Selling your plastic surgery practice is one of the most significant financial and personal decisions you will ever make. The Connecticut market presents unique opportunities, but navigating the process requires a clear strategy. This guide provides an overview of the current landscape, from understanding your practice’s value to planning your transition, to help you prepare for a successful and profitable exit.
Curious about what your practice might be worth in today’s market?
Connecticut Market Overview
The market for plastic surgery practices in Connecticut is active and sophisticated. We are seeing a convergence of aesthetic medicine, dermatology, and plastic surgery, which is attracting a new class of buyers. These are not just local doctors looking to expand. They are larger, well-capitalized groups and private equity firms looking to build regional platforms.
This trend means that buyers are looking for well-run businesses with strong, consistent revenues and clear growth potential. For practice owners, this creates a dynamic environment. While it can lead to premium valuations, it also increases the complexity of a potential sale. The buyers are experts in acquisitions. You need to be just as prepared.
Key Considerations for a Successful Sale
Thinking about selling is a multi-year process, not a last-minute decision. If you are considering a sale in the next few years, the time to prepare is now. It’s a major milestone, and having a clear plan is the best way to manage the financial and emotional aspects of the journey.
Here are three things you should be thinking about today:
- Start the Clock Early. A typical sale can take 12 months or longer from the day you decide to sell to the day the transaction closes. Buyers pay for proven performance, not just potential. Starting to prepare your financials and operations 2-3 years ahead of a sale is the best way to maximize your value.
- Assess Your Personal Readiness. What does life look like after you sell? Many buyers, particularly private equity firms, will require you to stay on for 3-5 years. You must be comfortable with the idea of working for someone else and be clear about your personal, financial, and lifestyle goals.
- Assemble Your Team. A successful sale requires a team of experts. You will need legal counsel for contracts, an accountant for tax planning, and an M&A advisor who understands the healthcare market to guide the entire process. Building this team early prevents costly mistakes down the road.
Your specific goals and timeline should drive your practice transition strategy.
Market Activity: Who is Buying in Connecticut?
The buyer landscape has changed. While a sale to another doctor is still an option, it often results in a lower valuation. Today, the most active buyers for profitable plastic surgery practices in Connecticut are private equity (PE) firms, large super-regional group practices, and multi-specialty platforms.
These buyers are aggressive and willing to pay a premium for practices that fit their investment strategy. They are looking for profitable, efficient businesses that can serve as a foundation for further growth. They value practices with multiple providers, a strong brand, and a healthy mix of surgical and non-surgical revenue streams. Understanding what these buyers look for is the first step in positioning your practice to attract their attention and command a top-tier valuation.
The Sale Process Unpacked
Selling your practice is a structured process with several key stages: valuation, confidential marketing, buyer negotiations, due diligence, and closing. Each step has its own challenges, but the due diligence phase is where many unprepared sellers run into trouble. This is when the buyer inspects every aspect of your business, from your financial records to your compliance protocols.
A critical part of the process is determining the deal structure. The two most common types are an asset sale and an equity (or stock) sale. The choice has significant implications for your taxes and future liabilities.
| Feature | Asset Sale | Equity Sale (Stock Sale) |
|---|---|---|
| What’s Sold | Specific assets & liabilities you choose | The entire business entity |
| Liability | Buyer assumes only specified liabilities | Buyer assumes all liabilities (known & unknown) |
| Tax Impact | Often better for the buyer | Often better for the seller |
The structure of your practice sale has major implications for your after-tax proceeds.
Valuation: What Is Your Practice Really Worth?
Your practice is worth more than its equipment and patient list. Sophisticated buyers value your business based on a multiple of its Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). Adjusted EBITDA is your net profit after adding back personal expenses run through the business and normalizing any above-market owner salary.
For example, a practice with $500,000 in profit might have an Adjusted EBITDA of $700,000 after these adjustments. In today’s market, a strong, multi-provider plastic surgery practice could command a multiple of 6x to 8x Adjusted EBITDA or even higher. For that practice, the valuation could jump from a simple $3 million estimate to over $4.9 million just by preparing the financials correctly. This is why a professional valuation is so important. It uncovers the hidden value in your practice that “rule of thumb” estimates always miss.
A comprehensive valuation is the foundation of a successful practice transition strategy.
Post-Sale Considerations: Planning Your Next Chapter
The journey isn’t over once the sale closes. Your role, your team’s future, and your financial legacy all need to be planned for as part of the deal, not as an afterthought.
Your Future Role
Most buyers will want you to continue practicing for a set period, often three to five years, to ensure a smooth transition. Your employment agreement, including compensation, schedule, and responsibilities, is a key part of the negotiation. It is important to be clear on what you want your involvement to be.
Your Team’s Transition
Your staff is one of your practice s most valuable assets. Protecting their future is a priority for most owners. We help structure agreements that ensure your loyal team members are taken care of by the new owner, preserving the culture you worked so hard to build.
Your Financial Legacy
A successful sale can create significant wealth. Having a plan for these proceeds is critical. This involves tax strategy before the sale and wealth management after. Structuring the sale correctly from the start can save you hundreds of thousands of dollars in taxes.
Every practice sale has unique considerations that require personalized guidance.
Frequently Asked Questions
What unique factors impact the sale of a plastic surgery practice in Connecticut?
The Connecticut market is active and sophisticated, with buyers including large groups and private equity firms looking to build regional platforms. Buyers seek well-run businesses with consistent revenues and growth potential, which can lead to premium valuations but also a complex sale process.
How early should I start preparing my plastic surgery practice for sale?
Selling your practice is a multi-year process. It’s recommended to start preparing your financials and operations 2-3 years before you plan to sell to maximize your practice’s value and attract serious buyers.
What types of buyers are currently most active in Connecticut for plastic surgery practices?
The most active buyers in Connecticut are private equity firms, large super-regional group practices, and multi-specialty platforms. These buyers look for profitable, efficient practices with multiple providers, a strong brand, and a mix of surgical and non-surgical services.
What are the main differences between an asset sale and an equity sale when selling a practice?
An asset sale involves selling specific assets and liabilities you choose, with the buyer assuming only those liabilities. In contrast, an equity sale transfers the entire business entity, with the buyer assuming all liabilities. Asset sales often have better tax outcomes for buyers, while equity sales tend to be better for sellers.
What should I consider about my role and team after selling my practice?
Most buyers will want you to stay on for 3-5 years to ensure a smooth transition. Negotiations will cover your compensation, schedule, and responsibilities. Protecting your team is also important; agreements can be structured to safeguard your staff’s future under the new ownership, preserving your practice culture.
