Selling your plastic surgery practice in Denver is a significant decision. The market presents a unique combination of high demand and strong competition, making your strategy more important than ever. This guide provides an overview of the current landscape, from valuation drivers to recent transaction activity. Understanding these factors is the first step toward a successful and rewarding exit. We will walk you through what you need to know to navigate the process with confidence.
Denver’s Market: An Overview
The Denver market for aesthetic medicine is thriving. High-income demographics and a culture that values wellness create consistent demand for plastic surgery services. This environment makes established practices attractive acquisition targets for private equity groups and other practices looking to expand their footprint.
A Competitive and Growing Landscape
This demand also fuels a competitive environment. To achieve a premium valuation, your practice needs to stand out. Buyers in Denver are sophisticated. They look past simple revenue numbers to find practices with a strong, defensible market position, a loyal patient base, and clear avenues for future growth.
The Opportunity for Sellers
For owners who have built a solid reputation, the timing could be right. The current window allows you to capitalize on years of hard work. Preparing your practice to highlight its unique strengths is not just a good idea. It is the main factor in turning a competitive environment into a financial opportunity.
Key Considerations Before You Sell
Beyond the financials, sophisticated buyers are purchasing your practice’s reputation and operational strength. A key driver of value is a strong patient base, often proven by hundreds of positive online reviews and a consistent flow of new patients. The quality and loyalty of your team are also scrutinized. A well-trained staff that can support a smooth transition is a significant asset. Your facility’s location, size, and equipment are important. Finally, your own willingness to stay on for a period post-sale can de-risk the acquisition for a buyer and increase their offer. Planning for these factors protects your legacy and the team you built.
A Look at Market Activity
The Denver M&A market is active, with both strategic buyers and private equity firms seeking to acquire high-quality plastic surgery practices and medical spas. Recent listings demonstrate strong valuations for well-run operations. These numbers show that buyers are willing to pay a premium for profitability and a strong market position.
Here are a few examples of recent public listings in the Denver area to provide context:
| Practice Type | Annual Revenue | Profitability (EBITDA/Cash Flow) | Asking Price |
|---|---|---|---|
| Medical Spa | $1,870,000+ | $475,000+ EBITDA | $2,800,000 |
| Cosmetic Surgery | $1,070,000+ | Not Disclosed | Off-Market |
| Medical Spa | $750,000 | $100,000 Cash Flow | $1,000,000 |
These transactions highlight the potential returns available in the current market. Knowing how your practice compares is a critical first step.
Understanding the Sale Process
Selling your practice is not a single event. It is a structured process designed to protect your confidentiality and maximize your outcome. It begins with a comprehensive valuation to understand your practice’s market worth. From there, we create a confidential marketing strategy to attract the right type of qualified buyers without alerting your staff or competitors. The next stage is navigating offers and negotiating key terms. The most intensive phase is often buyer due diligence, where every aspect of your business is reviewed. A well-managed process anticipates these steps, preparing you for each stage to prevent surprises and keep the deal on track toward a successful closing.
How Is a Plastic Surgery Practice Valued?
Valuing your plastic surgery practice is not based on revenue alone. Sophisticated buyers use a formula: Adjusted EBITDA x a Market Multiple. Your Adjusted EBITDA starts with your net profit but adds back personal expenses run through the business, excess owner salary, and other one-time costs to show the practice’s true earning power. This number is then multiplied by a figure that reflects your practice’s quality and risk. For a practice with over $1M in EBITDA, this multiple can often range from 5.5x to 7.5x or higher.
The key factors that determine your multiple include:
- Provider Reliance. Practices that do not depend solely on the owner command higher multiples.
- Service Mix. A strong mix of surgical and non-surgical or cash-pay services is attractive.
- Growth Trajectory. Demonstrable, consistent year-over-year growth earns a premium.
- Operational Maturity. Efficient systems for scheduling, billing, and marketing show a well-run business.
An accurate valuation is the foundation of any successful exit strategy.
Life After the Sale: Key Planning Points
Closing the deal is not the end of the journey. Your role after the sale is a key point of negotiation. You might agree to stay on for a transition period, or you could retain a portion of equity in the new, larger entity. This “rollover equity” can provide a second financial windfall when the larger group sells again in the future. The structure of your sale also has major tax implications. How the deal is classified can significantly change your net proceeds. Planning for these outcomes in advance ensures the deal aligns with your long-term personal and financial goals, not just the buyer’s.
Frequently Asked Questions
What makes Denver a unique market for selling a plastic surgery practice?
Denver has a high-income demographic and a culture that values wellness, which creates consistent demand for plastic surgery services. This makes established practices attractive to buyers, including private equity groups and expanding practices.
What key factors drive the valuation of a plastic surgery practice in Denver?
Valuation is based on Adjusted EBITDA multiplied by a market multiple that reflects practice quality and risk. Key factors include provider reliance, service mix, growth trajectory, and operational maturity.
How important is the patient base and team in selling a plastic surgery practice?
A strong patient base, supported by positive online reviews and consistent new patients, and a loyal, well-trained team are critical assets that buyers scrutinize. These factors significantly impact the practice’s value and facilitate a smooth transition.
What are the typical steps involved in selling a plastic surgery practice in Denver?
The process includes valuation, confidential marketing to qualified buyers, negotiating offers and terms, buyer due diligence, and closing. Preparation for each stage helps protect confidentiality and maximize sale outcomes.
What considerations should sellers make about their role after selling their practice?
Sellers often negotiate the post-sale role, such as staying on during a transition period or retaining equity in the new entity. These decisions affect financial outcomes and tax implications, so advanced planning is important for aligning the sale with long-term goals.