Organic and inorganic growth are the two main avenues for DSOs and dental groups to grow and expand, but which strategy is more effective is not always clear.
Here is what five dental executives have told Becker's about the two types of growth and which kind the industry has been seeing more of recently, as well as what type of growth has been impactful at their organizations.
Andrew Jones. COO of Imagen Dental Partners (Scottsdale, Ariz.): A number of groups use debt to grow, and in environments where you're struggling to grow organically, it becomes more difficult to service that debt. So one of the differentiators for Imagen is we don't use debt in that way, and that allows us to be more aggressive in our ability to grow, which is [why] inorganic growth has not slowed down during this time period.
Brian Lawson. Vice President of Business Development of Max Surgical Specialty Management (Hackensack, N.J.): Right now, the majority of DSOs out there are primarily focused on growing via M&A, while organic growth and support for the existing practices at the organization is an afterthought. Realistically, it's impossible to provide top-tier operational support to practices that are located two to three time zones away from the organization's headquarters.
Vincent Cardillo. Founder and CEO of Maeva Dental Advisors (Wilbraham, Mass.): At the moment, there's a little bit of a low on the market because of the high interest rates, and a bunch of these groups got into trouble with their covenants because the interest rate jumped and they couldn't pay it back, so now everyone's worried about organic growth. I think the consolidation is going to continue. There's so much Wall Street money in this industry, that it can't stop.
Stephanie Townsend. Senior Vice President of Operations of Heartland Dental (Effingham, Ill.): Organic and de novo growth and affiliation partnerships: We remain dedicated to expanding through organic growth and by building new offices, as well as forming affiliations with like-minded doctors. This time of year, many doctors consider transition strategies, and new graduates often seek opportunities in de novo offices.
Stephen Saukaitis. CEO of Select Dental Management (Florham Park, N.J.): Select Dental Management has experienced robust growth in 2024, surpassing our planned targets and building on the momentum of a strong performance in 2023. We are driving strong organic practice growth and profitability despite inflationary pressures, while supporting our partner practices in delivering high-quality patient care. We've accomplished this by incorporating new services and technology into our partner practices, working hard to recruit top talent and keeping our focus on supporting great patient care.