Private equity companies have become a big player in the dental industry, increasing competition and serving as a new avenue for companies to expand.
Many providers see several benefits to private equity investments, including ways to support their practices without the stress of high debt loads.
"This opens the door for doctors to utilize the private equity model to capture the value of their practice regardless of the stage in career that they are currently in," Brett Gilbert, DDS, told Becker's. "The key for younger doctors and owners is to capture equity in the larger entity with which they partner, so that the opportunity to get a return on their equity investment short and long term can support financial abundance in their lives. For new graduates, they can now enter the dental workforce, get great mentorship and future partnership opportunities without having to dig deeper into debt."
Some dentists also see private equity firms increasing competition among DSOs and other management models. Several firms have launched their own DSOs, while other companies have established partnership models that prepare owners to sell their practices to private equity firms.
Through the NextLevel Doctors Group, which launched in August, dental practice owners can join together to form their own group that is then sold to a private equity firm.
"I designed a way to put the leverage in the hands of the clinician. The clinician has the control and power, not the private equity firm," NextLevel founder Gary Kadi told Becker's. "My number one mission is the triple win: the well-being of the clinician, the well-being of the team, and the biggest one is the well-being of associates, and how do we get associates out of debt?"
With private equity already having a large impact on the dental industry, many execs see these groups staying long-term and digging deeper into the field.
Here is what private equity firms and private equity-backed companies accomplished in the dental industry in 2023:
1. Toms River, N.J.-based ProSmile sold its SmartArches brand to private equity firm TriSpan.
2. Thurston Group, a private equity investment firm, launched Modis Dental Partners, a dental organization focused on practices with an emphasis on dental implants.
3. Private equity firm InTandem Capital Partners established beBright, a doctor-owned and led pediatric dentistry and orthodontic services organization.
4. Canton, Mass.-based Advanced Dental Brands received a growth investment from an affiliate of H.I.G. Capital, a private equity and alternative investment firm.
5. Hudson Dental Partners, a DSO serving the Northeastern market backed by private equity firm Hudson Yards Capital, acquired its first practice.
6. Richmond Hill, Ga.-based SGA Dental Partners, which is backed by private equity firm Thurston Group, added its 100th location.
7. Oak Dental Partners received a $153 million senior secured credit facility from Comvest Credit Partners. Comvest Credit Partners is the lending platform of private investment firm Comvest Partners.
8. Bluetree Dental received a $32 million investment from private equity firm Clairvest Group.
9. Dentive received an investment from private equity firm HGGC.
10. Dental Care Alliance was acquired by Mubadala Investment Co., a sovereign investor based in the United Arab Emirates, in partnership with private equity firm Harvest Partners.
11. Vancouver, Wash.-based Mosaic Dental Collective partnered with Audax Private Equity, an investment management company.
12. Pluri Potent Partnership, which does business as OMFS Partners, received an investment from private equity firm HealthEdge Investment Partners.
13. Parkview Dental Partners, a Sarasota, Fla.-based DSO, gained investment from private equity firm Cathay Capital.
14. Dallas-based Pearl Street Dental Partners, a private equity-backed DSO, purchased Brush Dentistry and Derby Dental in Texas.