Business Valuation Guide
Most dental practices sell for 2.0x to 3.6x Seller's Discretionary Earnings, with the midpoint near 2.8x. A dental practice with $250,000 of SDE would typically fall between $500,000 and $900,000.
Dental practices are among the most reliably financed small businesses in the country. Lenders know the category, collections are predictable, and a practice with a stable hygiene recall schedule behaves more like an annuity than a retail business. That is why dental carries one of the higher earnings multiples on the board.
Start with Seller's Discretionary Earnings (SDE): net profit plus the owner's pay and perks, interest, depreciation and one-time costs.
Then apply the industry multiple. For dental practices that band runs 2.0x to 3.6x, and where a specific business lands inside it is decided by the factors below. Typical SDE margin for this category runs around 18% of revenue, which is a useful sanity check: if your margin is far off that, the multiple moves with it.
Above roughly $1M to $2M of EBITDA the buyer pool changes. Individual buyers give way to private equity platforms and strategic acquirers, and pricing restates onto an EBITDA multiple of 4x to 6.5x rather than a multiple of SDE.
Associate dentists buying their first practice with an SBA 7(a) loan, neighbouring practices expanding, and increasingly Dental Service Organizations (DSOs) rolling up multi-operatory practices in growth markets.
A typical sale runs 6 to 9 months from going to market to closing, assuming your financials are ready when you start. Dental sales run faster than most categories because lenders underwrite the sector confidently and buyers are pre-qualified associates. The gating item is usually the lease and whether the landlord will assign it, not the price.
Most dental practices sell for roughly 2.0x to 3.6x Seller's Discretionary Earnings, with the midpoint around 2.8x. Another common shorthand is 60% to 80% of annual collections, though that rule ignores profitability and is easily misleading. A practice collecting $1.2M with $300K of SDE would typically land between $600K and $1.08M.
Start with SDE: net profit plus the owner-dentist's compensation, personal expenses run through the practice, interest, depreciation and any one-time costs. Multiply by an industry multiple adjusted for how much of the clinical production the owner personally performs. Owner dependence is the single biggest swing factor in dental.
Often yes, for larger practices. DSOs typically price on EBITDA rather than SDE and pay in the 4.0x to 6.5x range once earnings clear roughly $1M, but they usually require the selling dentist to stay on for a transition period and may structure part of the price as equity rollover.
There is no single average, because price tracks earnings rather than revenue. At the midpoint multiple of 2.8x SDE, dental practices at $500,000 of SDE sell around $1,400,000, and at $1,000,000 of SDE around $2,800,000. Typical SDE margin in this category runs near 18% of revenue, so a dental practice doing $1,000,000 in revenue would often carry about $180,000 of SDE and land near $504,000.
Take your Seller's Discretionary Earnings and multiply by 2.0x to 3.6x. Where you land inside that band is decided by owner dependence, customer concentration, recurring revenue and the quality of your books. A dental practice at the top of the range looks materially different from one at the bottom, and most of those differences can be improved in the twelve months before a sale.
SDE multiples of 2.0x to 3.6x apply to owner-operated dental practices. Once earnings pass roughly $1M to $2M of EBITDA the buyer pool shifts to private equity and strategic acquirers, and pricing restates onto an EBITDA multiple of 4x to 6.5x. The two are not comparable: SDE includes the owner's compensation and EBITDA does not, so the same business shows a higher SDE multiple than EBITDA multiple.
Typically 6 to 9 months from going to market to closing, assuming financials are ready. Dental sales run faster than most categories because lenders underwrite the sector confidently and buyers are pre-qualified associates. The gating item is usually the lease and whether the landlord will assign it, not the price.
SDE times the industry multiple. For dental practices that multiple is 2.0x to 3.6x, so $250,000 of SDE points to $500,000 to $900,000. Recorded sales of similar businesses serve as a cross-check, and the equipment and inventory value usually sets the floor.
Yes, at the top of this page. It applies the 2.0x to 3.6x band for dental practices, adjusted for owner hours, margin and years in business, and returns a range rather than one number.
To decide whether to sell a dental practice, a market valuation: what a buyer would likely pay. A certified appraisal is usually needed only for divorce, estate, tax, litigation or a buyer's SBA loan, and costs far more.
Multiples reflect broker transaction data including the BizBuySell Insight Report and aggregated 2024-2025 USA small business sales, and mirror the bands used by the Exit Ready valuation calculator. They are planning estimates, not a formal appraisal, and not investment advice. Market multiples move; this page was last updated 2026-08-19.