01Situation
A PE-backed dental platform closed on a tuck-in acquisition of a twelve-location regional DSO. The target had been founder-run on a part-time finance director and a contract bookkeeper. AR aging was sitting at 78 days against a platform standard of 42. Monthly close was running fifteen business days late. Same-store unit economics were directionally fine but couldn't be defended down to the location level. The PE sponsor needed the integration to land cleanly inside one hundred days so the platform could go back to market for the next tuck-in without integration drag showing up in the LP report. Our brief: stand up the finance function, compress AR, rebuild same-store reporting, and hand back a steady-state operation by day one hundred.
02The work
- 01 Day-one finance stack. Installed the platform GL, chart of accounts, and revenue-cycle workflow across all twelve locations in the first three weeks. Standardised payroll, AP coding and bank reconciliations to the platform cadence. Hired a permanent controller and two AP/AR staff against platform job specs by day forty.
- 02 Revenue-cycle cleanup. AR aging compressed by 34% in the first one hundred days through a focused dispute-resolution sprint on the largest commercial-payer balances and a hygienist-by-hygienist insurance-verification audit. Old write-off candidates resolved; clean current-month AR established by day sixty.
- 03 Same-store reporting at the location level. Rebuilt the management report to show unit economics by location with hygienist-hours, chair-utilisation, case-mix, and case-acceptance rate — the four metrics that drive a DSO P&L. Platform sponsor got the first defensible same-store report at month two.
- 04 Cost discipline and renegotiated supply. Consolidated supply and lab agreements to the platform contracts. 7-11% reduction in COGS line items across the twelve locations. Renegotiated three of the highest-cost specialist agreements.
03Result
Integration completed inside the hundred-day window. AR aging compressed from 78 days to 51 days. Monthly close moved from D+15 to D+6. EBITDA margin recovered by 5.2 points off the trailing-twelve baseline, with two-thirds of the recovery from revenue-cycle cleanup and one-third from supply consolidation. The platform returned to market for the next tuck-in at month five with a clean integration story to tell LPs. The new permanent controller, who we recruited and onboarded, is still in seat and now leads the same-store financial close for the entire platform. The sponsor extended the relationship to cover diligence on the next three acquisitions.
04Lessons
- AR aging is the highest-ROI first lever in a multi-site healthcare integration. Most of the compression comes from a focused dispute-resolution sprint on the top twenty payer balances, not from any new technology.
- Standing up the permanent finance team inside the first sixty days is the move that compresses everything else. Interim staffing past day ninety becomes drag, not coverage.
- Same-store reporting at the location level — with the right four metrics — is what lets the sponsor go back to market for the next tuck-in. Without it, the platform is held back by the slowest integration on the LP report.