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MailDecember 2021
Independence Dental: The DSO for Dentists Who Do Not Want to Be Part of a DSO
True to his calling to expand dentistry through innovation, Patient Prism’s CEO Amol Nirgudkar, interviewed David Thoni, Chief Growth Officer of Independence Dental Services, at the 2021 DEO Fall Summit. Independence Dental is a prime example of DSO innovation, and Mr. Thoni has held multiple executive leadership roles in the dental and healthcare industry, including serving as President of ClearChoice Dental Implant Centers’ east division. Before ClearChoice, he served as head of global sales for Straumann Group’s Neodent Division.
Independence Dental’s Unique DSO Model
“Coming out of the pandemic, the demand for dental services is better than ever, and DSOs are leading the charge in ensuring that there is access to care,” says Nirgudkar. “How did Independence start and what is your current business model?”
“Our DSO is more of a DPO,” says Thoni. “It was started by an investment banker out of Toronto named Lane Theriault. Lane was one of the founders of 123 Dentist in Canada, and when 123 partnered with a new private equity group, Lane stepped down from the board to launch a similar business model here in the states by the name of Independence.”
Independence Dental’s business is based upon finding quality partners, across the country, who want an extreme level of autonomy. It’s unique and differentiated model does not charge DSO management fees because there is no intention of managing the partnering dentists.
“One of the reasons I think we're growing so fast is there is pent up demand,” says Thoni. “There are many great dentists out there that see the value of being a part of a DSO, but they don't want a boss. We're going to do all the back-office work and partner with them where they want help. But we put in writing that we cannot tell you what to do. We have a normal course of business clause, so as a partner, even though we may own 75% of the practice, we can't come in and make changes. We have to convince our partners of the efficacy of the things we want to do together to grow.”
“Dentists want their autonomy but how do you get everybody aligned to believe in a unified mission, vision and core values?” asks Nirgudkar.
Independence believes every practice has their own dental director. “Our unified vision is to create a platform for quality dental practices to continue growing the way they want to grow. They are successful in their market already for a reason. We want to respect that,” says Thoni.
And for that reason, Independence Dental does not partner with “fixer upper” dental practices. Independence buys into premium practices, and for that they pay a premium.
“It’s not that we're not an active collaborating partner,” says Thoni. “We do come to them with ideas routinely. But if we say, ‘Hey, would you like to start doing sleep apnea appliances in your practice?’ and they say, ‘No, I'm not interested,’ we move on. The interesting thing that we're finding is partners are joining us because of the autonomy. They're very adamant about wanting the autonomy and appreciate that it's in writing. But once the trust is established, they become very collaborative partners with us. When we go into one of our partners' practices, the goal is to get invited back. It's not to convince them or anything. It's just to be a good partner and to listen and share and support their goals.”
Independence is now up to forty partners. By being focused on successful dental practices, they uncover exciting ideas the partners can share and all use to grow even more.
“We've got our first partner meeting coming up this winter,” says Thoni. To share ideas currently, conference calls are made and introductions of one dentist to another are made. “Best practice tip sharing is one of the most exciting things about our platform.”
New Service Lines Spur Growth: How are they encouraged and facilitated by Independence?
“One of the things I love about this industry is the ability to have support for the clinician for growth, their internal growth as a doctor, improving their clinical skills, getting them to practice at the highest level of their license,” says Nirgudkar.
When a partner is interested in developing a new niche service, for example, sleep dentistry, clear aligners or implants, Independence helps the partner get started with the right training.
“The right training is absolutely key for any new service line you're starting,” says Thoni. “But we do that through third-party partners. We have a great resource in-house, Carey Lasher. She's our director of performance. Carey teaches case acceptance and how to communicate amongst team members and with their patients. So, we offer that service if they want it but for the most part, we bring third parties forward.”
Growth of Independence Dental Has Been Rapid
Independence launched on December 31, 2020, with eight practices, and will close on its 40th practice at the end of the year.
“Fortunately, our platform is very scalable,” says Thoni. “We've hired more analysts to help us with valuations, but we don't see it slowing down right now. We found a sweet spot I think with smaller group practices--that doctor who owns two to eight practices. Their platform isn’t big enough for a private equity group. They can use us as their financial backer and not have to deal with the bank.”
To find successful practices, Independence works with multiple brokers. And with a year into the business, Independence is benefiting from word of mouth.
“Word gets around quickly when there's a new and differentiated partnership model out there,” says Thoni. “But we have worked brokers. What I have found quite frankly is that a dentist who is working with a broker is most likely to close on a transaction. They’re better informed. If an independent dental practice or small group of dental practices wants to be part of a larger organization like ours, they can make contact directly through the Independence website – independencedso.com. “
An initial conversation will determine if Independence is a good fit. If not, Thoni can recommend other organizations that may be a good fit.
Helping Their Partners Grow
Independence dental partners report being able to relax into doing their best clinical work and patient conversations because Independence is doing the back office.
Everyone is struggling with staffing issues, finding assistants, hygienists, and other team members but the larger organization’s leaders have the expertise to look at the issues and individualize a strategy for each practice.
“I’m a pretty simple guy when it comes to business,” says Thoni, “because there are only so many ideas out there. We just break it down to input, throughput and output. If you don’t have the input coming in and the team organized to manage the throughput, the targeted output won’t happen. We look at the needs of the individual practice and try to have genuine conversations about how we can help.”
A real example is a practice where Independence renegotiated PPO contracts so that practice could collect an additional one million dollars in revenue.
More interviews with on DSO's that are breaking the mold:
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