Selling to private equity: My journey

If you get the reference in the headline, then you will likely have been around long enough to relate to my story (or you’re a very cool young person). If you don’t, some day you will reflect and appreciate that the path we set when we start isn’t always where we end up. Life throws curveballs and opens doors that we don’t expect or imagine.

On Dec. 30, 2021, I took the leap and sold my practice to private equity (PE). Although founding and running my own practice had been an invaluable, empowering experience, I had also learned that patient care and work-life balance were higher priorities for me. PE provided the solution.

EXPERIENCE ON MY OWN

I had never intended to own a practice, let alone be in a position to sell it to a non-physician partner. My original plan was to be an academic physician, teach residents and do research. But by the end of my residency, I noticed that many of the women I looked up to during training were leaving academics. I imagined that the pressure of wearing all those hats in addition to being a wife and mother would leave me feeling less than great at all of them.

It was almost 20 years ago that I ventured out on my own after working for other practices for several years. If it weren’t my husband’s encouragement and support, I probably never would have taken the chance or believed I could do it. But for 20 years I did it.

Along the way, the battle was real; it was also an amazing journey. I found my confidence not only as a doctor/surgeon, but also as a business owner, manager and human resource expert. That is not to say I didn’t make a few mistakes along the way — in retrospect “I wish I knew then what I know now.” But, I wouldn’t trade the journey for anything. I grew a practice from one doctor/one employee to three doctors/30 employees.

THE TRANSITION TO PE

I didn’t make the decision to sell my practice overnight, and I didn’t entertain only one offer. However, as the practice grew my administrative responsibilities and the pressures of increasing costs and decreasing reimbursement also grew. I found myself spending as much time on administrative responsibilities as patient care, and work-life balance became elusive. In addition, any future growth would require substantial personal financial investment and time commitment. For me, the opportunity and timing were perfect.

My transition to PE was more like a 3-year plan — again not without twists and turns. Those 3 years represented some of the hardest work and longest hours I’ve ever put into my career. If you’re thinking of PE then you suddenly must learn a whole new language, with “EBITDA” (Earnings Before Interest, Taxes, Depreciation and Amortization) probably the most important term. The phrases “claw back,” “holdback,” “rollover,” “multiples,” and “second bite” become part of your daily dialogue. If you’ve been on your own, then the concept of a restrictive covenant, PTO, performance-based salary and an employment agreement can be a little disarming.

The process is long and arduous at times. You’re forced to do the deep dive into every aspect of your practice, which can reveal things you didn’t know existed or were missing. For me it was eye opening, and I wish I had periodically looked at my practice with the fine-tooth comb I was forced to use in preparation to sell.

MY ADVICE

Unless you have an MBA it’s wise to seek out advisors, including a really good accountant and an attorney familiar with these types of deals as soon as you are even considering your option to sell. And being finished with the sale is not the end of stress or time-consuming aspects of that decision — I’m still in the process of closing my old business, transitioning to new EMR software and helping my employees navigate the challenge of new leadership and processes.

But my motto for 2022 is “Everything is possible!” Now is my time to enjoy what I’ve created, explore new interests, allow someone else to sweat the small (and big) stuff and continue to grow the practice. OM

Lisa K. Feulner, MD, PhD, is Ophthalmology Management’s chief medical editor. She is the founder and CEO of Advanced Eye Care & Aesthetics in Bel Air, Md., where she specializes in cataract surgery, medical and surgical glaucoma care and dry eye disease.