Buy vs. Start a Dental Practice in 2026: The Full Comparison
Starting a dental practice costs $650K-$950K. Buying one costs 1.8x-2.7x EBITDA. Here is the head-to-head comparison with real numbers.
34% of practice owners plan to retire within six years, creating a wave of acquisition opportunities. But startup costs have also come down in some markets. Here's how to decide.
The Numbers Side by Side
| Factor | Buy Existing | Start From Scratch |
|---|---|---|
| Total cost | $500K-$1.5M (varies by revenue) | $650K-$950K |
| Down payment (SBA) | 10-15% | 10-15% |
| Revenue from day 1 | Yes (existing patient base) | No (build from zero) |
| Time to profitability | Often immediate | 12-24 months typical |
| Equipment condition | May need upgrades | All new |
| Location choice | Limited to existing | Full flexibility |
| Overhead (year 1-2) | 55-65% | 70-80% |
| Patient retention risk | 10-20% attrition typical | N/A (no patients to lose) |
The Case for Buying
Cash flow from day one is the big advantage. A practice collecting $800K/year with a purchase price of $600K (roughly 2x EBITDA on a $300K EBITDA practice) puts money in your pocket immediately. Startup practices average $67,500-$70,000 in monthly overhead before they've seen a single patient.
Small independent practices trade at 1.8x-2.7x EBITDA. That's the sweet spot for individual buyers. Anything above 5x usually means a DSO is involved. With interest rates declining in 2026, financing is more favorable than it's been in 3 years.
The risk: patient attrition post-transition. Budget for 10-20% of patients leaving in the first year. A strong transition plan (seller stays 60-90 days, personal introductions, mailed letters) reduces this to under 10%.
Buy: $600K practice purchase financed via SBA at 10% down ($60K). Monthly debt service roughly $5,500. Practice collects $67K/month. After overhead (62%) and debt service, you net roughly $20,000/month from day one.
Start: $800K buildout, $80K down. Monthly overhead $67,500 with near-zero revenue for months 1-3. Break-even around month 12-18. You will burn through $150K-$250K in working capital before turning profitable.
The Case for Starting Fresh
Everything is yours: the location, the technology, the culture, the brand. No inherited problems. No outdated equipment. No staff who resent the new owner. And in underserved markets, a well-located startup can ramp faster than projected.
Startups also give you full control over your payer mix from day one. You can choose to go fee-for-service or limit your PPO participation without inheriting a patient base that's 80% PPO.
The Decision Framework
Buy if: you have limited working capital reserves, want immediate income, found a practice in a good location with a solid patient base, and can negotiate a fair transition period. Start if: you have 18+ months of living expenses saved, want full control over location and brand, your target market is underserved, and you have a strong marketing plan to build volume quickly.
Sources: ADA Practice Transitions Report 2025, AFTCO Dental Transitions Data 2026, SBA Lending Data for Dental Practices 2025.
Related: Dental Practice Exit Strategy: Start Planning 5 Years Out
