Ep. 141: State of the Dental Industry 2024

What is happening with private practice dentistry right now? Between inflation, economic pressures, insurance networks, corporate dentistry run amok, and an imminent wave of retiring dentists-we are living in strange times indeed! There are several recent trends that every practicing dentist should be aware of, including some incredible opportunities for entrepreneurially minded dentists to take advantage of. Listen to this week’s special “State of the Industry Address” to make sense of it all!

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[@timmietz]

Great episode! Thank you for forwarding your! I just want to make one small correction/update:
As it pertains to a purchase/valuation of any practice by a DSO, primarily the ones owned by private equity, the numbers are down, way down. Private equity is very sensitive to interest rates. As the interest rates went up, they are multiples team down substantially. From what I’m seeing, it’s 2 turns on average .That, combined with the fact that almost everyone’s EBITDA is down 20-40% in 2024 vs 2022 or early 2023, basically means that valuations are down as much as 50%. Even When the valuations were at their highest, all of the big DSOs were only paying 60 or 70% cash at close. The earn out timeframe used to be three years and it’s most universal at 4-5 years now. Meaning, that in order to get your food, now, you need to make enough money for that private equity owned DSO to pay you that money. And, like you said, the idea is that if you are signed up with them for a 5 year earn out, they are likely to have sold you or very close to a recap at which time whatever they paid for you is gonna seem like peanut. Finally, duct tape DSO‘s have started failing in 2022, and the rate has definitely accelerated since then. If the interest rates are going to stay as high as they are now, for another 12 months, I predict that there is gonna be a slew of duct tape DSO‘s of various sizes failing all over the country. I am in Florida, and I know of at least three that have changed hands in the last 24 months because they were basically bankrupt or closed to it.