. We’re here to give perspective to your options and help you shape the road ahead. We can help you learn what a personalized exit strategy could look like. While we understand how to navigate DSO deals, we bring a comprehensive approach to our clients. We help doctors find associates and individual buyers, too.
You built the practice: Don’t you deserve an exit strategy on your terms? Reach out today and start the conversation.
