Double Down on Your Investing Edge: Helping Dentists Retire on the Beach, Not Just Near It

When I was with Tech Coast Angels in San Diego, the most successful members would often say that everyone in this investor club lives a similar lifestyle—some just happen to live closer to the beach.

Recently, we've had a few more dentists join our group, and I've been thinking a lot about how we can pool our knowledge to help them retire closer to the beach, which is something we all dream of.

Investing well is doubling down on whatever edge you have.

ADA (American Dental Association) estimates that the average dentist earns $218,710, and retires with $2M - $5M. That will set you up comfortably, but there's still plenty of opportunity to enhance your retirement travel and living arrangements if you're strategic in using your years of medical training to their maximum potential.

1) Medical Real Estate Development

Many are content buying shares in medical REITs that acquire prime properties, but why should non-medical professionals profit off healthcare practitioners? Wall Street types, with more gel than brains, are living the easy life on the backs of medical professionals.

Shouldn’t doctors and dentists be taking the lead? Absolutely.

It may seem scary to dip your toe into the shark-infested world of real estate, especially when it’s outside of your comfort zone, but it doesn’t have to be. Essentially, you’re purchasing a space that houses your medical tools and is close to your patients. The construction process is straightforward and formulaic. Some of the best medical centers I’ve visited were designed with input from the doctors who would be practicing there, tailored specifically to their needs.

Story: Back in middle school, one of my best friends had a dad who was an anesthesiologist, and another buddy’s dad was a real estate developer. The real estate dad was talking to the doctor dad about some properties he owned that had flaky tenants or were occupied by businesses that weren’t ideal. He asked if the doctor could help him find better tenants. The doctor dad replied, “Sure, let me reach out to some of my medical school buddies and see if they’d be interested in relocating their practices there, with some attractive concessions.”

In the end, all of the buildings were fully leased with long-term tenants, and they were sold for a 5% CAP rate—compared to the 15% CAP rate they had when they were first bought, with a lot of vacancies. Both retired on the beach.

2) Dental Venture

The legendary investor Peter Lynch always said invest in what you know!

As dentists, investing in life science, MedTech, or dental tech is a great way to build your investment skills. You can draw on your own experience to evaluate whether a product or service is something you would use in your own practice. If it is, chances are your colleagues would be interested too—and often, based on your recommendation, they’ll follow suit. This not only strengthens your investment, but also increases the likelihood of success if the product gains traction.

There are 200,000 dentists in the U.S. and 30,000 in California. Often, there are just a few degrees of separation between one dentist and another—whether through medical school, a conference, or membership in the California Dental Association.

Having dentists on the cap table is the holy grail for DentTech companies, as they make excellent venture partners and investors. Many will offer venture shares if you can facilitate warm introductions, take the lead on a specific initiative or study, or contribute in some meaningful way. My advice is to take the venture shares for later-stage dental companies, but for early-stage ones, offer both your capital and time without asking for anything extra.

I’ve seen several dentist syndicates forming that allow dentists and their families to explore and invest in MedTech and DentTech deals together. This strategy not only helps them negotiate better terms, but also distributes the resources needed for more comprehensive due diligence across multiple families. It also serves as an excellent training ground for grooming the next generation to become chief investment officers of their own family offices.

Story: We had a dentist in Tech Coast Angels who recognized the potential of a DentTech company that many dentists, as well as life science investors, had overlooked. He made an investment and then introduced the company to larger buyers of dental equipment, demonstrating how he was using the product in his own practice and highlighting how it addressed common friction points. His advisory shares ended up being worth many times more than his initial investment, but the real value came from him opening his Rolodex and serving as an authentic spokesperson in just 4-6 meetings. His efforts played a crucial role in the company’s acquisition by one of its early customers.

3) Precious Metals Used in Dentistry

While porcelain, ceramic, and zirconia are becoming more popular, 50-60% of dental restorations in the U.S. involve some form of precious metals, chiefly gold, platinum, and palladium.

Much like how a mortgage on your dental clinic provides a fixed cost for 30 years before you own it—boosting your net worth in the process—some dentists take a long-term approach to their careers by hedging their practice’s exposure to precious metals, which can be volatile. With inflation running high, though, the price of these metals tends to rise over time.

1. Gold (Au) – Used in crowns, bridges, and inlays due to its durability and biocompatibility. Prices fluctuate based on global markets.

   

2. Silver (Ag) – A component of dental amalgam (though its use is declining). Also affected by industrial demand.

3. Platinum (Pt) – Used in some high-strength dental alloys and implant components. Expensive due to scarcity.

4. Palladium (Pd) – Frequently mixed with gold or platinum for dental crowns and bridges. More affordable than gold but still volatile in price.

5. Titanium (Ti) – Common in dental implants due to its strength and biocompatibility, though it's not a "precious" metal in the traditional sense.

If your practice has exposure to these metals, consider going long on the futures for them. This strategy could help you offer lower prices due to your hedged positions, winning favor with existing and new potential clients.

Story: A few years ago, I worked with a doctor who was still using silver fillings. He decided to go long on silver to hedge the amount he’d be buying over the final 15 years of his career, when silver was priced at $12. After five years, the price of silver tripled, and he was able to reduce his work by 10 years, just from the gains on his investment.

4) Dental Service Organization (DSO)

This one’s for the overachievers that really want to go above and beyond and take advantage of the ready source of capital local banks and credit unions wants to extend towards practice buy-outs, seen as a very safe bet.

Story: I knew a dentist who told his son that dentistry likely wasn’t the best fit for him, given his challenges with concentration. However, the son still wanted to stay involved in the field, having grown up helping out at the dental office and enjoying the people and processes. His dad taught him everything about managing a practice and suggested they start a Dental Service Organization (DSO). The dad would act as a silent partner and invest the equity needed for acquisition financing.

The plan turned out to be a big success—the practices became profitable by applying strategies that worked across multiple locations. They also made a smart move by placing dentists in medical buildings they purchased, creating a valuable asset with a low CAP rate that was easily sold to commercial real estate buyers.

In professional sports, the real money for owners often comes from owning the real estate around the stadium. Many dentists are discovering a similar opportunity—owning the real estate of their own and their colleagues' practices is a powerful way to build generational wealth.

—

If you're a MedTech investor, doctor, or dentist, connect with me to join our investor club to connect with a community of high-quality individuals.

Or tune in to the latest episode of Del Mar Medical Devices’ podcast!