Why More Aesthetic or Wellness Practice Owners Are Selling to MSOs

As the aesthetics and wellness industries continue to expand, practice owners are increasingly considering the possibility of selling their businesses. Whether you own a medspa, dermatology clinic, plastic surgery practice or another type of wellness clinic, selling to a Medical Support Organization (MSO) has become an attractive option for many business owners. MSOs provide significant operational support and resources, allowing practitioners to focus on patient care while benefiting from the financial backing and strategic growth potential that MSOs bring to the table.

In this blog post, we’ll explore why selling your aesthetics or wellness practice to an MSO can be a smart decision, how MSOs operate, and what benefits you can expect from such a sale.

1. Operational Support and Efficiency

One of the most compelling reasons for selling to an MSO is the operational support they provide. Running a practice is a complex endeavor, involving not only patient care but also business operations like human resources, marketing, compliance, billing and procurement. For many practice owners, the administrative burden becomes overwhelming, distracting from what matters most: serving patients.

By selling to an MSO, you offload these responsibilities. Many MSOs specialize in handling the non-clinical side of a practice, including:

• Human Resources: Recruiting, training, payroll and employee management become the responsibility of the MSO. They ensure that your practice remains fully staffed with qualified professionals and handle compliance with labor laws and regulations
• Billing and Revenue Management: MSOs manage the entire revenue cycle, from patient billing to collections, ensuring cash flow remains steady and optimized. This service can dramatically reduce billing errors and delays in payments
• Marketing and Patient Acquisition: With a team of experts dedicated to marketing and patient acquisition, MSOs help practices grow their patient base. This could include digital marketing, SEO, social media strategies and more aimed at boosting visibility and attracting new patients
• Regulatory Compliance: Navigating the healthcare regulatory landscape is a challenge for any practice. MSOs take care of maintaining compliance with local, state and federal regulations, allowing you to avoid costly legal issues

With an MSO managing these aspects, you can devote your time and attention to what matters most — patient care.

2. Increased Profitability and Growth Potential

MSOs are structured to increase the profitability of the practices they acquire. They achieve this by streamlining operations, leveraging economies of scale and implementing best practices across all aspects of the business. MSOs often have access to advanced technology and resources that smaller, independent practices may not like:

• Negotiating Power: MSOs can negotiate better deals with vendors and suppliers due to their larger scale, reducing operational costs for the practice
• Advanced Technology: Many MSOs invest in the latest technology platforms, such as electronic medical records (EMR) systems, telemedicine tools and patient engagement software, to improve efficiency and enhance patient care
• Centralized Services: MSOs centralize administrative services like finance, HR and legal, which cuts down on overhead costs for the individual practice

This increased efficiency often results in higher profit margins, making your practice more valuable. Additionally, the MSO’s strategic growth plan may involve expanding your practice to new locations, offering new services or increasing patient volume — growth opportunities that might not have been possible without their support.

3. Higher Valuation and Financial Security

One of the primary benefits of selling to an MSO is the financial upside. MSOs often offer higher valuations than individual buyers or small groups because they can integrate your practice into their larger network, realize economies of scale and achieve greater profitability. They are also more likely to see the long-term growth potential in your practice, which can lead to a more favorable offer and deal structure for your practice.

For practice owners considering an exit strategy, selling to an MSO provides financial security. Many MSOs are backed by private equity or other institutional investors, which allows them to offer competitive compensation packages. This financial stability can be particularly attractive for practice owners nearing retirement or those looking for a less hands-on role while still benefiting from the success of their practice.

Some common financial structures in MSO acquisitions include:

• 100% Buy-Out: Most MSO transactions involve a substantial upfront payment for the sale of the practice. This immediate payout provides financial security and can be used to invest in future ventures or secure your retirement
• Joint-Venture: The joint venture model allows aesthetics or wellness practice owners to sell a substantial portion of their business for an upfront lump sum while retaining equity and operational control, making it ideal for those who want to leverage their practice’s value without fully stepping away, benefiting from the partner’s resources for growth and securing both immediate financial gain and future profitability
• Equity Stake: Some MSOs offer sellers the option to retain an equity stake in the larger MSO organization, providing additional long-term financial benefits as the organization grows
• Earn-Outs: When selling your aesthetics or wellness practice to a private equity-backed MSO, earn-outs can be an effective way to maximize your payout. In this arrangement, part of the purchase price is contingent on your practice achieving specific milestones, such as revenue growth, EBITDA targets or patient retention, within a defined timeframe. Earn-outs provide the MSO with confidence in the practice’s performance while offering you the opportunity to increase your total earnings post-sale. Structured thoughtfully, they can align your vision with the buyer’s goals and ensure a smoother transition

4. Reduced Stress and Work-Life Balance

Operating a successful aesthetics or wellness practice requires long hours and constant attention to both clinical and business matters. This workload can lead to burnout for practice owners who are responsible for all aspects of their business. Selling to an MSO allows you to step back from the administrative burdens and focus solely on clinical work if you choose.

For those looking to transition to a less hands-on role or prepare for retirement, selling to an MSO offers a pathway to reduced day-to-day involvement without completely exiting the practice. Many MSOs allow the previous owner to remain on board in a clinical or advisor role, helping with patient care or mentoring the staff while leaving business management to the MSO.

This option provides a healthier work-life balance, reduces stress and offers peace of mind knowing that the business is in capable hands.

5. Clinical Autonomy

A common misconception about selling to an MSO is that you’ll lose control over how the practice is run, especially in terms of clinical care. However, MSOs are primarily focused on the business and operational side of healthcare and typically do not interfere with the clinical decisions made by healthcare providers. 

In fact, most MSOs prioritize clinical autonomy, recognizing that the quality of patient care is what drives the success of the practice. As a practice owner or clinician, most MSOs will enable you to retain full control over patient treatments. The MSO will provide the support and resources needed to run the practice efficiently, without interfering with how you care for your patients.

6. Access to Expertise and Resources

Selling to an MSO gives your practice access to a wealth of expertise and resources that can help it thrive. MSOs often have teams of business professionals with deep experience in healthcare management, finance, marketing and HR. This level of expertise allows them to implement best practices that improve operations, enhance patient satisfaction and boost profitability.

Additionally, MSOs are constantly monitoring industry trends and innovations. They have the resources to invest in cutting-edge technology, provide staff training and roll out new services that keep your practice competitive in the fast-evolving aesthetics and wellness markets.

7. Strategic Growth Opportunities

If you’re looking for a partner to help grow your practice, an MSO is an excellent option. MSOs are well-positioned to help practices expand by opening new locations, introducing new services or targeting new patient demographics. They provide the financial backing, operational support and strategic expertise to scale your practice without the risk or strain of doing it on your own.

Many practice owners find that joining an MSO allows them to achieve the growth they’ve always envisioned for their practice but lacked the resources or time to implement.

Closing Thoughts

For many aesthetics and wellness practice owners, selling to an MSO is a smart strategic decision that offers numerous benefits, from operational efficiency and financial security to reduced stress and work-life balance. MSOs often provide the support and resources necessary to help your practice grow, all while allowing you to maintain clinical autonomy and focus on patient care.

Whether you’re nearing retirement, looking to reduce your workload or seeking growth opportunities, selling to an MSO can be a pathway to financial success and long-term sustainability for your practice.

If you’re considering selling your aesthetics or wellness practice, contact us today to learn more about the process and how we can help you explore your options. Whether you’re looking to sell an aesthetics practice, sell a wellness practice, or partner with an MSO, our team of aesthetics practice brokers and wellness practice brokers is here to guide you every step of the way.