Choosing the Right Valuation Tool
Sellers often confuse a broker's estimate with a bank-ready appraisal. Understanding the difference is critical for a smooth due diligence process.
Key Differences
- BOV: Fast, market-driven, often free, used for marketing and setting expectations.
- Business Valuation: Expensive, rigorous, required for SBA/conventional financing, assesses risk and normalized EBITDA.
- DSOs rely on their own internal Quality of Earnings (QoE) reports regardless of the BOV.
Frequently asked questions
Do I need a formal valuation to sell my dental practice?
While you can list with a BOV, the buyer's lender will almost always require a formal, third-party business valuation to approve the acquisition loan.
How is EBITDA calculated for a dental practice?
EBITDA is calculated by taking net income and adding back interest, taxes, depreciation, amortization, and owner-specific discretionary expenses to find true operational cash flow.