OMFS salary disparities

[yappy]

Feb 17th CBSE

Another resource you could consider looking into is Zanki. Zanki? I just looked into it. Its kind of flash cards? found a link in reddit. p.s thank you for your kind reply and consideration

forums.studentdoctor.net

OMS wasn’t for me, but I did achieve a “passing” score on my second attempt. Maybe you were an applicant that got a competitive score your first attempt; I had to circle back to anki & 2xUworld to get a competitive score.

Why make the discussion personal?

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[702]

Nothing exotic. A lot of 3rd molars/implants outpatient. Maybe an orthognathic every other month.
This is coming across as very braggy which is not my intention.
The reason I am sharing is bc these forums rarely report accurate OMS incomes. My situation is not that unique.

How much did you pay to become 50% partner? How many years did the practice take to be successful?

 

[bergus95]

All these numbers being thrown out are silly low.

Military pay right after residency will be around $165k, more of you have been in longer or live in a HCOL area.

I moonlight one day a week working less than six hours in a poorer area taking crappy insurances. A bad day is $3k, an average day is $4k and good is over $5k. An average day could look like 6 sedations and a couple locals or a few sedations, few locals and an implant. A busy day will be a dozen sedation thirds. This is working now where near my potential although if I was working private every day this would be a smooth pace, definitely not overworked but enough to not be bored.

A couple buddies work part time at Clear Choice and an average daily take home is $8k.

Most surgeons who own have 40-55% overhead. A good associate offer is 40% production, average would be 40% collections. Corporate will be avg 32% but will be fed cases to be more busy and overall make more.

That one dude making like 10% in Seattle is getting criminally ****ed, blows my mind how badly he’s getting paid.

If surgeon overhead is 40-55%, how can associate offer be 40%? How can they make a profit?

 

[PhansterZ]

If surgeon overhead is 40-55%, how can associate offer be 40%? How can they make a profit?

looks like a 5-20% profit.

If you're an associate producing 2 million/year, that's 100k-400k profit for the owner.

 

[OncePreDent]

looks like a 5-20% profit.

If you're an associate producing 2 million/year, that's 100k-400k profit for the owner.

5% would be crazy low/probably not worth it for any business owner. Profit margins would be extremely tight

 

[ShortShortsDad]

5% would be crazy low/probably not worth it for any business owner. Profit margins would be extremely tight

These “management orgs” are really private equity backed by venture capital. Sit in on an earnings call and there is a bank behind the scenes willing to buy anything. They are literally trying to buy up the whole industry, the short term financials aren’t really a concern to them. Sure they have economies of scale which will lower purchasing prices but they are more interested in recapitalization or an eventual IPO.

For a business owner bringing in an associate is free money, less days they have to work, possibility to expand the practice, a route to retirement etc

 

[OncePreDent]

These “management orgs” are really private equity backed by venture capital. Sit in on an earnings call and there is a bank behind the scenes willing to buy anything. They are literally trying to buy up the whole industry, the short term financials aren’t really a concern to them. Sure they have economies of scale which will lower purchasing prices but they are more interested in recapitalization or an eventual IPO.

For a business owner bringing in an associate is free money, less days they have to work, possibility to expand the practice, a route to retirement etc

I wouldn't say it is free money; you still have to manage them & your team as well. With a profit margin of 5%, the margins would be too close for comfort for me/not worth it if I had a private practice. But if you can get the profit margins higher 25% or so, it would be worth it to me.

But I agree that the PE groups just purchase practices for insane prices that a new grad or anyone would ever pay. Not sure if anyone is familiar with the online space/DTC on these forums. But if you have an online DTC company selling products such as supplements, the profit margins on it will be around your 5%-10% after everything if you are lucky. So if you are doing $10M in revenue, you will likely only make around $1M.

However, what is really interesting is when DTC companies sell to a PE or larger companies. They purchase them on multiples of Revenue, not EBITDA. Small-Mid size DTC brands ($10M-$30M in revenue) will generally sell for 3x-6x revenue (this can vary because of many factors). So a company producing $15M in revenue and only profiting $1M the company would likely sell for/be worth $45M (give or take). It is also significantly more scaleable than dentistry.

 

[bergus95]

I wouldn't say it is free money; you still have to manage them & your team as well. With a profit margin of 5%, the margins would be too close for comfort for me/not worth it if I had a private practice. But if you can get the profit margins higher 25% or so, it would be worth it to me.

But I agree that the PE groups just purchase practices for insane prices that a new grad or anyone would ever pay. Not sure if anyone is familiar with the online space/DTC on these forums. But if you have an online DTC company selling products such as supplements, the profit margins on it will be around your 5%-10% after everything if you are lucky. So if you are doing $10M in revenue, you will likely only make around $1M.

However, what is really interesting is when DTC companies sell to a PE or larger companies. They purchase them on multiples of Revenue, not EBITDA. Small-Mid size DTC brands ($10M-$30M in revenue) will generally sell for 3x-6x revenue (this can vary because of many factors). So a company producing $15M in revenue and only profiting $1M the company would likely sell for/be worth $45M (give or take). It is also significantly more scaleable than dentistry.

How do we get into this business?

 

[OncePreDent]

How do we get into this business?

😂 I know haha; unfortunately, you'd probably need a couple of million to start up a real brand. Some people "bootstrap" it; either way, you will have a lot of sweat equity.

If you did a fundraising event you could probably raise a couple of million if you have a decent brand. There's a startup company called byhumankind (not the best products). Raised over $6M off a $22M valuation without any real sales or any value. Crazy. But 99% of the brands online have some form of private equity group invested in them or will at some point. They give up a chunk of equity for funding.

 

[ShortShortsDad]

I wouldn't say it is free money; you still have to manage them & your team as well. With a profit margin of 5%, the margins would be too close for comfort for me/not worth it if I had a private practice. But if you can get the profit margins higher 25% or so, it would be worth it to me.

But I agree that the PE groups just purchase practices for insane prices that a new grad or anyone would ever pay. Not sure if anyone is familiar with the online space/DTC on these forums. But if you have an online DTC company selling products such as supplements, the profit margins on it will be around your 5%-10% after everything if you are lucky. So if you are doing $10M in revenue, you will likely only make around $1M.

However, what is really interesting is when DTC companies sell to a PE or larger companies. They purchase them on multiples of Revenue, not EBITDA. Small-Mid size DTC brands ($10M-$30M in revenue) will generally sell for 3x-6x revenue (this can vary because of many factors). So a company producing $15M in revenue and only profiting $1M the company would likely sell for/be worth $45M (give or take). It is also significantly more scaleable than dentistry.

It is somewhat strange that EBITDA is such a focus in our field and not with other companies. I have a degree in economics so this was foreign to me when I started getting privy to the business side of things. PE seems to want growth and market share over anything more tangibly related to “real” value. DSOs often operate at a loss, I imagine they do it because they’re big enough to and are playing the long game with brand recognition or outlasting the private docs.

Every private practice owner will have something they care about when hiring an associate. Probably not worth it if it’s just 5% profit but there are some many other indirect benefits and intangibles. Being able to cut back hours, mentor the next generation, expand in the community are huge. For OMS that’s another body to cover call and another privileged surgeon on hospital staff who brings political power (from staff lounge improvements to buying sets/big equipment to getting a seat at the table with leadership). It’s not just the direct monetary benefits, there’s other value to growth