For new graduates of chiropractic colleges who are saddled with thousands of dollars of student debt, it may feel impossible to build or buy a practice any time soon. Luckily there is a way to buy a practice in a matter of years, while gaining fundamental clinic experience — through the sweat-equity buyout method. Ten things to know about SEBO: A SEBO arrangement allows associates to join a practice without putting down money and earn the down payment to buy a practice down the line. It’s considered beneficial for both the buyer and the seller, who is typically a retiring chiropractor looking for a reliable exit plan. The SEBO method also allows for seamless patient transitions, as the associate and the patients will become familiar with each other over the course of the agreement. This buy-sell strategy is common among

Buying a practice is one of the on ramps [LINK] to business ownership and career success for chiropractors. A huge benefit of buying is that it comes with a built-in transition process between buyer and seller. Here are 10 tips to get the most out of the transition: Buyers Buy from someone with a similar philosophy and personality. “If you’re buying from a guy who’s really gregarious and he can get up and give talks, and he’s extremely motivational and has a lot more energy and personal power than you do, I would not buy a practice from that person, not without a really long transition,” says Kevin Misenheimer, a broker with Progressive Practice Sales in Chattanooga, Tennessee. Look for a seller who would be a great mentor and who has time to give a proper handoff. Typically retiring doctors

Whether for retirement planning, a sale, a future partnership or even a divorce, chiropractors will need a practice appraisal at some point in their careers. Practice valuation is best conducted by a consultant or broker who is well-versed in the nuances of the chiropractic industry. This ensures the valuation is fair and as accurate as possible. A Simple Valuation Method While an appraisal will include an in-depth look at tangible and intangible assets, experts have a simple way to gauge value for practice owners looking for a rough estimate. The simplest way to value a practice is to use a multiple of net cash flow. For a quick estimate, chiropractors can take a practice’s net cash flow — or the income after expenses like rent, utilities, insurance, staff salaries and other debts are taken out — from the last fiscal

Brokers and consultants often price chiropractic practices using a simple net cash flow-based valuation method. While this estimate offers a good starting point for determining practice value, many buyers are still left wondering — is this practice worth the asking price? Understanding the Ballpark Figure Before evaluating whether a practice is a good investment, buyers should look at the basis of the valuation. A common ballpark valuation method is 1.3 to 1.5 times a practice’s net cash flow. The multiplier is based in part on current interest rates. In 2020, with interest rates at record lows [LINK], that multiplier is up near 1.5. This means a practice that cash flows $300,000 per year is worth roughly $450,000. This number can help buyers get a sense of what is in their budget — a typical down payment is about 10-12% of

Many chiropractors dream of having the professional freedom to run their own practice, be their own boss and set their own schedule. Experience level, finances, goals and practice preferences, all factor into how chiropractors may choose to pursue practice ownership. Luckily there’s a path for everyone, from the starry-eyed associate to the experienced pro. Here are four ways doctors can become practice owners: Starting from scratch Starting a chiropractic practice from scratch allows for complete flexibility and a blank slate to build a dream practice. However, the challenges of starting from scratch mean it’s a strategy that is often best left to the more experienced chiropractors or those with deep pockets. Building a chiropractic business from the ground up is like launching any other business — it requires some business acumen, funding and a lot of grit. Owners will need