Observations and takeaways of Miguel Mireles, Director, Investment Banking, from Becker’s 2026 Fall Dental Roundtable.
Two weeks ago, I participated in an M&A panel at Becker’s 5th Annual Future of Dentistry Roundtable in Chicago, joined by Mandy Gast, Chief Development Officer at Lone Peak Dental Group; Ashish Bagai, Co-Chief Executive Officer at Vitana Pediatric & Orthodontic Partners; Murat Ayik, DDS, Partner at Specialty1 Partners; and Jeff Ungrund, Vice President of Affiliations at Heartland Dental.
What follows is not a session transcript. It is a summary and key points of where the two days converged, and why I think it matters to financial sponsors and founders evaluating a transaction over the next 24 months.
Operators put a number on where the benefits of scale flatten
The most useful thing said about consolidation all week was also the most specific. Several executives described a cost curve that delivers genuine advantages early in a platform’s life, in purchasing, insurance and payer contracting, and then flattens somewhere in the range of 20 to 40 locations. Past that point the argument for size becomes considerably harder to make.
The corollary is the part sponsors should sit with. Scale produces cost advantages. It does not reliably produce revenue advantages. Top-line same-store growth was described repeatedly as a function of how close decision-makers sit to the practices, not of how many practices there are, and the recurring formulation was to be large enough to capture the cost benefits while remaining small enough to execute quickly.
That is not a critique of consolidation. It is a critique of consolidation as a substitute for operating capability, and it lands differently when it comes from people running the platforms rather than from the sell-side.
It also matters for valuation. When assets could be acquired at six times and exited well into the double digits, accumulation was itself a strategy. With multiples well off their 2021 peak and the entry-exit spread substantially compressed, the remaining levers are same-store growth and margin expansion. Both are operating disciplines.
The forward metrics are retention metrics
There was broad agreement that the industry’s traditional scorecard, office count and EBITDA, describes performance already delivered rather than performance to come.
The forward indicators raised most often were organic growth within the existing base and retention measured properly: not whether doctors complete their contract terms, but how many remain beyond them, including associates. Patient retention was framed as the measure that reveals culture, which in turn drives everything else.
For acquirers this maps directly onto price. Practices where the owner performs the substantial majority of production are discounted accordingly, and adding one producing associate 12 to 24 months ahead of a process remains among the highest-return actions available to a seller. At the platform level, a group whose work-back commitments expire shortly after closing is not offering a durable earnings base regardless of what the trailing financials show.
Asked where they would put new capital, operators chose people first
This was the clearest signal of the two days. Executives across very different models, value-based care, technology-forward groups and specialty platforms, were asked where they would deploy fresh capital. Each answered with workforce, and each described technology as the thing that makes the workforce more productive rather than smaller.
The specifics were concrete: expanding what auxiliary staff are trained and credentialed to perform, deploying automation alongside existing employees so that experienced people move off repetitive administrative work and onto tasks that require judgment, and building associate development and leadership pathways rather than treating recruitment as a perpetual replacement exercise.
The framing I took from it is that labor cost pressure and technology investment are no longer separable line items. For diligence purposes, the question is not whether a platform has adopted technology. It is whether adoption has actually changed the shape of the labor model, and whether the resulting capacity is reflected in production or has simply been absorbed.
Artificial intelligence is converging on table stakes
The consensus on AI was notably restrained. The prevailing view was that AI as a clinical differentiator is overhyped and will follow digital scanners into the category of infrastructure every organization has within a year or two. Valuable, but not distinguishing.
The trends identified as underweighted were more commercial in nature: patient acquisition shifting away from conventional search toward how AI systems characterize a practice or brand, medical billing and coding sophistication, and administrative literacy among clinicians, including the ability to interpret and contest claim denials.
The M&A Exit Door is Narrower Than the Entrance
The prevailing narrative treats seller supply as the constraint on dental M&A: an aging practitioner base, declining associate ownership, a demographic wave still to arrive. Those conditions are real. They are also not what determines outcomes.
The harder question arises at exit. Once a platform reaches $15 million to $50 million of EBITDA, the universe of capable acquirers narrows considerably, there is no meaningful public comparable set for pure-play dental, and a sponsor-to-sponsor transaction requires the incoming buyer to underwrite further multiple expansion. That is precisely the assumption the market has repriced.
The consequence was visible this year, as two well-known platforms transitioned into lender control. Neither represented a failure of clinical operations. Both were sound practice bases inside capital structures underwritten for a rate environment that no longer exists.
Scale, on its own, is not an exit strategy for DSOs that are already sponsor-backed. This is not an objection to private capital in dentistry. It is an argument for underwriting that requires operational sophistication that enhances clinics and a proven growth playbook, so that a subsequent buyer will pay a higher multiple. For example, a private equity-backed DSO with $20M in EBITDA will not necessarily trade at a higher multiple than a private equity-backed DSO with $50M in EBITDA. Scale must translate into demonstrable value beyond a larger EBITDA figure.
Implications
One point surfaced repeatedly and deserves more weight than the consolidation debate receives. By most estimates fewer than half of Americans see a dentist in a given year. Several operators made the case that the real competition is not DSO versus independent practice, or large versus small, but patient apathy and access. For sponsors, that reframes where growth is available.
DSO penetration, meanwhile, is quoted variously at 16%, 35% and 70% depending on the source, and the denominator is rarely specified. That figure is most often deployed to create urgency, and urgency is a reliable contributor to overpayment.
The prior cycle rewarded acquirers. This one will reward operators. For founders and sponsors contemplating a transaction, the highest-return work is not scale, it is operational strength and the 18-24 months of preparation that precede it.
My thanks to Becker’s, and to Mandy, Ashish, Murat and Jeff for a substantive discussion.