Eventually, every dentist will want a path to harvest the financial value they've cultivated in their practice. Some dentists will want to sell 100% of their practice and retire, but others may want to sell part of their practice and retain partial ownership.
Fortunately, a growing practice can be very valuable in any of the three main monetization strategies today: sell to an associate/another dentist, sell to a traditional dental support organization (DSO), or-for dentists with three or more years of chairside horizon-sell to an invisible dental support organization (IDSO) partnership.
So which option is best? Smaller practices may not qualify for IDSO partnership and larger practices may not be able to find dentists who can pay the market value for a practice. Each strategy achieves different values but has certain caveats and commitments.
Highest values partner with an IDSO
Practices with at least $500,000 in EBITDA (earnings before interest taxes, depreciation and amortization) may qualify for the highest value monetization option, an IDSO partnership.
There are over 1,000 IDSOs in the US today, some with 500+ partner practices. IDSOs have been operating nationally for over 35 years. However, many should not be considered qualified bidders for a variety of reasons.
An IDSO partnership involves a dentist selling 51% to 80% of their practice for cash up front to an IDSO, which becomes their silent partner. Dentists continue to lead their practices as owners with their brands, teams, and full autonomy for years or decades. An IDSO partnership is not a short-term transition or exit strategy; many dentists under 40 have chosen IDSOs to access the resources and potential equity value growth of a larger partner for future decades.
Selling to a DSO
DSOs will often acquire 100% of a practice, with the dentist departing quickly in some cases. Smaller practices that don't qualify for an IDSO partnership can often sell 100% to a DSO because the value in a DSO sale is far lower than in an IDSO partnership and closer to a dentist-to-dentist transition value. Today there are hundreds of DSOs across the US eager to buy practices-both GP and specialty-of all sizes.
A DSO typically prefers a quality, growing practice, but many will consider buying struggling or shrinking practices in the right areas.
Selling to an associate or another dentist
Most practice sales or transitions are accomplished in this structure. The largest transition firm, Henry Schein Dental Practice Transitions completed over 500 dentist-to-dentist transactions in the last two years. As of Q1 2025, they have over 34,000 registered buyers, primarily interested in single dentists with single-office practices.
Values are typically in the range of 60% to 100% of annual collections. In some cases, dentists sell all or part of their practice to an existing associate, but in others, dentists buy 100% of a practice. In either case, the selling dentist has options as to how long they would like to continue practicing. Financing for practice purchases today is available on very favorable terms and loans can exceed 100% of the purchase price.
Options to create higher values
The highest values in any of the three different monetization structures are realized for growing, profitable practices. The higher the EBITDA of the practice, the higher its value. Dentists should understand their practice EBITDA and possible ways to improve it.
As an example, a $2.5 million in collections practice with an EBITDA of 10%, or only $250,000, would not qualify for a high value IDSO partnership today. It would be valued at approximately 70% of collections, or about $1.75 million in a DSO or dentist -to -dentist transaction.
However, with a sharp focus on costs, most $2.5 million in collections practices can achieve an EBITDA of 20% of collections, or $500,000. With an EBITDA of $500,000, it would qualify for an IDSO partnership valued at 7x EBITDA or $3.5 million or more.
A careful focus on practice profitability can possibly more than double the practice value in a short period of time. A new crop of practice consultants specializing in helping practices increase EBITDA and practice profitability are now contacting dentists to help monetize practices at the highest values. It may pay to have a conversation with them now rather than later.
Dentists interested in learning more about their monetization options can contact LPS to have a confidential, obligation-free conversation. Whether a dentist is considering their options now or planning for the future, it never hurts to understand every choice available today.
