The DDR Dental Advantage

DSO Ready

The dental industry has recently attracted the attention of investors (mostly private equity groups) who are seeking new investment opportunities. The lack of consolidation and the desire to deploy capital is pushing valuations and forcing change on the industry.

The new investment vehicle for private equity groups is to form Dental Service Organizations (the “DSO”), sometimes also called Dental Support Groups. We helped form one of the first DSO’s back in 1998 (known as Pentegra Dental Group). We began with 50 practices in 19 states and quickly grew to over 103 practices in 31 states. DDR Dental knows intimately the pros and cons of selling to and operating within a DSO structure. If you are considering selling to a DSO, call us first. We know well their valuation methods and organizational challenges.

Advantages of DSO Model

  Sell but remain in practice
Liquidity and higher valuation
 Benefits for staff
Help with day-to-day decisions

Disadvantages of DSO Model

Loss of total control
Must fit their valuation model
 Staff under new management
All change is hard, even if beneficial

DSO’s are operated by skilled industry experts to know well the financial, operational and legal metrics. More than every, you need a knowledgeable broker and lawyer to brings the same level of experience. DDR Dental knows well the various DSO structures and valuation metrics.

When selling to a DSO, it is critical that you retain specialists in the brokerage, accounting and legal areas, so the tables are balanced. We urge you to obtain competent and experienced assistance with this life changing decision so that you realize the highest value for your practice. When it is time to consider a DSO, please call DDR Dental at 800.930.8017 or email us at info@ddrdental.com. We are here to help when you are ready.