Short answer: the market for big liquidity events — IPOs and large buyouts — opens and closes in cycles, and right now it remains well below its historical pace. If you’re holding rollover equity from a DSO sale, that cycle, not a calendar, is what determines when your “second bite of the apple” actually pays off.
If you sold or are considering selling your practice to a dental service organization (DSO), part of the pitch is often the “second bite of the apple” — the idea that the equity you roll into the larger group could be worth a multiple of what you put in when the DSO itself is sold again, whether to a bigger private-equity buyer or, eventually, through a public offering.
That second sale doesn’t happen on a schedule you or the DSO controls. It needs an open market for big liquidity events, and that market moves in cycles — sometimes closed for years at a stretch. U.S. IPO activity is one widely watched gauge of how open that market is at any given time:
Number of U.S. IPOs priced per year
Even the recent rebound years sit well below the long-run historical average — a reminder that rollover equity is a bet on a future market you can’t time, not a guaranteed second check.
What this means if you’re weighing a DSO offer
- Treat guaranteed cash at closing and contingent rollover equity as two very different kinds of value — see how DSO deal structures actually work.
- Before assuming a big check beats holding your practice, run the math both ways over your realistic remaining career.
- When an offer is on the table, evaluate it against your full financial plan, alongside your CPA and attorney — not just the headline number.