Guide to Selling an ABA Therapy Practice in New Mexico

An owner’s guide to navigating the market, maximizing value, and planning your transition.

The market for ABA therapy in New Mexico is strong, driven by growing awareness and demand. For practice owners, this presents a significant opportunity. However, turning that opportunity into a successful sale is a complex process. It requires careful preparation, a deep understanding of market dynamics, and a clear strategy. This guide provides a roadmap for navigating the journey of selling your ABA therapy practice.

Market Overview

The New Mexico market for ABA therapy practices is active, creating a promising environment for owners considering a sale. The demand for services is expanding, fueled by factors both locally and nationally. If you are a practice owner, you should know that buyer interest is high.

Three key trends are shaping the ABA market right now:

1. Sustained National Growth. The U.S. market for applied behavior analysis is not just stable; it is growing. Projections show a 4.8% compound annual growth rate, indicating a long-term, healthy demand for quality ABA services.
2. Increased Private Equity Interest. Your practice is likely on the radar of more than just local competitors. Private equity firms and larger strategic buyers are actively acquiring ABA practices to build regional and national platforms.
3. High Demand Within New Mexico. Rising awareness of autism spectrum disorder and strong insurance mandates for coverage in New Mexico ensure a consistent and growing client base for well-run practices.

Key Considerations for New Mexico Sellers

A strong market does not guarantee a successful sale. Buyers look for well-organized practices that are not only profitable but also resilient. Before you decide to sell, you should look closely at the core components of your business from a buyer’s perspective.

Regulatory Readiness

New Mexico has specific rules for ABA therapy, including requirements for practitioner training, background checks, and treatment plan reviews. Your practice’s adherence to these state regulations is not just a matter of compliance. It is a key indicator of quality and low risk to a potential buyer. Having your documentation in order is a critical first step.

Operational Strength

Beyond your financials, buyers will examine the stability of your staff and operations. The experience and credentials of your BCBAs are a major asset. Low staff turnover and strong, documented referral relationships with schools and physicians demonstrate a sustainable business. Clean billing systems and efficient client management are also important indicators of a well-run practice that a new owner can step into seamlessly.

Market Activity and Buyer Landscape

The ABA therapy sector is a focus of investment. Both private equity groups and larger healthcare organizations are looking to expand their footprint in markets like New Mexico. While specific sale prices are rarely made public, we know the market is active. Understanding the different types of buyers is key to positioning your practice correctly.

Each buyer has a different motivation. Finding the right fit depends on your goals for your legacy, your staff, and your own future role.

The Four Stages of the Sale Process

Selling your practice is not a single event. It’s a structured process that, when managed correctly, protects your confidentiality and maximizes your outcome. We guide owners through a professional process that prevents common missteps.

1. Preparation and Valuation

This is the most important phase. It is where we work with you to analyze your finances, normalize your earnings, and prepare a compelling narrative for buyers. A comprehensive valuation sets the foundation for the entire strategy. You should never enter a negotiation without knowing what your practice is truly worth.

2. Confidential Marketing

Your practice is confidentially presented to a curated list of qualified buyers from our proprietary database. This is not a public listing. It is a targeted process designed to create competitive tension among the right buyers while your staff and clients remain unaware.

3. Negotiation and Due Diligence

Once offers are received, we help you negotiate the best terms. After an offer is accepted, the buyer will conduct due diligence. This is where many deals fail without proper preparation. We help you organize your information to ensure a smooth and predictable review.

4. Closing and Transition

The final stage involves legal documentation and planning for a successful transition of ownership. Our goal is to ensure a smooth handover that protects your legacy and sets the new owner up for success.

How Your ABA Practice is Valued

Many owners wonder, “What is my practice actually worth?” The answer is more complex than a simple rule of thumb. Sophisticated buyers do not value your practice based on revenue. They value it based on its demonstrated and future cash flow.

The key metric is Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). This figure starts with your reported profit and adds back certain expenses, like an above-market owner’s salary or one-time costs, to show the true earning power of the business. This Adjusted EBITDA is then multiplied by a number (a multiple) to determine the Enterprise Value. That multiple is not random. It is determined by risk and opportunity.

Here are the key drivers of your practice’s value:

1. Profitability and Scale. Higher Adjusted EBITDA reduces perceived risk and commands a higher multiple.
2. Provider Reliance. Practices that are not dependent on a single owner or provider are more valuable. A strong team of BCBAs is a significant asset.
3. Client and Payer Mix. A diverse client base and favorable contracts with a mix of private insurance and Medicaid demonstrate stability.
4. Growth Potential. Buyers will pay a premium for a practice that has clear, identifiable opportunities for growth, whether by adding services or expanding into new areas.

Planning for Life After the Sale

A successful transaction is not just about the price. It is about achieving your personal and financial goals. The structure of your deal has major implications for everything that comes next. Your legacy, your staff’s future, and your after-tax proceeds all depend on planning that starts long before you close. We believe a good deal is one that works for you on day one and for years to come.

This means thinking through the transition plan for your team and clients. It also involves structuring the sale to be as tax-efficient as possible. For some owners, the right deal may include staying involved with the practice through an earnout or retaining a portion of ownership (rollover equity). This can provide a second financial upside in the future. Every practice sale is unique. The right strategy is the one built around you.