Unsolicited offers are a regular occurrence in private equity-backed marketplaces. Private equity groups (PEGs) purchase a platform or group of practices and then must feed and grow that platform to increase underlying profit in order to be sold approximately five years down the line. The manner of growth varies, but ultimately, the most efficient path is to purchase existing profitable practices, which are then incorporated into the broader business. Gaining access to these additional businesses can be difficult in a less mature marketplace, especially when a fully mature business development team has not been built out yet.

UNSOLICITED OFFERS 

Due to the difficulty of access, many newer groups rely heavily on what are often known as “unsolicited offers.” These offers can take many forms, such as mailers, phone calls, e-mails, door-to-door visits, referrals, and more. However, in almost all cases, they rely on limited data, usually a profit and loss statement for the last 12 months, to present an unsolicited offer for the purchase or partnership of a medical aesthetics practice. The risk associated with this is obvious: the buyer and the group responsible for valuing the business control both the flow of data and the interpretation of that data. This situation provides the owner with little room to negotiate or truly understand what their business would be worth on the open market.