Turning Associates into Partners: Financial Considerations for a Buy-In Structure

With Insights from Jessica Nunn of Maven Financial Partners

Bringing an associate into ownership of your healthcare or dental practice is one of the most impactful decisions you’ll make as an owner. Whether you’re looking to grow, gradually step back, or retain key talent, structuring an associate buy-in properly can set the tone for long-term success—or future frustration.

At Marti Law Group, we frequently guide practice owners through this transition. We also collaborate with advisors like Jessica Nunn, founder of Maven Financial Partners, who brings deep expertise in financial modeling and ownership planning. She discussed associate partnerships, buy-ins, and compensation in a recent episode of office hours. We've posted the full video below.

Plus, read on for a summary of the most important legal and financial considerations to keep in mind, combined with Jessica’s insights.

Want to know more about associate buy-ins? Read our article here.

1. Start With a Vision—But Don’t Get Locked In

It’s wise to begin with the end in mind. Are you building toward a five-year exit? Hoping to bring on multiple partners? Planning to grow into multiple locations?

Having clarity about your long-term goals helps guide the structure of a buy-in. But as Jessica puts it, “You want to leave room to change your mind.” People’s circumstances shift. Your associate may decide to move. You may receive an unsolicited offer from a DSO or another organization. Rather than drafting a rigid long-term partnership agreement from day one, start with a framework that allows for flexibility—particularly in the first year or two.

2. Get the Valuation Right—and at the Right Time

One of the most common questions we hear is: When should I value my practice? When I bring on an associate? Or, at the time we are considering partnership?

The consensus: value the practice at the time of the buy-in, not when the associate is first hired. The associate should be paid fairly for their clinical work, but not rewarded with ownership equity until they’re ready to purchase it. As Jessica notes, “When you give away equity too early, you’re giving away your value.”

Work with a qualified appraiser who understands healthcare and uses a reasonable methodology. You want a number both parties can trust—not something inflated or emotionally driven.

3. Structure the Buy-In for Alignment

Buy-ins should involve a meaningful ownership stake—typically 20% or more. Small percentages often lead to confusion and don’t give the associate enough skin in the game.

Jessica emphasizes the importance of helping the associate understand what they’re buying. “We walk them through: here’s your loan payment, here’s your expected compensation, here’s what distributions might look like.” Without that transparency, associates can get cold feet—or worse, feel burned.

An ownership model that combines performance-based compensation and profit distributions (see next section) helps everyone stay motivated and aligned.

4. Balance Compensation and Distributions

After the buy-in, the associate becomes both a clinician and an owner. Jessica recommends separating those two roles financially:

• Performance Compensation: Pay all providers based on collections or production—e.g., 35% of collections—to ensure clinical effort is rewarded fairly.

• Ownership Distributions: After overhead and base compensation, distribute remaining profits based on ownership percentage.

  
  

Jessica explains: “We model it out. We show them: you make X as an associate, and as an owner, you’ll make that—plus distributions. Here’s how that fits with your loan payment.” Financial modeling like this reduces surprises and builds confidence on both sides.

5. Build Trust Before Legal Paperwork

It’s tempting to go straight to drafting operating agreements—but Jessica encourages owners to build trust first.

That can mean offering mentorship, sharing financials, and having open conversations about vision, risk, and work ethic. “We want the associate to feel like they’re making a smart investment,” she says, “not just buying a job.”

Start with a letter of intent and work up to a full legal agreement over time. That allows both parties to test the relationship before making a long-term commitment.

6. Clarify Expectations and Roles

As with any business partnership, roles and responsibilities need to be clearly defined. Who handles marketing? Who’s managing staff? What happens if one partner wants to reduce hours?

These expectations should be agreed upon early and revisited regularly. When expectations are clear, accountability follows naturally.

7. Work With the Right Advisors

An associate buy-in involves legal, financial, tax, and emotional complexity. Surround yourself with an experienced team:

• A law firm that knows healthcare deals

• A financial advisor who can model out post-buy-in cash flow

• A qualified appraiser with healthcare expertise

• A CPA familiar with partner compensation and distribution tax rules

Jessica puts it simply: “When the right team is in place, you can make better decisions—and protect your relationship.”

Get a Buy-In Right with the Right Partners

Done right, an associate buy-in is a win-win. The associate becomes an invested partner. The owner transitions risk and gains support. And the practice becomes stronger and more resilient.

But successful buy-ins don’t happen by accident. They require planning, transparency, and expert guidance. Ready to explore your options? Marti Law Group and financial partners like Maven are available to help you structure a deal that works for everyone. Contact our team to get started.