Why We Chose to Sell Early in Our Careers and What We Learned
Early retirement in dentistry is different than most fields. For most people working life involves a minimum of 5-7 career changes. With dentistry, we generally sign up for our entire working life. So, anything less than a lifetime can be considered early. And so our story begins…
My husband is in our office between patients massaging his aching thumb joint because the recent cortisone shot is starting to wear off. I am popping my third Advil of the day to deal with what has become regular neck pain and I say to him, “what’s our exit plan?”
His answer is quiet and dulled by the fact that this isn’t the first time I have asked this. “I don’t know?” That’s his quick answer. “Maybe 5-10 years from now”, is his long answer.
But something has changed in me. I no longer feel the joy I once had when I am working. I know he feels the same but doesn’t say it as much. Most times it’s an actual physical ache but sometimes it’s a mental one. Twenty-eight years is a long time in any career…oh wait…except dentistry. We are supposed to graduate with our advanced degrees and never look back on the careers we have chosen for ourselves. We are to never have a thought that maybe this is no longer where my energy and passion lies.
Turns out it is not all about having the most money possible in your lifetime. Money can put a down payment on a lot of things both figuratively and literally. But there is a word I have come to love with regard to money and it is the word “enough”. Did we have “enough” to live comfortably? Did we have “enough” to not worry about finances driving the important choices in our life? It turns out some of our final decision-making depended on the value of our practice. And so I looked at my husband and said “let’s get our practice evaluated again and see what we find out.”
We already had an evaluation done by a local practice management team that had sold my husband’s first practice a decade earlier, but it seemed low to us. We had assumed, at that time, that all practice valuations were the same. We thought practices were like any other piece of real estate, but boy were we wrong. Our practice wasn’t any more profitable than the last time we had a valuation, but I took a gamble thinking that maybe all were not the same and we would try again.
I started doing research in the field and my search sent us to the Omni Group. They did practice brokering exclusively and they had been recommended to me by other dentists. I gave them a call and started talking to Rod Johnston. He was both mild-mannered and highly informative. I found out much later he just also happens to be the owner of the company. He came to our office and met with us and explained the valuation process. It seemed much more detailed and complex than the first one we had done. We forwarded the necessary documents to Omni and in about a week we had a fresh perspective on our practice’s value.
Wow, what a difference a new look made! The final price was almost 25% higher in this valuation compared to the previous. How had the other valuation been so off? Would our practice sell at the new price? Well, it didn’t take long to answer all those questions. After being on the market for about one week, we had three full price solid offers and the ability to choose our buyers and our own transition plan.
The subsequent transition met and exceeded our goals. We wanted new owners that shared our philosophy of patient care. We wanted none of the staff to find out until the final paperwork was signed, and a quick exit with little to no overlap in our time in the practice. We achieved all of those goals and a full price offer.
How did that happen so quickly and how could the price point be so different? We didn’t over-analyze at the time; we were just happy it was working out so well. The full understanding wouldn’t come until later when I decided this whole process was something I was passionate about and became a broker myself.
When the dust clears and the paperwork settles out, there are multiple pathways you can follow. The most important thing is to remember as a dentist we are not just skilled at one thing, we are in every aspect of business from top to bottom. When you run a dental practice you literally do it all. The list is long, so I won’t bore you with it, but never forget how talented you are.
My husband’s path after clinical dentistry was to form a company that would oversee the maintenance and upkeep of multi-family and commercial properties which included our own holdings. I immediately got my real estate license and formed a management company to take over the tenant relations and leasing. After hiring an employee and settling into the rhythm of our new lives I still felt I had more energy and passion that extended outside of the new world we had created.
When I added up the things that I loved: business, real estate, and the dental community it was an easy decision to move forward with my new career. I only wanted to be a practice broker in one place and that was with Omni Group.
I found out pretty quickly that what looks simple to the buyers and sellers is actually a tricky business. First, on the subject of valuations. Omni does a three-part and highly complicated deep dive into each practice. This includes the goodwill, location, production, collection, overhead, and investments one has made in their practice. As far as marketing, Omni blankets the airwaves literally across the country and Canada to get the news out of the practice you are selling. They have more buyers tuned in than any other brokerage house. They also have more listings. Relationships with lawyers and banks come in as well. It turns out that the brokers are at the ready to find competitive financing with banks that are actively lending on dental practices. Each party needs an experienced lawyer to take them to the finish line and Omni works closely with local attorneys who are experienced in dental practice transitions.
One thing that came up that I didn’t expect was how much I would care about who would take over our practice. I have bought and sold many properties in my lifetime, some more valuable than my practice. In all cases, my level of really caring who bought them was low. The highest price was usually top of mind. Not so with the dental office. Obviously, a good price was important, but it became clear that someone who supported our legacy and would take good care of the staff and patients was of equal value. We were given full ability to meet with and learn about prospective buyers of our practice and made a choice that satisfied all our requirements.
When interviewed after the sale, no dentists have ever said they sold too early. In fact, it’s often the opposite. As it was for us. If we could do it all again, we would only have started the process sooner.
The end of our journey in clinical dentistry was just the beginning of our next chapter in life. I have spent my life around enough dentists to know very few of us really fade into the sunset. Once you sell your practice, you will begin writing the next chapter of your life and I promise it will be a good one.