The Great Compression, Year 3
2025 has been quite a year for megamergers, shutdowns and regulators moving in for a closer look.
by Ryan Leech
The coffee was cold by the time Alex, the chief operating officer of a 300-hospital network, realized he’d been staring at the same spreadsheet for 20 minutes. Not long ago, mornings began with acquisition updates — new deals, new markets, new celebrations. Growth was the strategy, and improvements could always wait. Now, the numbers told a different story: underperforming locations, layoffs and closures, rising costs, and flat revenue. Investors who once demanded expansion were now asking for efficiency or their own exits.
Across the veterinary industry, executives like Alex are confronting the hangover from the acquisition era. The easy arbitrage is gone. Balance sheets are strained. De novo competitors are leaner, faster and hungrier. The Great Compression has entered its third year, and this time, the spotlight isn’t on who’s buying but on who’s holding on.
Financial Engineering to Buy Time
Thrive Pet Healthcare, with over 360 locations, figured out the new game early, securing a sizable capital extension as a stabilization move in the first quarter of 2025. The financing package, backed by existing investors, gave Thrive room to strengthen operations, manage debt and take another swing after years of rapid buildout.
It’s a quiet but telling pivot. Not every check is written to fund roll-ups anymore. Now, capital buys time — time to streamline, rebuild margins and prove that consolidation can sustain itself without another wave of acquisitions. If integration is the test, Thrive may have been the first to start studying.
Megagroup Moves
It finally happened. The long-rumored merger of Southern Veterinary Partners and Mission Veterinary Partners is official, giving the industry a new heavyweight to watch. Behind the fresh Mission Pet Health logo sits a serious to-do list: aligning operations, integrating systems and making two large networks run like one. With more than 750 hospitals and fresh capital from Silver Lake and Shore Capital, Mission Pet Health is the most closely watched experiment in veterinary consolidation yet. Whether it can pull off unification at that scale is the question everyone will be asking in 2026.
Not to be outdone, National Veterinary Associates is polishing its résumé. The group appointed Brian McKeon, former Idexx CFO, to its board and tapped John G. Bruno, formerly of Xerox, as CEO. These aren’t random moves; they’re the kind you make when you’re getting your house in order for the public markets. After all, nothing says “steady hands” like adding a finance veteran and an operations mastermind to your leadership team. Integration? Check. Governance upgrades? Check. Do we hear IPO bells?
Subscription Capital
For all the talk of tightening capital, a few hospital groups are still getting investors to knock, especially the ones with a membership card. With that, Small Door Veterinary raised $55 million to double down on its de-novo strategy, betting that design, experience and a subscription-based model can do what scale alone no longer can.
Modern Animal, meanwhile, managed to land $46 million in Series D funding. Its blend of digital-first infrastructure and membership-driven care continues to resonate with investors who see efficiency as the new growth story.
In a year defined by retrenchment, those two companies are proving there’s still capital available for innovation, just not for autopilot expansion.
The Great Pullback
Not every group made it through 2025 in one piece. My Pets Wellness shuttered in April, following a familiar story of overextension and rising debt. The Vets, once one of the fastest-growing at-home-care startups, halted operations in July after struggling to balance high acquisition costs with uneven demand. Even Bond Vet, synonymous with sleek clinics and fast scaling, went through a rough patch, closing a few sites and navigating an executive reshuffle.
The shake-ups sent a jolt through the industry. For many, these weren’t just business headlines but personal losses — teams displaced, clients left searching for care and a sense of uncertainty that rippled across the field. It was a sobering reminder that momentum isn’t the same as endurance and that the model that worked in 2021 simply can’t carry this year’s costs.
Oversight Rising
If financial pressure wasn’t enough, regulators pulled up a chair. In New York, lawmakers introduced Assembly Bill 9042, which would let the state attorney general review (and potentially block) mergers and acquisitions involving veterinary clinics and management services organizations. The bill also sets a $200,000 threshold for what counts as a “material change,” meaning even modest transactions would trigger a review and require extensive ownership and financial disclosures. The attorney general would determine whether a deal might limit access, raise costs or reduce the quality of patient care.
Supporters see the legislation as a long-overdue transparency measure. Critics warn it could slow or chill legitimate transactions. Either way, it signals that state oversight is moving closer to the exam table and that New York might not be the last to take a look.
Plenty is brewing across the pond, too. The United Kingdom’s Competition and Markets Authority raised concerns that pet owners don’t have clear or timely information about prices and who owns their local clinic, making comparing options difficult. To fix that, the Competition and Markets Authority released a provisional decision proposing transparency rules. These would require that practices publish price lists, disclose ownership, provide written estimates for higher-cost treatments and cap prescription fees.
If the rules pass, the next wave of competition in the UK might start not in the exam room but on the price list.
Reset and Rebuild
By late 2025, the consolidation market feels less like a sprint and more like a stress test. The focus has shifted squarely to balance-sheet health, especially among groups that haven’t raised new capital or are still carrying the weight of aggressive expansion. Hospital closures across the country served as reminders that scale alone doesn’t guarantee stability and that liquidity and operational discipline now matter more than deal velocity. Groups that brought in private equity in 2021, 2022 and 2023 are approaching their recap windows, which may prompt a new round of ownership changes as early investors look to cash out.
At the same time, the regulatory mood is hard to ignore. The motion in New York and the movement in the UK point to a future where consolidation comes with more paperwork and more public accountability. For independent clinics, none of this makes the day-to-day any easier. Flat revenue, higher costs and softening patient visits are testing every margin.
While the market regroups and larger players search for their next growth lever, this is the moment for independents to reset by investing in lasting efficiencies, refining processes and building the kind of operational muscle that pays off when demand for services inevitably returns. The next wave of growth might not come from roll-ups at all but from the clinics that never rolled over.
OUT OF MONEY
The Vets, an at-home care provider, went out of business in July 2025, just nine months after announcing its acquisition of BetterVet, another mobile practice network. At the time of the merger, The Vets touted: “This consolidation will significantly extend the company’s reach, expanding its footprint to over 30 major U.S. cities.” The company later lamented its inability to secure additional funding.
Fonte: todaysveterinarybusiness.com
