Usually, it takes around eight years to become a dentist, and even longer if you’re planning to become a specialist such as an oral surgeon, orthodontist or periodontist. For many it’s an intense, exhausting process with sky-high levels of stress. Nearly a third of trainees have symptoms of burnout and around a fifth have clinically high levels of anxiety or depression, according to a study by The Journal of the American Dental Association released in March this year.

But what’s just as worrying is that serious mental health issues remain even after a dentist has qualified and opened their own practice. With so much administration, accounting, marketing, staff recruitment and IT to look after, there’s precious little time left for what they spent all those long, hard years training to do.

When C Steven Villanueva, who is commonly known as Dr V, graduated from his South Florida dental school in 2004, he was pretty clear about how his career would play out. After working for a couple of local private practices, he joined a group practice while “chasing a girl who’s now my wife” to Dallas, where he opened his own at just 27. “My path at the time was to be a traditional dentist in a private practice, treat my patients and, hopefully, save enough to retire in my 60s,” he remembers.


It was a simple enough plan. But while his lecturers had taught him dentistry skills, they hadn’t fully prepared him for the practicalities of running his own business. “All I’d ever wanted was to be a dentist, but here I was with my own set-up, and a crazy amount of my time was taken up with just running the office,” Villanueva recalls. “And if you’re seeing patients for most of the day, you end up working nights and weekends just to stay on top of everything on the business side, whether that be human resources, payroll or marketing.”

However, overwork wasn’t the only problem. The dental profession is highly competitive, so keeping patient prices as low as possible is vital. But it was far from a level playing field. “I noticed that Dallas seemed to be the epicenter of consolidating dental groups,” Villanueva says. “My private practitioner friends and I realized that it was really difficult to compete with these large groups, who were buying everything for 30 per cent less than we were, and then getting reimbursed 10 per cent more by the insurance carriers. We were at a grave disadvantage.”

He was determined not to give up on his dream of running his own business, so he hatched a plan to create a dental cooperative involving several practices. Now he had the best of both worlds – the same economies of scale and buying power enjoyed by major group practices, while still maintaining complete autonomy over his career.

Villanueva didn’t realize it at the time, but he had put the wheels in motion to create a unique organization, now known as MB2 Dental, that has transformed dentistry in the US, and been valued at a staggering US$1.8 billion. This figure is projected to rise to US$2 billion by year’s end.

MB2 Dental is America’s first Dental Partnership Organization (DPO), affiliating with dentists who can have the support they need to grow without having to sell to a faceless corporation. “Shared ownership aligns their long-term interests as they leverage their collective size to curate business support services, negotiate economies of scale and attract higher valuations,” the Founder and CEO explains. “This allows them to compete with larger rivals while still maintaining control from both clinical and non-clinical aspects.”

The number of centralized services provided by MB2 Dental has grown exponentially, mainly driven by the needs of the doctor-owners. “A dentist might call and say, ‘Hey, Dr V, I need help with X, Y and Z,’ so my job is to make sure we get the support as soon as possible,” Villanueva says. “It could be anything from marketing, revenue cycle, procurement, advice from in-house attorneys, a compliance matter, or finance. Having all that on tap means the dentist can start to see their business in a whole new light and can spend more time on patient care.”

Individual private practitioners wouldn’t have the wherewithal to organize all that in a short amount of time in addition to seeing patients during normal business hours. “Believe me, I know what it’s like when you have to be the accountant, the marketer, the IT support, the guy who does the stationery order and a lot more. We negotiate collectively on behalf of more than 700 dentists so we’re in a very powerful bargaining position. You want to buy disposable gloves? Well, here’s what you’ll pay and it’s way less than if you went online yourself.”

Sharing the latest technological advances is one of the most obvious advantages of joining MB2. Software capabilities can change in a shorter time than it takes to remove wisdom teeth. Fielding calls from a dozen manufacturers and distributors, each insisting that they have the only logical solution for dental practices, can be bewildering, confusing and, well, like pulling teeth.

At MB2, Villanueva and his team of experts do all the heavy lifting to find the very best plan and the very best price, saving members literally days of sifting through a raft of complex options. “Here’s a great example. We’ve partnered with a software developer to create a cloud-based application programming interface that allows us to gather data from each practice without the need to retrain the staff or develop a whole new practice management system,” he shares. “It disrupts the traditional manufacturer/distribution model by opening up new opportunities in the market.

“And you know, the type of technology we invest in is often driven by our doctor-owners. We learn from them what their exact needs are and then negotiate on their behalf if there’s a certain system they’re interested in.”

Different programs might suit different people; it’s not one size fits all. Some dentists are more tech-savvy than others or have a business that requires specialist capabilities. “That’s how it should be – they’re private practitioners, after all, so they need to be calling the shots,” Villanueva says. “My job is simply to negotiate the deals on their behalf and then share the results with the rest of the group. Once we have data to support the efficacy of an initiative, we communicate that to the co–op. And, inevitably, it’s adopted by other individuals.”

The organization currently has more than 350 practices on its books and is growing at an extraordinary rate, adding 81 new affiliated offices with more than 1,000 employees in 2020 alone. Any dentist worried that it sounds too good to be true need only visit the website, where there are more than 80 videos of dentists extolling its virtues.

Private equity firm Sentinel Capital Partners was the first major financial backer, and its injection of funds thrust Villanueva into unfamiliar territory. “I’ve never been formally trained in business as I’m a clinician and my passion is dentistry,” he says. “This is something that I kind of just fell into. I had to educate myself on what private equity actually did. Before Sentinel came along, a lot of investment banks had refused to represent us because they didn’t think we’d find an institutional sponsor, but I kept at it.

“I mean, I remember our first employee was simply a guy named Bob who’d been helping us out as an accountant for US$75 an hour. We used him all the time so, after a while, we just said, ‘Let’s hire Bob full time and we can all use him and split the costs.’ Too easy. Well, he was the first and now it’s grown to 250 central service employees, and we’re probably going to double that in the next four to five years.”

Sentinel told Villanueva that it expected him to add 25 new locations a year, a figure it acknowledged was optimistic. Within 12 months, more than 70 had come on board. “After that, I mean, quite frankly, we were in a different arena. I had to learn very quickly as more and more dentists saw the benefits and wanted in,” he reveals. “Our valuation in 2017 was US$285 million.

“Any budget that’s been thrust in front of us, we’ve easily surpassed. Four years later, here we are, still growing at a pretty significant rate.”

In February this year, Boston investment firm Charlesbank Capital Partners acquired a majority interest in MB2 from Sentinel Capital Partners and all of the doctor-owners, who reinvested substantially in 2017.

Managing Director Brandon White said at the time: “We are very impressed by the platform Dr Villanueva and his team have built, supported by what we believe is truly a best-in-class culture. We see significant M&A opportunity in the fragmented dental services market, and we believe that our investment will enable MB2 to accelerate its proven acquisition strategy as well as continue to develop its suite of shared services to support value creation.”

It was a huge vote of confidence in Villanueva’s leadership and vision, as well as the potential for even more expansion. “If you compare us to the other groups in this type of consolidating market, we’re easily in the top five in size,” he points out. “In terms of rate of growth, we’re probably number one or close to it.”

In March, the respected business media brand Inc. included MB2 on its annual list of the fastest-growing private companies in Texas for the second year running, an impressive result given how the dental sector had been hit by the pandemic. In July, Villanueva was the only dentist featured on the Becker’s Dental + DSO Review round-up of the largest Dental Service Organizations (DSOs) and their CEOs, while in August, Inc. included the company on its overall Inc. 5000 list for the third year in a row.

So far this year, a couple of new practitioners have become doctor-owners nearly every week, almost all of them referrals from existing doctor-owners, leaving more proceeds for the dentists by saving on broker costs. Incredibly, close to 50 per cent of the equity injected so far comes from either the dentists themselves or Villanueva.

“It’s really exciting, but none of us has ever compromised our values,” he insists. “I’m still a dentist and the company is run by dentists. We don’t wear suits; we wear white coats. The white coats are what drive this business. Most of our competitors are led by private equity executives who are only in this for a flip and were previously in a different healthcare roll-up such as veterinary, dermatology or optometry.”

The growth is proof that the doctor-owners are delighted with the service they receive and are very willing to become ambassadors and advocates for the platform. And they’re not the only ones delighted to be a part of MB2. Villanueva is proud that his executive team is 100 per cent homegrown, not hired guns from private equity, meaning they have the long-term best interest of dentists at heart. But that doesn’t mean there aren’t challenges, the biggest being recruiting enough staff to keep up with demand.

“When you’re expanding the way we are, it’s always going to be hard to find enough talent to support it,” he concedes. “In any given week, we get between 60 and 70 inquiries from private practitioners looking to join. So being able to triage and select suitable partners and then support them is quite a feat.

“Essential services require a lot of resources in each and every location, so we’re constantly searching for great new people who support our culture to join us. I think that’s probably the most difficult part, although we’re very fortunate that our model means we have relatively low member turnover, so provider turnover is extremely low too, like it is in a private practice.”

Another competitive advantage is that when a doctor-owner joins, there’s no contractual obligation to stay. “If any of our partners were unhappy, they’d have left by now. It’s the thing I’m most proud of and it speaks to the peace of mind that we provide,” Villanueva says.

It also speaks to the culture of transparency and support that he’s nurtured. All the partners are in control of their own destiny and the increased profits they enjoy stay with them rather than being swallowed by a corporate entity.

“People ask me all the time, ‘How are you able to maintain this incredible culture at more than 350 locations?’ Well, I can tell you, they were asking me that when I was at 30 locations,” Villanueva confirms. “The truth of the matter is, this is a massive private practice to me. These are all my partners, my equals, but I don’t take it for granted. I have to earn their trust every single day. And even though I already have it, I still have to continue to do right by them.

“Our purpose is about more than just trying to monetize their investment at a later date at a higher multiple; it’s anchored with a value system as opposed to a transaction. I think a lot of leveraged buyout strategies are focused on exits and transactions.

That can certainly be the case with the dozens of DSOs that provide business services to a group of dentists in a location to share resources and bring operational costs down. Unlike MB2’s DPO, members of a DSO have less of a say in the running of the business.

“Traditionally, you either have a private practice or a DSO that’s very, very much like a hospital system, where the doctors are employees of that company,” Villanueva explains. “We didn’t want that as it’s really important to our doctor-owners that they can make important decisions themselves. At MB2, we have all the benefits and none of the drawbacks of both ways of operating. That’s the reason why we’re winning and growing so quickly.”

Despite his remarkable achievements and ever-growing list of doctor-owners, Villanueva remains humble. “You know, I owe a lot to my profession, and I believe that what we’re doing at MB2 is good for that profession and good for the most important people in the equation: the patients,” he says. “The reason all of us spent those tough years in dental school was to help people – kids, families, seniors, anyone who needs us. I never lose sight of the fact that, at the end of the day, I’m a dentist and that makes me very proud.”