If you’ve built a successful medical aesthetics or wellness practice, chances are you’ve already heard from a medical support organization (MSO). These groups are aggressively consolidating, and they’re targeting practices just like yours.
Before jumping into deal terms with an MSO, understand their process to protect your value and avoid pitfalls.
To get an insider’s perspective, we sat down with former MSO executives to hear how these organizations target practices, structure deals and decide what to offer. Their candid insights reveal how they think and why sellers shouldn’t go through it alone.
These organizations often scrape websites for details on provider count and services, analyze social media engagement, review local “Best Of” lists and even call after hours to gather info on volume or staffing. Once a practice demonstrates growth, profitability and market appeal, MSOs take interest and reach out.
“When MSOs approach sellers directly, they expect to pay less,” one dealmaker explained.
MSOs look closely at revenue and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), staff efficiency, your cash-pay mix and geographic potential for expansion. Another big factor is whether you’ll entertain an offer without shopping it around.
“Buyers look to acquire practices at fair market value. Of course, if there's an opportunity to secure a practice below that range, that's ideal,” said a former MSO executive.
The verbal offer you hear early on is often an anchor to get your attention, not necessarily reflect final terms. One insider told us:
“Negotiations often start with a number that catches attention,” another insider shared. “The final terms can look different once details are worked out.”
To evaluate any offer effectively, you need to ask the right questions, including:
● How much is paid upfront versus earnout or stock?
● What are the stay-on requirements?
● Are there non-compete restrictions?
● Is this a 100% buyout, joint venture or equity roll?
● Who controls the holding company?
If an MSO pushes you to sign quickly or avoids specifics about equity and earnouts, that’s a sign to pause—not because they’re acting in bad faith, but because they’re negotiating to their advantage.
“Without representation, negotiations usually tilt in the buyer’s favor,” an MSO executive admitted. “It’s a numbers game.”
Without representation, many sellers underestimate the strategic nature of MSO negotiations. In fact, MSOs often prefer unrepresented practices, reserving their budget for practices represented by brokers.
“We prioritized unrepresented practices because deals tended to be more affordable,” said a former executive. “When a practice worked with a broker, the price was going up. We could still do the deal, but we had to pay top-of-market for it.”
For example, a $2.5M medspa received a $3.7M direct offer from a national MSO. After hiring LuxMed to take the practice to market, multiple bids came in, and they ultimately closed with the same MSO, but at $6.5M, with more cash up front and stronger protections.
This is why competitive pressure and professional representation matter. At LuxMed, we don’t buy practices, we represent them. Our job is to help you understand your value, attract multiple offers and negotiate better terms across the board. We know the MSO playbook inside and out because we deal with it every day.
Get the facts first. LuxMed provides comprehensive practice valuations that show what buyers should pay, not what they want to pay. If you’re getting MSO interest, that’s validation of your value, but don’t let their first offer be the final word.
Contact LuxMed for a complimentary valuation to approach MSO deals with facts, not their numbers.
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