December 19, 2025 • 29 mins
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Ownership is back on the table—and not just for the fearless few. We sit down with finance specialist Ray Cox to unpack why more UK dentists are walking away from corporates and building practices that reflect their values. From cultural tailwinds to smarter lending, the ground has shifted in favour of clinicians who want control, flexibility, and long-term upside.
We compare squats and acquisitions with clear-eyed criteria lenders use today: headroom for growth, realistic demand, and operational discipline. You’ll hear why a well-planned squat can be less risky than an overpriced acquisition, how healthcare specialist teams at banks now evaluate dental cash flows, and what makes a business plan bank-ready. We also tackle refinancing—how owners who launched five to seven years ago are securing better terms, freeing cash, and leveraging equity to open a second site.
Beyond finance, we dig into the strategic moves that build resilient private practices. The frenzy for align-bleach-bond is fading as new owners double down on family dentistry, prevention, strong recall systems, and measured expansion into specialisms like implants. The NHS vs private decision is decisive among younger owners in England, with membership plans increasingly used to stabilise income without sacrificing clinical freedom. Add in interest rate dynamics and inflationary headwinds, and you’ve got a candid field guide to starting or scaling a modern dental practice.
If you’re weighing buy versus squat, plotting a refinance, or designing a patient-first model with durable cash flow, this conversation will help you move with confidence. Subscribe, share with a colleague who’s ownership-curious, and leave a review with your biggest takeaway—what’s your next step toward running your own practice?
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Disclaimer: All content on this channel is for education purposes only and does not constitute an investment recommendation or individual financial advice. For that, you should speak to a regulated, independent professional. The value of investments and the income from them can go down as well as up, so you may get back less than you invest. The views expressed on this channel may no longer be current. The information provided is not a personal recommendation for any particular investment. Tax treatment depends on individual circumstances and all tax rules may change in the future. If you are unsure about the suitability of an investment, you should speak to a regulated, independent professional. Investment figures quoted refer to simulated past performance and that past performance is not a reliable indicator of future results/performance.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Dr James (01:47):
Welcome to this episode of the Dentists Who
Invest Podcast where I'm joinedby expert on finance to
dentists, Mr.
Ray Cox.
This episode is a little bit ofa contemplative, reflective
episode over the history ofdentists, their mindset whenever
it comes to entrepreneurship,looking back to see how trends
have shifted as time has goneon, and then also looking
(02:08):
forward to the future tounderstand what we might expect
whenever it comes to dentists,their dental practices, and also
their implications of thatwhenever it comes to their
finance or their practices andequipment.
As ever, you can claim your CPDfor this episode within the
official Dentists Who InvestSmart Money Members Club.
Smart Money Members Club alsoincludes multiple mini courses
(02:30):
and webinar series on financefor dentists, including how to
become as tax efficient aspossible, as well as
understanding investing.
All of this content comments asverifiable CPD, and you can
download your certificates thereand then upon completion of
each lesson.
In addition to this, we alsoinclude a whopping 10% discount
on your dental indemnity and 5%discount on lab bills for dental
(02:52):
principals, amongst other perksand discounts for members.
Please use the link in thedescription to claim your
verifiable CPD for this episode.
And you were telling me justoff camera before we shot this
(03:17):
podcast episode that you reckonthere's been a little bit of
resurgence in dentists wishingto be their own boss at B T O B,
be the B B your own, no B Y OB, be your own boss.
And you reckon that it extendsa little bit beyond the them
wishing to make extra money.
(03:38):
There's a little bit more tothat, right?
Ray (03:42):
Yeah, I think um when I came into uh when I came into
dentistry, which is uh back in1973 now, but I I always joke at
this point as I was a childpropagy and I was only 10, 10
years old.
Um but I don't think manypeople who know me would believe
that.
But yeah, uh that time umdentistry was a was a private uh
(04:04):
private uh entity.
Um uh limited amount of privatework, it was mainly NHS, but
dentists owned their ownpractice.
So the the theory, the notionof corporatization was uh was
virtually unknown.
And that stayed that way for along part of that 40 plus years
(04:26):
that I've been involved indentistry, and corporatization
in the way that we know it now,really only I think is is
something like 25 years old.
And um what we're seeing now isthat it it came and it's going
(04:47):
to a large degree because lotsand lots of dentists are going
back to that original model ofwanting to run their own
practices, own their ownpractices, and be responsible
for their own uh uh their ownfutures.
Um and it's a completelydifferent mindset from the
generation of dentists thatwe've seen, you know, over the
(05:09):
last 25 to 30 years that youknow largely embraced the
concept of corporatization,working, you know, for you know,
a salary and the sort ofbenefits that they're they
probably saw colleagues uhgraduating from university with
them had, um, and without allthe risks of setting up your own
(05:30):
business.
Um but it's back.
And we, as I mentioned to youearlier, at uh in events and
seminars and exhibitions that weattend now, probably seven,
six, seven out of ten uhinquiries that we get from
dentists that come and seek usout and want to talk to us are
about starting their ownpractices.
And it's um it's a big seachange and and and and and and
(05:55):
frankly it's it's one that Ithink is uh you know should be
encouraged and we and that'sreflected across the the world
of money because uh you know thebanks and financial
institutions are getting reallyinterested in it, and to raise
money to start a dental practicenow is immeasurably easier than
(06:17):
it was seven, eight, nine yearsago.
Probably probably as recentlyas five years ago.
Dr James (06:23):
Hmm, and I'm interested because obviously
you've got a little bit, I knowthat you've been doing what
you've doing for a little whilenow, so you've got a little bit
of context in that.
What makes you say that it'seasier nowadays?
Ray (06:36):
I think there's a there's probably a greater degree of
this is a personal opinion, I'vegot no data on this, but you
know, there seems to be a acrossBritish society a great uh a
greater desire for um to startyour own business.
I mean, we know that the um thestatistics on the number of
(06:56):
self-employed people in the UK,I mean, is is phenomenal
compared to many othercountries.
And we know, I think I I sawsome statistics recently that
the number of registrations ofnew companies at Companies
House, um, I mean, I think in inAugust topped a hundred
thousand in the month ever.
(07:17):
Um and I think there is ageneral feeling.
I think people are they don'tnecessarily view working for a
big organization um with thesafety and uh and um uh that
that they once did.
Um and that um you know thatthere is there is an opportunity
(07:37):
out there to start your ownbusiness, and many, many of them
are doing it across all walksof life and all professions and
all trades.
Um and I think dentistry is isjust uh reflecting that in in
the market that you know we knowand understand.
Dr James (07:54):
So your observation would be there's a jet there's
some general tailwinds there, orcertainly that's what you've
noticed, general tailwinds interms of culturally uh people in
the UK being more open-mindedand wishing to run their own
business, and that hastranscended, that has transpired
into dentistry as well.
And I guess that leads on tothe next question or the next
(08:15):
thing that might be interestedto know.
Have you noticed the majorityof businesses coming to you
these days?
Is it these brand new, thesekids uh a lot of the time who
are wanting to set up theirpractices and maybe a little bit
wet behind their ears, butthey're they're for what they
lack in experience, they theythey overcome it by sheer
enthusiasm and willpower.
Is that fair to say?
Ray (08:34):
Yeah, I think I think to a to a degree.
I mean, I think all of themrecognize that you know you have
to uh having qualified fromdental school, or you know, you
have to learn your craft, as itwere, uh, and the corporate, and
working for a corporate as itused to be, working for an
existing practice as anassociate is a good way to do
that.
So we find very few coming tous, um, as I as I gather is is
(09:00):
still the case in North America,uh, coming to us straight out
of dental school, um, you know,and start wanting to start then.
But it's usually those with,you know, three, anything from
three to five years experiencebehind them.
Um they've they've they'veknown how to do the job, um,
they've seen practices beingrun, um, whether they consider
(09:21):
that that's they're being runwell or or not isn't another
matter.
Um, and they've got theconfidence to say, right, I
think I can do that for myselfnow.
And there is an ever-open doorfrom the institutions that uh
that says, come through it, wemight be able to help you.
Um is is it is it is it you isit easy?
(09:42):
No.
Uh is it guaranteed that you'regonna get the money and the
backing that you need?
No.
But you're a lot more likely tothan you would have done five
years ago.
That's for sure.
Dr James (09:55):
Hmm.
And five years ago, uh you'reyou're referencing coronavirus?
Ray (10:01):
Having coronavirus was probably a C you know, generated
a sea change in all sorts ofthings.
Um whether it was coincidentalthat off the back of the the uh
uh coronavirus, off the back ofCOVID finishing, we saw an
uptake in uh in dentists wantingto start talking about their
(10:23):
own practice, I'm not sure.
I'm not sure.
I suspect it might havehappened anyway, but I think
COVID caused uh some seismicupheavals in society in general,
um, across all walks of lifeand all professions and all
businesses.
And so I I suspect there wassome, uh there could be some uh
(10:46):
some of this new interest laidat its door.
And you know, that that I thinkthat's almost certainly the
case.
Dr James (10:53):
Tamares, here's a fun question.
Since how can we say this,maybe since you started out uh
in in your profession asoffering practice finance to
dentists, do you feel that theproducts nowadays are generally
more favorable uh by way of theproducts that existed way back
when, or is finance can beattained more plentiful and at
lower interest rates, or is theopposite true?
(11:14):
Has it become harder on thatfront?
Ray (11:19):
Interesting question.
I mean, I think Yeah, I mean, Ithink as dent as as dentistry
back in the back in the day, Imean, banks were banks, they had
no specific interest, well, notas far as dentistry was
concerned.
Um, dentists were considered uhextremely good risks, as they
still are.
Um, and probably any dentistwalking through a bank's door 40
(11:43):
years ago um would have got apretty good uh hearing, not
least of all, because you knowthose were the days of bank
managers.
The dentist was probably goingthere um uh not only with his
own professional qualification,but with maybe some family
connections to that bank.
Maybe his parents weredentists, maybe his parents were
(12:03):
other medical people, theywould know the bank manager in a
different way than bankmanagers, even where they exist
these days, um uh you know, werepositioned.
And so if anybody was going toget that money to open a
business um probably 40 yearsago, 50 years ago, dentists
(12:23):
stood up a much better chancethan than many.
The situation's the same, butdifferent now in the sense that
the banks themselves and otherfinancial institutions uh have
taken a lot more interestspecifically in certain types of
business and certain types ofuh profession.
(12:44):
And virtually all the banks,not all, but most of the banks
now will have healthcarespecialists.
That's indeed they might haveagricultural specialists and
engineering specialists thattake an interest in those
specific markets that the bankwants to be involved in.
Um and and and that that Ithink certainly in relation to
(13:05):
dentistry uh and otherprofessions means that it it
there is a more open door.
Those people that that are inthe bank aren't gonna give you
the loan simply because you area dentist and your dad was a
dentist or your dad was adoctor, other sort of favoured
professions.
They're gonna do it because uhthey have taken the time to
(13:28):
understand the business ofdentistry and how lucrative it
can be not only for you if theysupport you, the dentist, but
how lucrative it can be for thebank as well.
Dr James (13:41):
I see, understood.
So is that a yes then?
It's it's it's it's becomeeasier.
No?
Have I got that right?
Ray (13:49):
Yes, absolutely, yes.
Dr James (13:50):
Yeah, I think it is.
Ray (13:51):
I probably alluded to that in a couple of other answers,
but yes, I i I would say it isabsolutely, yeah.
And and the same would apply ifwe see, although dentists are
is our primary and main market,we also do business in in
pharmacy, we do business inveterinary, and exactly the same
trends are happening there.
It's a mirror image.
(14:11):
Young vets want to start theirown practices, young pharmacists
want to start their ownpractices.
Um and that that's that's aninestable fact.
We see the evidence every day.
Dr James (14:23):
Interesting.
And let's just scrutinize thata little bit further.
Let's just delve in a littlebit more.
Squats or purchasing a practicethat has already exist.
What do these young guns wantto do?
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Ray (16:28):
I would say in the context of the young dentist we've been
talking to up to now in this inthis podcast, I would say
squats.
Um largely been because of thecost of buying an existing an
existing practice.
Um I think the the the the thecost of existing practices has
(16:52):
uh to some extent um you knowbeen been skewed somewhat by the
corporate market probably overthe last 10-15 years.
Um dentists selling theirpractices now, quite right, you
want to get the best possibleprice for them.
Uh, whether the there are stillcorporates about willing to pay
the sort of prices they werepre-COVID and even post-COVID
(17:15):
for those practices.
But all that mitigate mitigatesagainst the young first-time
buyer um buying an existingpractice.
It happens, yeah, absolutely ithappens.
And the advantage they have, ifthey can raise the money, of
course, is that they have got anestablished practice with a
with a with an existing sort ofincome stream which hopefully
(17:40):
they can build upon.
If there isn't the abilitythere to build on it, then the
banks generally don't take too akind of view.
If the practice being sold isalmost its optimum point point
of success, and there's nogrowth and expansion there, then
the bank is far less likely tosupport the young guy wanting to
(18:03):
buy it because obviously wherewhat are you going to do with
this?
Where are you going to go withthis?
Um and so in many cases, umthey're almost more amenable to
the a pure squat star.
Dr James (18:17):
There we are.
There we are.
Ray (18:21):
There is less amount, there is less money for the for the
for the young dentist to buy, uhto to borrow.
The bank's risk is it's aninteresting thing.
In one sense it's greater, inone sense it's less.
They're dealing with a totallynew entity.
But of course, the borrowingrequirement is likely to be a
(18:42):
lot less than funding thepurchase of a very successful
existing practice.
Um so that's a that's aninteresting sort of uh scenario
that um uh there's no there's noyes uh or right or wrong
answers to that.
Each case is literally on itsown merits.
Dr James (19:04):
Because from the outside looking in, I would have
said that they were less keenon squats because there's more
moving parts.
The the business hasn't evenproved that it's viable yet.
Ray (19:15):
Yeah, the well we're we're back to we're back to uh the the
situation that is the case, butyou've got to get that existing
practice at the right at theright price, and that the bank
can see that it's going to get areturn on its money.
But um, you know, over time,there's got to be somewhere for
that practice to go.
(19:36):
If it's just gonna get boughtfor a price now and has no
expansion potential, then that'snot gonna do a a lot for the
for the guy who's taken it over.
Um, and it's not gonna do a lotfor the bank because there's
there's not there's no potentialfuture borrowing there.
Sure.
Dr James (19:54):
Yeah, I guess sorry, just to what I should have said
just then was um what I shouldhave said was that I would have
thought the fact that there wasno proof whatsoever that uh the
business was yet viable wouldhave overridden all other
factors and have meant that theywould basically lean away from
that sort of thing or you knowmake the the the borrowing very
(20:14):
unfavourable.
But apparently it's a lot moreuh they're a lot more welcoming
uh to that than uh one wouldhave initially suspected.
So there we are.
And yeah, I think the wholesquat thing fits in with this
wider narrative that we weretalking about just a second ago,
which is that people want to beeither be the entrepreneur,
blaze their own trail, createsomething from scratch, from the
(20:36):
ground up, make it their own,all of those things, everything
along those ones.
This kind of wider theme ofindependence.
Ray (20:41):
I've I I I I expect I think many young people now today
today, in whatever walk of life,don't see the security in
working for large corporateinstitutions or even working for
anybody.
I mean, their uh security ofjob, you know, is is very
tenuous these days.
Um and in fact we know thatlots of employers, you know,
(21:03):
because of uh costs and youknow, national insurance and
other ancillary costs are veryreluctant to enlarge their
workforce anyway.
Dr James (21:13):
You know what?
I think it's I think that's avery important uh thing to touch
on because I think it's alittle bit the the the common
the the narrative I guess or thekind of common consensus or
commentary on working foryourself versus being employed
that one is safer than theother.
You know what I mean?
I don't even know if that'strue, you know.
Like how do you define safe?
Define safe is what I wouldsay.
(21:35):
Anyway, that's probablyprobably a podcast for another
day.
What's hot in finance at theminute?
What are you seeing a lot ofout there?
People I know we touched uponum people, uh how can I say
this?
uh you know wanting to set upthe practice for the first time
so there seems to be morebusiness on that front.
You were saying refinance offcamera is hot right now.
(21:55):
Is that right?
Ray (21:57):
Yeah, I mean I think a lot of and and and and driven a lot
by young young dentists who tookthe uh the to you know the the
mantle of wanting to start theirown practice you know in the
last maybe five or six or sevenyears um were able to get it get
started but maybe at terms thatlooking back now they consider
(22:18):
um weren't that favorable andthey could do better now by
refinancing.
And the other thing is thatmany of them are looking for
their second practice now.
Their first one has beensuccessful they're looking to
move on to their second andoften that can be helped by
leveraging reborrowing at betterterms on their existing loans
(22:44):
and using that as a springboardto help finance the uh the
second practice.
So we're seeing a lot of thatand a lot of pure refinancing
simply to do nothing but securea better deal than the one they
were able to get you know five,six, seven years ago.
Dr James (23:03):
And is the fact that interest rates now are s seem to
be slightly coming down not notconsistently but they're a
little bit lower than what theyonce were is that something that
plays through into practicefinance as well do we generally
seem to see seem to see lowerlending rates as a consequence
of that I know it's not quite assimple as that yeah I mean I
(23:25):
think I think dentists likeeverybody else keep an eye on
the uh on what the the you knowthe the national news is
relating to uh to interest ratesand I think it's generally
accepted that that they are theyhave come down I think they
will come down a little more yetI think industry and business
has been disappointed that theydidn't come down sooner and
(23:47):
faster.
Ray (23:50):
And you know like with everything else the who can who
can crystal ball what theeconomy's going to do um I mean
there are some worrying trendsout there that I think might
slow the reduction in interestrates even further.
There is a school of economiststhat says that you know with
some of the some of theheadwinds there are in the
(24:11):
economy they might even startgoing up.
Dr James (24:14):
I mean certainly mortgage rates in some areas uh
have started to creep up alittle which is a worrying trend
um but I I think looking tryingto look on the optimistic side
I think uh they are lower thanthey were I think they've got a
little way to go yet um allthings all things being equal
(24:36):
hmm okay so let's be optimisticit's all about taming the
inflation base at the minuteright which is being a little
bit more stubborn than a lot ofpeople anticipated I guess NHS
versus private we talked aboutthe young guns earlier how many
of them out there are buying NHSpractices or does that does
that really ever happen nowadaysif from well I've got that
(25:00):
there might be you know the oddoccasion but what what themes
are we seeing what trends are weseeing especially with the
young people with the youngpeople that we've been talking
about primarily in this podcastJames um zero um zero literally
zero yeah I mean we asked thequestion I mean because it's it
it can be in interesting to theborrowing you know that if they
(25:23):
um it might make their borrowingeasier with the bank if they
were able to obtain a an NHScontract if they were able to if
they were seeking one but theanswer almost universally when
we ask the question is do youintend doing uh NHS treatment
and the answer is an emphatic noalmost in every case.
Ray (25:43):
Wow just they just I mean I I'm sure not because they've
got different systems in Walesand in in and in Scotland that
may be different but it'scertainly in in in in England
that is most definitely thecase.
Dr James (25:59):
And you know what a very interesting question to
answer someone like you who hastheir ears to the ground so to
speak once upon a time a fewyears ago everybody was
borrowing I mean I don't I don'tknow how much insight you have
into uh the business propositionor the business model that
these practices have I'm surethey you're involved in that to
a degree they run it by you atleast you must you you obviously
(26:20):
you give that to the bank rightum so I'm interested to know
once upon a time it seemed to bethat a line bleach bond
practice were just you knowevery new practice was an ABB
practice uh I'm wondering isthat still are they still as
popular any shifts in businessplans over the last few years
that you've noticed or picked upon j just refine slightly
(26:41):
refine what you mean by ADP?
ABB is you know like the alignbleach bond as in cosmetic
dentistry.
Oh I see yes you m do youremember at one point there was
Instagram dentists uh they wereabsolutely everywhere they you
know they were just springing upeverywhere you know what I mean
and they were all theirbusiness model was a line of
teeth bleaching and whiteningwhitening and then they would do
some bonding on top likecosmetic bonding or composite
(27:03):
bonding or something along thoselines I don't think it's as
fashionable now I mean I thinkthe the I mean we see a lot more
feet on the ground uh fromyoung squat dentists now um in
terms of general dentistry youknow the the the the the the
routine run of the mill the sumof things that brings most
(27:25):
practice both most patients tothe practice um a lot of
interest in family dentistry youknow getting being the old
family dentist to the wholefamily that seems to be
important to them and then yesmoving into to specializations I
mean implants obviously isthese is the main one um and so
(27:46):
all you know all of that andthat all goes into the into the
modern sort of squat businessplan but a lot of the more I
think as you were referring tolet's call them more esoteric
types of treatment that wouldhave been a major part of a
business plan 10 years ago uhthat they've lessened shall we
say interesting and that's I canI think the I think the kind of
(28:11):
wheels came off on a lot ofthose practices and treatments
because people realized you knowyou you have to have a lot of
lead flow you have to haveconstant new patients coming in
and one those treatments becameless popular because everybody
basically well the narrative isthat uh people had a lot of
money around about coronavirusbecause they were just basically
pent up in the house so theycould splash out on their teeth.
(28:32):
Um that happened and then alsoI think that basically well you
know people kind of saw thosebusinesses for what they were in
that there was very littlerecurring uh returning business
from those sorts of patientsthey're not really beholden to
you they generally have ageneral dental practitioner and
they come to see you one of thetreatment and then they go back.
(28:53):
So it's very hard to build abusiness where you're constantly
having to generate leads all ofthe time those are my thoughts.
Anyway I'm sure there'll besomebody out there who has a
different narrative or whothinks to themselves actually
that wasn't the case this wasthe actual reason why but that
seemed to be my perception of itanyway just sharing that out of
interest.
Ray (29:10):
And I do understand that just finishing that off there is
a there is a I would sayspecialization there's a lot of
interest in futurespecialization that they they
seem to uh articulate um youknow they there seems to be a
great desire to at some point intime specialise in one
(29:30):
particular avenue of dentistrywe've noticed that coming
through in their business plansinteresting so they're they're
kind of planning this from theget-go like we're not going to
do implants straight away but wewant it we want to scope to do
it at some stage or somethingalong the way fine good to know
Ray thank you so much for thatinput and wisdom and those
insights shared from many yearsbeing in the dental industry if
(29:52):
anybody wants to reach out toyou about sorting some practice
finance how are they best offfinding you uh they can get us
uh they can get me personally atuh rcox@ medifinance.co.uk they
can get the company at info atmedifinance.co.uk and they can
even phone me at 07785 75782 umand like the old like the old
(30:19):
bank manager we don't uh knockoff at 530 if they if they want
to phone me in the eveningbecause it's important to them
then that will be important tome and to us and my other
colleagues and uh so if that'swhen they want to phone us we're
very happy to take calls atthat time.
Welcome to this episode of the Dentists Who
Invest Podcast where I'm joinedby expert on finance to
dentists, Mr.
Ray Cox.
This episode is a little bit ofa contemplative, reflective
episode over the history ofdentists, their mindset whenever
it comes to entrepreneurship,looking back to see how trends
have shifted as time has goneon, and then also looking
(02:08):
forward to the future tounderstand what we might expect
whenever it comes to dentists,their dental practices, and also
their implications of thatwhenever it comes to their
finance or their practices andequipment.
As ever, you can claim your CPDfor this episode within the
official Dentists Who InvestSmart Money Members Club.
Smart Money Members Club alsoincludes multiple mini courses
(02:30):
and webinar series on financefor dentists, including how to
become as tax efficient aspossible, as well as
understanding investing.
All of this content comments asverifiable CPD, and you can
download your certificates thereand then upon completion of
each lesson.
In addition to this, we alsoinclude a whopping 10% discount
on your dental indemnity and 5%discount on lab bills for dental
(02:52):
principals, amongst other perksand discounts for members.
Please use the link in thedescription to claim your
verifiable CPD for this episode.
And you were telling me justoff camera before we shot this
(03:17):
podcast episode that you reckonthere's been a little bit of
resurgence in dentists wishingto be their own boss at B T O B,
be the B B your own, no B Y OB, be your own boss.
And you reckon that it extendsa little bit beyond the them
wishing to make extra money.
(03:38):
There's a little bit more tothat, right?
Ray (03:42):
Yeah, I think um when I came into uh when I came into
dentistry, which is uh back in1973 now, but I I always joke at
this point as I was a childpropagy and I was only 10, 10
years old.
Um but I don't think manypeople who know me would believe
that.
But yeah, uh that time umdentistry was a was a private uh
(04:04):
private uh entity.
Um uh limited amount of privatework, it was mainly NHS, but
dentists owned their ownpractice.
So the the theory, the notionof corporatization was uh was
virtually unknown.
And that stayed that way for along part of that 40 plus years
(04:26):
that I've been involved indentistry, and corporatization
in the way that we know it now,really only I think is is
something like 25 years old.
And um what we're seeing now isthat it it came and it's going
(04:47):
to a large degree because lotsand lots of dentists are going
back to that original model ofwanting to run their own
practices, own their ownpractices, and be responsible
for their own uh uh their ownfutures.
Um and it's a completelydifferent mindset from the
generation of dentists thatwe've seen, you know, over the
(05:09):
last 25 to 30 years that youknow largely embraced the
concept of corporatization,working, you know, for you know,
a salary and the sort ofbenefits that they're they
probably saw colleagues uhgraduating from university with
them had, um, and without allthe risks of setting up your own
(05:30):
business.
Um but it's back.
And we, as I mentioned to youearlier, at uh in events and
seminars and exhibitions that weattend now, probably seven,
six, seven out of ten uhinquiries that we get from
dentists that come and seek usout and want to talk to us are
about starting their ownpractices.
And it's um it's a big seachange and and and and and and
(05:55):
frankly it's it's one that Ithink is uh you know should be
encouraged and we and that'sreflected across the the world
of money because uh you know thebanks and financial
institutions are getting reallyinterested in it, and to raise
money to start a dental practicenow is immeasurably easier than
(06:17):
it was seven, eight, nine yearsago.
Probably probably as recentlyas five years ago.
Dr James (06:23):
Hmm, and I'm interested because obviously
you've got a little bit, I knowthat you've been doing what
you've doing for a little whilenow, so you've got a little bit
of context in that.
What makes you say that it'seasier nowadays?
Ray (06:36):
I think there's a there's probably a greater degree of
this is a personal opinion, I'vegot no data on this, but you
know, there seems to be a acrossBritish society a great uh a
greater desire for um to startyour own business.
I mean, we know that the um thestatistics on the number of
(06:56):
self-employed people in the UK,I mean, is is phenomenal
compared to many othercountries.
And we know, I think I I sawsome statistics recently that
the number of registrations ofnew companies at Companies
House, um, I mean, I think in inAugust topped a hundred
thousand in the month ever.
(07:17):
Um and I think there is ageneral feeling.
I think people are they don'tnecessarily view working for a
big organization um with thesafety and uh and um uh that
that they once did.
Um and that um you know thatthere is there is an opportunity
(07:37):
out there to start your ownbusiness, and many, many of them
are doing it across all walksof life and all professions and
all trades.
Um and I think dentistry is isjust uh reflecting that in in
the market that you know we knowand understand.
Dr James (07:54):
So your observation would be there's a jet there's
some general tailwinds there, orcertainly that's what you've
noticed, general tailwinds interms of culturally uh people in
the UK being more open-mindedand wishing to run their own
business, and that hastranscended, that has transpired
into dentistry as well.
And I guess that leads on tothe next question or the next
(08:15):
thing that might be interestedto know.
Have you noticed the majorityof businesses coming to you
these days?
Is it these brand new, thesekids uh a lot of the time who
are wanting to set up theirpractices and maybe a little bit
wet behind their ears, butthey're they're for what they
lack in experience, they theythey overcome it by sheer
enthusiasm and willpower.
Is that fair to say?
Ray (08:34):
Yeah, I think I think to a to a degree.
I mean, I think all of themrecognize that you know you have
to uh having qualified fromdental school, or you know, you
have to learn your craft, as itwere, uh, and the corporate, and
working for a corporate as itused to be, working for an
existing practice as anassociate is a good way to do
that.
So we find very few coming tous, um, as I as I gather is is
(09:00):
still the case in North America,uh, coming to us straight out
of dental school, um, you know,and start wanting to start then.
But it's usually those with,you know, three, anything from
three to five years experiencebehind them.
Um they've they've they'veknown how to do the job, um,
they've seen practices beingrun, um, whether they consider
(09:21):
that that's they're being runwell or or not isn't another
matter.
Um, and they've got theconfidence to say, right, I
think I can do that for myselfnow.
And there is an ever-open doorfrom the institutions that uh
that says, come through it, wemight be able to help you.
Um is is it is it is it you isit easy?
(09:42):
No.
Uh is it guaranteed that you'regonna get the money and the
backing that you need?
No.
But you're a lot more likely tothan you would have done five
years ago.
That's for sure.
Dr James (09:55):
Hmm.
And five years ago, uh you'reyou're referencing coronavirus?
Ray (10:01):
Having coronavirus was probably a C you know, generated
a sea change in all sorts ofthings.
Um whether it was coincidentalthat off the back of the the uh
uh coronavirus, off the back ofCOVID finishing, we saw an
uptake in uh in dentists wantingto start talking about their
(10:23):
own practice, I'm not sure.
I'm not sure.
I suspect it might havehappened anyway, but I think
COVID caused uh some seismicupheavals in society in general,
um, across all walks of lifeand all professions and all
businesses.
And so I I suspect there wassome, uh there could be some uh
(10:46):
some of this new interest laidat its door.
And you know, that that I thinkthat's almost certainly the
case.
Dr James (10:53):
Tamares, here's a fun question.
Since how can we say this,maybe since you started out uh
in in your profession asoffering practice finance to
dentists, do you feel that theproducts nowadays are generally
more favorable uh by way of theproducts that existed way back
when, or is finance can beattained more plentiful and at
lower interest rates, or is theopposite true?
(11:14):
Has it become harder on thatfront?
Ray (11:19):
Interesting question.
I mean, I think Yeah, I mean, Ithink as dent as as dentistry
back in the back in the day, Imean, banks were banks, they had
no specific interest, well, notas far as dentistry was
concerned.
Um, dentists were considered uhextremely good risks, as they
still are.
Um, and probably any dentistwalking through a bank's door 40
(11:43):
years ago um would have got apretty good uh hearing, not
least of all, because you knowthose were the days of bank
managers.
The dentist was probably goingthere um uh not only with his
own professional qualification,but with maybe some family
connections to that bank.
Maybe his parents weredentists, maybe his parents were
(12:03):
other medical people, theywould know the bank manager in a
different way than bankmanagers, even where they exist
these days, um uh you know, werepositioned.
And so if anybody was going toget that money to open a
business um probably 40 yearsago, 50 years ago, dentists
(12:23):
stood up a much better chancethan than many.
The situation's the same, butdifferent now in the sense that
the banks themselves and otherfinancial institutions uh have
taken a lot more interestspecifically in certain types of
business and certain types ofuh profession.
(12:44):
And virtually all the banks,not all, but most of the banks
now will have healthcarespecialists.
That's indeed they might haveagricultural specialists and
engineering specialists thattake an interest in those
specific markets that the bankwants to be involved in.
Um and and and that that Ithink certainly in relation to
(13:05):
dentistry uh and otherprofessions means that it it
there is a more open door.
Those people that that are inthe bank aren't gonna give you
the loan simply because you area dentist and your dad was a
dentist or your dad was adoctor, other sort of favoured
professions.
They're gonna do it because uhthey have taken the time to
(13:28):
understand the business ofdentistry and how lucrative it
can be not only for you if theysupport you, the dentist, but
how lucrative it can be for thebank as well.
Dr James (13:41):
I see, understood.
So is that a yes then?
It's it's it's it's becomeeasier.
No?
Have I got that right?
Ray (13:49):
Yes, absolutely, yes.
Dr James (13:50):
Yeah, I think it is.
Ray (13:51):
I probably alluded to that in a couple of other answers,
but yes, I i I would say it isabsolutely, yeah.
And and the same would apply ifwe see, although dentists are
is our primary and main market,we also do business in in
pharmacy, we do business inveterinary, and exactly the same
trends are happening there.
It's a mirror image.
(14:11):
Young vets want to start theirown practices, young pharmacists
want to start their ownpractices.
Um and that that's that's aninestable fact.
We see the evidence every day.
Dr James (14:23):
Interesting.
And let's just scrutinize thata little bit further.
Let's just delve in a littlebit more.
Squats or purchasing a practicethat has already exist.
What do these young guns wantto do?
I know we're painting withbroad strokes here.
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Ray (16:28):
I would say in the context of the young dentist we've been
talking to up to now in this inthis podcast, I would say
squats.
Um largely been because of thecost of buying an existing an
existing practice.
Um I think the the the the thecost of existing practices has
(16:52):
uh to some extent um you knowbeen been skewed somewhat by the
corporate market probably overthe last 10-15 years.
Um dentists selling theirpractices now, quite right, you
want to get the best possibleprice for them.
Uh, whether the there are stillcorporates about willing to pay
the sort of prices they werepre-COVID and even post-COVID
(17:15):
for those practices.
But all that mitigate mitigatesagainst the young first-time
buyer um buying an existingpractice.
It happens, yeah, absolutely ithappens.
And the advantage they have, ifthey can raise the money, of
course, is that they have got anestablished practice with a
with a with an existing sort ofincome stream which hopefully
(17:40):
they can build upon.
If there isn't the abilitythere to build on it, then the
banks generally don't take too akind of view.
If the practice being sold isalmost its optimum point point
of success, and there's nogrowth and expansion there, then
the bank is far less likely tosupport the young guy wanting to
(18:03):
buy it because obviously wherewhat are you going to do with
this?
Where are you going to go withthis?
Um and so in many cases, umthey're almost more amenable to
the a pure squat star.
Dr James (18:17):
There we are.
There we are.
Ray (18:21):
There is less amount, there is less money for the for the
for the young dentist to buy, uhto to borrow.
The bank's risk is it's aninteresting thing.
In one sense it's greater, inone sense it's less.
They're dealing with a totallynew entity.
But of course, the borrowingrequirement is likely to be a
(18:42):
lot less than funding thepurchase of a very successful
existing practice.
Um so that's a that's aninteresting sort of uh scenario
that um uh there's no there's noyes uh or right or wrong
answers to that.
Each case is literally on itsown merits.
Dr James (19:04):
Because from the outside looking in, I would have
said that they were less keenon squats because there's more
moving parts.
The the business hasn't evenproved that it's viable yet.
Ray (19:15):
Yeah, the well we're we're back to we're back to uh the the
situation that is the case, butyou've got to get that existing
practice at the right at theright price, and that the bank
can see that it's going to get areturn on its money.
But um, you know, over time,there's got to be somewhere for
that practice to go.
(19:36):
If it's just gonna get boughtfor a price now and has no
expansion potential, then that'snot gonna do a a lot for the
for the guy who's taken it over.
Um, and it's not gonna do a lotfor the bank because there's
there's not there's no potentialfuture borrowing there.
Sure.
Dr James (19:54):
Yeah, I guess sorry, just to what I should have said
just then was um what I shouldhave said was that I would have
thought the fact that there wasno proof whatsoever that uh the
business was yet viable wouldhave overridden all other
factors and have meant that theywould basically lean away from
that sort of thing or you knowmake the the the borrowing very
(20:14):
unfavourable.
But apparently it's a lot moreuh they're a lot more welcoming
uh to that than uh one wouldhave initially suspected.
So there we are.
And yeah, I think the wholesquat thing fits in with this
wider narrative that we weretalking about just a second ago,
which is that people want to beeither be the entrepreneur,
blaze their own trail, createsomething from scratch, from the
(20:36):
ground up, make it their own,all of those things, everything
along those ones.
This kind of wider theme ofindependence.
Ray (20:41):
I've I I I I expect I think many young people now today
today, in whatever walk of life,don't see the security in
working for large corporateinstitutions or even working for
anybody.
I mean, their uh security ofjob, you know, is is very
tenuous these days.
Um and in fact we know thatlots of employers, you know,
(21:03):
because of uh costs and youknow, national insurance and
other ancillary costs are veryreluctant to enlarge their
workforce anyway.
Dr James (21:13):
You know what?
I think it's I think that's avery important uh thing to touch
on because I think it's alittle bit the the the common
the the narrative I guess or thekind of common consensus or
commentary on working foryourself versus being employed
that one is safer than theother.
You know what I mean?
I don't even know if that'strue, you know.
Like how do you define safe?
Define safe is what I wouldsay.
(21:35):
Anyway, that's probablyprobably a podcast for another
day.
What's hot in finance at theminute?
What are you seeing a lot ofout there?
People I know we touched uponum people, uh how can I say
this?
uh you know wanting to set upthe practice for the first time
so there seems to be morebusiness on that front.
You were saying refinance offcamera is hot right now.
(21:55):
Is that right?
Ray (21:57):
Yeah, I mean I think a lot of and and and and driven a lot
by young young dentists who tookthe uh the to you know the the
mantle of wanting to start theirown practice you know in the
last maybe five or six or sevenyears um were able to get it get
started but maybe at terms thatlooking back now they consider
(22:18):
um weren't that favorable andthey could do better now by
refinancing.
And the other thing is thatmany of them are looking for
their second practice now.
Their first one has beensuccessful they're looking to
move on to their second andoften that can be helped by
leveraging reborrowing at betterterms on their existing loans
(22:44):
and using that as a springboardto help finance the uh the
second practice.
So we're seeing a lot of thatand a lot of pure refinancing
simply to do nothing but securea better deal than the one they
were able to get you know five,six, seven years ago.
Dr James (23:03):
And is the fact that interest rates now are s seem to
be slightly coming down not notconsistently but they're a
little bit lower than what theyonce were is that something that
plays through into practicefinance as well do we generally
seem to see seem to see lowerlending rates as a consequence
of that I know it's not quite assimple as that yeah I mean I
(23:25):
think I think dentists likeeverybody else keep an eye on
the uh on what the the you knowthe the national news is
relating to uh to interest ratesand I think it's generally
accepted that that they are theyhave come down I think they
will come down a little more yetI think industry and business
has been disappointed that theydidn't come down sooner and
(23:47):
faster.
Ray (23:50):
And you know like with everything else the who can who
can crystal ball what theeconomy's going to do um I mean
there are some worrying trendsout there that I think might
slow the reduction in interestrates even further.
There is a school of economiststhat says that you know with
some of the some of theheadwinds there are in the
(24:11):
economy they might even startgoing up.
Dr James (24:14):
I mean certainly mortgage rates in some areas uh
have started to creep up alittle which is a worrying trend
um but I I think looking tryingto look on the optimistic side
I think uh they are lower thanthey were I think they've got a
little way to go yet um allthings all things being equal
(24:36):
hmm okay so let's be optimisticit's all about taming the
inflation base at the minuteright which is being a little
bit more stubborn than a lot ofpeople anticipated I guess NHS
versus private we talked aboutthe young guns earlier how many
of them out there are buying NHSpractices or does that does
that really ever happen nowadaysif from well I've got that
(25:00):
there might be you know the oddoccasion but what what themes
are we seeing what trends are weseeing especially with the
young people with the youngpeople that we've been talking
about primarily in this podcastJames um zero um zero literally
zero yeah I mean we asked thequestion I mean because it's it
it can be in interesting to theborrowing you know that if they
(25:23):
um it might make their borrowingeasier with the bank if they
were able to obtain a an NHScontract if they were able to if
they were seeking one but theanswer almost universally when
we ask the question is do youintend doing uh NHS treatment
and the answer is an emphatic noalmost in every case.
Ray (25:43):
Wow just they just I mean I I'm sure not because they've
got different systems in Walesand in in and in Scotland that
may be different but it'scertainly in in in in England
that is most definitely thecase.
Dr James (25:59):
And you know what a very interesting question to
answer someone like you who hastheir ears to the ground so to
speak once upon a time a fewyears ago everybody was
borrowing I mean I don't I don'tknow how much insight you have
into uh the business propositionor the business model that
these practices have I'm surethey you're involved in that to
a degree they run it by you atleast you must you you obviously
(26:20):
you give that to the bank rightum so I'm interested to know
once upon a time it seemed to bethat a line bleach bond
practice were just you knowevery new practice was an ABB
practice uh I'm wondering isthat still are they still as
popular any shifts in businessplans over the last few years
that you've noticed or picked upon j just refine slightly
(26:41):
refine what you mean by ADP?
ABB is you know like the alignbleach bond as in cosmetic
dentistry.
Oh I see yes you m do youremember at one point there was
Instagram dentists uh they wereabsolutely everywhere they you
know they were just springing upeverywhere you know what I mean
and they were all theirbusiness model was a line of
teeth bleaching and whiteningwhitening and then they would do
some bonding on top likecosmetic bonding or composite
(27:03):
bonding or something along thoselines I don't think it's as
fashionable now I mean I thinkthe the I mean we see a lot more
feet on the ground uh fromyoung squat dentists now um in
terms of general dentistry youknow the the the the the the
routine run of the mill the sumof things that brings most
(27:25):
practice both most patients tothe practice um a lot of
interest in family dentistry youknow getting being the old
family dentist to the wholefamily that seems to be
important to them and then yesmoving into to specializations I
mean implants obviously isthese is the main one um and so
(27:46):
all you know all of that andthat all goes into the into the
modern sort of squat businessplan but a lot of the more I
think as you were referring tolet's call them more esoteric
types of treatment that wouldhave been a major part of a
business plan 10 years ago uhthat they've lessened shall we
say interesting and that's I canI think the I think the kind of
(28:11):
wheels came off on a lot ofthose practices and treatments
because people realized you knowyou you have to have a lot of
lead flow you have to haveconstant new patients coming in
and one those treatments becameless popular because everybody
basically well the narrative isthat uh people had a lot of
money around about coronavirusbecause they were just basically
pent up in the house so theycould splash out on their teeth.
(28:32):
Um that happened and then alsoI think that basically well you
know people kind of saw thosebusinesses for what they were in
that there was very littlerecurring uh returning business
from those sorts of patientsthey're not really beholden to
you they generally have ageneral dental practitioner and
they come to see you one of thetreatment and then they go back.
(28:53):
So it's very hard to build abusiness where you're constantly
having to generate leads all ofthe time those are my thoughts.
Anyway I'm sure there'll besomebody out there who has a
different narrative or whothinks to themselves actually
that wasn't the case this wasthe actual reason why but that
seemed to be my perception of itanyway just sharing that out of
interest.
Ray (29:10):
And I do understand that just finishing that off there is
a there is a I would sayspecialization there's a lot of
interest in futurespecialization that they they
seem to uh articulate um youknow they there seems to be a
great desire to at some point intime specialise in one
(29:30):
particular avenue of dentistrywe've noticed that coming
through in their business plansinteresting so they're they're
kind of planning this from theget-go like we're not going to
do implants straight away but wewant it we want to scope to do
it at some stage or somethingalong the way fine good to know
Ray thank you so much for thatinput and wisdom and those
insights shared from many yearsbeing in the dental industry if
(29:52):
anybody wants to reach out toyou about sorting some practice
finance how are they best offfinding you uh they can get us
uh they can get me personally atuh rcox@ medifinance.co.uk they
can get the company at info atmedifinance.co.uk and they can
even phone me at 07785 75782 umand like the old like the old
(30:19):
bank manager we don't uh knockoff at 530 if they if they want
to phone me in the eveningbecause it's important to them
then that will be important tome and to us and my other
colleagues and uh so if that'swhen they want to phone us we're
very happy to take calls atthat time.
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