01/09/2024
A note from Brady Frank:
"This is from an email I received last week:
'Brady - I keep hearing you say, 'Now more than ever, private equity is pouring a ton of money into dentistry...'
But...Why? Can you explain what is motivating that?'
GREAT QUESTION.
And the answer in three words is:
Underpriced cash flow.
Dental practices stand out as dependable cash flow generators. For example, a well-run dental practice produces a minimum of 300K of annual cash flow after compensating the dentists.
You can get this cash flow for a fraction of, let's say, the rent receipts from a piece of real estate, and it's just as low-risk.
And that’s what private equity is investing in—the low-risk, reliable cash flow."