Selling your Ortho & MSK practice is one of the most important financial decisions of your career. For practice owners in Colorado, the current market presents unique opportunities and challenges. This guide provides a clear overview of the Colorado Ortho & MSK market, outlines key steps in the sale process, and explains the fundamentals of valuation. Navigating this landscape effectively is the first step toward securing your legacy and financial future.
Colorado Market Overview: A Landscape of Opportunity
The market for Orthopedic and Musculoskeletal (MSK) practices in Colorado is exceptionally robust. The state’s active, outdoor-oriented culture and strong population growth create a consistent, high demand for your services. This is not just a trend. It is a fundamental market characteristic that makes your practice inherently valuable to a wide range of potential buyers.
A Magnet for Investment
Because of these strong fundamentals, Colorado has become a focal point for both regional health systems and national private equity groups. These buyers are actively seeking to partner with or acquire established Ortho & MSK practices. They see your practice not just as it is today, but as a platform for future growth in a thriving region. Understanding who these buyers are and what they are looking for is the first step in positioning your practice for a premium valuation.
Key Considerations for Your Practice
When a buyer evaluates your Ortho & MSK practice, they look far beyond your total revenue. They look at the quality and durability of your earnings. Do you have integrated ancillary services like physical therapy, an imaging suite, or a procedure room? These are powerful value drivers. They also assess provider reliance. A practice where revenue is driven by multiple associates is often valued higher than a practice dependent on a single owner-operator. However, even solo practices can achieve premium valuations with the right positioning. Your payor mix and the strength of your contracts within the Colorado market also play a major role. Each of these elements helps tell the story of your practice’s stability and growth potential.
Understanding Current Market Activity
The dominant trend in the Colorado Ortho & MSK space is consolidation. Independent practices are increasingly joining larger platforms to gain administrative support, negotiating power, and access to capital. This activity is primarily driven by three types of buyers, each with different goals for your practice. Knowing these motivations is key to finding a partner that aligns with your personal and financial objectives. Many owners think they need to sell in a few years, but preparing now means you can sell on your terms, not a buyer’s.
| Buyer Type | Primary Motivation | What This Means for You |
|---|---|---|
| Private Equity Group | Build a regional or national platform. | Opportunity for rollover equity and leadership roles. |
| Hospital / Health System | Expand service lines and referral networks. | Focus on clinical integration and community presence. |
| Strategic Competitor | Gain market share and operational scale. | May lead to full integration into an existing brand. |
The Path to a Successful Sale
A successful practice sale follows a structured, confidential process. It begins with comprehensive preparation, where we help you organize your financials and operations to present them in the best possible light. Next comes a formal valuation to establish a credible asking price. With that foundation, we run a discreet marketing process, approaching a curated list of qualified buyers who are a good fit for your goals. Once interest is established, the process moves into due diligence. This is where a buyer verifies all the information about your practice. It is also the phase where many unguided deals run into trouble. Proper preparation can prevent these issues, leading to a smooth negotiation and successful closing.
How Your Practice Is Valued
Practice valuation is more than a simple formula. It is about telling your financial story in a way that sophisticated buyers understand. While many factors are considered, the core of your practice’s value comes down to a few key drivers.
- Adjusted EBITDA. This is your Earnings Before Interest, Taxes, Depreciation, and Amortization. We adjust this number to account for owner-specific expenses and one-time costs to show the practice’s true, ongoing profitability. Most practices we see are undervalued until this is done correctly.
- The Valuation Multiple. Your Adjusted EBITDA is multiplied by a number based on current market trends. For Ortho & MSK practices with over $1M in EBITDA, multiples in the 5.5x to 7.5x range are common, with larger platform-level practices fetching even more.
- Your Growth Story. Buyers pay a premium for a clear and believable path to future growth. This could be through adding new providers, opening a new location, or expanding ancillary services.
Planning for Life After the Sale
Selling your practice is about more than the closing price. It is about defining the next chapter for yourself, your staff, and your patients. A well-structured deal protects your legacy. Your future role is something you design, not just accept. You may want to continue practicing with full clinical autonomy, reduce your administrative burden, or plan for a phased retirement. Many owners also choose to “roll over” a portion of their equity into the new, larger company. This gives them a stake in the future success and the potential for a “second bite of the apple” when that larger entity sells years later. Planning for these outcomes from the beginning ensures the transition meets all of your goals–not just the financial ones.
Frequently Asked Questions
What makes the Colorado Ortho & MSK market attractive for selling a practice?
Colorado’s active, outdoor-oriented culture and strong population growth create a steady demand for Orthopedic and Musculoskeletal services, making practices inherently valuable. Additionally, regional health systems and national private equity groups actively seek to acquire established Ortho & MSK practices in the state.
Who are the typical buyers interested in Ortho & MSK practices in Colorado?
There are three main types of buyers: Private Equity Groups aiming to build regional or national platforms, Hospitals/Health Systems looking to expand service lines and referral networks, and Strategic Competitors seeking market share and operational scale.
What factors do buyers consider when valuing an Ortho & MSK practice?
Buyers look beyond revenue to the quality and durability of earnings, presence of integrated ancillary services (such as physical therapy or imaging), provider reliance, payor mix, and strength of contracts. Adjusted EBITDA and the valuation multiple, which ranges typically from 5.5x to 7.5x EBITDA, are key valuation drivers.
What is the typical process for selling an Ortho & MSK practice in Colorado?
The process involves comprehensive preparation of financials and operations, formal valuation, discreet marketing to qualified buyers, due diligence, negotiation, and closing. Proper preparation and confidentiality are crucial for a smooth and successful sale.
How can an owner plan for life after selling their Ortho & MSK practice?
Owners should design their future role post-sale, whether continuing clinical practice, reducing administrative duties, or phased retirement. They can also consider rolling over equity into the acquiring company for future financial benefits. Planning ahead ensures the transition meets both financial and personal goals.