Practice Acquisition & Start-up Financing Dr. Tony Kremer, DVM

KVS Hospitals Animal Care Center of Plainfield CARE Animal Emergency Services Mallard Point Veterinary Clinic Oswego Animal Hospital Hinsdale Animal Hospital Animal Medical Center Animal Care Center of Shorewood Animal Care Center of Downers Grove Animal Care Center of Polaris Old Town Animal Care Center

Animal Care Center of Plainfield

Mallard Point Veterinary Clinic

Oswego Animal Hospital

Animal Care Center of Polaris

Animal Care Center of Shorewood

Old Town Animal Care Center

Animal Care Center of Downers Grove

Hinsdale Animal Hospital

KVS Services OPEN 7 DAYS A WEEK WALK-INS WELCOME Full medical & advanced surgery Boarding Grooming Doggie Day Care Obedience Training Adoptions Live-in externship program OPEN 7 DAYS A WEEK WALK-INS WELCOME

Why are you interested in this topic? Forward thinking How do I afford a practice/hospital? State of the profession Who owns most of the veterinary practices today? (Corporate/55+ older veterinarians) Consolidation What room is there for future private practices?

How did I get started/become a practice owner? Worked for a vet multiple practices Had a great mentor Proved my work ethic/motivation/enthusiasm Practice owner financed the sale & made me a part owner

PROS & CONS of Ownership Increased income Debt in practice & real estate Pay off student loans Huge financial risk Rental property income Great responsibility Independence Work hours Satisfaction of building something larger than yourself Employee issues (hiring/firing/drama) Lifestyle Patient responsibility Repairs & maintenance Client issues/social media Insurance & understanding Payroll

KVS Hospitals Animal Care Center of Plainfield CARE Animal Emergency Services Mallard Point Veterinary Clinic Oswego Animal Hospital Hinsdale Animal Hospital Animal Medical Center Animal Care Center of Shorewood Animal Care Center of Downers Grove Animal Care Center of Polaris Old Town Animal Care Center

Acquiring a Practice Start-up practice Acquiring an existing practice Partial Practice/Partnership Existing track record, back office, owner financing & shared responsibility

Finding the Right Location or Practice Traffic counts Population Competition Median income

Other Issues Why is the practice for sale? Desperation or profit? What is included in the sale? Practice, real estate, equipment, employees, goodwill?

Other Issues Cont. Contracts: Vendors Inside/Outside lab Facility leases Equipment leases Employee contracts

Financing Bank Relationship/Collateral The Price Formal/informal valuation (Vet specific CPA/attorney?) Formulas (+/-1X gross income, 5-14X profits, multiple of EBITDA) Value is all about profits – run your practice like you want to sell it in 6 months

What is EBITDA? Earnings Before Interest Taxes Depreciation Amortization.

Any Questions?

Contact Information Animalcareinfo.com Drtony.com Helpsavepets.com animalcare@DrTony.com (815) 405-1300 Mentorship, externships & tours! KREMER Veterinary Services