If it feels like everyone you know in dentistry is part of a merger or an acquisition, that’s because there’s been a surge of such transactions in the field. Here are a few factors driving all those deals.

  • COVID showed a lot of people what life was like outside of the office when their practices shut down and/or were providing limited services. Many doctors came to see that they enjoyed life outside the office and as a result have decided to sell their practices sooner than they had been contemplating. Even though the pandemic seems like it was in the distant past, the effects are still there in terms of doctors considering transition plans sooner than they would have anticipated.
  • Many doctors realize they enjoy dentistry but don’t enjoy the business side of practicing as much. A merger with a DSO takes those duties off the doctor’s hands and allows them to focus on dentistry. That’s even true for younger doctors who want to put their focus on practicing and not on running the business.
  • Meanwhile, a growing number of young doctors appear to be increasingly entrepreneurial compared to previous generations. I've noticed numerous young doctors brimming with enthusiasm about the opportunity to establish and grow their own dentistry businesses. They're eager to dive in, often right after completing dental school.
  • Another big factor: Dentists now have the potential to earn unprecedented amounts by selling their practices to DSOs. These organizations typically offer multiples of EBITDA (earnings before interest, taxes, depreciation, and amortization) in their purchase offers, far exceeding the valuation of private practices. Moreover, such transactions often include equity stakes and prospects for future income growth—perks not typically available in traditional practice sales.

Our clients rely on us to provide guidance in navigating these matters, ensuring that their decisions are well-informed and in line with their long-term objectives. Given the significance of these decisions, it's imperative to approach them with thorough consideration rather than rushing into them hastily.