DSO: Economies of Scale Is a Myth
Episode 42
George Hariri, Chief Financial Officer and Co-Founder of Shared Practices, exposes why most multi-location dental groups are quietly bleeding value: the "economies of scale" pitch is a fallacy once you factor in higher debt costs and bloated central teams, centralizing functions just moves expenses around instead of cutting them, and the GP acquisition model has an identity crisis — everyone's buying the same eight-op, $2M+ practice with no real plan to add value once they own it.
Key Revelations:
Multi-location debt is more expensive — DSOs pay higher interest and carry a full executive layer on top of practice-level costs
"Maturation means centralization" is a trap — pushing work to a central team doesn't eliminate practice-level costs, it just duplicates them
Most General Practice acquisition groups buy the exact same practice profile, which means they all give private equity the exact same answer to "what makes you different?"
The old playbook — buy low, sell high, change nothing — is dead. Private equity now wants proof you add value, not just collect logos
Why Bigger Isn't Always Better
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"How do you know if your associate dentists are actually profitable?"
Ken's answer: Most dental groups never measure production in terms of hours worked — that's the first blind spot to fix. Track doctor hours alongside procedures, and you'll get real traction on true profitability, even before you tackle the harder allocation questions like supplies, lab costs, and overhead.
The "Ask Ken" Question:
Top 3 Episodes Of The Dental Truth Project. Listen Now!
(E. 2) Why High-Multiple Exits Are Bankrupting Dental Practices - AJ Peak, Health Wealth Capital
(E.5) The DSO Valuation Crash No One Talks About - Gareth Petsch, pH Partners
(E.38) Roll the Equity or Take the Cash and Walk Away? - Mark Haddad, Specialty1 Partners | ScoutIQ
Get early access to the 'Roll the Equity - How Smart Dental Founders Sell Their DSO'
Learn how sophisticated dental founders navigate a DSO sale
Selling your DSO is one of the most consequential decisions of your career. Roll the Equity: How Smart Dental Founders Sell Their DSOs is the playbook for founders who want to approach private equity transactions with clarity — not guesswork. Join the insider list to get first access when it drops.
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