Marsallo: 'Still a lot of movement for companies'

When it comes to home medical equipment, Tony Marsallo has been there, done that. The new managing director at M&A firm Paragon Ventures was one of the co-founders of National Sleep Technologies (now Sleep Services of America) and operated a successful retail medical product and supply company, among other things.

“I have a passion for talking to business owners,” said Marsallo. “I've been in every kind of setting. You have to keep learning and reading and paying attention. It's so easy to read about what happened last week, but you've got to look ahead to next week.”

Marsallo spoke recently with HME News about why he's feeling bullish on the industry.

HME News:Are you feeling optimistic about the HME industry for the year ahead?

Tony Marsallo:From our standpoint, it's pretty positive. The companies that are still involved are survivors and probably run their business very well and have weathered the storm. All over the country, people I am dealing with now are talking about either acquiring or exiting, one of the two.

HME:What's the first step a provider should take when they decide to sell their company?

Marsallo:You have to sit down and get over the emotional part of it. It's difficult—you've been doing it for years. But once you get over the emotional part, it becomes black and white. Then you can bring somebody in and have a very sophisticated analysis to tell you what this business is really worth, not what you think it's worth or what Cousin Charlie thinks it's worth. Once there's agreement on that number, it's very doable. There's a way to exit the business.

HME:There's plenty of buyer appetite for niche providers, but what about for traditional DMEs?

Marsallo:There's still a lot of movement for companies doing lots of sleep with CPAP and BiPAP, and there's still a lot of movement with companies that specialize in mobility. With oxygen, when the cost to purchase POCs comes down and reimbursement is more favorable, more units will be placed and it will put business owners in a more creative part of the business, not so labor intense.

HME:Is there still a place in HME for the small mom-and-pop provider?

Marsallo:I think you need to have two people on the same page, like a husband and wife. Agree on your geography, really agree on what you are good at and focus on that. Take compression garments or mobility: You can get training from mobility and compression companies and call on local doctors. It's very doable.