Thinking of Selling to a DSO? Pause and Do This First – Episode #669

On this episode of the Dentist Money Show, Matt and Christine discuss the growing trend of dentists selling their practices to DSOs. They talk about the emotional and financial factors driving these decisions, including stress, boredom, and FOMO. The conversation helps practice owners assess whether they’re truly ready to sell or not. Tune in for some insights on avoiding regret, preserving long-term value, and finding fulfillment in your career.

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Podcast Transcript

Matt Mulcock: Welcome to the Dentist Money Show, where we help dentists make smart financial decisions. I’m Matt and I am joined here with, if you don’t know already, you need to know our practice strategy. Christine Uhen. Christine, how are you

Christine Uhen: Hi, I am fantastic today. How are you?

Matt Mulcock: Doing? Great. Although your friends call you Chris, right? We

Christine Uhen: My friends call me Chris.

Matt Mulcock: So I call you Chris. Um, so if you, if you didn’t listen to the episode that came out, I don’t know when this will come out, but. probably a few, probably three, four weeks ago, we announced that Chris is here now, joined Dentist Advisors as our practice strategist, and we are so excited to have you on the team. And that’s kind of the origins of this podcast because, and it’s amazing how many times this happened, how many times this happens, Chris, where. We are having a conversation and all of a sudden we like are deep into something and it’s like, this had just happened, right? So we’re talking and I’m like taking notes on what you’re saying and I’m like, oh my gosh, like we should talk. This is a podcast. And we started like, I started like creating an outline and then I messaged you. I was like, let’s talk about

Christine Uhen: Well, let’s do this, you

Matt Mulcock: Let’s do it. So we’re talking, all things DSOs and. I think specifically through our conversation, we started talking about like, what, what are the actual draws of the DSO? are people drawn to them? Like, let’s just do kind of like a deep dive into like why people are drawn to them. What are the main reasons, are they asking the right questions? And, and it’ll probably be somewhat theoretical or combination of like theoretical. When we, when I was on with you and Jake, we did a, a really deep dive case study.

Christine Uhen: Great podcast.

Matt Mulcock: It was a great, it was awesome. This will be just more like high level, like what are we seeing as far as why people are drawn to them and then maybe some alternatives or or things to think about if you’re considering the DSO. Anything else you’d say to that?

Christine Uhen: That definitely this, it’s on everybody’s mind, right? There’s no, we shouldn’t ignore this. We shouldn’t pretend it’s not there. We shouldn’t, you know, not be available as advisors or strategists to say, let’s talk about this. What are you thinking, doctor? We have thoughts. Let’s, let’s put our heads together and find out, you know, the why behind it and what we can do for you. So, I, it is topical, it’s top of mind, and that’s, let’s talk about it.

Matt Mulcock: Yeah. It, it is so true that this is, this is on top of everyone’s mind and has been for the last few years, several years. and the data supports this, that it’s not only people’s minds, but that 70%. And, and Chris you said, when we were talking before we were recorded, you’ve heard as high as 80%. But the data that I found was that se around 70%. Of all dental practice sales transactions are now going to DSOs,

Christine Uhen: Currently, right. In the end, it, it depends on which, which brokerage firm you’re talking about. If it’s a specialty group versus general versus, you know, an individual selling to a versus an individual selling to another individual. Yeah. I’m hearing 70 and 80%. Seven outta 10.

Matt Mulcock: Which, if I’m being honest. Is a little, it’s a little disheartening for me, for many level, for for many reasons. And we’ll talk about this. I think, the other side of this, and I wanna ask you this, Chris, but why it’s a little disheartening for me is I, I don’t know the numbers to this, this is all anecdotal, but a majority of those, I would guess. Went into them thinking it was something that it ended up not being. And I think a a from an, again, purely, fully admitting anecdotally that a good chunk of those end up regretting the decision. That’s off of a lot of dentists I talked to, at events and, and what I have a number in mind, but I’m curious, Chris, if you had to guess what percentage of dentists who sell the DSOs. End up unhappy afterwards.

Christine Uhen: I’d probably say 50 to 60 for sure, if not more percent. Again, I think. The point is if they went into it with the right mindset, I think that’s the point that we really wanna make here, is there are, there are decisions that are made in the right mindset and decisions that are made under duress, distress, you know, a lot of different negative emotions that there are unmet expectations then and a good deal. You know, when it become whatever transactions, but, we’ll, and this conversation is about A DSO transaction. A good one is transparent. It’s clear there’s managed expectations on both sides and, but that takes a lot of time. So when you see something happening fast or this rapid, you know, the consolidation model, that theory and, and action, you know.

Point that we’re at right now. Much of that is very, very fast and I’m, I get concerned about those transactions more than any. There are some dentists that need to sell. There are some from financial as well as physical reasons. The, the. Population’s aging. So some of our senior doctors are definitely looking at this as a logical and financially good decision. So I think there are some that were like, yep, I got a few years left in me. It’s post COVID, I’m good. So in that sense, they are happy whether that was something they would’ve done pre COVID. Might be a different story. Anybody that’s physically struggling, I think that’s a great opportunity for them to maximize on, you know, the financial side of that.

So I would say, I would say. 50 to 60 definitely, you know, are looking at this going, Hmm, maybe not so much. And depending on is it one year in, is it three years in? Have we Now here’s the other thing, if it’s just happened and they are three years in expecting a recap and it’s not happening, well, they’ve been happy until now, but then the recaps not happening. Or I think we’re gonna see more disappointment in the next two years than maybe we’ve seen in the last two years. Because of the current state of the economy and borrowing, you know, the cost of borrowing money in that right now, those macroeconomics right now weren’t there two and a half years ago.

Matt Mulcock: Yep.

Christine Uhen: So I think you’re gonna see more of that negative feedback as recaps may be delayed or multiples not being met as outlined.

Matt Mulcock: Yeah. I think you, I love what you just said there and I love that you highlighted that it’s so personal to the doctor and, and certainly would never ever say, don’t ever do this. Like, it’s, you know, you know, no DSOs ever gonna be a good fit. There are certainly deals that work depending on, like you said. Career stage and mindset and, and your current, your circumstance and, and all of that for sure. And, and finances. We’ll talk about that. but you’re optim you’re more optimistic than me. Um, I, I would, my number, when people ask me, people ask me all the time at, at events or for, if I’m speaking anywhere, whatever.

People will ask me and say, if you had a number, what would you say of, of, you could ask it in one of two different ways. But if you say, I. What percentage of people regret selling to A DSO? The number I throw out all the time is eight outta 10.

Christine Uhen: Eight. Yeah.

Matt Mulcock: Think eight outta 10 regret it. So 20% are

Christine Uhen: That doesn’t mean it was a bad deal, right? It’s

Matt Mulcock: Sure,

Christine Uhen: They’ve changed their mind. Let’s think about, now, that’s a different way to say that question. Right? Again, do I regret selling

Matt Mulcock: I, did I give you a different question?

Christine Uhen: Well, but, but there’s the real, again, this is, there’s that emotional state of this, right? It’s like, well, oh, and again, this is what we’re wanted to get into. It’s like, why did I choose to do it at that time? What was I looking for and or what was I running from, right? What am I trying to get away from? And yet maybe those things are still here, right? That I am, I am not. Away from the HR headaches, I still have systems that I need to manage with my team because my, my new partner, my new equity partner’s, like, no, no, no, you still have autonomy. I’m like, but wasn’t that what you were gonna do for me? Right. So do I, you know, so again, but again, I think that comes the longer they maybe have been in the relationship with the, the, the new partner that maybe things didn’t pan out

Matt Mulcock: A really good point. That’s a really good point, and, and a really good call out by me by giving you one question and then giving myself a different question. So that was, uh, that was my fault,

Christine Uhen: Yeah. And, but, but that,

Matt Mulcock: Kind of all sides of that.

Christine Uhen: Right. And that’s, but that’s also where you get people that can stand and go, oh my gosh, never do it because nobody’s happy. Well, when you asked two people and they both said no, neither one of them was happy. So nobody in their little circle that they’ve investigated, you know, said Yes. We love it. And, and that’s, but that’s the. We’re framing the question and really understanding, and again, let’s get into the motivation of why we ask that question. This is about hoping that we can help doctors make better decisions when approached

Matt Mulcock: Yep. And that’s the whole point of this. So let, let’s, let’s talk about, let’s back up a little bit and talk about some of, and we’re not necessarily saying this is an exhaustive list, but w we, when we, again, the, the origins of our conversation when we had this the other day, I. We were talking about this just naturally about a specific client and, and it kind of just kind of went off and we were talking, like laying out the list of like, what is the draw of the DSO, right. Beyond the obvious, let’s get the obvious one out of the way, which is always number one, which is the only reason why I’d say most dentists pick up the, or even like, even even accept a phone call or a meeting with the DSO. It is the money. Let’s just get that out of the way, like. That is the obvious reason that there is a draw is money. What is like, would you, what would you, your thoughts be on that?

Christine Uhen: Again, to piggyback on what we talked about, you know, being told that you have a fantastic business and someone wants to exchange, you know, millions of dollars for something that you’re like, ah, woo. You know, that, that number sounds fantastic and, and it feels good to be told. You’ve got a great business, by the way. Would you like to sell it?

Matt Mulcock: Yeah.

Christine Uhen: Right? You know. Yeah, can I have it or a part of it? Because it’s pretty great. So, you know, instead of just enjoying and basking in the moment of, yes, I’ve got a great business, they’re like, Hmm, maybe I should think about all the reasons I should, you know, I. Get out from under financially if we’re gonna stay with that financial side of things, what could this solve for me? And I think we really did some good justice to that when we talked about it on the last podcast of there’s a lot attached to that. I. Magic number that they throw out there. A lot of requirements. There’s a lot of, understanding that you’re not getting it all in cash, that there’s taxes on it, that there’s debt that has to get settled. So what you take home in a, in your bank account after some of these multimillion dollar offers is not anywhere near what that top line was. So that’s where it’s also, until you walk through that and have that prospectus and all of that proforma written out for you and walk through that and understand what you literally will take home is a significantly smaller amount in cash, if you will, at the time of

Matt Mulcock: Yep. Totally. And, and we’ll, we’ll talk about this on kind of the, we’re gonna get into after we go over this list of kind of what to do or different ways to think about this. but when it comes to the money being the motivation, I guess I’ll just say it now, like while we’re on the topic of money, Chris, would you, would you say it’s a fair thing to say that. If you are one of the dentists out there who, who was never thinking about this, and when I say never just mean like the stage of career you’re in who is never thinking about this and then got an email or a phone call or a text or whatever, and they threw a number out to you, and then you’re like, oh, I’ll think about that. Is it fair to say that you, that A, whatever you justify it to be afterwards, you’re gonna find reasons to justify it. A, the motivation there is money, which is, I’m not saying that disparagingly by the way. That is totally fine. I’m a financial advisor. Like it is totally fine. But, but it is like, just be honest with yourself that you wouldn’t have even entertained the discussion ’cause you weren’t thinking about it before until they highlighted a number and then B or two, I can’t remember what I started with B, B or two two B it would be a good like idea if that’s the case, to think. I wasn’t thinking about this yesterday or last year or five years ago. So all of a sudden they threw this money. Maybe it’s a good time to take a step back and just think a little bit more deep about this. ’cause it can’t just be about money. Is that a fair w would you say that’s fair,

Christine Uhen: No, I’d give that a 10 out of 10. Yeah. That, that deser, right. Well think about anything, any decision like that. Do you buy a home like that? Do you sell your home because you saw something on Conde

Matt Mulcock: Knocked on your door. Yeah.

Christine Uhen: Right. I mean, we don’t do that. We don’t Making major life. And or business, personal financial decisions spontaneously without the power. In the pause, if you will, just to stop and go, let me talk to some other people about this. Do I have anybody else that I can run this by, you know, perhaps a financial advisor. Right? That sort of

Matt Mulcock: Hmm. Or a practice strategist.

Christine Uhen: Heard there are people that can, you know, again, just to be a, this is part of the honor of what we do. Right Man. It’s the, it’s being that thinking partner with our clients to say. It’s not a bad idea. It’s not a good idea. It’s an idea. Take the emotions out of this first, do some, do some mathematics on this. Assess your emotional state. You know, I think that that’s a huge part of the good or bad decisions. I’m in a great place. I, you know, I. I had a wonderful day and I wanna do more of that. Well, now I’m gonna go buy a piece of technology that I’ve never heard of, but it sounds so cool, right? I’m having fun with this. And the, and just the opposite of I’m having a, a rough day. It’s been a day full of fillings. I’ve been busy and not productive, and the team, two of ’em wanna come to me. I’m having the same week off of vacation, and now I gotta deal with that.

Matt Mulcock: It’s

Christine Uhen: Don’t wanna deal with any of this. I’m shelling, right? Those, those, you know, the highs and lows are not good emotional states to make any kind of major decision.

Matt Mulcock: Yeah. I love that you just said the idea piece of like, it’s not a good idea, it’s not a bad idea, it’s just an idea. And like, let’s take that and then take it from there and assess, you know, assess what to do with it. So I love that you just said that. so the kind of the more nuanced takes or nuanced parts of this that goes beyond. Like, and you’ve already alluded to a couple of ’em, but I want to take some time to kind of go one by one. So we already hit the money one, that’s the obvious one. But let’s get into more, maybe more nuanced parts of this. The, the one beyond money that, again, in no particular order and certainly not exhaustive list, but one that we were talking about is I think the draw of the DSO stems from a lot of times dentists having what we’d call the wrong mindset. and what we mean by that is. there’s a huge difference. There’s usually two types of dentists, like practice owners. There’s the practice owner who maybe unknowingly treats their practice like just a high paying job. They don’t really actually think about the other type of dentist that’s out there as a practice owner, which is, I run a business, I am the CEO of a small business talk about that maybe Kristen, your thoughts on the mindset being. What kind of leads to being drawn to the DSO? Sometimes because of this, this wrong mindset

Christine Uhen: Yes. So in terms of the mindset that, that the different dentists have, there’s the highly paid employee where, you know, I am here, I’m doing my, doing my dentistry, and I’m not sure, you know, what else I should be doing. To think about this as a business versus the entrepreneur, the CEO of their business, and really looking at not only. Should the practice, and this is where you and I talking about, is it a practice or is it a business? Well, it’s both, right? So the practice of taking care of patients and doing the dentistry, doctors that often prefer the clinical side versus the business side are often, you know, really thinking about, Hey, if I could get somebody else to run the business side, then maybe I would be willing to sell that ENT that Clinician, when the clinician hat is on and I don’t wanna do anything else, they’re not looking at the fact that what they currently have as the COO of a business is an incredibly valuable asset. So there’s two different roles. The clinician is the creating the cash flow, you know, living the lifestyle, creating, you know, what I need to take home to fund my retirement. Invest into something, you know. Live my life, that’s the clinician and they should be compensated as a clinician, as a CEO to understand that I, you know, supplement a livelihood for other people. What if I got bigger and could. Take care of more patients and and have more team members and have other providers in here.

Could I expand my business that as it grows its value, meaning the worth that somebody else sees in it also grows. So I think this is a mind shift in. Our time, right? Whether that’s generational or just because we’re in the 21st century, however you wanna look at that. But right now, if we don’t help our doctors, our clients understand that they have both a, you know, a current lifestyle practice and could have a valuable asset. For a long term that’s not liquid right now. And again, just like a stock, it’s not worth anything until you sell it. But right now we could create more value within the business that they might never have even thought about. So even if they get the offer now, and this was a client, this was a call I just had this week, where the doctor’s like, yeah, you know, I got offered X amount. It’s about what I’m a little bit more than our, than our annual collections. I’m, and looking at the opportunity in his practice, he could almost. Just by optimizing by the number of, he had 10 ops and so at 10 Ops he was under producing on a benchmark of, you know, best in class in valuing a practice he’s under-producing, just maximizing the current facility in a year or two.

If he did then want to sell to whoever the value of that business is so much more. So that was just an AMA he didn’t even know, and it was super cool to have that conversation with him.

Matt Mulcock: This happens all the time and I love that you shared that story and we’re talking about the difference of the CEO versus the clinician mindset. And you really are both, because we get asked this quite a bit as well, is like, is dentistry still a viable or is practice ownership still a viable career or viable path? The answer to that is absolutely yes. Like we’re banking our business on this, that it, that is a viable and, and that’s what we want to. Protect and we wanna empower dentists to do, but we will admit that, is it the same landscape that you, that, that dentists dealt with 30 years ago that you just hang a shingle and patients walk in the door and there’s not as much, there’s really, there’s no real need to be a CEO.

Like sure, you, you definitely need to have a different mindset, but it is. There. It’s not black and white. It’s not just like, oh, here are DSOs. It’s ruining dentistry. It’s like it’s over. No, no, no. Vi private dentistry is still very viable.

Christine Uhen: Well, and it, you know, is the cost of doing business going up? It is in every business. I mean, that’s the truth too, right? And, and it is hitting, I mean, I. Supplies go up for everybody. Team salaries go up for everybody, including multi-doctor, DSOs, whatever. So we’re all in that same boat together. I mean, that is not different between private practice and, you know, multi-location DSO owned businesses. That is the landscape of, of dentistry. It’s the landscape of business right now too. So it is about doing things differently, but that is also where there are options that can help them grow. Still, we are still seeing private practice growing double digit percentages a year, year over year.

Matt Mulcock: Yeah. We’re seeing a, a ton of that and seeing

Christine Uhen: Do we wanna quote will again, ruthlessly intentional with what they’re doing Right? It, but there’s the CEO

Matt Mulcock: That as far as the solution. okay, Chris, we’re gonna, we’re gonna move, uh, quicker. ’cause if not, we’re gonna have to turn this into a two-parter. okay. Another part of this that we wanted to highlight again, maybe a nuance part is what, what draws to the DSO for dentists is oftentimes just misunderstanding the business cycle.

Can you break this down? When, when we talk about. A dentist misunderstanding the business cycle and maybe where they’re, where they are in their business cycle, and leading to maybe them jumping the gun, if you will, on a DSO transition.

Christine Uhen: So this goes back to creating, you know, the ideal and optimal value. That someone would exchange for you. So when you’re just starting out, whether you acquired or started up or what, you’re new to the business itself, you are in growth mode, and that is all it is. It is all new patients, it’s retained patients, it’s get your clinical speed, you know, it’s about the race to growth, right? Revenue. And that is really, again, that timeframe can be anywhere from one to two to five years where you grow, grow, grow. It is all about just more. More dentistry, more patients, and eventually adding team. At that point, you are just, you know, you’re working hard sometimes you’re doing your own hygiene until you can bring enough patients in that you can afford a hygienist, but you are creating a viable business in the growth mode.

Right. Will someone wanna exchange money for it? You’re, you’re still growing. There’s not a lot of infrastructure there. So after growth comes stability, right? We need to create, efficiencies in the practice. You start developing systems, you’re creating infrastructure from hr, marketing, Optimization of the practice. Do I have the recall cycle in place? Am I answering the phone correctly? You’re really looking at creating systems and stability because now you’re creating that value. You’re starting to see retained earnings. You’re starting to see repeat customers. You’re starting to see, you’re team members stay.

You’re starting to see the effectiveness of marketing and repeat business. Now you’ve got an asset that’s starting to develop, and we have to think about managing that risk. Too. So it is about you. I do need to protect myself. What are my options? Number one, the number one is the worst number to have in dentistry. One dentist, one hygienist, one assistant. Because when that’s out, when they’re out, then that whole system shuts down. So now I need to get back

Matt Mulcock: Failure. Yeah.

Christine Uhen: Yeah, but now we’re getting into phase two growth, which is like differentiation. So now I’m at some choice. Where I have options, I can differentiate my service mix. I could go, take some more CE add services to the general dentistry I’m doing. I could choose to, uh, bring on another doctor who I might want to do the general dentistry and I’m doing something else. So I’m starting to possibly narrow my clinical work. But now I’m actually looking at how, what. I can’t be everything to everybody anymore, so what am I gonna be?

But if I am choosing to be everything to everybody, now I gotta get back into that growth mode, and that’s expansion. So an expansion can be anything from adding an up, adding services, adding team, adding time, actually opening up your schedule, additional day a week, going from seven to seven. It could also mean buying or building another facility. That can be another option for growth. So it doesn’t, you know, a transition might be sales. That’s the fifth level is transition. That’s the fifth phase, if you will, but a transition, all of these are transitions. These are points along the way that we have to make decisions about, and we have opportunity to grow in each of them.

Right, and you can’t grow without building the infrastructure. Then you grow again, then you differentiate, then I expand and hopefully all my systems are gonna follow me into that expansion of time, service, technology, patient, clinicians, all of that. Now I’m actually at a level where I might be close to fully optimized as a business where this is the highest value that my practice is worth, but the transitions also are. Unending in the opportunities of, it doesn’t mean that I’m so big, only a corporate office can can buy me or some level of A DSO. There are. Buy-ins and earnings and associate opportunities to bring in partners where it used to be hire an associate, they start buying in, it’s 50 50, they buy you out. That model still works.

But now we have other opportunities for the newer dentists, to earn the opportunity to own something that they wouldn’t have to. Hang their own shingle, like you were saying, you know, that bring that full circle. You don’t have to. And they love the idea of having the, the younger providers that possibly have been, you know, COER, encouraged to look at DSOs as their only option when they were in dental school. They’re looking for opportunities other than that.

Matt Mulcock: Yeah, for

Christine Uhen: So creating those opportunities is such a growth opportunity.

Matt Mulcock: It’s huge. And I love that you just highlighted how many, like how dentists often think the only option if you’re filling the, whatever these things may be, to lead you to, to go to DSO or to to sell. there’s so many steps before that. it actually made me think, as the. My friend and I were both fathers to young kids, and something he said to me a long time ago that I’ve never forgotten, is that one of the hardest parts of parenting young kids as they get older is. Recognizing that you’re in a new phase of life with them. So every phase of children is like a new phase of parenting and technique and what you’re saying to them. And like, there’s different challenges and I felt when you were going through that, I’m like, man, this is, it honestly is so similar ’cause that business is your baby.

And I think one of the biggest challenges that, that, that the owners face is truly knowing when am I in a new phase? When am I outside of that? Grow, grow, grow, race to revenue phase and now I’m in efficiency phase or now I’m in grow, uh, optimization phase or, or whatever it is. recognizing that is really difficult and I think instead of taking the time to recognize that or use the resources at your disposal or seek those resources out, a lot of times dentists jump to step five, which is like. I’m gonna just go transition and sell and it might, that might, you might end up at the same conclusion. We’re just saying that there’s some steps before that to to think about before.

Christine Uhen: When there are measurements, and again, there’s. There are times I think, but again, I don’t think it’s just in dentistry that we go, we get into that, groundhog day feeling, here we go again. I’m doing it again. I mean, I find it, you know, after a couple weeks of being home and I’m not on the road, I’m like, I don’t wanna watch, you know, I don’t wanna have the same thing for dinner. I don’t wanna sit down and watch my tv. I wanna do something. It feels repetitive and, and that’s. Reality, right? That’s the truth. That there are days that will feel that way and sometimes that letter or, or that call, that’s life. But I’ll tell you, you know, if somebody called me and said, you know, here’s this great opportunity for you to move to, to New Zealand and you know, be on a podcast and be coaching and things like that, I’m like, huh, New Zealand, I’ve never been there.

Maybe I should think about that. I don’t wanna move to New Zealand. But I went, huh? Right. I think. But there’s the normalcy that I think, again, is such a great message of this is what we all go through in, in the dental industry, in life, at different times in our life, different ages in our life. And you have to then, you know, and you gotta make a decision as to what you’re gonna do, but make the decision with a lot of information. I think that’s our real message here and we, we have a lot of people that can help.

Matt Mulcock: Yeah. Well, you just alluded to the next one that I wanted to jump into you. The, the kind of alluding to the ordinary and getting, getting lost in, the mundane parts of life that lead to this. I, I think it a, a big part of this draw can, it can comes from, boredom, stress, and distraction. And you alluded to this earlier as well, of being in the proper emotional state to make a huge decision like this if you’re actually gonna do it, and how many dentists, you know, and people, but we’re all humans. And, and how many times, I mean, I can’t even tell you how many times after a stressful day at work, a rough meeting. With the board or with leadership or with a client or whatever. Me being like, you know what, I’m gonna do something different. Like, of course on those bad, yeah, forget this, I’m doing something different. Like I’m gonna go change careers. And I’ve never really thought that, but, but like we’ve all had those days when you’re like, I’m doing something different ’cause I’m bored, I’m stressed, or I’m distracted. And I think that’s a huge part of this, of the draw of, of those being in those emotional states.

Christine Uhen: Yeah. And, and just the, the idea of something different, the, the bright, shiny object, you know, and again, and the flattery. Let’s not, let’s not diminish that too. Someone said you were, you were fantastic, you know, and I wanna play with you. I wanna play in the sandbox with you. I mean, that’s, that people like to be recognized. And I think that that is a powerful emotional state that these, you know, these invitations, these opportunities. Can, can bring out in people that heightened emotional

Matt Mulcock: Yeah, totally. the last two I’m actually gonna combine, ’cause I actually think, now I’m looking at my notes here. They’re basically the same thing, or they’re kind of, they’re really connected. so they’re really, I think born out of either fear or. kind of the bandwagon effect. I think those are kind of, again, they’re very similar. So we’ve talked on previous shows about, the mimetic desire. so the original work comes from Renee Gerard back, I think in the seventies. And then Luke Burgess wrote a book I highly recommend it, called Wanting. We’re, he talks about how we don’t actually know what we want, like humans in general, in modern day society, we’re all just copying each other. And it’s called, literally called Mimetic desire. but I think the other piece of this, so I think we’re all copying each other and we’re all kind of fearing, we’re all kind of afraid that we’re gonna miss out.

Christine Uhen: Oh, see, FOMO came right to my mind when you started

Matt Mulcock: Fomo.

Christine Uhen: Exactly it. Fomo. Mm-hmm.

Matt Mulcock: Yep. Yep. That’s what it is. So you hear the stories. And by the way, we did a lunch and learn at our summit, back in June. And, Mike Baird, shout out, accelerate Dental. He’s amazing. he talked about this fomo, and he, he, he said he was such, it was such a good point. He’s like. who out there is gonna be, uh, ranting and raving and, and bragging about them getting screwed on something like a DSO deal. They’re not, they’re only going to talk. You are only going to hear the people shouting from the rooftops. The winners just like stock trading. No one’s ever gonna tell you they lost 80% on, you know, they’re five stocks they’re gonna tell you about the one time they got lucky and actually made a gain. So it’s the same thing. You’re only gonna hear the good stories.

Christine Uhen: Well, and again, I think, you know, the keep the, the, the fear of missing out. And again, there is some, you know, that is, I don’t know if I wanna call it a sales technique, but there, there’s some truth to that, the consolidation theory, that there will be an end, right? And so there is this time pressure to this, that, and it’s not. It’s not fake. I mean, there will be an a, a downturn that this is not

Matt Mulcock: Uh, yeah, for

Christine Uhen: So this timeframe, I think is also creating this sense of urgency of, if I don’t do it now, I’m gonna miss out kind of thing. So, but miss out, or is it just an opportunity to do something else?

Matt Mulcock: yeah.

Christine Uhen: It, is it. Does that mean that you’re, first of all, dentistry’s not gonna go away? Private practice isn’t gonna go away. DSOs aren’t gonna go away, so you still have a chance to create a great living for yourself, for your team, take great care of your patients, even do more of that, right? There are still opportunities for you to do something else if you’re in that rinse and repeat cycle that you’re not happy with. If you want to do something else and you wanna change your current situation, selling isn’t the only option.

Matt Mulcock: Anyone out there who’s ever done a house hunt or been on a house, hunt out on a house search, ready to buy a house has all had the same mentality and can all relate to this mentality. So I’m, I’m saying there’s empathy for this of this fomo. How many times, Chris, do you know someone, or maybe this happened to you? This happened to me when you’re on a house search. You’re like in the house buying mindset and you’re out there looking and you find one and you’re like, after I just looked at 50 houses, I finally found the one I want. And then, and then what’s the, and then you’re like, I gotta get this. There’s never gonna be one like this. I can’t even tell you how many times I’ve a thought that either in

Christine Uhen: Over if we don’t.

Matt Mulcock: Yeah. Like this is the only house that’s ever gonna come on the market that I abso, that I absolutely love. This is the only chance, like I kind of think of that when it comes to dentists who say like, I’ve gotta do this now. Uh, you know, or I’m gonna lose, I’m gonna miss out. And I’m like, you’re 35 years old, you’re not gonna like. What are you talking about? That there’s no possible way you can argue logically that if you don’t do this, and, and I’m not saying you should or should not, I’m just saying that is just an illogical, uh, reason to make a decision like this.

Christine Uhen: Illogical, right. Well, and I think that also is, that, that’s the back, back to that. It’s an idea. It’s not good or bad. It’s a, it’s a thought. Let’s just talk about this a little bit more. And I will say, you know, I fought hard for my house, the last one I got. But it’s, we, we, you know, I mean we, we were in that bidding war and everything and I think we really did go through the fear of not getting it and what would, but we talk, we actually addressed that of, well, what if we don’t? We’re still okay here. We’re not unhappy here. We’re not destitute, we’re not desperate. I mean, whether we want, we still wanted to move whether we got the house we did or not, but it wasn’t, you know, life and soul crushing to not, you know, there were several that we didn’t get that. So what we ended up with was exactly what we were supposed to be, but we went into that when we got our first know of, this isn’t going to. You know, ruin our lives if we don’t get that house.

Matt Mulcock: Yeah.

Christine Uhen: It was a conscious, it was a conscious conversation we had about it.

Matt Mulcock: Yeah, well, you’re practicing what you preach in regards to having the right emotional state when making any big transaction or financial decision in your life. It, which is don’t let your emotions completely take over and, and put yourself in this position of like, if this doesn’t happen, the thing that I wasn’t even thinking about last week, but now it has to happen or I’m gonna miss out, like just. Be a, you know, be more grounded and more data-driven and, and, and more ruthlessly intentional as, as we keep, uh, you know, we’re gonna make a t-shirt for will. Um, so let’s talk about, so we’ve kind of highlighted. the draws to the DSO and I think the, the go beyond money, and by the way, again with empathy, like these are all human, normal, psychological and emotional things that, that we all deal with in our life.

And Chris, I love that you’ve said this multiple times already, and I’ve heard you say this outside of this podcast, which is, it feels good to have someone come and tell you, you built a great business and we want to buy it like. Who wouldn’t want to hear that. Like that alone is a draw. So we totally understand that. Um, I don’t think we need to, I, I don’t wanna spend too much time just for the sake of time, uh, before we get into like what to do instead, but, uh, just kind of a highlight of like, what’s at stake here of getting this wrong. Um, do what, what comments do you have? Just generally of like what’s at stake for a dentist if they, if they. they’re not intentional, if they’re not thoughtful, if they do this just for the money. we’ve kind of alluded to this already, but what, what thoughts come to mind for you of kind of what’s at stake if you’re getting this wrong?

Christine Uhen: Well, I’m going to take this again a little bit higher level with the, when it comes to the value of the practice, you could be selling before it’s worth what it really could be. ’cause you didn’t take the time to build it up, so you might be, so there’s an opportunity cost that might be lost. That’s one thing I’m. I’ve taken some training on certified exit planning associate position on cepa, so there’s actually, there’s a state of seller readiness and it is a state that is financially, personally. Do you have your personal financials in alignment? Do you know that when you make this sale, it will satisfy the financial needs of you personally? Are you emotionally

Matt Mulcock: On the spreadsheet you’re saying on the.

Christine Uhen: Yeah. Mathematically. Yeah, mathematically. So again, financial advisor, that piece that I walk away with at the end. Is this going to satisfy my long-term retirement? Financial freedom, right? Financial independence. second one is the emotional state. Am I emotionally ready to no longer be in charge? To make the decisions ’cause it’s sort, we’re sort of complaining about making decisions, but am I really ready to give them up and am I willing to have someone else be my boss? ‘ cause I’ve been my own boss for a while, right? And it’s, if I really did the math, I’m gonna say eight times outta 10, I’m happy being the boss. If I’m truly an entrepreneur at heart, which many. Solo practitioners are, you know, or even let’s say owners are entrepreneurs at heart, have a little more control over my life. I can take my time off when I want to. Things like that. Those might be gone depending on the deal that is on the table. And then again, is your business attractive enough?

Again, have you optimized this to the point that it is at its highest best in class value? So there’s three different areas that if we’re not running the spreadsheet on your financial investment, talking through, it’s Tuesday morning at eight, what are you gonna do every Tuesday morning at 8:00 AM I’m gonna golf when I retire. I am a golfer. I’m not doing it every day. Eight hours a day, right? That’s just not gonna happen. Where’s my, uh, what’s my next passion in life? Right? So there’s hobbies and there’s passions, but so they need to, they, there really is time necessary and needed to walk through all of that before you’re even ready to think about stepping away from being a business owner. And then is it attractive enough to get the highest value for it?

Matt Mulcock: I love that you highlighted. Let’s just stick to the financial piece of like what’s at stake financially. I think there’s, I heard there’s two from you. There’s two distinct levels of this. When we talk about financially what’s at stake, there’s getting it wrong. Meaning the deal ends up not being what you think it is, and you didn’t put the time and energy and utilize your resources to figure out what am I actually gonna be with like leftover. With this, there’s that piece of it of just getting that piece wrong, which could be catastrophic. Uh, and if you know best case, it’s just stressful and you don’t have enough to retire or reach your goals. But the other piece of this that you highlighted that’s financially at stake is the opportunity cost of not taking the time to think. What’s the alternative here? Am I, have I optimized, or as you called it, I love this. Got my business, uh, what’d you call it? Uh, uh, business attractiveness and like sell ready, like ready for the

Christine Uhen: Ready?

Matt Mulcock: Am I actually ready, sell ready? Am I seller ready? Like do I have the business optimized to maximize the value?

Because This is a concept I share with dentists all the time. When you, when you get that money. Whatever that money you end up with, that cost that, or that capital has to be deployed somewhere else and you have to think about post-sale, where’s that capital going and is that capital more optimized in other areas? Right? So I’m a huge proponent of the public markets. Love it. Love the public markets. Think it’s a great place to diversify your wealth and grow wealth long term. But if you’re gonna sit here and tell me. I will, I should say this, I will sit here and tell you that you are more likely, uh, far more optimized or that that wealth is far more efficiently optimized that capital in your business with the use of some, or with the help of someone like Christine Ewen to help you optimize that over the next three to five years, rather than going and putting in the public markets, like generally speaking, all else being equal, you’re better off reinvesting and growing that practice. It’s a huge opportunity cost there.

Christine Uhen: Yeah. And again, if, if you’ve, you went into, remember you went into dentistry for a reason and hopefully that was ’cause you really wanna take care of patients. Right. You wanna be a clinician and a provider and a growth in your business allows you to do that. So again, part of this, there’s again, a little bit of that emotional tie of, you know, what is it that your practice provides? What is your, you know, philosophy of care? Do you have a commitment that to your community, to your, to your patients that will continue when you, you know, keep that practice going and growing.

Matt Mulcock: Yeah. Yeah. I love it. And the other thing that you said that I wanted to just reiterate really quick is the, the loss of control and no longer being. Boss. I would say outside of the finances. Outside of like the financial deal, not being what they thought, the number one. And it’s after that. After again, after the money. This is the one A, one B to that. If there’s a level of regret, it is. I didn’t realize how much I was gonna hate giving up control and no longer being the boss.

Christine Uhen: Even though that might’ve been, what prompted you to pick up the phone? ’cause of my,

Matt Mulcock: Exactly. The

Christine Uhen: Bothering me.

Matt Mulcock: The

Christine Uhen: I don’t wanna have to deal with this. And yet, yeah. The irony. Hmm. Hmm.

Matt Mulcock: Well, Chris, when I’m sitting, I’m staring at a piece of paper with four or $5 billion on it. My hygienist feels a little bit more annoying at that point. Kinda like, you know what she, yeah, she is. She is annoying.

Christine Uhen: Uh, just, you know,

Matt Mulcock: Feel a lot bigger when you’re staring at 5 million bucks.

Christine Uhen: Well and again, that, but there’s the, let me sleep on it. Right. Didn’t, wasn’t that one of our old fashioned, you know, recommendations of, let’s just sleep on that. That is the pause, right? Let’s just sleep on that. Don’t go to bed angry. But let’s just take, let’s take a minute.

Matt Mulcock: Just take a minute. Take some time. Yeah. Uh, okay. So let, let’s, uh, let’s kind of start wrapping this up with I think some takeaways. We, I think we’ve kind of established. The draw we’ve established kind of what’s it, what’s it? Um, and we’ve, again, we’ve kind of, uh, weaved this in, but I think summarizing what to do instead if we’re saying a DSO transaction is an option. It is on the list for sure. And we’re not saying it is a, just don’t ever do it, but we’re saying what to do instead of be drawn to the DSO right off the bat. we think there’s some things to be considering before, and it’s kind of the inverse of everything we’ve just highlighted. So if we’re saying, again, we’ve already kind of weaved this in, but we’ll just summarize and then we’ll kind of wrap up with, with final thoughts. But if we’re saying the first draw outside of money is, the wrong mindset, the opposite side of this is let’s redefine your role as the CEO, not just clinician. Like be really mindful. Of your role in the practice and be really intentional about what that looks like for you.

Christine Uhen: And be willing to ask for help in that too. Again, I think there’s a lot. Basically as a solopreneur, you wear all the C-suite hats, right? The CEO, who’s the visionary? The CFO. Who’s the financial person? The chief marketing officer? The chief operating officer. But. In that sense, as you see the need as you’re getting outta that growth phase, and now we’re talking about systems, this is where you get to elevate the team. You don’t have to do this alone. Your team is looking for opportunities to do more, to be a leader, to be the head of a department, those sorts of things. And creating those opportunities within your current team is a great retention strategy to keep the team. ’cause that’s one of the biggest headaches is finding, recruiting, and you know, then. Retaining your team. So internal opportunities where they can grow and that will help you from that multiple different hats that you have to wear. So get support from your team, get outside support, you know, from coaches if you need it.

Matt Mulcock: I love it. You, you just hit on a couple of these all in one, which I love. not only the mindset, but under No, I love this un understanding. You just alluded to understanding the business cycle you’re in. Like where are you in that cycle? You very likely, if you’re, if you’re the dentist who just picked up the phone ’cause someone randomly called you, I’m gonna guess chances are. A, you probably don’t know what bus, like where you are in the business cycle of your own personal business, and B, you’re probably not at step five, which would be selling your business. There’s probably a lot of work to be done to get there.

Christine Uhen: And that is, again, you have to, there’s working in your business as a provider, but there’s also working on your business, meaning I do need to be aware of opportunities. In growth. I need to be aware of what my patients are asking for. Am I providing what they’re asking for? What is my team asking for? What is the marketplace asking for? What are the opportunities that I do need to pay attention to in order to grow? What are some of the data points I should be looking at? So there’s time that’s required to do that, but without taking, you know, those three, four hours a week to do that. You won’t grow successfully, which will create distress, stress, frustration, and that’s the emotional state that you’re susceptible to an offer that may be too good to be true.

Matt Mulcock: Yeah, so good. Chris, I, I can’t even tell you how many times. We’ve had conversations that begin with, I’m gonna sell my practice and end with, oh, I’m gonna make some of these tweaks and changes and just start practicing the way I want to practice or adapt my model or my approach as you’re alluding to, and get the support that I need. Maybe bring in an associate maybe. Expand and, and remove myself from clinical ’cause I love the business side or whatever, make these changes. And it’s, it’s mind blowing how many times, what started out is I’m gonna sell my practice ended with I could do this thing for another 20 years. ’cause I am now, I found a more intentional approach to my business.

I think that’s the main takeaway we want to, we want to hit, is just, again, being more intentional with this approach. Explore the options, which includes transitions or selling to A DSO, but I would say stop buying this idea that is so pervasive that it’s the only option now. It’s not even close to the only option. It is a option, but it’s not even close to the only option.

Christine Uhen: And until you take the time to be introspective and say, what is it that I want? Not what the other people that are doing and, and assuming what they want or what the, what I’m hearing on TikTok Instagram, you know what the, what the Joneses are doing. Do what you want to do. If you don’t take the time to think about that, I do want to stay working, but I only wanna do X dentistry. Fantastic. Let’s do that. Let’s get you excited again about what got you into dentistry in the first place, taking great care of your patients.

Matt Mulcock: I love that. Can I, I think that’s another thing that, that wasn’t on the ne list necessarily, but it’s been coming out in our conversation, which is get back to finding that connection to meaning in your work. Uh, find, find that. Maybe your

Christine Uhen: Find your why. I’ve heard that that might be important.

Matt Mulcock: Yeah. Yeah. Well, uh, I, I love what you just said too.

There’s a, a quote by. Chris Morley, I believe Christopher Morley says, the greatest success in life is living life your own way. And I think it’s the same with this is living or practicing in your own way, practicing the way you want to practice. I think that is super, super easy to say, super difficult to implement in real life. Living life your own way is really difficult. so. I wanna give you the, the last word here, Chris. I guess I’ll just, what I’ll say to wrap this up is, and now again, I wanna give you the last word is just, the themes that came out of this is intentionality, being much more intentional, being more thoughtful, not as urgent or desperate. Like w know where you’re emotionally, where you are emotionally as you’re thinking about this decision. And, Don’t ever make a decision out of fear or desperation or this, this, like I’m, this is my only opportunity to like life-changing money. Just be more thoughtful about it and understand there’s a lot more options out there than you think by being creative and dentistry is still a private practice. Dentistry is still a killer path forward. So I’m gonna give you last, final thoughts though.

Christine Uhen: I don’t know what else I can add to that. Um, I just keep I be authentic, be true. Right? This is, this is where, you know, just wrapping up that whole again, whole nother podcast of, you know, what is authentic and what, what don’t be. You don’t have to be a part of be. Be who you are.

Matt Mulcock: Yeah.

Christine Uhen: Stay in your boat. Don’t jump in

Matt Mulcock: Uh, Chris.

Christine Uhen: Stay in your boat. It’s a

Matt Mulcock: Yeah. Stay in your own private little hot tub. Yeah, exactly. Chris, I love this. This is such a pertinent, important conversation. One of many, many we will have and little offshoots that we’ll have from this conversation. We would love to hear from you. and if you have ideas or things that you wanna talk about or you want us, and now we’ve got, Christine on the, on the team, you have questions you want us to, to, to bring up and have a q and r with, with Chris, we would love to do that. You can just go to the Dentist Advisors Facebook group post any question you want, and we’ll, we’ll. We’ll talk about it on the show. Uh, and then also if you’re out there sitting there thinking, man, I’ve had DSO deals come across my desk. I don’t know ever what to do with it. I want to talk to somebody about it. Or, you know, there’s something in this podcast or in this discussion that’s resonating with you, A, share it with a friend of someone you think it could help as well. But B, if you wanna talk to us dentist advisors.com. Click on the yellow book free consultation button. We talk to dentists all over the country all the time.

We would love to talk to you and help walk through whatever situation you’re dealing with, DSO or otherwise. For now, thank you so much for listening. Christine, thank you so much for being here. Till next time, bye-bye.

Christine Uhen: Bye everybody.

Keywords: DSO, dental practice, financial decisions, practice strategy, practice ownership, emotional impact, business cycle, mindset, opportunity cost

Practice Transitions, Practice Value