Both dental organizations and dentists are looking at partnerships with a longer-term view, rather than straight up sale value.
Practice owners want to ensure that the culture they worked years to build will last through any affiliation, and DSOs want to make sure that the practice they are looking to add is really an organizational fit. Both parties, above all else, want a win-win partnership with true alignment.
These two dental executives recently connected with Becker’s to talk about how partnerships in the DSO landscape have changed and evolved over the past few years.
Note: Responses were lightly edited for clarity and length.
Question: What is the biggest change you’re seeing in how dentists and DSOs evaluate potential partnerships today?
Leann May. Executive Director of Operations of Iowa Dental Associates (Spirit Lake): At Iowa Dental Associates, we are seeing a meaningful shift in how dentists evaluate potential partnerships. Increasingly, dentists are looking beyond the financial aspects of a transaction and focusing on long-term alignment—specifically how a partnership will impact their community, patients and team members. Many doctors want reassurance that the culture they have built will continue, that their patients will remain well cared for, and that their team will have stability and opportunities for growth.
In the same way, IDA approaches partnerships with a long-term perspective. We seek practices that have strong roots in their communities, trusted relationships with patients and a commitment to quality care. Our focus is on partnering with practices that demonstrate sustainable operations today while also offering meaningful opportunities for future growth, development and continued service to their communities.
At the same time, the dental partnership landscape is continuing to mature. Both dentists and DSOs are approaching partnerships with greater sophistication and intentionality — focusing more on long-term sustainability, operational strength, and strategic alignment rather than simply transaction value.
This evolution has led to more thoughtful due diligence, clearer expectations on both sides and partnerships designed to support practices not just through a transition, but through the next phase of growth and development for the doctors, teams and communities they serve.
Rob Rubino. Chairman and CEO of Qualitas Dental Partners (Sharon, Mass.): There are two important changes in how dentists and DSOs evaluate potential partnerships today.
No. 1 is achieving aspirations. How can the owner dentist help the practice grow and thrive after the sale. Practice valuations are increased to the degree the new partner practice can grow organically. Conversely, limited growth opportunities post-sale, limits practice valuations. The viability of practice growth plans is an important partnership detail to discuss amongst the potential partners. These can be energetic and exciting discussions where properly equipped DSOs can help execute on the long thought about growth opportunities of the practice owner.
No. 2 is that relationships matter. Both dentists and DSOs are looking more intensely at the softer issues of a partnership. Does the partnership make sense? Is there a cultural fit between the practice and the DSO? Are there true alignment of interests and is a partnership a win-win for both dentist and DSO? These are important discussions to have and often require several dinners, meetings and calls to build both trust and a sustainable relationship. If either party is not set up to devote the time necessary to develop the answers to these questions, then the partnership may not be worth exploring.
