When starting a cash physical therapy practice, many owners are focused on providing excellent patient care and growing their revenue. But have you ever considered that your practice could one day be something you could sell? Even if you’re not planning on selling it anytime soon, building your business with the intention of creating a sellable asset can dramatically impact your income, freedom, and lifestyle.
In this blog post, we’ll cover how to approach your business as a sellable asset and the five key areas that increase your practice’s valuation. We’ll also explore how to remove yourself from daily operations while continuing to grow your business, and why building a business that can run without you is essential to long-term success.
Why Building a Sellable Business is Key for Growth
It’s common for practice owners to fall into the trap of thinking their business will always depend on them. However, not having an exit strategy could lead to missed opportunities and a lack of long-term financial freedom. Ben and I have seen countless business owners fail to plan for this, and when unexpected personal or health-related issues arise, they’re stuck with a business they can’t sell.
Building your practice with the intention of selling—whether or not you plan to—is a game-changer. This mindset forces you to structure your business efficiently, remove yourself from day-to-day operations, and focus on what truly matters: profitability, growth, and impact.
The Difference Between Job Owners and Entrepreneurs
The key difference between a job owner and an entrepreneur is how they think about their business. A job owner creates a business that is essentially just a job with more responsibilities, leaving them constantly overwhelmed and overworked. An entrepreneur, however, builds an asset that can eventually function independently and be sold for a significant profit.
To make this shift, you need to think like a CEO, not just someone providing services. For example, Ben has built his practice in such a way that he only spends three hours per week managing the location with his team of directors and employees. He still loves working in the business, but if he needed to step away, the business could continue to grow without him.
The Five Key Areas that Increase Practice Valuation
Building a business that can eventually be sold requires attention to several key areas. Here are the five factors that can drastically improve your business’s valuation:
Profit
Profit is the most important factor in valuing your business. Don’t make the mistake of focusing on revenue alone. A practice may be generating millions in revenue, but without solid profit margins, it’s worth very little. Aim for a profit margin of 30% or more to ensure your practice is a valuable asset.Revenue Growth
A business that grows consistently is much more attractive to potential buyers. Aim for at least 30% growth year over year, but if you’re really pushing the limits, you could see growth rates of 60-70%. As you scale, revenue growth becomes a key selling point for your business.Customer Retention (LTV)
Patient retention is crucial for your practice’s valuation. The longer a patient stays, the more revenue you generate. This is why it’s important to not only retain your patients but also increase their lifetime value (LTV) by offering ongoing services that improve their long-term health.Customer Acquisition Costs (CAC)
Keep track of how much it costs to acquire each new patient. If you can generate more revenue per patient while spending less to acquire them, your business will be much more attractive to investors.Systematizing Your Business
The more efficient your systems, the more valuable your practice becomes. Whether it’s through marketing, patient care, or team management, having clear, documented systems will ensure that the business can run smoothly without your constant involvement.
Removing Yourself from Daily Operations
One of the most powerful strategies for increasing the value of your business is to remove yourself from daily operations. Ben’s practice, Pro Kinetics, runs on autopilot with minimal input from him. The key to achieving this is hiring the right people and setting up processes that ensure the practice continues to grow without your constant presence.
When you focus on building the systems, procedures, and leadership in your business, you can gradually step out of the operations and become more of an investor than an active manager. This gives you the time freedom to pursue other ventures, enjoy life, and ultimately position your business to be sold at a high value.
Avoiding the Silent Killers of Business Valuation
There are several silent killers that could crush your business valuation without you realizing it. These include:
Key Man Risk
If your business relies too heavily on you, its value will be much lower. If something happens to you, will your practice survive? Start delegating tasks early so your business can operate without you.Single Channel Risk
Relying too heavily on one marketing channel—like workshops or Facebook ads—puts your business at risk. Diversify your channels to ensure consistent lead generation and reduce dependence on a single source of revenue.Data Risk
Not tracking your key metrics is a huge mistake. Without data, you’re running your business blind. Make decisions based on real numbers and track your leads, bookings, conversions, and patient retention to improve your business’s efficiency and valuation.
Conclusion: Building Your Practice to Sell
Building a physical therapy practice with the intention to sell—even if you don’t plan on selling—will set you up for massive success. It forces you to systematize and streamline operations, focus on profit rather than revenue, and reduce your reliance on daily tasks. By doing so, you not only create a more valuable asset but also gain more time and financial freedom.
Start building your practice with an exit strategy in mind, and you’ll find that your business not only becomes more valuable but also more enjoyable to run.
Watch and Listen to the Full Video
For a deeper dive into a cash physical therapists’ journeys, make sure to listen to the full video: Stop Owning A Job: Build A Profitable Sellable Physical Therapy Practice.
About Author:
Although the company eventually failed, it provided Jordan with invaluable learning experiences. He became passionate about designing world-class patient experiences and building efficient marketing & sales funnels for cash physical therapists. Utilizing this expertise, Jordan became the CMO of a well-known physical therapy media company, and consulted for and built marketing funnels for some of the top physical therapy business coaches.
Eventually growing tired of the typical agency and consulting grind, Jordan, alongside Max Zirbel, founded Clinical Marketer. They infused it with the hands-on support and mentorship that they benefited from in their initial venture. The company was a success from the start, aiding clinics in scaling to 6 and 7 figures in revenue. During its first launch, Jordan and his team met Dr. Ben Bagge, whom they later partnered with after helping him grow his business from $200K/year to over $1M/year in three years.
