Understand your personality and make decisions that are in sync with your nature. For example, some dental practice owners are very hands-on and like to be in control of every aspect of patient care. Because they need to be in control of every treatment plan and the delivery style, they might have difficulty adding an associate or partner to the practice. Doctors like this may be better served by either selling outright and walking away or decreasing patient volume and remaining a solo practice owner. When making big decisions, don’t forget that you will be the one who has to live with them!
As a part of our series about “Five Things You Need To Know If You Want To Build, Scale and Prepare Your Business For a Lucrative Exit, I had the pleasure of interviewing Dr. Suzanne Ebert.
Dr. Suzanne Ebert built a successful dental practice from scratch. After selling her practice, she became the Dental Director of a Federally Qualified Health Center where she provided high-quality care to underserved populations. She joined ADA Practice Transitions™ (ADAPT) to provide tangible benefits to dentists and help address access to care issues across the country by keeping at-risk practices from closing their doors. She is currently ADAPT’s Vice President of Dental Practice & Relationship Management.
Thank you so much for doing this with us! Before we dive in, our readers would love to learn a bit more about you. Can you tell us a story about what brought you to this specific career path?
Like many people, the career path I’m on is not exactly the one I envisioned when I was young! I always wanted to follow in my grandfather’s footsteps as a surgeon, however, I had to turn down my medical school acceptance due to a difficult pregnancy and was not ‘invited’ to even interview the following year. After another child and the realization that being a hands-on mom was very important to me, I knew I needed to consider alternate career paths. Fortunately, my stepfather encouraged me to consider dentistry, he was an oral surgeon and thought it would be a good fit. This turned out to be the beginning of a wonderful career in a profession I have come to love. After completing dental school and a residency program, I opened my solo practice and ran it for about 11 years.
That chapter ended when I ran into some health problems and sold my practice. In some ways, it seemed like I was back to square one, but once again, the profession had my back! I had accumulated a ton of knowledge and felt I had something unique to contribute both to the profession and underserved patients. My next adventure combined these and I went to work in public health as the dental director at a Federally Qualified Health Center providing quality dental care to the homeless population. The center also served as an off-site teaching clinic for senior dental students at a state dental school. During this time I was honored to hold leadership positions in the dental association at the local, state, and national levels.
Given my involvement with the students and the dental association, I was privy to many of the challenges facing dentists. In particular, a recurring theme from the students was that they did not know how to find a great practice to begin their careers. They wanted to be mentored as they refined their clinical and business skills in a quest to provide the highest quality care, but I heard horror stories about these young professionals being taken advantage of because they did not understand the process or their options.
At the same time, I was hearing about dental offices serving rural communities were closing as dentists approaching retirement were unable to find buyers willing to pursue ownership in smaller market areas — despite the huge financial opportunities.
When I heard that the American Dental Association (ADA) was launching a project to help dentists do a better job as they made significant transitions in their careers, I wanted to get involved. So here I am! It might not be what I set out to do when I entered the profession, but it’s been very rewarding and a lot of fun.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
When I started my dental practice from scratch, I was watching every single penny and my husband ended up being my front desk person, assistant, sterilization person, maintenance man, and pretty much anything else I needed. Now, I love him very much, but it was a really good day when I could hire an assistant, front desk, and hygienist! Lesson learned — keep your family close, but not TOO close!
Togetherness is wonderful, and family businesses are amazing, but I would recommend some separation between your business life and your personal life so you can keep everything in balance.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
There’s a Winston Churchill quote: “Success is not final, failure is not fatal, and it’s the courage to continue that counts.” That means a lot to me because failures so often are what drive me towards success.
Having courage doesn’t just mean dragging yourself up after a failure. It also means not allowing yourself to get stagnant after a success. It’s easy to get complacent and let life’s circumstances dictate your attitude, but you’re never going to be truly happy unless you keep moving forward no matter what.
Ok super. Thank you for all of that. Let’s now shift to the main part of our discussion. Can you tell us a story about how you were able to build a business from scratch, scale and sell it to another bigger firm?
Starting a dental practice is like starting any other business. You’ve got to have a clear vision of what you want. You have to be passionate about your goals, and you have to understand your definition of success. That’s important — my definition of success isn’t going to be the same as the dentist down the street, but my definition is what’s going to matter when I look back at my career and the person I have chosen to become.
My practice vision was to have a patient-centric practice where the patients were true partners in their oral health care. I knew that delivering the highest quality dentistry involved educated and engaged patients and staff. I made sure to stay up-to-date with my clinical skills, I ensured my staff was well trained in both dentistry and customer service, and my patients were engaged in their dental treatment, truly understanding and taking ownership of their care. By focusing on the vision, I was able to differentiate my practice from others in the area. This differentiation is what ultimately made my business a success in a competitive market.
When health issues made it apparent that I would not be able to provide the level of care that my vision demanded, I made the tough decision to transition out of private practice. Because I had a well-run, profitable business with a clear vision, I was able to move very quickly on that opportunity.
Based on your experience, can you share with our readers the “Five Things You Need To Know If You Want To Build, Scale and Prepare Your Business For a Lucrative Exit”? Please give a story or example for each.
- You have to have passion for whatever you’re doing. If you’re not excited about it, why would anyone else be? Passion is the foundation for success.
- Have a vision and write it down, then make decisions that contribute to your overall vision. It’s easy to get sidetracked or do what’s most convenient at the moment, but if your decision-making doesn’t build toward your ultimate goal, you’re going to get off track.
- Work on your financial literacy, administration, and accounting skills from day one. As a business owner, you are accountable for every single dime and every single document that comes through your hands. You owe it to yourself, your staff, and your patients to have a well-run business with strong systems.
- Be flexible. You’re going to have to pivot and make changes to keep up with the latest in clinical guidelines, technologies, staffing needs, and patient expectations. Keep your vision front and center, but recognize when you have to adapt to improve.
- Understand your personality and make decisions that are in sync with your nature. For example, some dental practice owners are very hands-on and like to be in control of every aspect of patient care. Because they need to be in control of every treatment plan and the delivery style, they might have difficulty adding an associate or partner to the practice. Doctors like this may be better served by either selling outright and walking away or decreasing patient volume and remaining a solo practice owner. When making big decisions, don’t forget that you will be the one who has to live with them!
In your experience, is there a difference in approach for building a service-based business versus a product-based business when you have the intent to eventually sell the business? Can you explain?
The true value in a service-based business like dentistry lies in the relationship between the dentist and the patient. As a patient, you don’t trust your oral health care to just anyone — you want to know that you’re being personally taken care of by someone who knows you. That makes it more difficult when it comes time to sell the business because you’re essentially selling your relationships with your patients — with the expectation that the buyer will be able to maintain those same relationships.
Mentorship and transition skills are really important when it comes time to sell. For example, the mentorship-to-ownership model we created through ADA Practice Transitions can be ideal when someone is retiring or transitioning to a new opportunity. Find someone with a similar philosophy of care who can take over your patients as seamlessly as possible. There are many talented young dentists out there who are interested in private practice but aren’t yet ready to make the leap to ownership. Having a structured plan that helps the new owner succeed while letting you transition out slowly and pass on your expertise can create the best outcome for everyone involved, especially your patients.
Throughout the whole process, it’s important to prioritize open and honest communication with your staff so they don’t feel like a newcomer is busting in and taking over.
How does one go about the process of finding a buyer?
Start by identifying your practice philosophy clearly so that you can find someone who approaches patients, staff, and the community in a similar way. When I sold my practice, I didn’t do this well enough. The practice ended up closing because my patient’s expectations didn’t align with the new owner’s approach to dentistry and they ultimately left the practice. At ADA Practice Transitions, I encourage everyone to find a buyer with a shared approach to patient care. The actual delivery of care is not necessarily going to be the same, but if the patients’ experience is consistent with their expectations, they will be more likely to give the new owner a chance.
It just so happens that ADA Practice Transitions is perfect for helping dentists with this process because that’s what we do. We match our dentists up based on philosophies to make sure both the seller and the buyer are confident that this is a good investment for themselves, their staff, and their patients.
How can one decide if it is better to build a business in order to exit, or if it is better to stick around for the long term and let the company bring in residual income, or if it is better to go public?
Most dentists aren’t necessarily looking to build a business just for the sale value — it’s not like the corporate-startup environment. They want to practice, and many stay in solo private practice for the duration of their careers. When it’s time to move on, however, a lot of them will move into the background without actually selling for a while. If done correctly, this can allow a younger dentist to take over the majority of patient care and build their skill sets while the older dentist passes on their knowledge base and business savvy.
This can be a fulfilling and gratifying process, even if there might be a little reluctance to relinquish control. Watching a new, talented professional learn and grow is incredibly rewarding and it can bring closure to the older dentist while getting them excited for whatever comes next.
Can you share a few ways that are used to determine a good selling price for the business?
The market-based approach is to look at the value of comparable practices in the area, just like buying a house. It’s not always easy to find a direct comparison, however, so use this strategy with caution.
A better indicator of value would be to look at multiples of earnings. If you’re planning to own the practice for five years or ten years, you want to know what profit you’re likely to make during that time so you know what you should pay. That can get a little complicated once you start looking at complex figures, but it’s a good guide for value.
Generally, practices will sell for somewhere between 65 percent and 85 percent of the average of the prior three years of collections, but it’s highly variable. If your business is in good shape with technology updates and cash flow, you’re likely to see the higher end of that range.
Most evaluators will take the average of multiple methods of calculations to come up with a fair price. But in reality, a practice is only worth what a buyer is willing to pay. For dental practices, remember that it is the patient relationships that bring the true value to the practice and you will be paying much more for that goodwill than the hard assets.
You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
It’s got nothing to do with dentistry, per se, but I would love to see people get off social media and start to reconnect face-to-face. Zoom has been wonderful, especially during the pandemic, but it can feel very impersonal. I think the impersonal nature of online communication, especially social media, has separated us from the feelings of our fellow humans. That allows people to give voice to some things that damage relationships and separates us further.
How can our readers follow you on social media?
I’m not very active on social media, and you won’t find me on Facebook or TikTok! But I do have a LinkedIn, and you can get in touch with me there. I am also an active contributor to the ADAPT Blog, which is a great way to learn more about succeeding in the business of dentistry and what’s happening at ADA Practice Transitions.
Thank you so much for joining us. This was very inspirational.