When the big offers start rolling in, most dentists think the hard part is over. They believe that finding the right buyer is the challenge and that once a Letter of Intent is signed, everything else is a formality. The reality is far different.
The real game begins inside the negotiation room. DSOs do this every day. They have deal teams, analysts, attorneys, and experienced negotiators whose sole job is to structure acquisitions in their favor. Dentists, even those who own multimillion-dollar practices, usually go through this process once. The knowledge gap is massive. And that gap costs doctors millions of dollars every year.
After working on hundreds of millions in dental transactions, I’ve seen the same traps catch practice owners over and over again. They are avoidable, but only if you know they are there.
Going to Market Alone
The first and most expensive mistake is entering negotiations without experienced representation. Many doctors are approached directly by DSOs and decide to “save money” by handling the process themselves. On the surface, this seems simple. A DSO expresses interest, asks for financials, and sends a Letter of Intent with what looks like a strong number.
What most doctors do not realize is that the offer on the table is almost never the final deal. DSOs expect negotiation. They anchor their offers strategically. Without representation, doctors accept terms that a professional advisor would have immediately improved.
I’ve seen practices leave ten to twenty percent of their value on the table simply because they didn’t know how to create competitive tension. DSOs are sophisticated buyers. They’re not in the business of overpaying voluntarily. The presence of a strategic advisor signals that the seller understands the game, which alone can elevate offers significantly.
Focusing on the Headline Number
The second trap is focusing exclusively on the headline number while ignoring deal structure. Many DSOs present eye-catching purchase prices, but the real value lies in the fine print.
A ten-million-dollar offer can sound incredible. But if half of that is tied up in an earn-out over five years with aggressive performance targets, the guaranteed payout may be far less. Some DSOs include clawback provisions, performance contingencies, or equity rollovers that are poorly understood by the seller.
I’ve seen deals where the “headline number” never materialized because the doctor didn’t meet post-sale targets or misunderstood the operational expectations. This is not about DSOs acting in bad faith. They’re simply protecting their investment and structuring deals to incentivize continued performance.
Dentists who focus on structure rather than flash are the ones who walk away with real value. They understand how to negotiate the allocation between cash at close, earn-outs, equity, and holdbacks to match their personal goals and risk tolerance.
Ignoring Cultural and Operational Fit
The third trap is one of the most overlooked. A deal may look great on paper, but if the cultural and operational fit is wrong, problems arise quickly after closing.
Every DSO operates differently. Some are hands-off and allow practices to maintain their identity. Others impose strict operational systems, staff changes, or scheduling protocols that can dramatically alter the daily experience.
If the post-sale environment is a poor match, doctors often find themselves frustrated. Staff morale suffers. Patient retention can decline. Earn-out targets become harder to hit. And in some cases, doctors choose to leave early, sacrificing significant portions of their payout in the process.
The smartest sellers evaluate the DSO as carefully as the DSO evaluates them. They ask the right questions. They understand how the buyer operates, how decisions are made, and what the integration process looks like. A good cultural fit is not a soft factor. It is a financial factor.
The traps exist because DSOs are professionals at buying.
They negotiate dozens of deals every year. Their analysts know how to dissect your P&L. Their attorneys know how to structure agreements that protect their investment. Their executives know how to appeal to a doctor’s ego with big numbers up front.
Most dentists, even those with thriving practices, are not professional negotiators. Their expertise is in clinical care, not deal structure. This imbalance is not malicious, but it is real. And if you walk into the DSO deal room without preparation, you’re playing their game by their rules.
The way to avoid these traps is through preparation and strategic positioning.
That begins long before the Letter of Intent is signed. A proper valuation through the lens of a DSO buyer reveals where your leverage is. Strategic marketing of your practice to multiple buyers creates competition and improves offers. Skilled representation ensures that deal structure works for you, not just for the buyer.
The goal is to secure the best possible outcome for your years of work. That means maximizing value, minimizing risk, and choosing a partner that aligns with your vision for your legacy.
I’ve been directly involved in over two hundred million dollars in dental transactions and indirectly involved in over two hundred million more. I’ve seen brilliant dentists negotiate alone and lose millions without ever realizing it. I’ve also seen practice owners who approached the process strategically secure deals that exceeded their expectations and set them up for life.
The difference is not luck. It is preparation, strategy, and expert guidance.
If your practice generates more than one million dollars in revenue and you’re considering a DSO sale, the smartest first step you can take is to get a strategic appraisal. My team and I offer a comprehensive valuation and positioning report, valued at $2,743, at no cost to qualified practice owners.
Before you step into the deal room, make sure you know the traps and how to avoid them. DSOs will bring their A-team to the negotiation. You should too.
To your unstoppable success,
Your Team at Everything DSO