Hi {{firstname|everyone}},
Most successful DSOs begin with a strong founder at the centre. Clinical credibility. Commercial instinct. Decisiveness. The ability to move quickly and bring people with them. In the early years, that concentration of leadership is often the reason the platform works at all.
Investors are usually drawn to that strength. And teams often find comfort in it because decisions are clear and direction is visible.
As the network grows, the same traits that created early momentum can quietly become a constraint. When too much authority, judgement, and trust sit with one individual, the organisation’s confidence becomes tied to that person’s presence.
The issue arises at scale and this is a structural reality.
Buyers and investors do not just assess current EBITDA. They assess how durable it is. When performance depends heavily on one individual, valuation starts to reflect concentration risk. Strength that cannot be transferred becomes difficult to price at a premium.
Founder-led success only becomes exit-ready when it translates into institutional capability.
1. When Decision-Making Lives in One Person’s Head
In many founder-centric DSOs, key decisions still route through the founder even after significant growth.
Pricing exceptions, clinician disputes, site level underperformance, senior hires, capital allocation. The founder may not intend to centralise authority, but the organisation often defers upward because that is how it has always worked.
This works while the group is manageable. It becomes fragile when scale increases.
To reduce that fragility:
Define decision rights formally across clinical, operational, and financial domains so authority flows through roles rather than personalities
Document recurring decisions and the criteria behind them so that judgement can be replicated rather than guessed
Establish clear escalation thresholds that prevent routine issues from defaulting to founder involvement
When decision systems are institutionalised, performance becomes more predictable. Predictability strengthens EBITDA quality and investor confidence.
2. When Relationships Replace Systems
Founders often hold deep relationships with clinicians, managers, suppliers, and even lenders. Those relationships are valuable, creating loyalty and speed.
However, when the organisation depends on personal trust rather than embedded systems, continuity risk increases. Buyers will ask what happens if the founder steps back, reduces involvement, or exits entirely. If the answer relies on personality rather than structure, multiples tighten.
To move from relational to institutional strength:
Formalise clinical governance frameworks so standards are enforced consistently across all sites
Standardise reporting and performance review processes so feedback does not depend on direct founder interaction
Develop second line leadership that owns site level accountability without informal reliance on founder intervention
When systems replace informal dependency, EBITDA becomes less volatile because performance management is consistent. Consistency commands stronger valuations.
3. When Founder Energy Masks Leadership Gaps
A driven founder can compensate for organisational weaknesses for years because they step into underperforming sites, resolve conflicts personally, and push initiatives forward through sheer force of judgement and energy.
This allows the group to grow, build momentum, and increase revenue even when underlying leadership depth has not developed at the same pace.
Contrarily, the hidden cost is that capability beneath the surface may not develop at the same pace. Investors eventually look beyond current performance and examine depth.
To build transferable strength:
Create structured leadership development pathways for clinical directors and regional managers so capability expands alongside footprint
Align incentive structures to reinforce shared accountability rather than founder approval
Reduce single point dependencies in finance, operations, and clinical oversight so resilience is tested before exit discussions begin
When leadership depth increases, EBITDA becomes more resilient because performance does not rely on extraordinary effort from one individual. Resilience influences valuation directly.
More in Samera’s DSO Exit 2030 Playbook
A founder who builds an institution rather than a dependency does not lose control. This is one of the core themes in the DSO Exit 2030 Playbook.
It examines how governance, leadership design, financial clarity, and clinical standardisation convert founder-driven growth into durable value. That structural work improves EBITDA quality and supports stronger multiples when the time comes to exit.
If you are building or investing in a dental group and want to move from founder-centric success to institutional strength, learn more in our free and fully accessible DSO Exit 2030 Playbook:
Cheers,
Arun