The U.S. veterinary services market is presently in the middle of a consolidation trend that continues to attract large amounts of capital and investor interest. Investors and their platforms remain eager to roll-up the fragmented sector given strong industry fundamentals, significant market size, cash pay operations, and resilience to economic cycles.

The large cohort of platforms (50+) actively acquiring creates a deep pool of consolidators driving purchase prices to record levels. As broader market conditions have become more challenging over the last 12 months, acquirers have responded in various ways according to their own capital structures, risk tolerance, and overall M&A strategy. Some have
become less aggressive with M&A and more focused on de novo growth, and others remain quite aggressive with M&A activity. Meanwhile, we continue to see newly-formed PE-backed platforms entering the space. Investor appetite has been buoyed by case studies of successful returns realized by the early cycle consolidators. In some cases, investors, along with certain Doctor of Veterinary Medicine (DVM) partners, have generated very high returns on invested capital upon exit, well above average private equity returns. While 2021 set a new high-water mark for both acquisition multiples and overall volume, strong M&A volume persists as acquirers remain eager to scale — albeit with an increasing sense of
valuation discipline and underwriting rigor.