Rajiv Sharma, MD, owner of Terre Haute, Ind.-based Digestive Health Associates and nutritional supplement company Dr. Gut Happiness, joined "Becker's Ambulatory Surgery Centers Podcast" to discuss how private equity can be a boon to practice owners.
Note: This is an edited excerpt. Listen to the full podcast episode here.
Question: What are you most excited about right now?
Dr. Rajiv Sharma: The one thing which I'm very happy about, thank God, is private equity. Thank God. Oh my God, private equity was perfect for me. Now I have access to capital, right? One thing which always bothered me was for GIS and other practices, unlike other businesses, we really don't have very clear legacy planning.
Normally you'll have a nice doctor who will come to an area, live there for 20 or 30 years, scope half the town, and then when they're done, they close up shop and they go. That's a wasted opportunity to: A, pass on a legacy; and B, cash in the equity and the goodwill of the practice. I'd be losing time and money both. I cannot do that. I want to cash in on my equity.
For any GIs listening out there, do not waste your time giving away your time-value of money, your hard work. It has equity. It has a dollar value attached to it that appreciates with time. Get somebody to take that equity and do some stock or stock option that appreciates with time. And then when you want to retire or walk out, you don't walk out just with your stethoscope in your pocket or your car keys in your pocket. You walk out with a stock certificate, which you can cash out.
[Private equity] lets you be a doctor and gives you the fuel, right? It's like rocket fuel for your career.