If you’re thinking about selling your practice, you’ve probably already started thinking about what’s most important to you. Whether your goal is financial security or to have more time for fishing & family, your succession strategy will have a long-lasting impact on you, your family, and the hospital staff. Given the plethora of potential buyers for your practice, there are, it’s important to go into the process with a plan or a roadmap so that you feel comfortable with why and how you made your decision.
For me, my roadmap was about realizing my financial goals and finding a group that shared my values so that I knew I could trust them to take care of my team. For you, it might be the same or it might be different. Regardless, understanding your priorities throughout the process will make for a much easier decision. So, how do you choose the right partner to sell to?
First, I’d like to get one thing out of the way. Things are going to change. When any potential buyer told me “nothing is going to change” I ran for the hills. It was a huge red flag for two reasons: 1) we all know that things will change and 2) if they don’t know that things will change, it’s a problem – or worse, they do know that things will change and they’re just saying what they think I want to hear. If a group isn’t being forthright with me during the sale process, the entire relationship is built on a lie and I didn’t want a partner that I couldn’t trust. From experience, I can tell you that things do change down to where your team members get their paychecks from, benefits, credit card merchant account, etc. While these changes may seem menial, these are the things that can become a giant pain in the butt if they’re not handled smoothly.
What I can tell you is that one of the most consistent goals I’ve heard from a lot of different sellers is that they want to make sure our team members are taken care of. As practice owners, we spend years with the people at our hospitals and for a lot of us, those people are like family. It’s not “Jill the receptionist,” it’s “Aunt Jill.” We’ve been friends with Jill for 20 years and she’s seen our kids grow up – she’s a part of our life. So, what does that mean for choosing a partner?
Here’s how I thought about it: At the end of the process, I knew there was going to be a big check that showed up in my bank account. I also knew that it was going to have the same number of zeros on it no matter which group I sold to. The last few numbers on that check changed a little bit from offer to offer, but they were all in the same ballpark. For me, I thought about Jill, the rest of my team, and which group I thought I could trust to always do the right thing. I thought about bumping into Jill at church or the supermarket and wanted to make sure that she’d give me hugs rather than turn the other way. It may sound cheesy, but I know that I sold to the right people for the right reasons and those hugs give me comfort in my decision so I’ve never second-guessed it.
While that may seem to oversimplify the decision, it really doesn’t. It requires time and effort to identify which group is the right fit and I found that the most important part of that evaluation is getting to know everyone that matters at the group you’re thinking about selling to. If you are talking to a group and you don’t get along with their medical leadership, CEO, COO, or CFO, it’s probably not a great fit. If you haven’t met those people and don’t have the opportunity to meet them, then how could you know if it’s a good fit? I spent just as much time working through the financials with my attorney and my CPA as I did getting to know the leadership at the group I eventually sold to. I visited their headquarters for a day and met the people who would soon become a part of my larger team. Although we sometimes think of these groups as “corporate” and faceless, the companies are made up of people that create the culture (just like our hospitals).
Ultimately, I wound up taking a step forward in my career with the group that I sold to. I’m now a regional medical operations director at MVP. While you might think that means I’m biased, it doesn’t. It just means that I did a great job searching for my succession plan and I found a group that cares about people and that I love to work with. I encourage you to do the same; find a group that is led by people that you can trust who are creating a culture that aligns with your beliefs.
This is a big decision so if it doesn’t feel right when you’re getting to know a buyer, keep looking.