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Your “skin in the game”

Nov 16, 2022 2:56:49 PM / by Everything DSO

Its becoming more common these days for DSOs to pursue partnerships where the selling dentist retains equity interest …

Thus continuing their “skin in the game.”

This aligns incentives between the DSO and you as the lead dentist in your practice.

If the DSO does well, then you do also.

When revenue and profit grows, so does the equity value of your retained interest.

This is one of the categories used in deal structures for DSOs …

Commonly referred to as “Rollover Equity” - in this example, we’re referring to equity on the practice level (in the next email, we’ll talk about another type of rollover equity).

There are a few details that are very important to take into account when considering Rollover Equity in the practice.

They really depend on the details of the rest of your deal structure, so that’s something we can discuss in person.

But for today I wanted to make you aware of this, and so you can think about the possibility on the long term.

These kinds of equity deals are beneficial to you in the long term if you plan to keep practicing and working to grow the business, and if you believe the DSO you are partnering with is going to be supporting you in this way for many years.

Your benefit comes over time, but can easily be a very large benefit to you when done right.

And if you recall, if the DSO seeks to sell their interest in your practice later on, you can get a large chunk of that as well.

This category is a great opportunity for long-term benefit.


Everything DSO

Written by Everything DSO

 Stan Kinder

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