Transition Tales: 5 Lessons on the Cross-Country Journey to a Unicorn Practice

Posted by Bree Simmers on 2/4/20 9:00 AM
Bree Simmers

Blog_Image_For_Sale_Balance-1This is part of the Transition Tales & Truths series in which we discuss practice transitions with real dentists.

Patience is a virtue when trying to find the ideal practice. However, it is important that you use the waiting time to prepare for your next steps.

That was Dr. Jim’s message to his dental colleagues when he got in touch with ADA Practice Transitions to share his story.

Dr. Jim and his wife, Pam (names changed at their request), worked together as a team to navigate the practice transitions process. Over six years and a variety of experiences, they refined their idea of the “perfect practice” and wanted to share their lessons with other young dentists ready to forge a path.

A series of practices, each with a lesson

Dr. Jim started his dental career as a staff dentist in a public health center and then soon found himself an associateship in a private practice. Eventually, he was presented with an opportunity to buy the practice – but an accountant looked at the numbers and cautioned, “Don’t walk – run!”

Since that practice was in poor financial health, Dr. Jim left for a small-group practice in a small town. He loved the community, but that practice’s financial health was not great, either.

Finally, after years of picturing his ideal practice, he got serious about purchasing.

Understand your priorities and have a plan as you search for the perfect practice.

Dr. Jim and Pam created and refined a matrix of priorities, and a business plan, to help guide their search. And they remained patient as they searched for the perfect small-town practice where they could become enmeshed in a community and do things their way.

Ready for the “unicorn” practice

Thanks to all their preparation, the couple instantly recognized a practice’s potential when they saw the listing. Their “unicorn” practice had strong financials, a similar philosophy of care, and just happened to be close to family. It was also across the country from where they were currently living, but that did not deter them.

Since the practice looked promising, Dr. Jim flew out immediately to meet the owner. A one-hour meeting turned into 3.5 hours as the two dentists compared notes and found they shared very similar philosophies.

“Everything lined up to be just what we were looking for – just not in the geography where we planned to live. We were ready to move when we found the right fit, though,” Pam said.

Since the couple had done all their homework and assembled a team of trusted professionals, they were able to put in an offer right away, less than a month after the practice was listed. The entire transaction closed in less than five months. Nearly three years later, the practice is thriving as Dr. Jim treats patients and Pam runs the business.

The family pointed to several lessons that helped them find the perfect practice.

Keep your options open

The couple knew what they wanted, but also knew that they had to be willing to compromise on some things. Their matrix of priorities helped them refine what was most important to them. With each potential practice, they recognized what worked and what they would do differently. And by remaining flexible, they were able to jump at the chance to have their “unicorn” when it presented.

“You may never find that ‘perfect’ location with your preferred mix of payers. But you can calibrate what’s most important to you.”

“You may never find that ‘perfect’ location with your preferred mix of payers,” Pam noted, “but you can calibrate what’s most important to you.”

Dr. Jim added, “That’s why we looked rural. There’s much greater opportunity for community interaction, connection, and impact beyond what happens within the walls of the practice.”

(See why one dentist transformed a short-term rural contract into a successful career.)

Build a team you can trust

Throughout their journey, the pair developed relationships with their own team of advisors. Their accountant taught them how to look at the numbers and explained why the first two practices were not financially sound. The couple also engaged a professional to do a clinical audit.

After learning some expensive lessons by working with a “less helpful” attorney, they found one who really protected their interests. “Make sure you have your own representation,” Dr. Jim urged. “It’s really important to have a lawyer review your contract as an associate or for purchasing a practice.” (See more ways to avoid common contract pitfalls.)

Dr. Jim also relied on a mentor (a retired dentist) to provide practical advice and reassurance.

The couple’s team worked with the seller’s representatives to decide which practice valuation methodology would be used and how to handle the real estate transaction. This step helped the transaction go smoothly.

Think of the transaction as just the start of the change

The couple knew that no matter how perfect the practice was, they would make changes that fit their own values and priorities. They viewed signing the paperwork as only the first part of the process and worked closely with the seller to ensure the transition went as smoothly as possible. The seller even stuck around for a short time to answer questions and help out.

The couple was careful not to make drastic changes too quickly. “We tried to demonstrate to patients that it’s an amicable transition and tried to honor what [the seller] had been doing,” Dr. Jim said.

Inform staff of the transition

Dr. Jim and Pam had witnessed transitions where the staff was kept in the dark due to fears of patients leaving. They wanted to take a different approach. Luckily, the seller agreed and informed his long-standing team of his plans. The couple met the staff before the sale closed and assured them that they would keep their jobs and compensation. (See more about why practice transitions shouldn't be kept a secret.)

“Keeping the original staff has helped us grow and maintain our patient base,” Pam said. “The previous owner gave us his blessing and demonstrated his confidence in us – and that made a big difference.”

Involving staff also made the transition easier. Staff helped make all the necessary compliance and documentation changes and shared their confidence with patients.

Make it personal

Dr. Jim learned that he prefers a small-town practice where he can be a part of the community – and his new practice fits the bill. The previous owner shared the same philosophy and was eager to help by writing personal letters to his long-standing patients. This personal connection has helped retain patients. In fact, “The challenge now is managing a schedule that’s too full!” Pam laughed.

The couple is thrilled to have landed in the right practice for their long-term goals. If you are looking for your own long-term practice, create an ADA Practice Transitions profile today. Once you submit your profile, you will be connected with an ADA Advisor who will help you find the right practice and guide you through every step of the process.

Topics: incoming dentist, purchase a practice, transition tales


Comments

Subscribe Here!

Popular Posts