# Pet Care Roll-Up Model

Plan a veterinary clinic group, from patient demand and clinic growth to profitability and investor returns.

- Canonical: https://finamodel.com/templates/pet-care
- Excel download: https://finamodel.com/templates/pet-care.xlsx
- Category: Healthcare
- Model type: Operating model
- Difficulty: Intermediate
- Audiences: PE & buy-side, M&A bankers, PE associates and partners, Veterinary platform CFOs, Acquisition lenders
- Tags: pet care, veterinary, roll-up, private equity, m&a

## Overview

Use this model to understand how a veterinary business grows as it adds clinics, patients, services, and supporting staff. It brings medical care, retail, grooming, and boarding income together with the costs of running a multi-site platform.

It is useful for owners, operators, and investors assessing an acquisition strategy or a growing clinic group. Adjust clinic growth, patient activity, pricing, and financing to see the effect on cash flow and returns.

## What's included

- Clinic panel: starting clinics, per-year acquisitions Y1-Y5, annual closure rate
- Per-clinic revenue inputs: medical visits and ticket, retail % of medical, grooming visits and ticket, boarding nights and ADR, per-clinic revenue growth
- Cost structure: vet comp % of medical, support per clinic, medical and retail/grooming COGS, rent per clinic, marketing %, corporate base + per-clinic
- M&A inputs: purchase multiple, trailing EBITDA per clinic, sponsor equity %, exit multiple, acquisition debt rate
- Clinic_Count sheet with opening, acquired, closed, closing, average clinic count
- Revenue sheet with four streams (medical, retail, grooming, boarding), total revenue, revenue per clinic
- P&L: vet, support, COGS, rent, marketing, corp overhead, EBITDA, D&A, EBIT, tax, net income, margins, identity check
- M&A_Cash: clinics acquired, acquisition spend, sponsor equity, acquisition debt, cumulative equity, PIK interest accrual, cumulative debt
- Returns: sponsor equity contribution stream, platform FCF (informational), exit equity proceeds, IRR, MOIC, blended entry multiple, multiple arbitrage
- Dashboard with Y5 revenue, EBITDA, margin, clinic count, sponsor IRR, MOIC, exit EV, multiple arbitrage, Y5 revenue mix, traffic-light status
- Clinic panel: starting clinics, per-year acquisitions (Y1-Y5), annual closure rate
- Cost structure: vet comp % of medical, support per clinic, medical and retail/grooming COGS, rent per clinic, marketing %, corporate base + per-clinic, D&A, tax, WC+capex drag
- Clinic_Count sheet: opening, acquired, closed, closing, average clinic count
- Revenue sheet: four streams (medical, retail, grooming, boarding) × clinics × growth, total revenue, revenue per clinic
- P&L sheet: vet, support, COGS, rent, marketing, corp overhead, EBITDA, D&A, EBIT, tax, net income, margins, identity check
- M&A_Cash sheet: clinics acquired, acquisition spend, sponsor equity, acquisition debt, cumulative equity, interest accrual, cumulative debt
- Returns sheet: sponsor equity contribution stream, platform FCF (informational), exit equity proceeds, IRR, MOIC, blended entry multiple, multiple arbitrage
- Dashboard: Y5 revenue, EBITDA, margin, clinic count, sponsor IRR, MOIC, exit EV, multiple arbitrage, Y5 revenue mix

## Pet Care Roll-Up Model: How the Five-Year Clinic Acquisition Template Works

This pet care roll-up model projects a five-year veterinary clinic acquisition strategy by linking clinic count, per-clinic revenue, cost structure, acquisition financing, and sponsor returns. It lets you flex acquisition pace, ramp assumptions, overhead, and exit multiple to see how equity IRR, year-five EBITDA, and enterprise value move together.

### Clinic Count and Acquisition Ramp Drive the Operating Build

The model starts with a clinic-count panel that rolls forward each year as opening clinics plus acquisitions minus closures. Average clinic count, the mean of opening and closing, feeds revenue and most cost lines.

- A weighted acquisition-age calculation blends the founding platform, which enters mature, with new acquisitions that start at mid-year age. That weighted age converts into a ramp factor applied to volume-driven revenue streams, so newly acquired clinics contribute less than their full run-rate until they mature.

- This single blended-cohort proxy is a simplification, not a per-vintage matrix, but it captures the drag from integrating new practices.

### Revenue Streams and Cost Structure Translate Activity into EBITDA

Revenue builds from four streams: medical services, food and retail, grooming, and boarding. Medical revenue equals visits per clinic times ticket times average clinics times the ramp factor.

- Retail revenue is a percentage of medical revenue and inherits the same ramp. Grooming and boarding use their own volume and pricing drivers, also multiplied by clinics and ramp.

- Total revenue is the sum of streams. On the cost side, veterinarian compensation scales with medical revenue only, reflecting that vets earn from medical services.

- Support compensation, rent, and corporate overhead escalate annually with cost inflation. Other costs include medical and retail COGS, a distinct grooming cost of service, marketing as a percentage of revenue, and D&A as a percentage of revenue.

EBITDA is total revenue minus total operating expenses.

Calculation summary:

```text
Medical revenue = visits per clinic × ticket × average clinics × the ramp factor
```

### Acquisition Financing and Cash Sweep Shape the Debt and Equity Profile

The M&A cash schedule values the founding platform on day zero as starting clinics times trailing EBITDA per clinic times the purchase multiple, split into sponsor equity and acquisition debt. Each year, acquisition spend equals acquired clinics times trailing EBITDA per clinic times the purchase multiple, similarly funded by equity and debt.

- Interest accrues on the cumulative debt balance in a paid-in-kind style, adding to the debt rather than being cash-paid. A cash sweep applies a percentage of platform free cash flow against the debt balance, capped so debt cannot go negative.

- Cumulative equity and post-sweep debt roll forward across the hold. This structure shows how acquisition pace and cash generation interact to deleverage the platform.

### Returns, Dashboard, and Practical Use for Deal Evaluation

The returns view constructs a sponsor equity cash flow stream: a year-zero equity outlay for the founding platform, annual follow-on equity contributions for acquisitions, and year-five exit proceeds. Exit enterprise value equals year-five EBITDA times the exit multiple, and equity proceeds subtract net debt at exit.

- The model calculates equity IRR, MOIC, and multiple arbitrage between exit and blended entry multiples. A dashboard presents ten key metrics, including year-five clinics, revenue, EBITDA, net income, revenue CAGR, EBITDA margin, revenue per clinic, sponsor IRR, MOIC, and exit EV.

- Traffic-light conditional formatting on EBITDA margin and IRR cards uses status thresholds set in the assumptions. This structure helps an operator or investor test how acquisition pace, integration ramp, corporate overhead, and exit pricing affect sponsor returns.

## Built on the canonical PE roll-up thesis

When the question is "what equity IRR does a veterinary platform deliver at a given entry multiple, exit multiple, and acquisition pace?", a clean per-clinic revenue build plus a platform EBITDA stack plus an exit-multiple-arbitrage return is the answer. This template hands a PE associate, platform CFO, or M&A banker a one-page bridge from per-clinic economics to sponsor IRR.

## Designed for one-edit responsiveness

Every input - starting clinics, acquisitions per year, per-clinic visit/ticket/mix, cost structure, purchase and exit multiples, debt rate - is a named-range cell. Edit one and the clinic count, revenue, P&L, M&A cash schedule, returns, and dashboard all recompute. No formula rewrites needed to test a different acquisition pace or multiple-arbitrage assumption.

## Honest about debt service in a stylised structure

Cumulative acquisition debt grows year-on-year by both new debt drawn AND interest accrued on the prior balance at the user-set rate (PIK-style). The model excludes operating FCF from the sponsor IRR stream because in a real PE roll-up FCF services that debt and funds follow-on M&A - it isn't distributed to the sponsor during the hold. Sponsor returns come strictly from equity contributions in Y1-Y5 against exit equity proceeds.

## Built on the canonical PE roll-up thesis

When the question is "what equity IRR does a veterinary platform deliver at a given entry multiple, exit multiple, and acquisition pace?", a clean per-clinic revenue build plus a platform EBITDA stack plus an exit-multiple-arbitrage return is the answer. This template hands a PE associate, platform CFO, or M&A banker a one-page bridge from per-clinic economics to sponsor IRR.

## Designed for one-edit responsiveness

Every input - starting clinics, acquisitions per year, per-clinic visit/ticket/mix, cost structure, purchase and exit multiples, debt rate - is a named-range cell. Edit one and the clinic count, revenue, P&L, M&A cash schedule, returns, and dashboard all recompute. No formula rewrites needed to test a different acquisition pace or multiple-arbitrage assumption.

## Honest about debt service in a stylised structure

Cumulative acquisition debt grows year-on-year by both new debt drawn AND interest accrued on the prior balance at the user-set rate (PIK-style). The model excludes operating FCF from the sponsor IRR stream because in a real PE roll-up FCF services that debt and funds follow-on M&A - it isn't distributed to the sponsor during the hold. Sponsor returns come strictly from equity contributions in Y1-Y5 against exit equity proceeds.

## Workbook structure

### Cover

Workbook overview, sheet legend, and tab-colour key for navigation.

- Title and scope framing
- Sheet-by-sheet purpose summary
- Tab-colour legend

### Assumptions

Every driver in one sheet: clinic panel, per-clinic revenue, cost structure, M&A inputs, status thresholds.

- Clinic panel: starting clinics, acquisitions Y1-Y5, closure rate
- Per-clinic revenue: medical visits and ticket, retail % of medical, grooming visits and ticket, boarding nights and ADR, growth
- Cost structure: vet comp %, support per clinic, medical and retail/grooming COGS, rent per clinic, marketing %, corporate base + per-clinic, D&A, tax, WC+capex drag
- M&A: purchase multiple, trailing EBITDA per clinic, sponsor equity %, exit multiple, acquisition debt rate
- Status thresholds for EBITDA margin and sponsor IRR

### Clinic_Count

Panel roll-forward with opening, acquired, closed, closing, average clinic count.

- Opening clinics carry from prior closing (Year 1 = starting clinics)
- Acquired per year linked from Assumptions
- Closed = opening × closure rate
- Closing = opening + acquired − closed
- Average = opening/closing mean - drives per-clinic revenue and cost lines

### Revenue

Four-stream revenue build per year off average clinic count.

- Medical = per-clinic visits × medical ticket × average clinics × (1 + growth)^year
- Retail and food = medical × retail percent
- Grooming = per-clinic visits × ticket × average clinics × growth
- Boarding = per-clinic nights × ADR × average clinics × growth
- Total revenue and revenue per clinic

### P&L

Revenue to net income with platform-level cost stack.

- Vet comp = medical revenue × vet comp percent (medical only - not retail/groom/boarding)
- Support comp = average clinic count × support-per-clinic
- COGS = medical × medical COGS percent + (retail + grooming) × retail COGS percent
- Rent = average clinic count × rent per clinic
- Marketing = total revenue × marketing percent
- Corporate overhead = corp base + closing clinics × corp per clinic
- EBITDA, D&A, EBIT, Tax (positive EBIT only), Net Income
- EBITDA margin, Net margin, identity check

### M&A_Cash

Acquisition spend, equity contribution, debt, and PIK interest accrual.

- Clinics acquired linked from Clinic_Count
- Acquisition spend = clinics × trailing EBITDA × purchase multiple
- Sponsor equity = spend × sponsor equity percent
- Acquisition debt = spend − sponsor equity
- Cumulative equity (running sum)
- Interest accrual = prior cumulative debt × debt rate (PIK)
- Cumulative debt = prior + new debt + interest accrued

### Returns

Sponsor equity IRR / MOIC from contributions and Year-5 exit.

- Equity contribution: zero in Y0, negative in Y1-Y5 matching M&A_Cash equity
- Platform FCF (informational): EBITDA − tax − WC/capex drag
- Exit equity proceeds in Y5 = Exit EV − cumulative debt with accrued interest
- Sponsor net CF = equity contribution + exit proceeds
- Exit EV = Y5 EBITDA × exit multiple
- Sponsor IRR (IRR of the CF stream), MOIC (proceeds / equity invested)
- Blended entry multiple, multiple arbitrage

### Dashboard

Y5 headline metrics with traffic-light status and revenue mix.

- Y5 revenue and EBITDA
- Y5 EBITDA margin with On-track / Watch / Stretched flag
- Y5 clinic count
- Sponsor IRR with On-track / Watch / Below-hurdle flag
- Sponsor MOIC
- Exit enterprise value
- Multiple arbitrage
- Y5 revenue mix by stream (medical, retail, grooming, boarding)

### Cover

Workbook overview, sheet legend, and tab-colour key for navigation.

- Title and scope framing
- Sheet-by-sheet purpose summary
- Tab-colour legend

### Assumptions

Every driver in one sheet: clinic panel, per-clinic revenue, cost structure, M&A inputs, status thresholds.

- Clinic panel: starting clinics, acquisitions Y1-Y5, closure rate
- Per-clinic revenue: medical visits and ticket, retail % of medical, grooming visits and ticket, boarding nights and ADR, growth
- Cost structure: vet comp %, support per clinic, medical and retail/grooming COGS, rent per clinic, marketing %, corporate base + per-clinic, D&A, tax, WC+capex drag
- M&A: purchase multiple, trailing EBITDA per clinic, sponsor equity %, exit multiple, acquisition debt rate
- Status thresholds for EBITDA margin and sponsor IRR

### Clinic_Count

Panel roll-forward with opening, acquired, closed, closing, average clinic count.

- Opening clinics carry from prior closing (Year 1 = starting clinics)
- Acquired per year linked from Assumptions
- Closed = opening × closure rate
- Closing = opening + acquired − closed
- Average = opening/closing mean - drives per-clinic revenue and cost lines

### Revenue

Four-stream revenue build per year off average clinic count.

- Medical = per-clinic visits × medical ticket × average clinics × (1 + growth)^year
- Retail and food = medical × retail percent
- Grooming = per-clinic visits × ticket × average clinics × growth
- Boarding = per-clinic nights × ADR × average clinics × growth
- Total revenue and revenue per clinic

### P&L

Revenue to net income with platform-level cost stack.

- Vet comp = medical revenue × vet comp percent (medical only - not retail/groom/boarding)
- Support comp = average clinic count × support-per-clinic
- COGS = medical × medical COGS percent + (retail + grooming) × retail COGS percent
- Rent = average clinic count × rent per clinic
- Marketing = total revenue × marketing percent
- Corporate overhead = corp base + closing clinics × corp per clinic
- EBITDA, D&A, EBIT, Tax (positive EBIT only), Net Income
- EBITDA margin, Net margin, identity check

### M&A_Cash

Acquisition spend, equity contribution, debt, and PIK interest accrual.

- Clinics acquired linked from Clinic_Count
- Acquisition spend = clinics × trailing EBITDA × purchase multiple
- Sponsor equity = spend × sponsor equity percent
- Acquisition debt = spend − sponsor equity
- Cumulative equity (running sum)
- Interest accrual = prior cumulative debt × debt rate (PIK)
- Cumulative debt = prior + new debt + interest accrued

### Returns

Sponsor equity IRR / MOIC from contributions and Year-5 exit.

- Equity contribution: zero in Y0, negative in Y1-Y5 matching M&A_Cash equity
- Platform FCF (informational): EBITDA − tax − WC/capex drag
- Exit equity proceeds in Y5 = Exit EV − cumulative debt with accrued interest
- Sponsor net CF = equity contribution + exit proceeds
- Exit EV = Y5 EBITDA × exit multiple
- Sponsor IRR (IRR of the CF stream), MOIC (proceeds / equity invested)
- Blended entry multiple, multiple arbitrage

### Dashboard

Y5 headline metrics with traffic-light status and revenue mix.

- Y5 revenue and EBITDA
- Y5 EBITDA margin with On-track / Watch / Stretched flag
- Y5 clinic count
- Sponsor IRR with On-track / Watch / Below-hurdle flag
- Sponsor MOIC
- Exit enterprise value
- Multiple arbitrage
- Y5 revenue mix by stream (medical, retail, grooming, boarding)

## Features

- **Built on the canonical PE roll-up thesis:** The model is structured around the three value-creation levers PE underwrites at IC: per-clinic growth (visits × ticket × clinics), platform synergy (corporate overhead drag against acquired clinic SG&A), and exit-multiple arbitrage (buying small at 7.5x, selling platform at 11x). Flex each independently to see which lever drives the headline IRR.
- **PIK-style interest accrual on acquisition debt:** Cumulative debt grows year-on-year by both new acquisition debt drawn and interest accrued on the prior balance. Sponsor equity proceeds at exit = Exit EV − cumulative debt with accrued interest, so the model honestly reflects that a $48M debt stack at entry compounds to $54M by Y5 if FCF doesn't service it.
- **Vet comp scaled off medical revenue only:** Vets earn off medical services they perform - not retail, grooming, or boarding. The model scales the vet compensation pool off medical revenue alone, matching how multi-site vet platforms actually pay producer comp. This avoids the common error of overstating vet expense as percent of total revenue.

## Use cases

- **PE diligence on a vet platform deal:** Drop in the target's clinic count, per-clinic revenue, and entry multiple, then flex the platform corporate overhead and exit multiple to see whether the sponsor IRR clears the IC hurdle. The model surfaces exactly which value-creation lever (organic growth, M&A pace, multiple arbitrage) is doing the work.
- **Platform CFO annual board review:** Take a real Y0 clinic count and per-clinic economics, set realistic Y1-Y5 acquisition pace, and read the Y5 EBITDA, total capital deployed, and sponsor equity returns. Use it to size the cumulative acquisition debt facility and the equity reserves the platform needs.
- **Multiple-arbitrage stress test:** Set Exit_Mult = Purchase_Mult (no arbitrage) and watch sponsor IRR collapse from ~60% to ~20% - the bare-EBITDA-growth return. Then flex Exit_Mult up and down to size how much of the deal thesis is multiple arb vs operational improvement.

## Frequently asked questions

### What is a pet-care roll-up model?

A pet-care roll-up model captures the operating economics and sponsor equity returns of a private-equity-backed veterinary clinic consolidation play. It translates a clinic-count trajectory and per-clinic revenue/cost economics into a platform P&L, an M&A cash deployment schedule, and a sponsor IRR / MOIC on a five-year exit at a higher EBITDA multiple. It is how PE associates underwrite deals like Mars VCA, NVA, IVC Evidensia, BluePearl, and Pathway Vet Alliance.

### Why does the IRR stream exclude operating FCF?

In a true PE roll-up, operating free cash flow services acquisition debt and funds follow-on M&A - it isn't distributed to the sponsor during the hold. The model shows platform FCF as informational but excludes it from the sponsor IRR stream, so the IRR strictly reflects equity contributions in Y1-Y5 against exit equity proceeds in Y5. This is the institutional convention for sponsor returns in a leveraged platform deal.

### Why is vet comp scaled off medical revenue, not total revenue?

Veterinarians earn off medical services they perform - examinations, surgeries, diagnostics - not off retail food sales, grooming, or boarding. Scaling vet comp off total revenue would overstate the expense and depress modelled margins by 4-6 percentage points. The model uses the producer-comp convention every multi-site vet platform pays on.

### How is the multiple arbitrage modelled?

Purchase Multiple sits on the Assumptions sheet (default 7.5x trailing EBITDA - institutional 2024-2026 pricing for single-location vet practices) and Exit Multiple is separate (default 11x - what a scaled 50+ clinic platform exits at to a strategic or larger sponsor). The Returns sheet headlines the spread as Multiple Arbitrage = Exit_Mult − Purchase_Mult. Set the two equal to see what the deal looks like without multiple arb.

### Can I extend it to a full LBO with debt amortisation?

Not directly. The template uses a stylised PIK-style debt accrual (debt balance grows at the acquisition debt rate without principal amortisation or interest paid in cash). For a full LBO with senior/sub tranches, scheduled amortisation, and a covenant pack, layer the lbo template on top - point its debt schedule at this model's M&A_Cash sheet.

## Related templates

- [Leveraged Buyout Model](https://finamodel.com/templates/lbo-model)
- [Dental Practice](https://finamodel.com/templates/dental-practice)
- [M&A Modeling & Valuation](https://finamodel.com/templates/ma-model)