Dental practice ownership: buying, starting, valuing, selling, associates and DSOs

This guide maps the main routes into and out of dental practice ownership. It explains how each route works, what the published data show and which questions to bring to your advisers. It is general education by Copeland Consulting Services. It is not legal, tax or financial advice.

What are the ways to own, or not own, a dental practice?

A dentist can start a practice, buy an existing one, buy in as a partner, work as an associate, or practice with a dental support organization (DSO). These paths are not exclusive. Many dentists use two or three over a career, and each one changes risk, control and income in different ways.

The sections below take each decision in turn. Each links to a longer guide.

Is dental practice ownership becoming less common?

Yes, and it is arriving later. The ADA Health Policy Institute (HPI) reported in June 2025 that 73 percent of U.S. dentists were practice owners in 2023, down from 85 percent in 2005. The same brief found that the drop is mostly in early career. Once dentists reach about 15 years in practice, ownership rates look similar across generations.

HPI also reported that ownership is a longer process for newer generations, particularly those who graduated since 2011. A related paper in the peer-reviewed literature found that higher dental insurance concentration was associated with a dentist’s decision not to own a practice. These are population averages. They do not predict what will happen to any one dentist.

Three numbers help set the scene. All come from the sources linked at the end of this page.

Figures change every year. Check the linked pages for the newest release before you rely on a number.

How does a dentist buy a practice?

A buyer sets goals, finds a practice, signs a letter of intent, completes due diligence, arranges financing and closes with a written purchase agreement. The details belong in the full guide to buying a dental practice. This section covers the outline.

A common sequence looks like this:

1. Set the goals. Decide the location, size, clinical style and the debt you can carry.
2. Build the team. Hire an attorney and a CPA who know dental sales. A lender and a practice broker may join.
3. Find and screen practices. Review the numbers a seller shares before you visit.
4. Make an offer. The offer is often framed in a letter of intent that sets the price basis and timeline.
5. Do the due diligence. Check financial statements, tax returns, staff contracts, equipment, the lease and compliance records.
6. Arrange financing. A lender sets the terms.
7. Close and transition. The agreement covers patient records, accounts receivable, staff and how patients are introduced to the new owner.

For financing, the U.S. Small Business Administration (SBA) lists changes of ownership, complete or partial, among the permitted uses of its 7(a) loans. Applicants must be creditworthy and show a reasonable ability to repay. The SBA also says applicants work with a lender, not with the SBA, and that the lender helps decide which loan type fits. Terms vary by lender and borrower, so only a lender’s written quote shows what a loan would cost.

What does it take to start a dental practice?

Starting a practice means building patients, staff, systems and compliance from nothing, so planning matters more than speed. The guide to starting a dental practice covers the steps. Here are the main parts.

• A business plan. It states the market, the budget and how the office reaches its first break-even month.
• Funding and working capital. A new office has costs before it has income. A lender and CPA can test how much cash the plan needs. See the glossary entry on working capital.
• Legal and licensing steps. Entity setup, the lease, equipment contracts and state requirements need an attorney. The Missouri Dental Board publishes the state’s rules.
• Compliance. OSHA, HIPAA and infection-control duties apply to dental offices. The compliance checklist guide on this site lists the official sources.
• Patient flow and systems. The dental practice management guide covers scheduling, recall and money systems.

Only a written budget from your own advisers can say what a practice start-up would cost for you. This site does not publish cost figures.

How is a dental practice valued?

Appraisers estimate value with one or more accepted methods and then adjust the earnings for the owner’s pay and one-time items. The full guide to valuing a dental practice explains the inputs. Here is the short version.

The ADA tells sellers to engage “a dental practice valuator to assist in developing an independent and objective assessment regarding the actual worth of the practice, the patient population, equipment and, if applicable, real estate.” It also suggests a valuator who specializes in dental practices.

Rules of thumb for price circulate online, for example a single percentage of collections. No published standard backs them. Treat a quoted shortcut as a starting question for your valuator, not an answer.

What should a seller plan for?

A seller needs an exit plan, a team of advisers, clean records and a clear picture of the transition. The guide to selling a dental practice has the longer checklist. The ADA publishes a tip sheet on the topic.

The ADA suggests that sellers build a team that can include:

• a dental practice valuator,
• an attorney experienced in dental practice sales,
• a certified accountant experienced in practice sales,
• a financial adviser for the proceeds, and
• a broker experienced in selling dental practices.

The same ADA page lists records that buyers will ask for. These include financial statements, balance sheets, federal tax returns, staff employment contracts, an equipment inventory, lease documents, and patient data such as active patients, new patients per month, case acceptance, recall scheduling and collection rate.

Contract points the ADA tells sellers to read closely include patient records and access to them, whether there are restrictive covenants, how goodwill transitions, tax consequences, collection of accounts receivable and who stays on the team. Each party should have an attorney review the contract of sale. How long a sale takes varies by market and by how prepared the seller is. See the post on how long a sale takes.

Planning an exit is also a succession planning task. The glossary also explains a partial exit.

What do dental associate contracts cover?

An associate agreement sets pay, duties, status and what happens after the job ends. The dental associate contracts guide covers each term. Three points come up most.

Pay model. The ADA lists four common models: straight salary, salary plus commission, straight commission and net profit. Pay that depends on production needs clear definitions. The ADA defines total production as the amount the office bills under its fee schedule, and adjusted production as what the office is contractually allowed to collect. The two can differ a lot when many patients are on discounted plans. Read the glossary entries on production-based pay and collections-based pay, and the post on associate pay models.

Employee or independent contractor. The ADA says associates are generally employees when the employer has the right to control how duties are performed. A contractor handles their own schedule, taxes and benefits. A wrong label can create tax and legal trouble for both sides, so the ADA advises having an attorney review the terms. See independent contractor and the post on employee or contractor status.

Restrictive covenants. The ADA explains that a non-compete is a mechanism that purportedly prevents an employee from competing after employment ends, and that to be valid it will almost certainly be limited in time and geography. Whether a specific clause can be enforced is a legal question. Ask an attorney who practices in your state. Terms to know include the non-compete clause and the non-solicitation clause. The post on employment agreement provisions lists others.

What is a DSO, and what does the data show?

A DSO is an outside entity that manages some or all of a practice’s non-clinical work, such as billing, marketing and human resources. The ADA HPI uses that definition and notes that DSO status is about the business model, not the size or number of locations. A single-office practice can be DSO-affiliated. The full DSO and private practice guide compares the models.

The data show growth, mostly among newer dentists:

HPI describes its practice modality data as showing that affiliation with large groups and DSOs “continues to grow, especially among early career dentists.” Terms related to this topic include private equity in dentistry, management services organization and dental partnership organization. For plain facts on each, read the posts on what a DSO is, private equity findings and DSO versus private practice data.

This page does not say which model is better. The answer depends on the dentist’s goals, the specific contract and the specific organization. A dentist weighing an offer should read the full agreement and compare terms such as pay, clinical decision rights, covenants and exit options.

Who should be on the team for an ownership decision?

Ownership decisions involve law, tax, credit and valuation, and each has its own professional. This site does not provide that advice. The roles below show who handles what.

The ADA adds two practical tips. Contact your professional liability carrier to see if they have suggestions, and consult an attorney early so assets stay protected and state and federal laws are followed. The ADA’s own contract guide carries the same warning. In its disclaimer it says to get legal or professional advice, “you need to consult directly with a properly qualified attorney admitted to practice in your jurisdiction.”

What should you read next?

Match the next page to the decision you face.

• Considering a purchase: Buying a Dental Practice.
• Planning a new office: Starting a Dental Practice.
• Needing a price estimate: Valuing a Dental Practice.
• Planning an exit: Selling a Dental Practice.
• Reviewing an offer: Dental Associate Contracts.
• Comparing models: DSO vs Private Practice.

Money questions also lead to practice management. The dental practice management pillar covers overhead, collections and the other numbers every valuation looks at. For the numbers behind pay and profit, see the posts on overhead percentage and how much practice owners make.

Next step

For the numbers that sit behind any ownership decision, start with the dental practice management pillar. To talk about a specific practice question, contact Dr. Copeland about consulting. Dr. Jon Copeland, DDS, is a general dentist in Wildwood, Missouri.