1) Introduction
Dr. J was a high-producing pediatric dentist in the Dallas area who was dedicated to her business and who had grown a strong practice over the years as the only provider in the office.
2) Challenge
Dr. J wanted to continue practicing but knew she couldn’t keep up the current pace alone. Dr. J practiced all day which only left the evenings for her to do the management work. This took up too much of her time and deprived her of work-life balance and being able to spend time with her husband. She had the vision to grow the practice but knew she could not take on any more work and needed help.
3) Our Approach
Dr. J called Practice Transitions Group (PTG) to help her find a partner who could manage the business side of the practice. This would allow Dr. J to focus her time on the clinical side, including hiring talented clinical assistants including a new associate. A partner would also allow Dr. J to spend more time with her husband and achieve a better work-life balance.
PTG identified the perfect partner for Dr. J – one who shared her values of being community-oriented and one who started working to find an associate and other clinical help even before the deal closed!
4) Road Blocks
Dr. J rented the office her practice was in so as part of the deal, she would need to assign her lease to her new partner. However, Dr. J’s landlord thought he would try to take advantage of this situation and threatened to not assign the lease if the parties did not agree to a 15% rental increase on the current rent and a 20% rent increase during the renewal.
5) Solution
PTG knew this was not within the landlord’s rights, however. They were able to use not only its sister company’s real estate experience but the relationships they had built in the community to both deny the landlord’s requested rental increase and incentivize him to sign the deal.
6) Results
In the end, Dr. J received a significant cash payout based on a valuation of 248% of revenue and maintained 40% equity in her practice. Her first extended vacation is on the horizon!