What we are seeing in the current state of dental technology is like nothing we've seen before. The capabilities, the way it's being built, evaluated, bought and implemented.
It's exciting yet incredibly difficult to manage at the same time.
The impact is hyper focused too. The cost of labor and the way we operate inside a dental practice and DSO today is happening inside the tightest margins on record.
As Geoff Wayne, the CEO of Jefferson Dental & Orthodontics put it, the struggle right now is finding the right mix on the tech that provides real ROI in a world of overall margin compression.
One part of this business that has slowed significantly but not completely stopped is the building and selling of dental assets. Whether it's a six location group going to market or an enterprise group trying to recap, the activity has quieted compared to a few years ago.
There may be light at the end of the tunnel though.
According to a recent TUSK survey, 69% of DSOs expect to increase acquisition activity in 2026 and 78% of buyers anticipate recapitalization within the next 12 to 36 months.
As the market gains momentum, more organizations are coming to a realization. What you do operationally and technologically between now and then will define how that conversation goes.
The Right Question
For practices going to market and those bringing stability to their organizations, the conversation around technology is changing.
It's no longer just about the tools you have but whether those tools are working and providing meaningful outcomes inside the business.
Stability and clarity inside a DSO requires technology that is valuable across the entire organization. Standardized workflows, RCM stability, a cloud based PMS, and data clarity that drives outcomes are must haves.
Most DSOs approach technology by solving for one problem or one department at a time. Or in some cases the exciting shiny toy takes over and solves no problem at all.
The groups thriving at the moment are coming at this with a different approach.
Ali Hyatt, CRO and Head of Commercial at Henry Schein One, put it this way.
"The successful DSO is thinking, what is the key need for all of my stakeholders for technology to help them do their job better? That might be taking into account growth metrics, doctor retention, financial metrics and efficiency needs and ensuring the full picture is there.
Then the leadership team has to frame their technology stack in terms of how it meets the key most important need for that entire group and keep telling that story."
What she's saying is that it's not just about having the right technology. It's about having a clear rationale for it and then leadership being able to communicate that across the entire organization.
The Multiplier or the Mess
Having the right technology conversation inside your organization starts with a technology diagnostic. Understanding what you have, what's working, and what isn't.
Once the health of your tech stack is diagnosed, it’s time to focus on what’s next.
This is where a lot of DSOs find themselves right now. The tools exist, they're being used (hopefully) and the intent is there. But if the structure and path isn't solid, adding more technology doesn't fix the problem you’re trying to solve, it amplifies it.
Joseph Feldsien, Sr. VP of Integrated Care at PDS Health, put it simply.
"If the business structure is solid, technology can be a multiplier. If the business structure is fragmented, technology will create chaos."
He also made a broader point that the dental space is poised to capitalize on the health crisis in this country. But that opportunity only exists when technology enables personalized care to happen.
"The future is about how technology supports care outside of the dental environment. DSOs that win there will win."
That's a longer horizon than most organizations are thinking about right now because not all are at the scale of a PDS. But it points out that the decisions being made about technology today aren't just operational.
They're setting up how these businesses compete in a market that is going to look very different in five to ten years.
The answer being discussed consistently in conversations right now is consolidation. Not like in years past, because a stack that has grown without a clear rationale becomes an operational burden.
Too many tools, too much overlap, tools underutilized and nobody can clearly explain why they have what they have.
That rationale matters significantly. Not just operationally but when it comes time to tell the story of the business to someone outside of it considering investing in it.
When It Works
The conversation around centralization and frameworks happens everywhere but especially at the leadership level. But stability has to show up everywhere. At the practice level, with the regional operators managing multiple locations, and with the leaders trying to make sense of what's happening across the network.
When technology is working the way it should, everyone benefits. The person scheduling patients, the regional operator with ten locations on their plate, and the executive trying to see the full picture.
Bonnie Thompson, COO at Forest Family Dentistry, said it clearly.
"Operational stability exists when technology reduces the workload by creating streamlined workflows that create consistency across the organization."
That consistency starts with the basics being in sync. Hygiene driving re-care. Call logs being tracked. AI and analytics informing decisions and eventually predicting them. The PMS being the source of truth everyone is working from. Clarity around who is on the schedule, who is coming in, and what the team needs to know day in and day out.
When those things are working together the organization runs cleaner, more profitable, happier. When they aren't, the day runs the people and those people affect care and sometimes turnover.
Rezwan Manji, Co-Founder and CEO of Imagen Dental Partners, describes what that shift looks like at scale.
"Operational stability is when the business moves from hindsight to foresight. A lot of groups focus on the tool itself, but the real unlock comes from the data structure and operating foundation underneath it.
When that foundation is in place, the right technology does more than produce dashboards after the fact. It powers reliable workflows in the background, surfacing the right actions at the right time so teams can stay focused on great patient outcomes.
At scale, that is how you create consistency across the network without taking away the local identity of each practice."
He's speaking to the foundation providing outcome. Everything else, the multiples, the market attractiveness, the enterprise story, gets built on top of this.
Tighter margins mean less room for error on technology decisions.
The Provider Perspective
Every voice in this piece so far has been an operator or executive. People who think about doctors every day but don't pick up a handpiece themselves.
Leaders correctly thinking about centralization, stability, stakeholder alignment, and what the market is looking for.
Dr. Scott Dudley, the Founder and CEO of Branin Center for Dentistry, is taking it on from the angle of not only a DSO owner but also a provider.
"Technology produces nothing. There is no dental code for it. Revenue comes from provider actions and procedures. Firm A won't produce more tomorrow by adopting Firm B's better tech stack unless that technology actually changes provider behavior and efficiency."
He goes further.
"Solving for the perfect tech stack is like pouring more water into an overflowing glass, where the glass is provider capacity. If providers don't get better, more efficient, and more capable, technology spend is wasted."
This part sometimes gets overlooked in the world of exciting tech. You can have the best technology the world has ever seen. The most integrated stack, the cleanest data, the most advanced AI tools.
None of it matters if the provider isn't delivering on care, converting treatment plans, and showing up as the reason patients come back. The provider is still the most important seat and no amount of software solves for a gap there.
"Simple beats perfect. Less is more. The ideal tech stack isn't the best of breed collection of parts. It's the one that is simple, coordinated, and pieced together with no overlap and no gaps."
That's a hard thing to sell at a conference. But it's the reality.
What the Market Sees
As M&A activity picks back up the scrutiny on how a DSO is run operationally and technologically is increasing.
Clean books have always mattered. What's changing is that a clean tech stack is becoming a standard part of the conversation.
The difference between a 5 to 8x EBITDA multiple and a 9 to 11x conversation can come down to a number of factors. For a DSO doing meaningful revenue that gap in multiple is significant.
Operational clarity, margin predictability, and technology that tells a consistent story are increasingly part of what separates one outcome from another.
Consistent KPIs across locations regardless of size. Scalable systems that work the same way whether you have 6 locations or 60. Technology that talks to each other rather than creating manual workarounds between disconnected tools.
These aren't just operational goals, they're preparation for the market.
Point solutions that go deep on specific problems like RCM have staying power. Products with multiple functions that integrate cleanly across the organization increase the attractiveness of the asset. A fragmented stack that requires workarounds and unclear data sets tells a story you don't want told during due diligence.
Ali Hyatt at Henry Schein One frames it nicely.
"Technology is key here because it's the tie that binds the story together. If growth is going to be the key driver, then technology needs to be set up in a way that allows the DSO to track those metrics consistently so they have a good baseline and then a way to show progress."
Of course platform businesses command higher multiples. If your business is smaller yet your technology infrastructure looks like a platform rather than a collection of disconnected tools it changes how the business is perceived and how the story gets told.
Standardization and consolidation are legitimately not buzz words. They're how you get your house in order before someone else comes to visit.
Be Prepared
Technology has always been part of dentistry. Paper charts gave way to digital records. Film gave way to digital imaging. Alginate impressions gave way to digital workflows.
The industry has always found a way to innovate and adopt.
But what is happening right now and what is coming over the next few years is on another level entirely.
The pace, the capability, the number of options, and the expectations around how technology performs inside a dental organization have never been higher.
That means thinking differently about what you choose, how you evaluate it, and what you do with it once it's in place.
Getting control of the health of your technology isn't just an operational priority. It has an impact on your team, on your patients, and based on everything in this piece, increasingly on the value of your entire business.
The market is signaling that recaps and acquisitions are coming. The organizations that will be best positioned are the ones that started getting their house in order before someone else came to take a look.
Be prepared. Do it now.
If any of this resonated and you want to think through where your organization stands, we'd love to be part of that conversation.
As we approach budget season we are working with teams to make sure good decisions are made going into 2027.
Schedule some time with me and the team at this link here.
Here's what that process looks like.
See everyone at Dykema!
If you're attending, reach out and let's find some time to connect. It's always one of the better weeks of the year for conversations like the ones in this piece.
New podcast episodes!
The DSO Technology Show
Brian Colao and I sat down with Dustin Johnson, Co-Founder and CTO of SOTA Cloud and Ryan Chan, VP of Revenue to talk about the shift toward cloud based imaging platforms and how they can impact a DSO.
DSO Compass Off Script
Clayton Russell and I had a summer break but will be launching a new episode right before Dykema that discusses our mid-year review on all things DSO and Tech.
👉 Listen on Spotify, Youtube & Apple Music
My friends at MB2 are offering a discount on their Carabelli Club membership. It gives independent practices access to MB2-style pricing on supplies, technology, and other purchasing benefits.
If you're interested, check out this site for more information and use promo code MCGAW for a substantial discount.
Truly appreciate you being here and making it to the end. Have ideas, questions, or tech you want me to explore? Just reply to this or book some time with me to discuss.
- Matt
