ESOP
Exit comparison calculator
Put your own numbers in and see how three exit paths compare. Everything here is an illustration built from the assumptions shown beside each figure.
Your numbers
Nothing is sent anywhere. The math runs in your browser.
Illustration, not a projection
What the three paths look like side by side
These are illustrations produced by the multiples shown below. They are not a valuation, not a projection, and not an offer. No one has looked at your practice.
EBITDA used throughout: $300,000 ($1,500,000 collections x 20% margin)
Private sale to another dentist
$1,050,000
- Multiple used:
- 70% of annual collections
- Math:
- $1,500,000 x 70% = $1,050,000
- Assumes:
- a single closing, a buyer who can obtain financing, and no retained equity. Taxes, debt payoff, and transaction costs are not deducted.
DSO acquisition
$1,800,000
- Multiple used:
- 6x EBITDA
- Math:
- $300,000 x 6 = $1,800,000
- Paid at closing:
- $1,260,000, with $540,000 (30%) assumed to sit in rollover equity or an earnout that may pay less, or nothing.
- Assumes:
- the buyer accepts your EBITDA as calculated, and you continue working through the post closing period.
Three bite ESOP model
$1,963,008
Total across all three bites, before taxes and costs.
| Bite | Sold | Company value used | Illustrative proceeds |
|---|---|---|---|
| First bite | 30% | $1,800,000$300,000 EBITDA x 6, no growth applied yet | $540,000 |
| Second bite | 30% | $1,944,000$300,000 EBITDA x 6 x 8% growth applied 1 time | $583,200 |
| Third bite | 40% | $2,099,520$300,000 EBITDA x 6 x 8% growth applied 2 times | $839,808 |
- Multiple used:
- 6x EBITDA at the first bite, then the same multiple applied to a company value grown at 8% between each bite.
- Assumes:
- growth actually happens, an independent valuation supports each price, and the plan can fund each purchase. If growth is flat or negative, later bites are worth less. Taxes, debt, and transaction costs are not deducted, and no tax treatment is assumed.
About the numbers on this page
- Any figures or ranges shown here are illustrative examples. They are not a forecast, a promise, or a typical result.
- Nothing on this page is an offer to buy or sell securities, or an offer to enter a transaction of any kind.
- What a practice is actually worth, and how a sale is structured, depends on that practice's own performance, market, and deal terms.
- Talk to your own tax advisor and your own attorney before making a decision. We are not providing tax, legal, or investment advice.
The other path
Real estate is the other path
Ownership of the building you practice in runs alongside ownership of the practice itself. The two are separate decisions and either one can come first.
Explore real estate