We work with both high-growth doctors and established dental organizations to create, launch and scale innovative new DSO businesses that measurably improve healthcare and position platforms for best outcomes with investors. We do this from scratch, and in the space of weeks and months, not years.
Dental Business Education
Gain a deeper understanding of the value of your practice/s and how family funds or private equity could benefit your practice, assessing its potential to align with your goals and succession strategies
Positioning & Preparation
We’ll lay the foundation and prepare a comprehensive analysis of your group. PDA acts as an extension of your leadership team, gathering all of the necessary qualitative and quantitative information on your practice in order to create marketing materials to present to prospective partners
Create CompetitioN
Engage with potential healthcare private equity partners to identify the most interested groups, and select specific ones to meet with your practice. PDA will utilize competition and market insights to achieve the most advantageous outcome
DEEP INDUSTRY EXPERIENCE
We have extensive deal-making experience, deep DSO sector knowledge and strong personal relationships with key decision-makers in corporates, funds and dental PPM companies.
Finding the Right Partner
Arrange discussions with the highly interested partners, assess which group aligns best culturally, and offers support to facilitate the ongoing growth of your practice while preserving clinical autonomy. PDA performs Sell-Side QofE to ensure your practice aligns with an organization poised for long-term success
Negotiation and Closing
PDA will strive to negotiate all significant deal terms in the LOI that would be reflective in the purchase agreement, employment agreement, and operating agreement before your practice signs the letter of intent, leveraging competition while aiming to prevent any unexpected surprises
Why are PE funds interested in Dental DSO* / PPM** business:
Private equity (PE) funds are heavily investing in dental practices due to the industry's strong fundamentals, consolidation potential, attractive financial returns and a recession proof business model.
* Dental Service Organizations
** Physician Practice Management
Fragmented Market with Consolidation Potential
- The U.S. dental industry is highly fragmented, with many independent practitioners. Dental industry today is less than 22% consolidated
- PE firms see an opportunity to consolidate smaller practices into Dental Support Organizations (DSOs), benefiting from economies of scale and operational efficiencies.
Recession-Resistant & Stable Revenue
- Dental care is an essential healthcare service with consistent demand.
- Recurring revenue from routine visits, hygiene, and preventive care provides stable cash flow.
High Margins & Cash-Based Revenue
- Dental practices operate with strong profit margins (often 15-30% EBITDA).
- Many procedures are paid out-of-pocket or via dental insurance, reducing reliance on slow government reimbursements (compared to other healthcare sectors).
Operational Efficiencies & Profit Maximization
- PE-backed DSOs centralize functions like billing, HR, marketing, and procurement, cutting costs.
- Investments in technology (AI diagnostics, teledentistry, digital workflow) further enhance profitability.
Increased Valuations & Exit Opportunities
- PE firms buy practices at lower EBITDA multiples (3-7x) and scale them into DSOs that can be sold to larger firms or go public at higher multiples (10-19x).
- Strategic buyers (larger DSOs, insurance companies) and public markets provide lucrative exit options.
Aging Dentists & Succession Planning
- Many independent dentists are nearing retirement and seek liquidity.
- PE firms offer attractive buyouts, with earn-outs or rollovers to retain clinical talent.
Shift Toward Consumer-Centric Care
- Dental chains improve patient experience with extended hours, financing options, and modernized facilities, making them competitive against solo practices.
Key Risks & Challenges for PE in Dentistry
- Dentist Retention:Maintaining quality care and keeping top providers engaged post-acquisition.
- Regulatory Scrutiny:Compliance with healthcare regulations, state-specific laws on corporate practice of dentistry.
- Patient Experience vs. Profitability: Balancing cost-cutting with maintaining quality care.
“Despite the growing consolidation of healthcare markets, the dental sector in the US remains highly fragmented and presents a significant investment opportunity for private equity firms and strategic buyers from adjacent healthcare sectors. Consolidation and the creation of dental chains can bring significant operational and procurement efficiencies, as long as local market differences and patients are respected. The Dental Services Organizations (DSO) sector is currently experiencing exponential growth as established DSOs expand, while newer equity firms are moving into the sector. If you are thinking to start a DSO / group practice, you may have already investigated some of the available options. With over a decade of experience and leaders in DSOs M&A and operation, our dental advisory services address a wide range of platform investment, succession and regulatory DSO as well as MSO objectives”
