In the current dental market, DSOs (Dental Support Organizations) have shifted their acquisition strategies to mitigate financial exposure, a move described as "de-risking". This shift has significant implications for dentists looking to sell their practices, particularly regarding how much cash they receive at the closing table.

The End of the "Heyday"

Previously, dental transitions were often "home runs" for sellers, who could expect to receive significantly more at closing than they would from a private buyer. During the "fast and furious" pre-COVID era, money was cheap, and private equity-backed groups were buying practices aggressively.

However, this market has undergone a correction:

• Vanishing FOMO: The "Fear Of Missing Out" that drove sellers has largely disappeared as market conditions have tightened.
• Expensive Capital: Money is no longer "cheap," causing private equity funding to dry up for many groups.
• Margin Pressures: Rising costs for hygienists and dental assistants have squeezed profit margins, making it harder for DSOs to service debt.

DSOs are now focusing on de-risking by pushing more of the transaction's financial risk onto the selling doctor.

• Decreased Cash at Closing: While sellers used to expect roughly 80% of the enterprise value in cash at closing, that figure has frequently dropped to between 50% and 60%.
• Rollover Equity Risks: A larger portion of the practice value is being held back as equity in the parent company. Attorneys note that some DSOs have recently informed partners that their internal shares currently have "zero value".
• Stock-Based Earn-Outs: Future payouts (earn-outs) that were previously paid in cash are now often being structured as 50% cash and 50% stock.
• Unique Holdbacks: Buyers are implementing new types of holdbacks, such as those for Accounts Receivable (AR), that were not common in previous years

Shifting Payout Structures

DSOs are now focusing on de-risking by pushing more of the transaction's financial risk onto the selling doctor.

• Decreased Cash at Closing: While sellers used to expect roughly 80% of the enterprise value in cash at closing, that figure has frequently dropped to between 50% and 60%.
• Rollover Equity Risks: A larger portion of the practice value is being held back as equity in the parent company. Attorneys note that some DSOs have recently informed partners that their internal shares currently have "zero value".
• Stock-Based Earn-Outs: Future payouts (earn-outs) that were previously paid in cash are now often being structured as 50% cash and 50% stock.
• Unique Holdbacks: Buyers are implementing new types of holdbacks, such as those for Accounts Receivable (AR), that were not common in previous years.

Increased Retention Requirements

To further de-risk the acquisition, DSOs are requiring sellers to stay on as providers for longer periods.

• Clinical Stability: A practice is considered a safer acquisition as long as the seller remains on-site to maintain patient and team stability.
• Longer Commitments: While three-year stay-on periods were standard, many DSOs now require five-year commitments from the selling doctor.
• Team Continuity: DSOs fear that if the owner leaves too soon, the dental team—and the patients—will follow.

The Private Buyer Advantage

Because DSOs are offering less cash upfront and requiring longer work commitments, the gap between corporate and private offers has narrowed. Private practice buyers now have a solid chance to compete by appealing to the seller's desire to protect their staff and legacy, offering a simpler transition compared to complex DSO equity structures.

Dental Practice Acquisition | Profitability in Dentistry | Selling a Dental Practice
Dentists desire to get the most out of their practice when putting it on the market is common! But today we are starting to focus on what truly matters: the bottom line. Learn rules of valuation with CTC Associates expert Marie Chatterley.

Are you a buyer chasing after high collections number and number of ops only to find out the net profit is lacking? In this episode of Dental Unscripted, host Michael Dinsio sits down with Marie Chatterley, owner of CTC Associates, to debunk the myth that a practice’s worth is simply a percentage of its top-line revenue. With experience in the dental industry since 1988, Marie explains why EBITDA and adjusted profit are the true North Stars for any dental practice acquisition or transition.

Whether you are a first-time buyer navigating dental practice financials or a veteran owner preparing for a successful dental practice exit, this conversation reveals the technical "add-backs" and operational secrets that drive a premium valuation in 2026.

What You’ll Find Out:

• The Collections Trap: Why two practices with $1M in revenue can have vastly different sale values.
• The "Profit Multiple" Secret: Why the standard "70% of collections" rule is dead and what has replaced it.
• Inventory & Analysis: A look at the dental practice management reports that buyers and banks scrutinize most.
• The DSO Reality Check: How to compare private buyer offers against corporate "strings-attached" deals.
• Insurance vs. Freedom: Why transitioning to a fee-for-service model could be the fastest way to increase practice value today.
• Attrition Myths: Why the "20% patient loss" fear is often overblown and how to maintain loyalty.
• Debt & Anxiety: Strategic dental industry advice for younger buyers managing high student debt while acquiring.

Perfect For:

This episode is essential for dentists who need help understanding clinical practice management, those navigating the dentistry journey toward ownership, and established owners looking for profitability in dentistry.

Special Guest: Marie Chatterley

Marie Chatterley has been a leading force in dental transitions since 2003, having facilitated thousands of successful sales and associateships. As the owner of CTC Associates, she covers the Rocky Mountain region—including Colorado, Utah, and Montana—providing expert dental consulting and valuation services.

Connect with CTC Associates: https://ctc-associates.com/

Visit Dental Unscripted: https://dentalunscripted.com/
Visit Michael & Paula at https://nxlevelconsultants.com

Key Takeaway:

Dental practice valuation isn't about the amount of work you do; it's about the money that stays in the business.
Focus on profitability in dentistry and operational efficiency to ensure your practice is a salable asset, not just a high-volume job. Dental consultants can help you solve the missing pieces of this equation.

Stay Connected to Dental Unscripted for more great content on...
buying a dental practice, dental business, dental consulting, dental industry, dental management, dental podcast, dental practice acquisition, dental practice financials, dental practice revenue, dentist, dentistry journey, growing a dental practice, profitability in dentistry, running a dental practice, selling a dental practice, successful dental practice.

Is your team running the show while your grinding away to pay the bills? In this episode, Mike Dinsio, MBA and Paula Quinn, BSDH sit down with Jill Hasselman to expose the silent killers in dental ownership. If you are afraid to correct staff or rely too much on an outdated and generic employee handbook, you are exposing yourself to risk. This episode breaks down the exact dental practice operations needed to protect your license, fire toxic staff safely, and finally sleep at night. Stop being held hostage and avoid toxic situations. And why the "Document or Didn't Happen" strategy prevents lawsuits from sinking your practice.

WHAT YOU'LL LEARN

• Why "borrowing" a colleague's handbook is actually legal suicide for your practice.

• The psychological "Popup" trick that stops employee tardiness immediately.

• Why fighting unemployment claims often triggers expensive wage and hour lawsuits.

• How to document performance issues without being a "jerk."

• The "Document or Die" framework: Why if it isn't written down, it didn't happen.

• Understanding the massive gap in EPLI insurance that leaves most dentists exposed.

PERFECT FOR: Dental practice owners feeling held hostage by their staff, dental startup doctors establishing culture, and anyone seeking dental entrepreneur advice on navigating labor laws and dental teams.

SPECIAL GUEST Special Guest on Today’s Show:
Jill Hasselman is the Chief Growth Officer for HR for Health. With nearly 12 years of experience protecting doctors, she specializes in customized HR compliance and software solutions specifically for the dental industry.
HR for Health was founded by an employment attorney to help doctors prevent lawsuits before they happen.

🔗 Connect with HR for Health: https://www.hrforhealth.com

KEY TAKEAWAY Consistency is your best defense. HR isn't just about following rules; it's about regaining your freedom. By implementing consistent documentation and state-specific policies, you stop being a hostage in your own business and build a dental practice culture that respects your leadership.

STAY CONNECTED FOR MORE INFO ON:
dental practice management, dental business, dental team optimization, dental practice leadership, dental practice operations, running a dental practice, dental practice ownership, dental startup, dental hr, dental entrepreneur advice, dental practice challenges, dental industry insights, dental practice protection, dental leadership

DENTAL UNSCRIPTED:
Website: https://nxlevelconsultants.com/resources/dental-podcast/

WORKING WITH MICHAEL & PAULA:
Michael Dinsio, MBA and Paula Quinn, BSDH are dental practice consultants specializing in startups, acquisitions, and practice management optimization. Their proven frameworks help dentists navigate ownership, improve profitability, and build sustainable practices everywhere!
Website: https://nxlevelconsultants.com

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PRODUCTION
Dental Unscripted
Hosted by Mike Dinsio, MBA & Paula Quinn, BSDH
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