What is Your Practice REALLY Worth?
How and Why LPS Achieves Higher Practice Values Than Doctors Can by Themselves, or With Any Other Advisor
LPS is unique in that unlike other advisors, we are only paid by doctors. We have no conflicts of interest. LPS is not paid by buyers. LPS’ independence enables us to create bidding contests for our clients among multiple Invisible Dental Support Organizations (IDSO). The other guys will only show your practice to groups that will also pay them a fee. It is tough to negotiate the highest value when an advisor is paid on both sides of a transaction! LPS receives nothing unless we complete a transaction with a partner you love, at the value you want.
The principals of LPS have owned and operated multi-location, multi-specialty dental practices as well as publicly traded and private companies for over 40 years. We have completed hundreds of transactions not only for client dentists, but also our own portfolios. Our team includes CPAs, lawyers and entrepreneurs experienced in the operations of larger dental practices.
LPS is famous for devising creative solutions to complete the highest value transactions for our clients. A few recent examples:
- A large practice was in the only two U.S. states without a DSO. LPS brought the first DSO to both states for them.
- Two feuding partners would not complete a partnership with an IDSO unless the millions of dollars of practice real estate owned jointly could be sold. LPS bought all of the real estate.
- LPS achieved a $17 million dollar offer for a single doctor practice, which could only close if the doctor found an associate. LPS recruited the associate.
- A single doctor orthodontic practice client was not attracting high bids. LPS created a Dental Trifecta by adding additional orthos, pedos and OMFS practices to the transaction. All of the doctors achieved over 10X EBITDA in a $50,000,000+ transaction.
- A growing IDSO was eager to invest $200,000,000 in a specific region in Dental Trifecta transactions. LPS engineered their purchase of 50+ specialty offices of our doctor clients in less than nine months, at record values.
- A young GP in a town of 3500 people wanted to expand. LPS found the right partner for a rural practice. Within two years, the doctor’s practice value proceeds exceeded 3X collections and he was a partner in three more offices in the region.
A discount advisor, may be able to introduce you to a buyer, but then they are done and wait for their fee. LPS team members manage every step of the transaction including meetings with multiple IDSO suitors, transaction structure negotiation, all of the due diligence, Quality of Earnings audits, lease assignments, lien releases, tax allocation strategies and legal documentation. With other advisors, over 50% of transactions fail. With LPS, over 90% of clients complete a transaction.
Large Practice Sales (LPS) has the NET lowest advisory fees in the dental transaction industry. We deliver the highest values to our clients with a very unique full-service approach. Dental practice partnership is all we do. No consulting, no tropical seminars, no recruiting; just high value partnership transactions with great partners for our clients. Many other advisors may quote slightly lower fees, but they also deliver much lower NET value in your pocket. Why? In part because they get paid by both the doctors and buyers. Your real cost with them is much higher than they lead you to believe.
Because of our low NET fees, we have closed more dental practice transactions, in dollar volume, than any other advisor in the United States in the last three years. Remember that we get paid NOTHING unless you complete a transaction.
The simple reason our fees are justified is that we deliver NET values to our clients far higher than the other guys. NET, after our fees, in your pocket is all that matters. The IDSOs are also willing to pay more for LPS clients because we make transactions easier for them.
Some IDSO’s actually refer doctors to us for representation as we are more likely to get a transaction closed than an unrepresented doctor. Transactions are not as easy as they may appear, especially in the Covid-19 era
What is the Difference?
First and foremost are our people. The principals and executives of LPS have experience in starting, buying and selling their own companies and actually operating large, multi-specialty dental practices. We have done dozens of transactions for our own accounts. When our analyst team provides numbers on a client to an IDSO, they know from experience that the data is correct. We don’t BS the buyers and we provide the information they need, when they need it, accurately.
Because we are NOT paid by buyers (EVER) as virtually all other advisors, we have the ability to negotiate better values for our clients. This is critical. Many other advisors may or may not be getting paid on your specific transaction, but there is a high likelihood that they have other paid relationships with the buyers. It is tough for the two-timing advisors to negotiate the highest value for your practice when they also get paid by the buyer.
About Our Team
Chip Fichtner, Principal
Chip Fichtner has built, bought and sold multiple companies, both public and private, in a variety of industries for 40+ years. He has been featured in numerous media outlets including The Wall Street Journal, Forbes and CNBC. His tolerant wife of 30+ years allows him to live on Southwest Airlines visiting clients every week.
Matt Wilkins, Principal
A serial entrepreneur, Matt Wilkins landed in dentistry by accident following too much time spent preparing to be a corporate tax attorney. His entrepreneurial career was interrupted when he became CEO of an 18 location multi-specialty dental group at the age of 26. When he’s not criss-crossing the country to meet with LPS clients, he’s chasing his 3-year-old in Bentonville, Arkansas.
John Harris, Principal
John Harris has been with LPS since the beginning, John is responsible for expanding LPS outreach and partnerships with others that serve the dental industry. Primarily financial planners, accountants and practice consultants. Prior to LPS, he was President and Chief Executive Officer of Dental Resource Systems. John enjoys movies, music, boating and motorsports.
Michelle Norwood, EVP, Client Development
Michelle Norwood began her career as a commercial banker and became a senior executive at a publicly traded consumer products company. Her entrepreneurial career in the dental industry began over ten years ago where she loves dealing with great dentists every day! She resides in Dallas, has 3 wonderful children and too many cats and dogs.
Maxwell Sellers, EVP of Development & Buy-side Relations
Maxwell Sellers is an Executive Vice President for Large Practice Sales (“LPS”) based in the firm’s Dallas office. He joined the LPS team in 2019. Prior to LPS, he worked for J.P. Morgan, Caiman Energy II, Pathway Vet Alliance, Thrive Affordable Vet Care, and Dental Care Alliance. He has done over $3.2B in transactions which include syndicated loan facilities, buy-side M&A, and sell-side M&A. $1.3B of his total transaction experience has been in the healthcare industry.
Morgan Hunt, VP of Finance
Holding more all-around dental office knowledge than anyone else at LPS, Morgan Hunt is our resident jack-of-all-trades. Having spent nearly a decade in the dental industry holding titles such as controller, CFO, and consultant, she agreed (after a year of begging from Matt) to jump on board with LPS to meet clients' needs in a variety of areas.
Tyler Stone, Senior Financial Analyst
Tyler Stone, CPA joined LPS following a career in public accounting where he engaged in assurance and advisory services across a variety of industries. He worked with both public and private companies, developing a thorough understanding of financial statement presentation and analysis. In his free time, Tyler enjoys spending time at the lake, playing golf, and traveling.
Rachel Crabtree, Senior Financial Analyst
Rachel came to LPS following 8 years experience and careers in public and private accounting as a Tax Preparer, Controller/CFO with a background in forensic accounting and GAAP compliance. She holds a bachelor's degree in accounting and criminal justice and a master's degree in business from The University of Central Oklahoma in Edmond. A Northwest Arkansas native, she enjoys Kayaking, RZR riding, traveling, movies and spending time with family.
Lindsey Brown, Director of Operations
Lindsey Brown joined Large Practice Sales in 2019 as the Director of Operations. She came to LPS with 10 + years of management experience in corporate dentistry from specializing in patient treatment and insurance credentialing to running the Accounts Receivable Department of a multi-million dollar orthodontic practice. Lindsey thrives on communication, organization and implementing standard business procedures across the company
Nicole Quiceno, Executive Assistant
Nicole Quiceno is our Executive Assistant with over 10 years experience in the Sales & Marketing fields. She excels at keeping everything organized and making everyone's life easier. When she's not in the office, you can either find her at an art gallery or in Key Largo enjoying the Florida sun with her husband and daughter, Stella.
Lauren Schmalz, Administrative Assistant
Lauren Schmalz has been working with LPS since the fall of 2020. She has a varied background in administrative functions, management, and coaching. She is the friendly voice that will most likely greet you when you call the LPS office! When she is not in the office you can find her coaching on the softball field or visiting unique restaurants in downtown Ft. Lauderdale.
Deanna Murphy, Graphic Designer
Deanna Murphy is a nearly-native Texan and self-educated graphic designer who works to make sure all LPS publications and ads look flawless. She volunteered to design open house postcards for her realtor clients and has since created everything from business cards to billboards since the late 1990s. She’s happy jumping into projects that require learning a new skill, such as video editing. Shifting trends in fonts, grammar, punctuation and messaging also keep her learning
About Our Process
At LPS, we like to use the analogy of a relationship to explain our process. LPS starts by acting as a “dating consultant” by understanding your values and goals to ensure that we introduce you to qualified prospective “spouses” (IDSO partners). We only want to invest your time and ours on “dates” which will meet your goals for practice operations, your time horizon and growth plans. LPS only accepts very attractive clients for which we believe we can draw at least five bidders. Creating a bidding contest among multiple suitors is critical to achieving the high practice values for which LPS is acclaimed and why we are by far the largest advisors in the industry. See the below infographic.
About the IDSOs We Introduce Our Clients To
There are hundreds of both branded Dental Support Organizations (DSO) and Invisible Dental Support Organizations (IDSO) actively consolidating dental practices across the country today. A new DSO or IDSO is formed every week. Some IDSOs have been operating for 30+ years and others for 30+ days. Many are qualified to become your partner, but there are also many which have ill-conceived strategies and/or are mismanaged, and a few will ultimately fail.
Choosing your IDSO partner carefully is critical to both short and long-term success. COVID has exposed some of the fatal flaws in a few IDSOs which doctors could have easily avoided if advised by LPS. We carefully vet and complete due diligence on any partners and their backers, interested in investing in our client doctors. This is just another reason why LPS is only paid by our clients; the doctors, rather than by buyers/IDSOs.
As an example of the rapid growth of IDSOs, in the last three years there have been a dozen or more IDSOs formed focusing on OMFS practices only. There are now ten IDSOs targeting Endodontic practices only. At least nine new groups are orthodontics only. Several new groups are pursuing Dental Trifecta (pedo/ortho/OMFS) strategies, and, of course there are at least 100 newer groups targeting GP or multi-specialty strategies either regionally or nationally. With roughly 120,000 unconsolidated dental practices in the U.S., the field is still wide open. For comparison, over 75% of all MDs are now affiliated with large groups or hospitals.
As of October of 2019, DSOs were in 48 states. That month, LPS completed filling out the DSO map by advising our clients; the largest orthodontic groups in both Wyoming and Montana, on a partnership with a Dental Trifecta focused IDSO. Now all 50 states have operating IDSOs. Some are better than others. In the last 12 months, LPS has completed transactions with 18 different IDSOs in 19 states.
Private Equity groups have been investing in dental consolidation for decades. Some invest early in the IDSO lifecycle as the initial or early capital, build it to a certain size and then sell it to a larger Private Equity group which is more focused on mature IDSOs. The new owner’s larger pool of capital can hopefully accelerate the growth of the IDSO to the next level.
Many IDSOs have had three, four and five different owners over their lifespan. As an example, the largest U.S. IDSO has had five different financial sponsors, some of which were Private Equity and others which were direct pension fund investors. It is now owned by one of the largest PE firms in the world, Kohlberg, Kravis & Roberts, or KKR. It is estimated that PE groups invested over $40 billion dollars in dental practice consolidation in 2019 vs. $10 billion in 2016. While ownership may change, management typically remains consistent.
Often confused with PE, very few venture capital funds are invested in IDSOs. VCs more typically invest in ideas or small companies and are not following a buy and build strategy like the majority of investors in IDSOs.
FO are typically either internal investment vehicles for a single wealthy family or for groups of families seeking advisory services for their family made fortunes. Any self-respecting billionaire either has one, or is a part of a FO. This is the fastest growing category of investors in IDSOs. In the last 12 months, LPS has completed over $200,000,000 of transactions with FOs building IDSOs. The largest IDSO sale in 2019 was to a Swiss FO for over $700,000,000.
There are over 300 SBICs in the U.S. They have access to funds from the U.S. Small Business Administration (SBA) and operate much like Private Equity Groups. LPS has recently completed multiple transactions with SBICs and they have growing interest in IDSO investments.
Hospitals have been quietly investing in IDSOs in various parts of the country. Some are providing internal dental services as well. LPS engineered a large transaction in 2020 in which one of the larger investors was the largest and non-profit hospital group in the state.
Every IDSO is Slightly Different and May or May Not Be a Fit for You
It is critical in an IDSO partnership process that doctors fully understand ALL of the options they may have to monetize a part of their life’s work. The more qualified IDSOs you are introduced to, the better your chance of achieving the highest values due to bidding contests among multiple investors. More importantly, the more you meet, the more likely you are to choose the best long-term partner.
Get Started With LPS
Let Us Help You. We GUARANTEE Two Things:
We have the highest success rates.
After our fee, you will get the highest net proceeds possible than from any other advisor.