DEO's Growth Secrets Podcast for Dental Organizations 234: Why $1M–$3M EBITDA Dental Practices Get the Highest Valuations
Jul 2, 2025
Brandon Moncrief, CEO & Principal of McLerran & Associates, shares his expertise on what drives high valuations in dental practices. He explains that practices with $1M–$3M in EBITDA are currently the most sought after. The conversation highlights the dangers of owner-dependence and why improving same-store revenue is crucial. Moncrief emphasizes that profitability should take precedence over mere expansion and underscores the significance of accurate financial assessments in maximizing practice value for potential sales.
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$1M–$3M EBITDA Sweet Spot
- The highest valuations are for dental practices with EBITDA between $1M and $3M due to strong demand and sustainability.
- Deals still happen but involve more diligence and take longer, with Class A assets maintaining premiums.
Reduce Founder Dependency
- Delegate production and management responsibilities to multiple providers to reduce founder dependency.
- Building a less owner-dependent practice increases valuation and reduces post-sale obligations.
Optimal EBITDA Margin Range
- Aim for an EBITDA margin between 18% and 25% for optimal buyer interest and valuation.
- Practices within $1M to $3M EBITDA attract the most buyers and highest valuations.