Is Private Equity another form of Corporate Optometry?
Private Equity has become very popular in our industry. Many older ODs find it have found great benefits with private equity as an exit strategy. Many ODs can sell their practices and not worry about the administrative tasks and still be able to practice the way they want and focus on what they love the most and that is patient care. There are many similarities and differences among practicing optometry in a private equity firm and corporate optometry. Ophthalmology went through it before and maybe the same can be said about labs being bought out over the years. PE is a tough conversation. Some might differ on this comparison, here is what some ODs think about this question.
There are the pros and cons of private equity in optometry
Some Private Equity are investing in new technology in their practices, from EHR to diagnostic equipment. They are building a practice to help with increased costs with low reimbursements. The new investment in technology allows ODs to practice the highest scope allowed. It can be a good employment opportunity for many young ODs that are tied down because of high debt and can still have that private practice feeling with higher than average salaries.
With the pros come the cons. Some of the negatives that ODs expressed were that there would not be any practices for the next generation of ODs to purchase and move the position forward. Some concerns were that these private equity firms would purchase these large practices hold them for a short period of time and sell them to a larger entity in the industry. ODs were concerned that optometry was being lead the way that pharmacy was taken. Being employed might be something that young ODs would like at the beginning of their career, but after a few year many desire to have their own business.
We asked the industry what they thought about if private equity was good for the future of optometry.
Dr Joshua Woodland from Dyerville, Iowa
“History doesn’t repeat, My point isn’t about current status of VCPs but, it’s about allowing something to take hold that allows for short sighted gains but is bad for the profession in the long term.”
Think about how other factors have affect our industry over the years. Use that information to help guide you on new trends and disruptive technology for the future of optometry.
Survey taken in the corporate optometry FB group, many of the members feel that private equity is another form of Corporate Optometry.
From this survey many ODs feel that private equity is another form of Corporate Optometry
It is not Corporate Optometry
Not all corporate opticals are the same, why would private equity firms be the same? There are different models and strategies. Leadership styles can vary in the direction they want to take that company. It is hard to make direct comparisons.
Stan Peacock- Walmart sublease holder in Marianna Florida.
“Not really, it depends on ones definition of what corporate optometry is. And also now there are different types of PE. So different definitions of PE also, especially how the OD is treated-in different PE settings.”
Private Equity is an alternative form of Corporate Optometry.
There can be a blur in being able to differ ante between the two in optometry. When the owner is not an OD sometimes it can be classified as form of corporate optometry. Usually in private equity ODs are employed by the firm. Private equity firms make the decisions on OD schedules, hiring, products for the optical, equipment and other decisions that ODs are not involved with.
John Wiener Costco leasehold in Cincinnati, Ohio
“It is meta corporate optometry. Equity is buying up everything. OMDs included. If you are working under a private equity firm, you are clearly not private. Your livelihood is at the mercy of market forces and corporate decisions that might be far removed from optometry.”
Only time will tell on what specific companies will do and what their strategy is. What is your opinion? Join the conversation on Facebook Corporate Optometry group!