My first practice acquisition may actually be due to divine intervention.
I had been talking with a veterinarian for a month about buying his practice. It was not the right deal, but he connected me with a colleague who might be interested in selling. We texted back and forth and never got far. A couple of weeks later, my parents met an old priest friend at a Knights of Columbus event and got to talking. He was friends with a local veterinarian who was considering selling her practice. My parents texted me the information. It was the same person.
Four months later, I owned the practice.
The backstory goes deeper. I had been looking to buy for almost two years. I looked at deals through brokers; sent numerous letters as proprietary outreach; and stopped into clinics, without much success. I got frustrated enough that I started a practice from scratch instead. The de novo was doing very well, but my mission is to get more veterinarians into ownership and one practice alone does not accomplish that. So when this opportunity finally came knocking, I took the leap into acquisition, too.
The Listed Market is Crowded and Thin Where it Matters
I looked at hundreds of practices across a number of sites and built relationships with brokers around the country. There is plenty to look at and it becomes overwhelming.
It is also crowded, and the practices I want are not the ones most corporations or most veterinarians want to buy. One and two-doctor practices hit the market and sit there for a long time. The buying pool is small, which makes them a hard sell for a broker. These practices are often built around a single individual and there is always a question of whether the clientele transfers.
I still think they are great opportunities. I bought one.
Doing the Search Yourself
Proprietary outreach is taking the search into your own hands and going after practices in the areas where you want to own one. It is not necessarily bypassing a broker. It is getting in front of owners before they have decided to sell.
I researched practices in my target area to identify who actually owned them and whether they were truly independent. Some still look independent but have a group behind them. I checked whether an owner was listed on the website or in the state business directory. That was harder and more time consuming than I anticipated.
I sent a lot of letters. Letters lack a personal touch, so I started stopping into practices and trying to talk to owners directly. I handed over a letter in person with a handwritten note, my cell number, and my email. I wanted them to know my mission and what I was trying to accomplish. When I could not get to a clinic, I tried the owner by phone.
If this were easy, I would have found a deal much sooner. Doing it well is a full-time job, and I was doing it while practicing and taking care of my family. It is a great opportunity and it is also where I see exactly how brokers earn their keep.
Three LOIs That Went Nowhere
The outreach did produce real opportunities. I made offers on three practices during that stretch, and none materialized past an initial offer.
The first couple were crushing and delayed my search because I felt defeated. What I understand now is that I was building confidence in the deal-making process every time one died. A letter of intent carries no legal obligation to complete a purchase. Its purpose is to secure exclusive negotiating rights while you move toward an asset purchase agreement. Once I understood that, making offers got easier.
I also stayed in contact with those veterinarians. A failed LOI today may still become a deal later, for me or for someone in my network.
What You Gain . . . and What You Do Not
There is a misconception that proprietary outreach gets you a discount. You may buy at a lower cost than through a broker, but you give something up. Brokers do real legwork assembling financials, business information, and real estate details and they hand it to you in a clear format. Without one, all of that is on you, and it is harder to assess the true health of the practice.
So here is my advice. Unless you have real experience doing this analysis yourself, have a quality of earnings performed by a Veterinary-specific CPA on any off-market deal. They will tell you where the revenue is actually coming from and whether it is sustainable.
You also will not have competing bids driving your price up. Understand what comes with that. In many of these deals, the seller is not especially motivated or the business does not command a high price and you are the one who has to do the work to grow it.
The Honest Cost
Proprietary outreach cost me two years of searching and nearly four months from signed letter-of-intent to close. The real question is the opportunity cost during that time. I do not know the answer, but it is worth weighing before you commit.
There are pros and cons to both approaches and the answer is probably a mixture. Either way, patience matters most. Is the business transferable? Can you grow it? What is the demand in that area? Those answers are personal and only you can give them.
What I Want You to Do
If you are an owner thinking about retirement, start cultivating relationships with younger veterinarians who might buy your practice. And if someone approaches you with a letter or a phone call, please take the call. Not everyone looking to buy is a corporate entity. Some of us are local veterinarians looking to take the next step and your practice might be it.
I wrote previously about the two clocks. They do not always line up and sometimes selling a little earlier than you planned beats waiting until it becomes a necessity.
If you are looking to buy, knock on the door and ask to speak to the owner. Tell brokers exactly what you want. Build your list now: what you are looking for, what you are willing to spend, and the profitability you need. Hand that list to a broker and they may bring you something that fits it exactly.
Be prepared and do not be afraid to ask. The practice you want might come to fruition faster than you expect.