February 28, 2023
What It’s Like to Work With a Dental Practice Broker
There are countless reasons why you should work with a dental practice broker when transitioning ownership of your business, but what steps go into working with a dental practice broker once you’ve decided with whom you trust your life’s work? Professional Transition Strategies Founder and President Kyle Francis recently sat down with Dr. Paul Goodman of the “Dental Nachos” podcast to talk about all the things that go into buying and selling dental practices. Here are the key takeaways from their conversation.
Understanding the goals
Back in the day, if you had a dental practice that you built up over time with a strong cash flow, your only exit strategies were to bring on a partner to eventually sell 100% of the practice to or sell to an individual. But not every dentist dreams of being a business owner, as well, and respectfully only has an associateship mindset. That’s where private equity comes into play, leveraging the market to work in such capacities, and the goal of any good dental practice broker should be to help a doctor understand the equity they have in their business and how to leverage it.
Laying out options
It’s perfectly acceptable and understandable for a dentist working toward retirement age to begin the process without knowing all the ins and outs of what goes into a practice transition. It’s the job of the dental practice broker to explain everything from the difference between EBITDA and SDE to all the data that goes into calculating the true market value of your business. “It’s like a choose-your-own-adventure book with no one-size-fits-all solution,” Francis describes.
Finding a good fit
The buyer for your dental practice has to be a good fit on more levels than just the obvious bottom line. Above all, they should be someone with whom you want to do business and trust to carry on your business goals with your patients’ and staff’s best interests in mind. However, that doesn’t always mean selling to an individual. Sometimes, that means affiliating with a dental service organization (DSO), which comes in many forms such as a joint venture or an equity roll-up. “Just like a dentist offers the right treatment plan for the right person at the right time, there’s the right decision for the right [dentist] at the right time,” Dr. Goodman explains.
Finding another good fit
Just like you’ll want to find the right person or dentist to take over your practice, you’ll first want to work with a dental practice broker who has your best interest in mind. A good dental practice broker will present all the options to you and connect you with a team of advisors to get you over the finish line. “It’s like having a caddie in golf, someone to lean on and get advice from along the way to the biggest decision of your life,” Dr. Goodman explains.
The experts at Professional Transition Strategies perform more than 700 prospectuses a year and have helped more than 500 dentists transition ownership of their dental practices. Contact them today to get the process started.