The market for Ortho & MSK practices in Raleigh, NC, is more active than ever. Driven by significant private equity interest, this creates an unprecedented opportunity for practice owners like you. However, navigating this landscape requires a clear understanding of local market dynamics, practice valuation, and the sale process itself. This guide provides the insights you need to make informed decisions about your future and your practice’s legacy. Curious about what your practice might be worth in today’s market?
Market Overview
Your practice operates in one of North Carolina’s most dynamic healthcare hubs. Understanding the local terrain is the first step toward a successful sale.
A Competitive Landscape
Raleigh is not a quiet market. It is home to major players like Raleigh Orthopaedic, EmergeOrtho, and OrthoNC. This concentration of large, sophisticated groups means that buyers have high expectations. When you decide to sell, you are not just selling a practice; you are competing for capital against well-established operators. This makes professional positioning and a compelling growth story critical.
Investor Appetite
The competition is not just for patients, it’s for practices. Private equity (PE) firms and larger strategic groups are actively seeking to expand their footprint in desirable markets like Raleigh. They are drawn to the region’s growth and the profitability of orthopedic and MSK services. This investor demand is what drives high valuations, but it also means buyers are sophisticated and expect a professionally managed sale process.
Key Considerations
Beyond the numbers, a sale is a deeply personal and professional transition. We find the most successful outcomes happen when owners think through a few key questions early on. What do you want for your staff and your legacy? Are you looking for a clean exit, or would you prefer a strategic partnership that allows you to retain clinical autonomy while someone else handles the headaches of billing and administration? Many owners fear losing control, but modern deal structures are not one-size-fits-all. The right buyer will work to align with your goals, not just acquire your assets. Thinking about this now puts you in a stronger negotiating position later.
Market Activity
The “active market” in Raleigh is part of a much larger national trend, especially in orthopedics. The data shows a clear and accelerating pace of acquisitions by sophisticated buyers. For practice owners, this represents a unique window of opportunity.
Here are three key trends driving the market right now:
1. Explosive Growth in Deals. Private equity acquisitions of physician practices have increased more than six times over the last decade. This surge in demand is a primary driver of higher practice valuations.
2. Higher Prices for Orthopedics. Studies show that PE acquisitions in the orthopedic space have led to an average price increase of 7.1% for services, reflecting the value investors see in the specialty. They are willing to pay a premium for well-run practices.
3. Rapid Consolidation. In many cities, a single PE-backed group now controls over 30% of the market. This trend toward consolidation means the landscape for independent practices is changing rapidly. Getting ahead of this curve is key.
Many owners think they should wait 2-3 years to sell. But that’s exactly when you should start preparing. Buyers pay for proven performance, not future potential. Starting the process now ensures you sell on your terms.
The Sale Process
Selling your practice is not like selling a house. It is a strategic process designed to protect confidentiality and maximize value. We don’t just “list” your practice. We run a professional process that starts with a thorough valuation to understand your practice’s true worth. From there, we prepare a confidential marketing package and approach a curated list of qualified strategic and financial buyers. This creates a competitive environment where multiple parties are interested. The most critical phase is often due diligence, where the buyer inspects your financials and operations. Proper preparation here is the key to preventing surprises that can delay or derail a closing.
Valuation: What Is Your Raleigh Practice Worth?
Many owners underestimate their practice’s value because they look at their tax returns. Sophisticated buyers, however, look at a metric called Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). We calculate this by taking your net income and adding back personal expenses run through the business or an above-market owner’s salary. This paints a truer picture of profitability. That Adjusted EBITDA is then multiplied by a “multiple” to determine your practice’s Enterprise Value. Most practices are undervalued until their financials are properly normalized. The multiple itself is not fixed; it is influenced by several factors that we help you optimize before a sale.
| Factor | Lower Multiple | Higher Multiple |
|---|---|---|
| Scale | Single provider, <$1M revenue | Multiple providers, >$3M revenue |
| Provider Reliance | Success depends solely on owner | Strong team of associate physicians |
| Ancillary Services | Primarily consultations & surgery | In-house PT, imaging, or ASC |
| Growth Profile | Stable, but flat patient volume | Documented history of yearly growth |
A comprehensive valuation is the foundation of a successful exit strategy.
Post-Sale Considerations
The day you close the deal is a new beginning, not an end. Many transactions today involve more than just cash. You might be offered an earnout, where you receive additional payments for hitting performance targets, or rollover equity, where you retain a stake (often 10-30%) in the new, larger company. This “second bite at the apple” can be incredibly lucrative when the new parent company is sold again years later. More importantly, this is the time to ensure the legacy you built is protected. A good partner will be committed to retaining your staff and honoring the culture that made your practice successful. Planning for these post-sale realities is a critical part of a well-negotiated deal.
Frequently Asked Questions
What makes the Raleigh market unique for selling an Ortho & MSK practice?
Raleigh is one of North Carolina’s most dynamic healthcare hubs with major players like Raleigh Orthopaedic, EmergeOrtho, and OrthoNC. This competitive landscape means buyers have high expectations and sellers must position their practice professionally with a compelling growth story to attract capital.
How does private equity interest affect the sale of an Ortho & MSK practice in Raleigh?
Private equity firms are actively seeking to expand their footprint in Raleigh due to the region’s growth and profitability of orthopedic and MSK services. This leads to increased investor demand, higher practice valuations, but also means buyers expect a professionally managed sale process.
What factors influence the valuation of an Ortho & MSK practice in Raleigh?
Valuation is based on Adjusted EBITDA and a multiple that varies based on factors such as scale (single provider vs multi-provider), provider reliance, availability of ancillary services (like PT, imaging, ASC), and growth profile. Proper normalization of financials is key for accurate valuation.
What are the key considerations for practice owners when selling in Raleigh?
Owners should consider their goals for staff and legacy, prefer a clean exit or strategic partnership, and understand that deal structures are flexible to align with their objectives. Early planning strengthens negotiating positions and ensures the sale aligns with personal and professional priorities.
What should sellers expect in the sale process of an Ortho & MSK practice in Raleigh?
The sale process is strategic and confidential, starting with a thorough valuation. Sellers receive a confidential marketing package, and qualified buyers are approached to create competitive offers. Due diligence is critical, focusing on financial and operational inspection to prevent closing delays.