Episode 26 – Deeper Dive: Looking to Your Dental Practice Future

“Where you set your mind and your focus is where you will end up.” ~Dr. Victoria Peterson

Think about this: what is your 10-year goal?

I often invite business owners to talk about their 10-year goal. It seems easy so you might be surprised to learn how many owners balk at doing that. 

I get it. When you let yourself dream about where you want to be in 10-years it can be scary. You look at some big, seemingly unattainable goal and it makes you panic. It can seem like you’re setting yourself up for failure when you look at this beautiful, ambitious, 10-year goal.

But I’m here to tell you, your big goals are possible! Did you notice in my interview with Dr. Clint Euse that as he was building his Investment Grade Practice, he talked about the lifestyle he wanted and the goals he had for his practice and life? He defined his core values – what is important to him in life and lifestyle – and he defined what his endgame goals were. Then he built his lifestyle to honor those core values while staying focused on his long-term goals. 

Sounds easy when I put that way, doesn’t it? Here’s what usually trips people up in this process: we typically overestimate what we can do in 1 year, but underestimate what we can accomplish in 10 years.  

This is what makes Dr. Euse such a good example to follow: he is realistic about what he can accomplish in 1 year within the context of where he wants to be in 10 years. 

This is the key to building an Investment Grade PracticeTM.

So I invite you today to start dreaming big about where you want you and your practice to be in 10 years as I dive deeper into how you can build your Investment Grade PracticeTM, including:

• What banks look at when approving loans 
• What character traits to look for in possible associates or partners to help you along the way
• 3 phases of long-term practice growth

Want to know if you have an Investment Grade PracticeTM? Click here to use the completely free Investment Grade PracticeTM calculator: What’s my IgP Freedom Number?

Want to have a conversation about your Investment Grade PracticeTM? Contact Brent at brent@productivedentist.com.
Never miss an episode! Subscribe to Investment Grade PracticesTM Podcast on iTunes & Spotify.

EPISODE TRANSCRIPT

Victoria Peterson
Years ago, I was at a Tony Robbins event and I remember him saying people overestimate what they can do in a year and they grossly underestimate what they can accomplish in a decade and I think Dr. Clint used really persona FIDE that to the tee, you could hear in his language, you could hear in his confidence that he does annual business planning and he’s very realistic about what can I accomplish this year, in the context of where do I want to be in 10 years and I think that is the key to creating an Investment Grade Practice. Business Ownership is the greatest track to wealth, whether it be a dental practice or real estate, Empire, investment services, whatever you do as an entrepreneur, it pays dividends far above and beyond working for someone else. In my interview with Clint, we really didn’t go as deep into it, but you got the seeds of asset building. So step one, he became an owner, and right out of school, he found a mentor. In fact, he was one of those students in school, that were probably interviewing dentists and doctors in the area while he was still in school so that when he came out, he had the practice to go into, he formed a great partnership by 50%, in the first year that he was there, and then build a partnership over the course of 10 to 12 years, with an exit strategy for the initial owner.

These types of win-wins are being created every single day and banks are loaning on them every single day, regardless of the high student loan, or the high student debt. What the banks are looking at is does this business cash flows? And if the answer is yes, then they ask, Are you a person of character and leadership that can guide it into the future that was probably one of the most exciting things that Clint pointed out that his partner, Randy right, noticed that Clint was coming in as a serious individual who had a vision of the future who wanted to take on the business and management challenges of it, I can tell you, their business is fortified, they went through the stage one is this even viable as a partnership, where we grow their practice to the point that both of us earn a living. That was stage one, stage two became predictable, let’s invest in our team, let’s invest in the systems, let’s make it so that we can predict what our production and collections are going to be this month, next month, the month after, let’s make a very predictable business. I could hear it in the client’s conversation today that he’s now moving into the third phase, which is durable.

When you transition to a senior doctor, you know down from full-time to part-time you start bringing in associates and mentoring them up, you really do have to make sure that your systems are durable and that’s the stress test of it. Does this work regardless of the person that’s here? Now, I know there are boundaries in that you can’t take a highly-skilled doctor and replace them with someone who barely passes their boards. There’s quality assurance in that but that’s part of the durable system. Are we hiring and attracting and onboarding the right people so that they can come up to our standard? So if you are in a situation where there’s a difference, a dissonance in the standard of care or the standard of delivery or the philosophy of business or how we charge things out and you can’t have a meeting of the mind, then the partnership is doomed to fail. Really taking time to work on those partnership conversations is imperative. My dog co-pays So too, I can remember doing retreats with Clint and Randy and it’s not easy and it’s scary to say where do we want to be in five years and put your cards on the table? And maybe the older doctor said, I don’t know if that five year gets me here or not and the younger doctors saying, Well, I don’t know where I’m going to be looking into the future.

One is exciting. Because you can’t, you can’t say yes or no, that will or won’t happen. You get excited about the dream but then almost instantly, it scares you. Because what if I invest in this and it doesn’t come true? Here’s what I’ve I’ve known about doctors like Dr. Use is that wherever you set your mind, and you set your focus, that’s where you end up and that’s what being an investment grade practice owner is all about. He was very clear, I loved he goes, of course, I have Mondays off, I never worked Mondays, I have forgotten that. He set up his lifestyle to say, what is important to me, what are my core values, and you could hear family was one that was very important to he and Kelly, our family and our boys are going to come first. So we all work Tuesday, Wednesday, and Thursday, you work Monday, Wednesday, and Monday, and Thursday, and we can maximize our time with our kids. That’s planning, that’s life planning.

Then you heard him say, we figured out our lifestyle, and then we back the business into it, to see what the business needed to produce and collect, and what our overhead needed to be so that we could live this lifestyle. This was a very intentional business plan that said, My Life comes first. My business is here to fund my life and because he got that in the right order, he asked the question, what is my profitability point? Where do I need to be? So he went for 20% EBITA. He’s now at 38%, EBITA and growing, it is incredible what can happen with intention and so for me, this is a self-sustaining business, Clint is now a choice. He’s a financial choice, he could sell tomorrow, and he would probably get the highest multiple on the marketplace. So if a sale multiple goes from 4x to 10x, or 8x, he’s going to be on that eight to 10x, multiple levels compared to someone else who’s got a 10% EBITA on a million-dollar practice who will get a 4x. So when you read the magazines when you read articles and you and you hear about the fear mongers and DSOs are the devil. That’s not the message at all. The message is, how do you create a life of wealth, where you’re living your core values of family and health and vitality and travel and contribution? How do I set that up? And what’s the best environment for me?

For Clint, it’s obvious he’s got a great head for business. He’s terrific at managing. He’s pretty even-keeled. I’ve known him for over 12 years. I’ve never seen him any more upset or dramatic than he was today. He’s always very thoughtful and very even-keeled. He’s built for owning and running businesses and so it brings some enjoyment. For other doctors. It’s not that way, you know, struggling with the numbers struggling to hire the right CPAs and financial planners, you know, if you get that part, right, I promise you, everything else gets better. You know, if you have a poor CPA, who doesn’t pre-warn you about taxes, that, gosh, I had one client, they couldn’t file their taxes because their CPA was in jail, and they froze all of his records, and they couldn’t get the records out to even file their own taxes. So, you know, just like any other profession, accountants CPAs financial planners, you really need to vet them out to make sure that they are working in your best interest and that they’re on time and they are accurate. You know, a few key relationships like this gives you peace of mind.

You also heard that Clint was not really fatigued or stressed about the team and we didn’t get into depth by that but he said we put in the time we worked. It was an effort there was training. I know that they set aside at least an hour a week, half a day, every quarter, one to two days every year to do their planning to do their training. They have a mentorship program for new people as they joined the team so that everybody stays on the same page. These are clues to success and I think a lot of times we spend so much time analyzing our failures and where things went wrong. When you find someone who is successful, take them to lunch, I hope you comment, email PDA will get you connected with Dr. Use. He’s really sincere when he says I’d love to talk to anyone about how to make this a reality in your life. When you find someone who’s successful, pick their brain and ask them to unwind. How did you do that? Wherever the tough parts, how did you get through the tough parts? Building community, I think is a requirement for being an entrepreneur in today’s world. Success requires support and surrounding yourself with those who are generous in their mentorship really

plays a key part in it. So if you’re a young dentist, and you’re contemplating a partnership, I hope that this podcast encouraged you. If you want to scratch the dirt, that’s great, too. There are so many models that work. If you are an older doctor, by an older doctor, I mean 45 years old or more and you’re looking at your succession plan. Know that there are young doctors out there just like Clint who say, Man, I would love to walk in your footsteps, I would love to build a lifestyle similar to yours. Let’s work it out. I’m telling you, we can help you find the right financial planners find the right banking, find the right advisors to put the deals together because those deals are out there, and with all the consolidation that’s going on, I want to be a stand and a voice that there is room for everyone to play. There are great partnerships that abound. There are fantastic young solo entrepreneurs, there are private groups that are thriving, and there are some very good private equity-backed companies. So buyer beware, of course, in all of these situations, but don’t be afraid and don’t take a large paintbrush, and just put a big coat of paint across an entire sector of the market. There is a reason that all the players are in the market right now. Because there is a need at different levels. For great patient care, there is a need for consolidation, there is a need for up-leveling of the dental care across the board.

So all of us are needed and my part is to help entrepreneurs see how they can get out of the chaos of business ownership, and really build value and bring strength to their business, to the point that it is an investment grade practice and as you heard with Dr. Us Today, he’s a choice. He’s 44 years old, he’s financially secure, he can sell, he can hold, he can expand, he can contract. He’s in control of how many days he works, how long he works, and what a beautiful place to be. I can also tell you that he’s managed the risk around all of that as well. With overhead disability insurances and malpractice and all of those things that’ll be a different episode but once you understand your financial freedom number, you know what you’re building towards and you get to that place of security in that place of choice, that place of freedom and you know, you’ve mitigated the risk and protected your assets on the other side, man oh man, does it become a whole new game?

Thanks for joining me as I debriefed and worked with Dr. Clint use of Carson City, Nevada, a terrific friend, advocate, and alumni of Productive Dentist Academy. Kelly, you and Clint your family are a cherished part of our family and I appreciate you both.

I have a question for you, Are your CPAs preparing your first quarter financials? Are you excited to see the result? Or do you have a little bit of hesitancy wondering if you’re profitable enough to sustain the business and move it forward? You see a productive dentist Academy we know that looking at a profit loss statement and looking at budget versus actual can be daunting and that’s why 18 years ago, my partner, Dr. Bruce Baird, and I created the Productivity Workshop. If you’re wondering, what are the benchmarks for my practice, and how do I move my practice forward? How do I clearly articulate my vision and the passion that I have so that my team wants to join me in this endeavor? How do I elevate patient care so that I’m not at the mercy of insurance limitations?

These are all things that we cover at our signature productivity workshop. Our next one is September 22 through the 24th in Frisco, Texas and I certainly hope that you and your team can come and learn the exact tools that we not only have shared with 1000s of dental practices across the country to help them be successful but they’re the exact tools that I used in my own network of five dental practices. That helped me create a sustainable legacy company that is thriving today. So to make things a little bit easier, as you’re looking at your p&l and wondering, is this a great time to invest in myself and my team, if you sign up, we will open up our PDA online program is a recording of a previous PDA workshop, you’ll have access to a full year following our workshop.

You will also have a complimentary to our business session with some of my top business coaches. Every day of the week, they are helping doctors build Investment Grade Practices, building the value of their business, securing the system so that they are durable and it’s our gift to you to work with one of these high-level coaches to identify opportunities before you come to the workshop. We did this in February and I will have to say that the doctors who took advantage of it were sharing stories that they were already up to $50 an hour $100 An hour $200 an hour. So here’s the challenge right now. Pick up a pencil and write down the number of hours that you work per month, let’s say 114 Multiply that by 100. Now, what could you do with an extra $11,000 per month? If you’re ready to get started on the journey, I encourage you to check out productivedentist.com You can reserve your spot by going to productivedentist.com/workshop and get in touch with our team and see what we can do to help move you forward.