The Practice Buyer's Corner - Random Musings from the Buy-Side
The Practice Buyer's Corner - Random Musings from the Buy-Side
The purpose of this blog is to share current, real world, experiences on the topics of practice valuation, practice transition, retirement planning, and building equity value - over time - in your dental practice.
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seanepp
seanepp

Valuation Blind Spot:  Price Per Patient

Valuation Blind Spot: Price Per Patient

11/20/2025 8:33:16 AM   |   Comments: 2   |   Views: 56
Most of us are familiar with practice valuations being expressed by a variety of metrics - e.g. % of revenues, multiple of Seller Discretionary Earnings (SDE), or multiple of EBITDA or "Cash Flow".  
 
These are all commonly accepted, relevant metrics, especially when comparing valuations across practices.  
 
However, these metrics have a huge blind spot.  What these metrics ignore is a concept of a price per unit - i.e. what is the effective price you are paying per Active Patient being acquired?
 
Since the fundamental asset being conveyed in any practice sale (at least GP) is the patient base, I've found this to be a key metric when trying to  differente amongst multiple opportunities.
 
This simple extra calculation might provide helpful insight when trying to compare the relative value of multiple practice acquisition opportunities.
 
Happy Hunting!

Best,

Sean
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