Sell-side readiness

How do I prepare my dental operations for private equity diligence?

You prepare by fixing what diligence reads before diligence reads it: collections against production, aging past 90 days, owner dependency, and add-backs with documentation behind them. GME Dental Professional Services runs that read for orthodontic and dental owners and builds the roadmap to close the gaps, starting 16 months to 3 years out.

What diligence is actually testing

A financial buyer is testing whether the earnings survive you leaving.

A quality of earnings review values the earnings. What sits underneath it is whether the operation that produced those earnings keeps producing them once the selling doctor is out of the building and the long-tenured office manager has taken a package.

That is the part an owner can still change. It is also the part most owners have never been asked about directly, because a broker prices the practice and a QoE team prices the earnings. Nobody reads the operation until the buyer's side does, and by then the finding is a deduction.

Where deals slip

Add-backs are where good deals go sideways.

Adjusted EBITDA is a stack of add-backs. Owner pay above market. Related-party rent. Personal expenses run through the practice. One-time costs. Each one lifts the earnings the multiple is applied to.

Here is how it breaks, and it usually starts honestly. The seller tells their advisor those costs were personal or one-time, from memory, because that is how it felt. The advisor builds it into the number. Then the buyer's QoE team asks for support, finds none, and treats the expense as a normal cost of running the practice. The add-back comes out and the earnings the price was built on drop.

One thin add-back can cost close to a full turn on the multiple. The fix is boring and it works: before anyone anchors a model, pressure-test the three largest add-backs for support. A market rent study. An owner-pay comparison. Actual records behind the personal and one-time costs.

What gets read

The operational file a buyer builds on you

Collections against production. Net collection rate, aging over 90 days, denied claims, and whether anyone works the list every week. Production is what you did. Collections are what you keep.
Contract book, in orthodontics. What share of contracted revenue actually clears, and how fast a failed auto-pay gets worked. A case is booked once and collected two dozen times over 18 to 30 months.
Demand conversion. New patient calls to exams to starts. Exam-to-start, same-day starts, pending starts, and observation recall. Hygiene recall and reactivation on the dental side.
Owner and key-person dependency. Whether each number has a named owner and a review cadence, or whether the owner is the backup plan for every breakdown.
Standardization, on a group. Whether the locations run one operating standard, who owns it, and what happened at the sites that did not adopt it.

Targets

What a clean operational file looks like

98%

or more of what you are owed, actually collected

<5%

of accounts receivable past 90 days

97%

or more of contracted revenue collected on an orthodontic book

10 days

maximum to work a failed payment before recovery odds drop

Falling short of these is not a reason to stay off the market. Each gap is a number, and each number is either something you fix on your own timeline or something a buyer takes off the price on theirs.

The full sale-readiness picture, and where to start →

How the work runs

Read the operation first, then build the runway.

Value Gap Snapshot. Starting at $3,900*. A practice management system data pull and analysis plus a short discovery and readout call. The fastest read on what diligence would find. The full fee credits toward Transition Readiness if you sign within 45 days.
Transition Readiness. Starting at $9,250*. The roadmap build, reviewed against what a buyer pays for, with the fixes ranked and quarterly check-ins through the runway to market.

*Scales with location count and complexity. Travel billed separately at cost.

Who runs it

Gretchen M. Estapa has sat on the buyer's side of this table.

Since 2025 she has run operational due diligence for buy-side clients of an investment banking firm, which means she has read other owners' operations the way a buyer will read yours. Before that she built practices on the operations side, spent four years as a sell-side broker taking them to market, and designed the operating model behind a franchise-like orthodontic concept.

Gretchen leads every engagement. Specialists join based on what the work needs.

$158M

in transactions guided and practices prepared for transaction, pre-LOI through close

320 / 650

practices and locations reached in total, including 120-plus practices across 350-plus offices led directly

30 years

building professional service businesses, 15 of them in dental and orthodontics

Green Belt

Lean Six Sigma in Healthcare, the same discipline hospitals use to remove delay and error

Common questions

Diligence preparation, answered

What does a private equity buyer look at that a practice broker does not?

A broker prices the practice and a quality of earnings team prices the earnings. A financial buyer also reads the operation that produced those earnings: whether collections hold without the current biller, whether the schedule fills without the selling doctor, and whether each number has a named owner. That read is what decides whether the earnings survive the handover.

What is a QoE, and how do I get ready for one?

A quality of earnings review tests whether reported earnings are real and repeatable. You get ready by documenting the three largest add-backs before anyone builds a model on them: a market rent study, an owner-pay comparison, and actual records behind the personal and one-time costs. An add-back reported from memory is the one that comes out.

How long does preparation take?

16 months to 3 years for the trends that matter. Recurring revenue, write-off percentage, and owner dependency take 18 to 24 months to build and show clean. Documentation work on add-backs can be done faster, and it is usually the first thing to start.

What happens if my add-backs have no documentation?

Start with the three largest and document those. A market rent study, an owner-pay comparison against market, and receipts or records behind the personal and one-time costs. This is the fastest part of getting ready, usually weeks rather than quarters, which is why it is worth starting even if a sale is years out. An add-back you cannot support is better removed from your own model than removed from the buyer's.

Should I fix operations before or after the LOI?

Before, wherever the timeline allows. Findings that surface after the LOI move price in the buyer's direction, because at that point they are deductions rather than improvements. Fixed beforehand, the same gaps are value you keep.

What does it cost?

GME's Value Gap Snapshot starts at $3,900 and Transition Readiness starts at $9,250. Both scale with location count and complexity, and travel is billed separately at cost.