Best buy-in method for specialty (OMFS) partnership?

[osteotomy01]

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My experience practicing for several years post residency is that no buy in you will ever be offered is fair. Maybe 1 out of every 20 practices will truly offer to make you a equal “partner” but usually it’s a rare set of circumstances.

Most “partnerships” have 1 or more docs who will either keep a larger percentage of the equity, or own the property and charge the rest of the practice obscene rent, not have to take call like everyone else or work as hard as everyone else, and still make the most money. “Partnership” is really just a fine line with them giving you just enough to make it worth staying, but them still coming out on top.

Corporate comes with its own set of problems. Both ethical and otherwise. But financially it’s definitely the better option.

That's the truth right there. Being several years out too, my experience has been very similar to yours with "partnerships." Here I was thinking that I was the only one going through this. This is why at this point I'm looking at other options such as private-equity owned practice vs startup. No one ever mentioned these kinds of things during residency.

I haven't done corporate but from what I hear from friends, the money is good. It also sounds like a minefield of issues waiting to go wrong.

 

[AfterEffects]

That's the truth right there. Being several years out too, my experience has been very similar to yours with "partnerships." Here I was thinking that I was the only one going through this. This is why at this point I'm looking at other options such as private-equity owned practice vs startup. No one ever mentioned these kinds of things during residency.

I haven't done corporate but from what I hear from friends, the money is good. It also sounds like a minefield of issues waiting to go wrong.

What part of your partnership offer did you not like?

 

[osteotomy01]

What part of your partnership offer did you not like?

Some of the unfavorable things that have been in my "partnership" contracts ranged from less equity to offset the partner (i.e. primary partner would own 51% and I would be buying into 49%). Moving targets--if your buy in was X years, that number of years could be altered by a number of factors as determined by the partner(s) such as production goals. Unreasonable call, one place wanted me to take hospital+office call for all of the partners 365 days/yr for the entire buy in.

Also for the new grads, I would suggest having a talk about PE with your "partners." There are several associates I've known who were in the middle of their buy-in, only to have the owner sell to private equity.

 

[AfterEffects]

Some of the unfavorable things that have been in my "partnership" contracts ranged from less equity to offset the partner (i.e. primary partner would own 51% and I would be buying into 49%). Moving targets--if your buy in was X years, that number of years could be altered by a number of factors as determined by the partner(s) such as production goals. Unreasonable call, one place wanted me to take hospital+office call for all of the partners 365 days/yr for the entire buy in.

Also for the new grads, I would suggest having a talk about PE with your "partners." There are several associates I've known who were in the middle of their buy-in, only to have the owner sell to private equity.

I was just discussing "partnership" as a minority equity stake holder (senior doc retains 51%+). Also was told 7-10 year path to partnership. The senior doc keeps telling me this what his financial/accounting advisors recommend to him but I'm getting red flags. To be fair the senior doc is a pretty nice guy on the surface.

 

[dratc]

I was just discussing "partnership" as a minority equity stake holder (senior doc retains 51%+). Also was told 7-10 year path to partnership. The senior doc keeps telling me this what his financial/accounting advisors recommend to him but I'm getting red flags. To be fair the senior doc is a pretty nice guy on the surface.

I wouldn’t even entertain that offer. Move on.

 

[AfterEffects]

I wouldn’t even entertain that offer. Move on.

The current owner tells me they got their advice from a certain Dallas based dental financial firm CW. I've read of the "kool-aid" on dental town, but didn't actually experience until now. CW is either giving advice that is unreasonable or the owner doc is greedy/unrealistic. Needless to say, I walked away.

 

[osteotomy01]

FWIW I think you made the right choice. A lot of these senior docs' judgements are being clouded by stories about the payouts some practices are getting from PE and DSOs. Who else are they to squeeze other than their associates? I've since gone corporate and now looking back I wish I had done it sooner. I hope your non-compete wasn't terrible. It's too easy to get caught up in the glitz and glamour when signing your contract to even think about negotiating your radius/duration down.

 

[dratc]

FWIW I think you made the right choice. A lot of these senior docs' judgements are being clouded by stories about the payouts some practices are getting from PE and DSOs. Who else are they to squeeze other than their associates? I've since gone corporate and now looking back I wish I had done it sooner. I hope your non-compete wasn't terrible. It's too easy to get caught up in the glitz and glamour when signing your contract to even think about negotiating your radius/duration down.

What version of corporate? Pacific/Aspen type, or private practice style private equity (paradigm, usosm, etc).

 

[osteotomy01]

What version of corporate? Pacific/Aspen type, or private practice style private equity (paradigm, usosm, etc).

PDS. I've also done Western and chatted with others who have done other corporate models. Believe me when I say they're not all the same in how they are run. Some are run much better than others. I've interviewed at USOSM and some of my past PPs have been bought up by PE like Paradigm--those offer a different style of practice.

 

[702]

PDS. I've also done Western and chatted with others who have done other corporate models. Believe me when I say they're not all the same in how they are run. Some are run much better than others. I've interviewed at USOSM and some of my past PPs have been bought up by PE like Paradigm--those offer a different style of practice.

Which one you liked best