Buying a Dental Practice (Part 2): Mastering Due Diligence & Risk Management | Ep. 7

Does that staff member have 20 years of experience, or 1 year of experience 20 times? In Part 2 of our Buying a Dental Practice series, host John Stamper and consultant Ken Mathys move from the "big picture" practice evaluation to the specific due diligence required to close the deal. They dive deep into the specific numbers you need to request, why "low overhead" is often a red flag for neglected equipment, and how to model cash flow scenarios (Best, Probable, and Worst Case) to ensure you can service your debt. Ken also explains why "People Diligence" is often the hardest—but most critical—part of the transaction. In this episode, we cover: Chapters 00:00:00 Mastering Due Diligence & Risk Management 00:01:54 Revenue Stream Diligence: Analyzing 5-year trends to see if growth is coming from fee increases or actual patient volume. 00:08:04 The "Overhead" Myth: Why you should ignore the generic "overhead" percentage and look at Fixed vs. Variable costs. 00:11:46 People Diligence: How to evaluate pay scales, internal leaders, and whether the team has "progressive experience". 00:16:42 Brand Diligence: Assessing reputation, online reviews, and patient churn rates. 00:21:22 Cash Flow Modeling: Why "Cash is King" and how to stress-test your financial model against a "Worst Case" scenario. 00:24:51 Managing Risk: Identifying external threats (like a local factory closing) and internal threats (key staff leaving). About the Guest: Ken Mathys is the founder of Dental Practice Advisors and has spent over three decades helping dentists master the business systems behind their clinical work. He specializes in leadership, operations, and practice transitions.