Diversifying Owners’ Holdings
MB2 Dental is a leading dental partnership organization that employs a differentiated doctor-centric business model through which affiliated dentists enjoy the clinical benefits of a private practice and the infrastructure, compliance, marketing, and purchasing advantages of a traditional DSO model. MB2 draws on the energy of highly engaged and deeply committed dentist partners with aligned economic interests.
Background
Sentinel was introduced to MB2 by an investment bank tasked with finding a financial partner who could help MB2’s founders and management team achieve their estate-planning goals and continue to grow MB2 through add-on acquisitions. MB2’s founders selected Sentinel because of our strong cultural fit with management, extensive experience investing in the dental sector, and proven record of growing businesses through add-ons.
Opportunity
To partner with MB2’s founding management team, capitalize on its unique local-ownership model, and rapidly grow through add-ons and de novo office openings
Accomplishments
Transitioned Smoothly to Sentinel Ownership: As a business owned and operated by management and their dentist partners, Sentinel and management worked together to ensure a smooth transition.
Positioned the Business for Further Growth: Sentinel worked closely with management to strengthen MB2’s infrastructure to support rapid growth. MB2 hired additional central support staff and invested in new systems. During Sentinel’s ownership, MB2 more than doubled its corporate staff.
Accelerated Growth Through Acquisitions and De Novos: With a unique operating model that resonated with independent entrepreneurial dentists, MB2 significantly accelerated its growth by:
- Making 100 add-ons of single and multi-location general and specialty dental practices representing 175 dental clinics
- Opening 20 de novo offices with existing MB2 doctor partners
In total, MB2 more than tripled its office count, from 85 to 275, and expanded its geographic footprint from six states to 24.
Outcome
Having accomplished our investment objectives in under four years, we sold MB2 to another private equity firm in a highly successful management buyout. Three years later, with MB2 still outperforming its peers, Sentinel participated in a recapitalization of MB2.
Case studies have been selected for illustrative purposes for management teams of midmarket companies considering a partnership with Sentinel and should not be considered an offer or solicitation of services or an actual or implied endorsement of Sentinel or any security, investment, or portfolio company. The portfolio companies highlighted are not representative of all current and prior investments of Sentinel. A list and description of investments since Sentinel’s inception is available on this website.