Case Study

Smile Doctors

New Commitment

The company

  • Region: USA
  • Sector: Healthcare
  • Stage: Small/mid buyout
  • Type: Manager-led Secondary
  • Highlights:

Private Equity Manager (GP)

Case study

About the company

Smile Doctors is a provider of orthodontic treatments and services which include bracket and wire braces, clear aligners and retainer insurance. As of December 2022, the company had over 350 clinics in 27 states in the USA.

Investment rationale

  • Smile Doctors is more than four times larger than its closest peer and is a leader in the large and growing orthodontics industry in the USA.
  • The company’s scale positions it well and gives it first mover advantage to execute on the consolidation opportunities in this fragmented market, where approximately 95% of US orthodontic practices are independent.
  • Smile Doctors has an attractive financial profile given its high recurring revenues and strong profit margins.

Active management and value creation

Linden Capital Partners is a dedicated healthcare specialist firm and has an 18-year track record of healthcare investing. It partners actively with management teams to create value during its ownership period. Linden has been an investor in Smile Doctors since 2017, growing the business significantly through M&A with the completion of over 100 add-on acquisitions.

There are significant benefits to an independent orthodontic practice joining Smile Doctors including access to the latest orthodontic technology, marketing support and access to operational and financial resources to improve the business. The management team at Smile Doctors has developed an M&A playbook to target acquisitions that offer the potential for near-term cost synergies and revenue uplifts. The business has also formed a dedicated team focused on acquiring and integrating businesses to capitalise on these opportunities.

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