How much is an orthodontic practice worth?

Short answer: orthodontics prices off collections plus the contracts already signed. Traditional doctor-to-doctor sales have long clustered around 80% of annual collections, while the earnings math on the standard size ladder can run higher — about $1.39 million on $1.4 million of collections in the example below, versus roughly $1.12 million on the traditional lens. The gap between those two numbers is the story of this market: who is buying, and what they believe your pipeline of signed cases is worth. Run your figures in the valuation calculator and see the orthodontists industry page.

The number

Orthodontics has no separate realized multiple in BizBuySell's trailing-five-year data (Q3 2021–Q2 2026) — it is folded into dental — so this page runs on the trade's traditional lens plus the IBBA Market Pulse ladder (Q2 2026): 2.0× SDE under $500K, 2.8× at $500K–$1M, 3.1× at $1M–$2M, then EBITDA pricing above that.

A worked example, both lenses (SDE margin is an assumption):

• Annual collections: $1,400,000
• Traditional lens: 80% × $1,400,000 = $1,120,000
• SDE margin, assumed: 32% → SDE = $1,400,000 × 0.32 = $448,000
• Earnings lens at this price band: $448,000 × 3.1 = $1,388,800

Why ortho can price at or above a full year of collections when general dentistry cannot: a healthy practice holds contracts receivable near 55–60% of a year's collections (Cain, Watters & Associates' long-running practice benchmark) — signed treatment, already sold, paying monthly for the next 18–24 months. The buyer is purchasing that pipeline, not just last year's cash. Corporate buyers (OSOs and DSOs) push further into EBITDA pricing for larger practices; treat any multiple quoted without your collections, overhead, and contracts data as marketing. For scale, the public proxy — Hospitals/Healthcare Facilities at 8.86× EV/EBITDA (Damodaran Online, January 2026) — values diversified platforms, not a two-chair specialty practice whose production has one doctor's name on it.

How buyers actually value an orthodontic practice

Ortho buyers read a different chart than general-dental buyers. Starts: new cases started per year is the growth vital sign — a practice can coast on contracts signed two years ago while starts quietly fall, and buyers look straight through the collections to the start trend. Contracts receivable: the balance of signed, in-treatment cases and how it is structured (down-payment size, paid-in-full share) — a higher receivable balance means more of next year's collections are already sold, which is precisely what a buyer is paying for. Referral dependence: ortho lives on general-dentist referrals plus direct consumer demand; buyers map the top referring offices and discount hard if two dentists are half the starts, because referral loyalty attaches to the doctor, not the building. Overhead: the trade's benchmark overhead runs around 58% of collections excluding doctor compensation (Cain, Watters & Associates) — five points of bloat comes straight out of earnings and price. Case mix and payer mix: aligner versus fixed appliances, adult versus adolescent, insurance assignment share, and the observation/recall pool — the list of kids not yet in treatment is a future-starts asset buyers count separately. A practice whose doctor does every consult and every wire change prices like a job; one with trained treatment coordinators closing cases and associates bending wires prices like a company.

What raises the price — and what kills it

Raises it:

• Starts growing or holding for three straight years, documented by month
• Contracts receivable in the healthy 55–60%-of-collections band, cleanly aged
• Referral base spread across many GP offices plus a real direct-to-consumer channel
• Overhead at or under the ~58% benchmark, with the gap explained, not hidden
• Treatment coordinators who present and close — case acceptance that survives the doctor's day off

Kills it:

• Collections propped up by old contracts while starts fall — the coasting practice
• Two referring dentists as the majority of new cases
• A paid-in-full-heavy book: collections look great, the pipeline behind them is empty
• The seller is the only clinician and the only consult — every number in the deal is personal
• Delinquent patient balances inside contracts receivable, discovered in diligence

Move your number

The levers target starts, collections, and transferability. Collect the contracts you already sold: autopay enrollment on every payment plan, delinquency chased in week one instead of month three, and payment processing priced for hundreds of small monthly charges — the Finix payments team is our route for that work. Feed the top of the funnel on system: referral-office touchpoints, observation-pool recalls, and consult follow-up that run automatically are an operations build — ClaroPro's lane, aimed squarely at the starts trend buyers pay for. Make the pipeline legible: starts, contracts receivable aging, referral source, and case acceptance reported monthly from your practice system — in a form a buyer's lender can underwrite — is the build a Nova engineering team does when the standard reports stop answering. Baseline first: run the calculator.

This is an educational framework with the math shown, not an appraisal — ortho transitions involve lenders, and often OSO term sheets, that will each run their own numbers. The caveats are here to protect you, the owner: so you do not overpay for a coasting practice whose starts already fell, undersell a contracts pipeline you spent years signing, or let a corporate buyer's platform multiple talk you into — or out of — the wrong deal. A real price is set by a real buyer on a specific day, after they have read your starts log and your contracts aging.