With more Americans owning pets and those pet owners increasingly prioritizing the health and well-being of those new pets, the market is ripe for veterinary hospitals everywhere. So the closing of Inspire Veterinary Partners Inc.’s (NASDAQ:IVP) Initial Public Offering (IPO) last month, marking the introduction of the first publicly traded vet services company is a great opportunity for investors who want to gain exposure to that $61 billion vet services market.

Unlike other pandemic-era booms that went bust soon after quarantines lifted, the pet boom began decades before COVID and shows every sign of being here to stay. Today, 62% of Americans own at least one pet (about half of those pet owners have two or more). As pet ownership increases, so does the amount owners spend on their pets. Even as inflation strains household budgets, nearly half of pet owners say they haven’t made cuts to their monthly spending on their pets.

Inspire’s approach to consolidation is unique. Rather than an exit-driven strategy, the vet hospital owner structures acquisitions with the goal of owning that hospital for the long term and helping it improve its operations, costs and revenue along the way. Adding a personal touch, the company’s CEO personally visits each potential acquisition to interact with the staff and address any concerns. Additionally, Inspire allows each hospital to maintain its unique practice methods and identity, thereby appealing to sellers who are wary of the centralized models of larger competitors. This differentiates the vet hospital owner from most players in the game.

“The overwhelming majority of organizations that buy and open veterinary clinics in the United States are owned by private equity investors and managers,” said Inspire President and CEO in a recent blog post. “Funds are put in, a company is grown, and down the line those investors sell the company to new investors, take profit as a result and then look for another company or industry in which to invest.”

For shareholders, that approach has the potential to generate more sustainable long-term growth as the hospitals already under the Inspire umbrella continue to grow their revenue while later acquisitions help Inspire expand that revenue base. It also puts Inspire in a unique position to create additional revenue opportunities by expanding existing hospitals, adding on new services, and building a network for case referrals by connecting nearby hospitals and clinics in Inspire’s expanding network.

For the stakeholders in the hospitals themselves, that acquisition approach alleviates the stress of dealing with new owners who have no intention of sticking around for more than a couple of years and may have little interest in the long-term health of the business. It also gives them access to training and consultation from an experienced team of medical and operational coaches with a deep well of vetted experience. This approach can help improve margins as Inspire consolidates purchasing relationships and provides on-the-ground consulting and training to improve overall operations and identify the best growth strategy for each location.

As with the past couple of years, Inspire will continue to focus on general practice veterinary hospitals that already have a track record of profitability while diversifying into new clinic types in the years to come. As each new acquisition allows the company to further scale and bring more of its operations in-house, it plans to expand into emergency care clinics and earlier-stage practices as well. Acknowledging the vast market opportunity, Inspire Veterinary Partners notes that less than 30% of the over 28,000 veterinary hospitals in the U.S. have been consolidated, signaling a large upside potential for further acquisitions.