Interested in selling your practice to Refresh Mental Health?
Refresh Mental Health is proud to have partnerships with premier mental health, substance abuse and eating disorder centers across the country. If you are the owner of a solo practice, group practice or treatment facility, Refresh would like to learn more about you, the community you serve, your clinical philosophy and about your staff to see if it might be a good fit for Refresh to invest in you and provide operational support so you can be freed to do the work you love most.
We welcome having an introductory conversation to answer any questions and see if Refresh Mental Health might be a good fit for you. Please contact us at firstname.lastname@example.org.
FAQ About Selling a Counseling Center or Private Practice
Why do practice owners choose to sell?
- To reduce liability and responsibility
- To cash out and lower/eliminate ownership risk
- To be freed to pursue other opportunities
- Relocation or life transitions
- Retirement or to have more work/life balance
How can I find out the value of my practice?
- Businesses are valued on a variety of factors including, but not limited to, the businesses’ annual profitability, provider count, provider type, scalability, insurance payor mix, concentrations, former owners’ involvement and strategic fit with the buyer.
- There are many other factors which affect value including:
- Owner’s salary and how that affects the business profits
- Quality of staff, staff retention and morale
- Owner’s clinical and operational contributions and transition plans
- Strength and diversity of the referral relationships
- The strategic nature of the insurance contracts, EAPs and other payor streams
- Clinical reputation in the community served
- Recent business growth or clinical hires
- Compliance with professional, ethical and legal standards of practice
- Owned assets such as equipment or commercial real estate
Who buys mental health practices?
- Internal staff, although financing may be a difficult
- Other private capital groups (e.g. private equity)
- Larger regional practices, hospitals and EAPs
- Strategic buyers (i.e. Refresh Mental Health)
When is a good time to sell?
- When your business is at a high point
- When you are starting to burn out
- When you are ready for a change in your life
What if I’m not ready to retire or leave?
Your role is negotiable. Owners can choose to eventually leave or they can choose to:
- Stay on with the business (or the parent company) as a full or part-time employee
- Keep in mind that you will likely be asked to stay in your current role for a transitional period anywhere from a few months to a year and you will likely be asked to sign a non-compete agreement (which is standard sale of business protocol)
Who can assist me with the sale process?
It’s important to have a team of advisors including:
- A strong accountant or CPA who will explain things like closing costs and taxes related to the sale
- A corporate attorney, possibly one who specializes in mergers and acquisitions for smaller businesses in the healthcare services
- A business broker or advisor can be very helpful throughout the process, although they typically receive anywhere from 5-10% of the sale price
- It’s wise to keep your interest in selling confidential to avoid concern from your staff. You may choose to tell your leadership team in order to gain their trust and support
How long does it take to sell a business?
- Many business brokers will say that on average, it can take a year to sell a business
- It’s possible to sell your business in a fraction of that time if you choose an experienced buyer with a streamlined diligence process and avoid formalized broker-led auction process.
What is the process like?
- Most processes typically start with an Indication of Value (IOV) which includes the offered sale price. Once an IOV is signed, the seller is under “exclusivity” and is restricted from talking with other prospective buyers for a period of time. This phase is similar to being “under contract” when selling a home
- The next phase is a period called “due diligence.” Due diligence is a process where the prospective buyer conducts a confirmatory review of the business. The length of this review depends on the complexity and organization of your business. This phase is akin to the inspection process of selling a home
- The final phase is “attorney review”. This is when the purchase agreement and any other applicable documents such as offer letters, non-competes, and/or shareholder agreements are reviewed and signed
How does it feel to sell?
“Many people, including myself, wondered how I would feel after selling my practice, which I often referred to as my “baby.” I feel proud, relieved and freed. I have peace of mind in knowing that the staff and clients of UB are in good hands and I’m enjoying doing the work that I most love as VP of Marketing & PR for Refresh Mental Health. I’m grateful that I continue represent Urban Balance as the Founder through my writing, speaking and media work and am extremely happy about this next chapter of my career!” ~Joyce Marter, Founder of Urban Balance