Dental Success Partners

About DSI

The Dental Success Institute, founded by Dr. Mark Costes, is a multi-faceted dental education coaching business designed to inspire, connect, and educate the world’s top dental professionals.

The exceptional team of blackbelt level coaches is committed to empowering practicing dentists with knowledge, helping them increase profitability, and fostering greater satisfaction in their careers. Over the years, DSI has matured into one of the most reputable consultancies within the dental profession. The members of the community are closely associated with some of the most successful practices across the nation, cementing its footprint in the field.

With over 200 top-tier practice owners within the organization, it boasts a substantial recruitment pool that would contribute to an expanding DSO. DSI champions an integrative approach to dental consultancy, underpinned by a commitment to superior service, progressive knowledge dissemination, and the realization of our member-clients’ full potential.

What Matters to DSP

Mission:

Dental Success Partners exists to provide owner doctors with unmatched support both in business and clinically. We believe in giving doctors a valuable partner of which they can be proud. Owner doctors will largely maintain their autonomy to run their already successful practices, while having the support of the larger organization. Our goal is to be the catalyst for the next step in their ownership journey which takes them to places they never thought possible.

Vision:

Dental Success Partners is a one-of-a-kind dental service organization. Comprised of already successful practice owners we create synergies which allow our owner doctors to maximize their potential in an ever-consolidating industry while maintaining their autonomy and giving them opportunities they would not have independently.

Core Values:

• Community: DSP was founded through DSI which at its core believes in the power of community. DSP will foster a culture of communal interaction, growth and fellowship.
• Servant Leadership: As a healthcare organization we believe it is all our priority to put patients first. To this end all members of our organization will work with the heart of a servant and put the greater good above their own.
• Integrity: DSP believes that long-term economic growth comes from strong ethical business practices. We do not believe in short-sided gains, but rather treating team members and patients with respect, dignity and how we would test our own families.
• Personal Growth: Our owners will have achieved a high level of growth prior to joining DSP by way of the DSI belt system. Owners are expected to continue to grow both in their business acumen and clinical skills. Further, we believe that personal growth is necessary to have continued business growth.
• Autonomy: DSP will be a partner to owner doctors not a micromanager.
• Associate Growth and Ownership: We believe retaining associates requires avenues to learn new skills as well as equity opportunities. Our focus is that the journey is taken together partnered as one and moving in the same direction.

Dental Success Partners (DSP) Group FAQs

Could you elucidate on the back-end structuring in terms of cost, timeline, and comprehensiveness of services for implementation?

• The back-end structuring for the DSP Group necessitates uniformity across all practices in operational software and ancillary services. This includes, but is not limited to, uniform HR and payroll companies, banking institutions, accounting services, billing, IT support, practice management software, equipment procurement, etc. Once the founders’ group composition is established, our Professional Transitions Services (PTS) will provide a detailed timeline tailored to the group’s size. Regarding costs, the LOIs currently in place have allocated a $2 million budget to facilitate these structural changes, ensuring no direct financial burden is imposed on the practices for implementation. Our leadership team, comprising Dr. Mark Costes, Dr. Ben Kacos, and Dr. Bill Keith, will collaborate with each practice to meticulously adhere to the implementation checklist, ensuring the transition is executed within the designated timeframe.

To how many PE firms was the DSP group presented, and what was the outcome of this market engagement?

• The DSP group was introduced to a total of 2,800 PE firms. This initial engagement yielded interest from 160 firms, which were then rigorously evaluated by our PTS to identify the top five contenders. Currently, DSP is poised for in-person discussions in Dallas with the final two firms, R&R and Westin.

What is the threshold for combined EBITDA required by DSP to secure the most favorable multiple for the group?

• The group is aiming for a minimum combined EBITDA of $10 million to position ourselves advantageously for an optimal multiple during negotiations.

From the perspective of the PE firms, what are the perceived advantages of investing in DSP?

• PE firms have noted several compelling attributes of DSP, including the youthful demographic of our average doctor, the potential for the DSI Consulting Group to act as a conduit for future acquisitions, and the presence of highly profitable general practitioners who share a unified philosophical approach to dentistry.

Conversely, what are the potential drawbacks of DSP as viewed by the PE firms?

• The PE firms have expressed concerns regarding the lack of a centralized geographic location for DSP operations and the ambiguity surrounding the allocation of time between DSP responsibilities for the C suite and their other professional engagements or ventures.

Where can one access DSP-related resources, recordings, and the calendar of events?

• All non-confidential DSP materials are readily accessible on the DSP Landing Page. Should you require information not listed, please contact Kyle Francis, who maintains the repository for confidential materials. Certainly! Below are succinct, logical responses to the additional suggested questions:

How will the integration of practices into the DSP structure affect day-to-day operations in the short term?

• In the short term, practices may experience minimal disruptions as systems and processes are standardized. However, our transition team will work closely with each practice to minimize any operational impact and ensure a smooth integration process.

What measures are being taken to ensure that the unique culture of each practice is preserved post-integration?

• We recognize the value of individual practice cultures. Our integration strategy includes utilizing the same DSI frameworks like cultural assessments, weekly meetings, and leadership training to preserve the unique aspects of each practice’s ethos.

Can you detail the governance structure post-acquisition and the extent of autonomy that will be retained at the practice level?

• Post-acquisition, governance will be a collaborative effort between DSP leadership and practice heads. While strategic decisions will be centralized, practices will retain autonomy in day-to-day clinical decisions, ensuring that patient care remains personalized and high-quality.

How will the valuation of individual practices be determined within the DSP framework?

• Valuations will be based on a fair and transparent assessment of each practice’s EBITDA. It is important to maintain practice performance during negotiations as not to negatively impact your practice’s EBITDA. That includes making strategic decisions in your personal and professional life, such as keeping a consistent work schedule, maintaining production, no large practice purchases of equipment, etc.

What is the strategic growth plan post-acquisition, and how will it impact current practices?

• The strategic growth plan post-acquisition focuses on operational expansion and the careful integration of new practices, with the goal of enhancing the group’s market value and preparing for a subsequent sale. Current practices will gain from increased market leverage and shared expertise, driving collective profitability and growth. Members will have the option to engage in an equity rollover, allowing them to reinvest a portion of their equity into the expanded entity. This strategy not only facilitates sustained personal investment in the group’s success but also positions members to potentially realize greater returns in the event of a future sale to a larger buyer.

Can you outline the support system that will be in place for practices to adapt to the new operational software and services?

• A comprehensive support system, including training sessions, DSP Admin zoom and phone support, and industry partners brought in to assist will be available to ensure that all practices are confident and competent in using the new systems and services.

What are the long-term financial projections for the DSP, and how will these affect individual practices?

• Founders who opt to sell to DSP now are looking at a multi-faceted financial benefit. With an initial sale value of $18,125,000, continued earnings as an associate, and a substantial 75% of a 9.5x multiple of EBITDA, the financial rewards are compelling. Additionally, the ‘second bite’ investment opportunity, valued at $10,000,000, offers a further avenue for wealth generation upon a subsequent sale. It’s important to note that while these figures are promising, they come with the responsibility of establishing and refining the DSO structures. Founders will play a crucial role in this phase, ensuring that our core values and commitment to patient care remain steadfast. Flexibility and collaboration will be key as we navigate this transformative period, with the understanding that these efforts are in pursuit of a stronger, more resilient DSP.

How will the DSP ensure compliance with industry standards and maintain quality control across all practices?

• DSP will implement a unified quality control system through collaboration and consistency with HR, the oversight of our Chief Clinical Offer, and unified Practice software that aligns with industry standards. Regular audits, peer reviews, and continuous training will be part of our commitment to excellence and compliance across all practices.