The goal is to transition your practice, in terms of sale preparation, from 'Main Street' to 'Wall Street. On Main Street, practices are acquired by other doctors, DSOs, or MSOs at low multiples. In contrast, on Wall Street, practices can receive significantly higher multiples based on both EBITDA and gross collections, with a range of acquisition structures. Think of Main Street as being on the left side of a river and Wall Street on the right, but with a vast distance between them. The challenge has been for doctors who wish to have their practices positioned to sell, to cross that river to Wall Street.
Nearly every doctor will eventually sell their practice, and selling on Wall Street is preferred as they can achieve much higher multiples. If you are invited to participate, please review as your referring source and Healthcare Practice Sale (HPS) will help you create a bridge to cross the river from Main Street to Wall Street. HPS is a platform onto which over 1,200 buyers have signed who are interested in investing in and/or acquiring healthcare practices. On Wall Street is where you will receive the highest price possible for your practice whenever you decide to sell.
Main Street is where most doctors currently find themselves, along with their accountants, attorneys and most everyone else they know. Most business owners (not just healthcare owners) reside on Main Street as they do not prepare their practices for evaluation by Wall Street. These owners typically remain on Main Street and retire there as well. On Main Street, doctors receive offers from MSOs, DSOs, hospitals or other doctors.
The MSO and DSO approach often involves a small upfront payment to the doctor, followed by a requirement that the doctor remain with the practice for several years to essentially generate the income that funds their own payout. This arrangement is great for the new owner but is not necessarily fair to the doctor. If another doctor buys the practice, the seller often times has to finance the deal themselves and may not receive the full sales price.
Therefore, it is crucial for doctors, whenever possible, to transition from Main Street to Wall Street.
Doctors go into business not only to earn a living but also, and often more importantly, to help their patients. When doctors begin to consider selling their practice, they are usually well into their careers. Because they haven't been positioning themselves for a Wall Street evaluation from the start, their options are often limited to Main Street. In contrast, companies like tech companies start planning for their exit strategy from day one, ensuring they are ready for a Wall Street review when the time comes to sell.
Wall Street is home to the majority of the over 1,200 buyers signed by HPS. It is where buyers offer properly prepared practices high multiples of both EBITDA and gross collections. It is also where rollups occur, which can substantially increase the amount paid for a practice. There has never been a shortage of buyers for healthcare practices—only a shortage of properly prepared practices for sale.
The number of buyers interested in healthcare continues to grow, as the healthcare industry is viewed as stable and sustainable. Certain healthcare practice owners have become very wealthy from selling during this time. However, 99% of healthcare sellers remain on Main Street, and Wall Street buyers will not consider these practices unless they are properly structured and prepared for acquisition. A trend is emerging where buyers are shifting their focus from tech to healthcare, but healthcare practices must be able to be reviewed by Wall Street (the practice profile needs to be properly prepared) to even be reviewed to attract their interest.
A practice needs a referring source who will refer you to HPS. HPS ensures that your practice profile is prepared to meet Wall Street-level standards. Once a practice profile is listed on the HPS platform, it can be reviewed by over 1,200 buyers who have signed on to the HPS platform to either invest in or acquire healthcare practices. A referring source will only refer a practice to HPS if they believe it has the potential to attract Wall Street buyers. This doesn’t mean the practice needs to have enormous EBITDA or be a large-scale operation; it simply needs to be structured in a way that, in the referring source's opinion, makes it viable for a Wall Street acquisition. HPS invests significantly in preparing practice profiles for their platform and only earns revenue when a practice sells, which is why they depend on referrals.
A referring source is an individual or group approved by HPS to identify healthcare practices that could be successful candidates for sale on the HPS platform. HPS does not charge doctors upfront; instead, they earn their fees at the time of sale, making the expertise of the referring source critical. A referring source will work with the practice to recommend adjustments that improve its attractiveness to Wall Street buyers so that the highest sales price possible can be achieved. Rely on your referring source's Wall Street expertise—they are dedicated to achieving the best possible outcome for your practice.
HPS has signed over 1,200 vetted buyers interested in investing in or acquiring healthcare practices. These buyers have been carefully screened and have paid a fee to access the HPS platform. Once a practice profile is created, it is listed on the HPS platform, where buyers review it and submit offers, which are then displayed on the doctor's personal dashboard. Because every practice is unique, a referring source and HPS will customize their approach to each practice to ensure optimal results.
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