5 mistakes that cost owners
20-30% of their practice value.

Not Knowing What Your Practice Is Actually Worth

Most practice owners have a number in their head. It's usually based on what a colleague sold for, a rule of thumb from a conference, or a gut feeling anchored to revenue. All three are unreliable. The gap between what owners think and what a buyer will pay can be 30% or more in either direction.

Revenue is not value. A $3M practice with 5% margins is worth far less than a $2M practice with 25% margins. Buyers pay on adjusted EBITDA, not top-line revenue. Private equity's sweet spot starts at $500K+ EBITDA, and if your practice clears that threshold, you are sitting on an asset that is worth significantly more than you probably realize.

Owner compensation adjustments matter enormously. If you pay yourself $350K but market rate is $180K, a buyer adds $170K back. These adjustments swing valuation by hundreds of thousands.

Multiples have surged. Under $1M EBITDA: 8-9.5x. Between $1M-$3M EBITDA: 9.5-11.5x. Over $3M EBITDA: 11-13x or higher. The SVP/MVP merger recently closed at 17-18x EBITDA across 700+ combined hospitals. These are not the 5-6x multiples of a few years ago. The market has fundamentally shifted, and most owners are still anchoring to outdated numbers.

Waiting Until You're Burned Out to Start Planning

By the time most owners seriously think about transitioning, they've already started pulling back. Not investing in equipment. Not hiring aggressively. Not marketing. Coasting. And it shows in three-year trends. Buyers see it immediately. They price it in.

The average practice owner is 55+ and has spent years thinking about exit without acting. By the time they start planning in earnest, they've already lost the window to optimize. A two-year runway for a process that takes three to five means you are negotiating from weakness, not strength.

Practices that plan 3-5 years ahead sell for 15-25% more than practices that rush the process. And here is the part nobody talks about: if you die or become disabled without a written transition plan in place, your estate loses approximately 40% of practice value. Your family inherits chaos instead of wealth.

Ignoring the Tax Implications Until It's Too Late

Owners spend months negotiating the sale price, then lose 20-40% of proceeds to taxes they could have legally minimized with advance planning. On a $2M deal, the tax difference between an asset sale and a stock sale can exceed $200K. That is not a rounding error. That is your retirement.

Most use a general-practice CPA who has never structured a multi-million dollar business sale. The tax code offers legitimate strategies, but almost all require years of advance planning. By closing day, it's too late. The money is already gone.

Trying to Navigate the Process Alone

Practice owners are independent by nature. That independence built your practice. In a business transition, it destroys value.

Buyers have done dozens or hundreds of acquisitions. They have playbooks, legal teams, and negotiators who do this every week. You've done this zero times. The information asymmetry is massive, and they are counting on it.

Negotiating without representation. A good advisor pays for themselves many times over.

Using a general attorney. Practice transitions involve purchase price adjustments, reps and warranties, indemnification, earnouts. Your family lawyer isn't qualified.

Skipping the broker. Owners who negotiate without representation typically leave more on the table than the commission would have cost.

Overlooking What Happens After the Sale

Most owners focus entirely on sale price and give almost no thought to Day 1 after closing. This leads to choosing the wrong buyer and structuring the wrong deal for their actual goals.

Buyer Type	Price	Autonomy	Best For
Corporate Consolidator	Highest upfront	Least	Full exit
Regional Group	Moderate	Flexible	Reduced burden, meaningful role
Individual Buyer	Lower initial	Most	Gradual, legacy-preserving transition