3 Doors to Dental Practice Ownership: Brokers, Sellers & Fixers | 3

Which path would you choose if your dream dental practice was hidden behind three very different doors?

In this episode, Dave and Sandy put you in the contestant’s seat in “Let’s Make a Dental Practice Deal,” guiding you through three distinct “doors” that can lead to a successful practice purchase, no matter where you are on your career journey.

They break down the pros, cons, and expectations behind each "door": the crowded market of brokered sales, the relationship-driven private sellers, and the overlooked fixer-uppers that may just need some TLC. Dave and Sandy share their playbook for early financing prep, explain why building local relationships pays off, and offer clear, actionable steps so you can map out your dental future. Whether you’re a motivated associate, student, or new buyer, you’ll come away ready to take the next concrete step on your journey, armed with the questions to ask, the lists to start, and the confidence to spot opportunity where others don’t.

What You'll Learn in This Episode:

• How associates and students can qualify for 100% practice financing
• Key factors banks use to underwrite dental practice loans
• The three main pathways (“doors”) to finding a practice to buy
• Advantages and challenges of public broker listings
• Secrets to uncovering hidden, unlisted practices through personal outreach
• Why some overlooked practices hold untapped potential for growth
• How to define your ideal community and practice target zones
• Steps for early networking and due diligence with lenders
• Tips for evaluating and tracking opportunities like a pro
• Actionable homework to start your practice search today

Hit play to discover the best-kept secrets to finding (and securing) your next dental practice opportunity!

Learn More About Dave & Sandy Here!

Website: https://www.dentalassociateedge.com/

Email Dave & Sandy: dentalassociateedge@gmail.com

Dr. Dave Striegel: https://www.drdavestriegel.com/

Sandy Baird, MBA: https://www.bairdconcepts.com/

Mentions & Links:

Organizations:

• ADA

Three Homework Questions / Action Items:

1. Where are your three doors?
   What communities are you interested in? Where do you want to spend your career? Research those locations and build a spreadsheet profile for practices in those areas.
2. What do you know about your target communities?
   Research population growth, median age, major employers, dental insurance dependency, number of dentists in the area, competition, education, cultural offerings, and safety.
3. Walk through door number one and explore what's publicly for sale.
   Check broker listings, dental journals, and dental association literature for your target locations. Get reps reviewing practice prospectuses so you know what to look for when it matters.

Transcript

Sandy 0:00

Behind each of these doors are doing practices each of you listening could successfully own. This is important to remember. Behind each of these three doors could be your perfect practice, the practice that brings you the most happiness and success in your career. Let's start with door number one.

Dave 0:22

Hi everyone, and welcome to the Dental Associate Edge, where practice ownership isn't a dream, it's a destination. I'm Dave.

Sandy 0:30

And I'm Sandy. And together we are consultants who work with dental practices every single day. We created this podcast to help dental associates and dental students build a clear path towards practice ownership. So many of our associates and dental students say that is their ultimate goal is to buy their own practice. So we're here to help walk you through that whole process.

Dave 0:57

So we've had an episode recently. In fact, the last episode was about debt. And so we're going to just do a quick flashback on what we covered there, and then we'll get into today's topic. So we discussed in particular the funding for a practice of your dreams, how to figure out how to get that done, even if you have dental school loans. So at the end of the podcast, we left you with a few critical questions to consider. So if you haven't heard that episode, then please jump back and take a listen. The first question we left you with was which requirements have you already satisfied in order to qualify for a loan? And in many instances, you can qualify for upwards of 100% of the purchase price of the practice, if not a little bit more, depending on the overall characteristics of you as a borrower, but then also of the practice itself. And the second question we offered was what are your plans to satisfy unmet requirements to buy a practice? So all of this is speaking to doing the due diligence now or soon, depending on what your timeline is, to know what banks are looking for with respect to income, respect to reserves, time, credit, all of those elements are important to understand as you get closer to the time when you feel like you're ready to buy a practice. And then what will be your first step? For example, if you're a dental student, perhaps spending at least a year or two as an associate dentist might make most sense. And if you're an associate, the first step might be accumulating the necessary reserves, which, depending on the lender and the scenario, might be seven to ten percent of the purchase price. So these are all factors that are fluid and the conditions and parameters evolve and change from one year to the next. So what would be a great idea for anyone who's considering buying a practice in the next probably 12 to 24 months is to build a relationship with a lender, and perhaps more than one. Get an idea of what they look for in their underwriting, what's important to them, what do they emphasize more than other things, because every lender is a little bit like a fingerprint. They have different tranches or buckets of loans that they look for. And if they're filled up in one bucket, they'll be looking for different types of loans. And it's helpful for you to understand from a dental perspective what they're looking for. And the good news is that many lenders are looking for borrowers like you. Because they look at dentistry and dental practices as being on the range or on the scale of risk versus safe to be certainly safer than many. So this is all part of the process of your education that they don't necessarily teach you a lot about in dental school, but will have a significant impact on you getting started, all the way down to the loan payments that you have, you know, in the first few years of ownership. Okay. So enough on the last episode. So let's tackle today's topic. So today's topic in episode number three is how to find practices to consider for purchase.

Sandy 4:08

That sounds so boring. And let's spice it up a little bit. How about we play a game? What do you think? What do you think?

Dave 4:17

I I love the idea. I have no idea what you have in mind, but I'm up for it. So let's do it. Okay.

Sandy 4:22

It's a game called Let's Make a Dental Deal. I know our listeners are up for it. So, guys, prove me right out there. Prove me right. Okay. So you ready, Dave?

Dave 4:33

Yeah, I'm not sure I could stop you anyway.

Sandy 4:36

Probably not. Okay, so welcome to Let's Make a Dental Practice Deal, the game where you must choose wisely, very wisely. And this is how it works. Okay. Everybody envision in your mind three massive doors. They're labeled door one, door two, door three. Now, if anyone is having flashbacks to the old game of let's make a deal, you're right on spot here. Right on spot. Okay, first let's look at door number one. So, Dave, on this door, there is a big, huge, clear sign with a number one on it, and it says, Dental practices for sale. It's bold, it's brightly colored, and the door is wide open. Then there's door number two. It has an o sign on it. Just a little thing, tiny two up in one of the corners, and you have to look really hard to see that. It's almost invisible, it's hard to see. And the final door, door number three, has a broken, rotten sign on it with a faded number three and some pretty impressive cobwebs in the corners, competing with the Adams family there. So, Dave, you got it. Are you with me, Siddhart? Yes.

Dave 5:59

I envision door number one is like screaming, come on in, uh, pick me. Uh it's one of those that is kind of like a neon sign around, and your eyes are drawn to it. So that's an easy one. The second one is one that you kind of have to look for. You drive right by it, maybe, and wouldn't even notice it's there. It's just kind of quiet, but definitely substantial and solid. And then the last one has me a little scared. It's a little, it's a little creepy, maybe a little run down, maybe needs some TLC, kind of like when you look for a home and it makes you kind of want to run away, but you also kind of want to check it out.

Sandy 6:38

You're spot on. You're right there with me. Okay. Now, behind each of these doors are little practices each of you listening could successfully own. This is important to remember. Behind each of these three doors could be your perfect practice, the practice that brings you the most happiness and success in your career. Let's start with door number one. Let's look at it again. Now, do you see that long line of dentists and associates and students and DSOs waiting to get into that room through that door? Do you see all the confusing signs and arrows to make sure as many people as possible can squeeze into that door? Why are so many people busting into this door? Why? Behind this door are the practices that are just screaming to the world that they're for sale. Look at me. I'm for sale. Me, me, choose me. Please choose me. They are the practices on all the brokers' lists. They're on all those websites that say match your practice. This is the practice for you. Practices for sale, their ads and the dental journals and newsletter listings. These are all the public announcements that are saying, yes, my practice is for sale. Come and get it. This door is kind of like the world of dental match.com. So eligible buying dentists can find the perfect match. Okay. Now, obviously, behind this door, and then you can imagine this, there's stiff competition for these practices, right? There are a lot of people, right? Look at that one sign. It says, enter only if you have a deep pocket, infinite patience, and lots of emotional and professional support. What do you think about that?

Dave 8:29

Well, my initial thought on that is if you consider the three doors and the dynamic of the practices on face value, you would normally be attracted to door number one just because it's more visible. It's easy. And it's cleaned up, it's shined up, everybody's ready to talk about it and come on in, take a look, all those types of things, just like you know, you walk into uh, you know, a new car dealership, and all the new cars are there, spiffed up and right on the showroom floor and ready for you to take a test drive. And there's countless salespeople right there to answer any questions you have. And there are some people and some practices if that's a great match. Now, what you have to also understand is that under door number two and door number three are still potentially great practices. As you already said, Sandy, they just require a little more patience and a little more know-how to uncover their hidden value.

Sandy 9:24

Let's talk about door number two. Okay, this door is the one, if you remember, the one that's hard to see. Behind this closed door are practices that nobody really knows are for sale unless they're approached individually and the right questions are asked. For example, these are often practices owned by dentists who have practiced for a long time, 25, 30 years. Retirement is on the horizon. It's there. They know it's getting closer. But however, they are hesitant. They're very hesitant. And it couldn't be many, many reasons. Like maybe they're not sure how retirement will work for them. What are they going to do? Do they have plans for their retirement? Maybe they're frightened about being on a fixed income. That's a big step. Or maybe they're not even sure they have enough money saved. They're just not sure. And they certainly are terrified to say anything to anybody for fear it will leak out. And then the word will spread. All this practice is for sale. We need to find a new dentist. We need to find a new place to work. So there are lots of reasons why these dentists maybe are thinking sale at some point or associateship to sale, but they will not put it on the internet. They will not put it out in the public. And these practice owners are typically very relationship-driven. They carry a deep sense of responsibility on who will carry on their legacy. They want it to be personal and they want to be particular about the person that takes over. So if the right person comes along, all of a sudden they're ready, but they're not advertising it. So they require a little more effort. They need a little bit of personal TLC, so to speak. Now, Dave, in your opinion, do you think there are more buyers in line outside that door or less?

Dave 11:25

Initially, they're going to be fewer because there isn't that neon sign pointing people look here. And it takes more forethought and effort and time to open this door. So buyers have to start months or perhaps even years in advance cultivating those relationships. That's why when it comes to buying a practice, buying a dental practice, and I think you would probably agree on this, Sandy. First of all, it's not a simple or easy process because practices are so, so different one to the next. But it's also one that rarely have I seen where the first practice that someone finds is the best practice for them. I agree 100%. And because oftentimes, too, if you come out of dental school and you join a practice as an associate dentist, rarely is that the practice you buy as well. So this kind of door number two type practice, where it's a solid, strong practice, but it's not on the market. The dentist we know is approaching that range of age where retirement's going to be a consideration. That's why getting to know these dentists in your ideal geographical area, going to the local dental society meetings, going to the study clubs, really getting out and circulating and getting to know people is the best thing you could possibly do. Then when the time comes, have them think of you and make a call to you to let you know, hey, I've now decided it's time for me to consider selling.

Sandy 12:56

Take them out to lunch. Sit down and talk to them, share your vision and let them share their plans with you, establish that relationship. It takes a little more and work, but it's much more, there are not as many barriers, so to speak. Because if you get that personal relationship, a lot of the nightmares that go with buying a practice can be resolved simply, much more simply, I think.

Dave 13:20

One thing I would say too about door number two, these touch of practices often, if the dentist, and you said this earlier, Sandy, many of these dentists, not that they don't want to sell their practice for below market because no one knows. No. But these dentists often are not interested in garnering every single cent to the detriment of their legacy and the detriment of their patient base and their team.

Sandy 13:45

Yes.

Dave 13:45

So I see a lot of dentists who decide who to sell to based on who will do well with their team.

Sandy 13:53

Absolutely.

Dave 13:54

So this again takes time and it also provides the opportunity for maybe a little bit more creativity with respect to financing and timing. And maybe there's a period of partnership first where the selling dentist works back with you as the new owner. And then it's a gradual buyout. These are all scenarios to explore. It doesn't always have to be an immediate purchase, and then the owner leaves. There are many iterations of this that could be good for you as well as good for them.

Sandy 14:26

And we're going to explore a lot of those options on this podcast to help you understand the nuances between the many possibilities and options. Let's move on to the creepy door, door number three. Behind this door are the practices most buyers avoid. They're old, they're dark, they're unperforming, they have faulty operating systems, they have low fees, and they use outdated equipment. You're probably not going to see any buyers in this line. You may see one or two people hiding behind some trees looking at the door and kind of scratching their heads and thinking of running. But Dave, this is a worn-out practice. But that doesn't mean it couldn't be a stellar practice, right?

Dave 15:13

Well, you're exactly right. And you have seen them just like I have. And think of it as when you buy a house or even buy a car. Just because it's used and maybe needs some TLC aesthetically doesn't mean necessarily that it doesn't have solid structural bones. So that's really where the due diligence and the analysis and making sure that you are aligned with people who can know what to look for and know what to look behind and under and know how to analyze things, know how to evaluate a practice so that you can know that, yeah, it doesn't look like much. And it's going to take a little time.

Sandy 15:52

It doesn't look like much now. That's right.

Dave 15:54

Well, and so the bottom line is that you can find all three of these doors of practices to a large degree, which one fits for you is going to have a lot to do with your parameters of when are you going to be ready and how much time do you have? And do you know your area? And all of these elements that then give you time and buy you time to figure out all right, where do I want to be? What dentists are in that area? Where are they in terms of their practice life? And then starting to build those relationships. And I don't care if it's the ugliest practice there is, even if you choose not to inhabit it, I've had clients who have bought those types of practices and they take it and they stack it on top of a different practice they did buy.

Sandy 16:41

Exactly. There are so many options out there. And that's what I see as one of our goals, Dave, is to talk about these options in these podcasts and help everybody learn how to choose wisely. And that's why this game, let's make a dual practice deal, that's why the byline is the game where you must choose wisely, very wisely. And that's where I hope we can help everybody since, of course, I've been through it. And Dave has been through it in all kinds of guidance ways, I'm sure. But of course, my husband's a dentist, and we sold his practice in 2010, and we interviewed a number of dentists to come by our practice. We had some great advisors, but we're going to go into all of that in detail.

Dave 17:31

And just for a moment, Sandy, on that topic, because you walked this actual path with your husband. At the end of the day, no one needs to know names or numbers or anything like that. But what were the considerations from uh decision making for you and Bruce to decide who was the right fit for you to buy your practice? Was it just the highest offer, or was it other factors too for you?

Sandy 17:54

No, it wasn't the highest offer. We live in a very small, unique community. And my husband grew up here. And so he felt a huge and that's responsibility for who was going to come in here and work with his beloved patients, his friends, and he knows he would have to listen to the cooking of his friends for eternity. And about that. So we interviewed probably five or six, and we always did a background check, got online, and checked out some things, and that eliminated a few. And then we just got to know them what their situation is, what their goals were. The one situation sounded like the wife wanted the dentist to buy a practice, but the dentist didn't want to buy a practice. So you kind of pick up on these little nuances. Ours was more personal. We were kind of in that second door. We were behind that second door.

Dave 18:54

Got it. Okay.

Sandy 18:56

We did work with some very knowledgeable brokers and transitional consultants, but it was not out in the public that much. That's kind of where we stood. And I will say, after 15 years, we made an excellent decision.

Dave 19:13

That's how you know, isn't it?

Sandy 19:14

Yes, it is. So yeah, that story ended well.

Dave 19:18

So when we think about preparing for episode number four, we have a handful of questions for you to ponder and answer. And strongly advise you to write answers to these down, which really, if you think about from a preparation standpoint, if you're listening to this podcast, whenever you do, unless you're driving, which we understand you might be driving or walking or something like that. But if you're sitting, then I think it'd be a great idea for you to have a little notebook to write down thoughts, write down questions. You could follow up with us to ask or just be pondering and think about. But what are your three doors? Meaning, what's the location? So the geographical location of where you and if you have a partner or a spouse, where you all want to live, and what part of the country? Is it suburban? Is it rural? What's the dynamic like? And whether it's in a city or in the country or somewhere in between, these three doors exist in nearly every community, no matter the size or the state. Another element that's important to keep in mind is that purchasing a practice is a permanent commitment. And you and your family need to narrow down the locations of places that you believe you will thrive. And don't be seduced in a way by the shininess necessarily of the practice. Because again, if it has good bones, then there could be even more value pent up in a practice like that. And then reflect on it.

Sandy 20:50

This is one of the wonderful advantages of owning your own practice. You get to choose to some degree where to spend your life, your career. And that's one of the joys of this whole thing. Bruce was licensed in like, I think, five states when he graduated dental school. And we were looking all around, and we were looking for exactly what we ended up in, which was his hometown and where we met initially.

Dave 21:16

Initially, did you not think that you would end up settling in the hometown?

Sandy 21:22

Bruce was hesitant.

Dave 21:23

Oh really?

Sandy 21:24

He was a little hesitant. He just felt like, I don't know the guy. I think he just felt like he should branch out. Branch out somewhere. And someone lived in Virginia and Kentucky, and of course, other places in Tennessee and then Arkansas. We didn't look too much in Arkansas, but but it turned out we knew we were looking for the exact same thing where we came from. And then the community reached out to us. And that's all it took. That's all it took is for them to reach out and say, and there was no dentist in our community. None.

Dave 21:58

Oh, at the time there was no.

Sandy 22:00

Not there hadn't been for 50 years.

Dave 22:03

Oh wow.

Sandy 22:04

I know, I know. And so that was what nudged us. We needed that little nudge, just like I was talking about in that second door. We needed that little personal nudge, and that's all it took.

Dave 22:17

And I think that's just testimony for dental practice students as well as new associates to begin to start to meet people. And dental societies are a great place to start because they're already in place. They are. You don't have to search for them. You just have to go online and look on the ADA website and find the local dental society. Start there, then ask around for study clubs, get a little more specialized and unique, but get out to the dental society. And I know some of the younger generations are a little hesitant to get out there and start meeting people. What do I talk about? It's awkward and things like that, because we'd much rather do it through our phones. But there's no substitute for that face-to-face, name to a face introduction and conversation.

Sandy 23:04

Not with a purchase like this. And I'll tell you this.

Dave 23:08

I was talking to a client of mine just last week, and they were explaining that they knew of a dental student, not an associate yet, but a dental student who had started to go around to meet local dentists. And all those dentists were just floored looking around like, who is this kid? And then what my client suspected was when the time came for that student to look around, that there was going to be competition.

Sandy 23:37

Yeah.

Dave 23:38

Because nobody said anything, but they were all thinking, I want that kid taking over my breath.

Sandy 23:45

That's right.

Dave 23:46

And that will happen to you if you put together a plan and execute it, starting to get to know the people in your community.

Sandy 23:54

And when you start looking at what kind of communities you want to look at, some key things to look online to see what community do I want to spend my career in? Look at the growth, the population growth. Is it growing? What's the median age of the population? What's the economy? Who are the big players in the economy? Who are the dental insurance? Well, how much dependency will you have on those dental insurance? You know, do they have something like Nissan, a huge Nissan plant or something that dominates the economy? You're going to have a little different practice than you would if it doesn't. And look at the competition. You want to look online to find out how many dentists are there in your field and where they're located. And then you will, of course, look at education opportunities and cultural opportunities. Just your lifestyle, safety, if you have families and children. These are the kind of things you want to do some research on if you don't know exactly I'm going home and starting to practice there.

Dave 24:58

Yeah, or take over my dad's practice. Exactly. Exactly.

Sandy 25:02

But not everybody has that option.

Dave 25:04

No, no. More often than you might realize, but still, you're right, not as much as you might think. The other thing that I thought of was wherever you look, get into the habit of asking a series of questions so that you can start to get reps on evaluating practices. Now you're not going to get access to the profit and loss statement and things like that. That's more in depth and down the line. But you can ask very basic questions or even through the internet research basic questions on the practices that are around you, and then start to create a profile. Maybe and start a spreadsheet. And that way you start to establish which door does each of these practices belong to, including are these practices insurance driven?

Sandy 25:59

And that's a fair question.

Dave 26:01

Most practices work with insurance. Whether they're in network or out of network, they differ. But most will work with insurance. But you know, I have a number of clients up in the Portland, Oregon area, and some of them, especially the ones in Beaverton, they have a lot of patience with Nike because Nike's headquarters. Nike's huge, right. In Beaverton. It's important to know that if you're wanting to settle in that area. So these are all things that ideally you do, and you start to make a list of the locations that are important to you and your family, if you have one, and start to get reps on evaluating practices, certainly in those areas. That way, when you get ready to go make a decision, even if it's to be an associate dentist and not to buy yet, you are already ahead of the game in terms of making a decision as to why one practice over the other. Is there anything else, Sandy, that you can think of to add to today's? This has been awesome.

Sandy 26:59

We wanted to leave them with three homework assignments, so to speak. One of them was that first one, where are your three divorce? You need to find out what communities you're interested in. Where are you going to spend your career? Research those locations on your list and do a great spreadsheet. Dave's idea was wonderful. And finally, we want you to walk a little bit into door number one. You know that door is wide open. You can go on the internet and you can research online brokers, ads, dental associations, literature in those particular locations that you're interested in. So this is the process. Find the areas you're interested in, do some research, and then walk into that first door and see what's just screaming at you. What's on dental match.com out there for those areas. Then we can start digging deeper.

Dave 27:53

Yeah, that's a great idea, Sandy, because when you go to those open houses that they will have, that brokers will have, they'll have a packet of information to give you a perspective, initial, a financial data, perhaps. You might need to sign a document indicating you're not going to distribute the information. And that's why start to get some repetitions of exactly what Sandy's saying, those door number one practices, so that even if that's not the one for you, you start to see some of the common links and also those things that differ and differentiate practices.

Sandy 28:27

Yes. And it's a good baseline to have when you start looking in the other doors. You start seeing some of the barriers, some of the additional cost involved. You know, the brokers aren't going to just give you that information and not charge somebody for getting them. You will kind of see some of the additional expenses and how each of those doors kind of differs in those barriers or those hurdles you have to jump over.

Dave 28:54

Absolutely. And the idea is that by the time you're ready to buy a practice, you already have a sense of what to ask and what to look for. So that you're not spending your time just trying to figure out what is this information, what do I need to ask? You already know what to ask and are much further along and therefore can be a much more competitive buyer because you can move faster either moving on or moving towards.

Sandy 29:21

And that is one of the most important ways to get wiser. You know, we say this a game of choosing wisely, repeating, interviewing, talking over and over to different dentists, different brokers, getting that experience is how you're going to choose more wisely. You're going to make a better choice. So I think you brought up a great point, Dave.

Dave 29:43

So that's it for uh this edition of the Dental Associate Edge, where practice ownership isn't a dream, it's a destination.

Sandy 29:50

And don't forget, your future dental practice is waiting. Let us help you build something extraordinary. That's what we're here to do. We want to help you be successful.

Dave 30:04

Thank you, everybody, and we'll see you next time.