The Top 5 Mistakes Practice Owners Make – Episode 277

Don’t let these five mistakes keep you from owning a practice you love.

On this episode of the Dentist Money™ Show, Ryan talks with Dr. Richard Low of Shared Practices about the mistakes that can threaten the hard work that goes into practice ownership.

Ownership remains an ultimate goal in dentistry but costly blunders can be discouraging. From too casually considering your ownership options—scratch start, single-doctor practice, multi-doctor practice—to delaying your jump into ownership for too long, Ryan and Richard cover typical mistakes that every owner should know about.

 

Show notes:
https://www.sharedpractices.com/
https://event.sharedpractices.com/

 

---

 

Podcast Transcript

Ryan Isaac:
Hey everybody. Welcome to another episode of The Dentist Money Show, sponsored by Dentist Advisors, a no-commission, fiduciary, comprehensive dental-only financial planner for dentists all over the country. Check us out at dentistadvisors.com. Today on the show, Richard Low from Shared Practices, Dr. Richard Low from Shared Practices and I discuss the top five mistakes of practice owners, especially in the beginning of career and a really great list, a lot of really important things that we talked about.

Ryan Isaac:
Richard’s an expert on this stuff. He’s been running a podcast for a long time. He’s been a dentist. He’s bought and sold and built practices and his insight and experience was really awesome to hear. So thanks to Richard for being on the show today. Thanks to all of you for tuning in. We really appreciate the support. And if you have any questions for us, you can always go to dentistadvisors.com and book a free consultation with one of our very friendly dental-specific advisors. Or if you have a question you just want a quick answer to, go to the Dentist Advisors discussion group on Facebook. Post a question. We’ll post an answer. Thanks for tuning in. Enjoy the show.

Announcer:
Consultant advisor, conduct your own due diligence when making financial decisions. General principles discussed during this program do not constitute personal advice. This program is furnished by Dentist Advisors, a registered investment advisor. This is Dentist Money. Now here’s your host, Ryan Isaac.

Ryan Isaac:
Welcome to The Dentist Money Show, where we help dentists make smart financial decisions and, new and improved, avoid costly financial mistakes. I’m your host, Ryan Isaac. And I’m here with a guy I’ve known for a very long time. I met him in the lobby of the Dentaltown headquarters circa 2000 and, I don’t know, 14? Dr. Richard Low from Shared Practices. The Shared Practices I might add. What’s up, Richard? Thanks for joining us, man. How you doing?

Dr. Richard Low:
Thank you, Sir Ryan Isaac. How’s it going?

Ryan Isaac:
Good. Do you remember that day when we met in the lobby of the thing?

Dr. Richard Low:
Oh, I started grilling you fully expecting to be able to cross you off my list of yet another financial advisor not to trust.

Ryan Isaac:
Dude, I remember we had traveled to Phoenix to go spend an afternoon with the illustrious Howard Farran and did that, that was an adventure, and hung out at the headquarters there at Dentaltown and then I’m leaving, I’m in the lobby waiting for the elevator, out comes … were you an intern there?

Dr. Richard Low:
I was. They had full-time positions listed on their website, and I kept applying for them in my third and fourth year of dental school. And they’re like, Richard, stop applying for these. These are full-time positions. We actually need to hire people, stop. [crosstalk 00:02:38] And eventually they hired me as an intern.

Ryan Isaac:
See, it’s tenacity, folks. It’s grit. Yeah. You come out and you start asking these really amazing, detailed financial questions about everything, markets and costs and fees and philosophy. And I didn’t know you were a dental student. I’m like, he’s a magazine intern and he knows more about finance than most financial planners in my whole industry. It was awesome.

Dr. Richard Low:
Yeah. It’s something that I’m passionate about. And I’m probably in the dangerous zone, I think I know what I’m talking about, but I don’t have a depth of experience, but I’ve just read a lot so that makes me really informed, quote-unquote.

Ryan Isaac:
No, that’s the Dunning-Kruger principle, man. You’ve learned a lot. And now you realize how much you don’t know. And then anyone who learns a lot about a subject, you get to the point where you’re like, I’ve learned a lot, but man, there’s a lot smarter people out there than me and I still don’t know anything.

Dr. Richard Low:
Exactly right. No, exactly right.

Ryan Isaac:
The reverse is true as well. People that don’t know anything about anything and think they know it all.

Dr. Richard Low:
Well, the nice thing about investing was that as I learned more, I realized that index funds were something that I was drawn to as like, okay, these aren’t sexy, but this makes sense.

Ryan Isaac:
It’s going to work.

Dr. Richard Low:
This could work.

Ryan Isaac:
Yeah. Yeah. You come to that conclusion, oh, I can do kind of boring stuff. It’s not very sexy. Over decades, it’s going to work fantastically. Then go spend your time and your risk and your energy on a business and improving your income. And then that’s where the success will come from, man. That’s a great conclusion you came to. Anyway, that was a good day. Richard, who are you, where do you hail from? Where do ye hail from? What are you about, man? I’m sure everyone’s got to know, but [crosstalk 00:04:21] show.

Dr. Richard Low:
No. No, no, no. I am an Army dentist for another, oh, I got to pull it up on my phone, I think 35 days, I think.

Ryan Isaac:
Oh, for real? Wow.

Dr. Richard Low:
35 days. I was right. Yeah.

Ryan Isaac:
You even got countdown?

Dr. Richard Low:
Yeah. I have multiple countdown timers on my phone. The Army is great. It doesn’t have to be the long-term solution for everybody. I’m very grateful for the opportunities it afforded me. I did the HPSP scholarship, which let me go to Midwestern University in Arizona, graduated in 2015, worked for Howard Farran while I was in dental school. And then did a two-year AEGD advanced education in general dentistry residency at Fort Hood in Texas, easily the two worst years of my life and also best years of my life. Learned a ton, very painful, family strain, drama. And part of that came down to the fact that I started a podcast while in residency.

Ryan Isaac:
As you do.

Dr. Richard Low:
My bad. Yeah. So the podcast came from working for Howard, because I produced his in dental school and then meeting Alan Mead and Mark Costes in my fourth year of dental school. And including the pod father, Gary Takis.

Ryan Isaac:
Oh, Takis, G-man.

Dr. Richard Low:
Yeah. So all of these people I got to know fairly well while still in dental school. And they were telling me that I should start my own dental podcast. And I’m like, who wants to listen to some new grad Army-

Ryan Isaac:
[crosstalk 00:05:51] is there room for more?

Dr. Richard Low:
Right. We’re already at 20 dental podcasts. There’s no way we could ever reach 70-plus. Oh, wait. So there was this feeling of, what am I going to podcast about? Who’s going to listen to this dude yammer on about what he thinks is important. But I realized that the one thing I had was a bunch of angst and questions and a desire to come up with an organized curriculum of a podcast, which nobody does. And now we’re in 2021 and we’ve had 1.3 million downloads. We’re 450 five-star reviews and I think we’re the number one rated dental podcast in the industry. And people tell us all the time I bought my practice because of your podcast, which is just crazy.

Ryan Isaac:
So cool. Was it called Shared Practices when you began?

Dr. Richard Low:
Mm-hmm (affirmative). The whole time.

Ryan Isaac:
Right off the bat, you never changed it? Okay. I got a few points here we’re going to hit. We’re going to cruise through some of these, and these are great topics. They’re all pretty related, but they’re pretty broad topics too. Mistake number one, people who delay practice ownership. What’s the scenario there, what’s happening? Where do the mistakes get made?

Dr. Richard Low:
Yeah, this is getting worse, not better. So I think there’s a combination of student loans constantly escalating, corporate putting the pressure on that hey, number one, you shouldn’t own a practice. You should come work for us. They’re telling that message to dental students all through dental school. And then number two, corporate buying up some of the practices that would have otherwise been for sale.

Dr. Richard Low:
And then three, even COVID, recent events. I’ve talked with some dental students recently who’ve said that their classmates share the sentiment that, man, I don’t know if I even want to own a practice. I mean, look at COVID, look how risky things are. And ironically, those who got laid off during COVID were all the corporate associates and those who got PPP loans [crosstalk 00:07:53] and weathered the storm were the owners.

Ryan Isaac:
It is ironic.

Dr. Richard Low:
There’s this sense of, I either need to wait until I’m somehow magically confident to own a practice, until I’ve figured it all out or until I’ve made a bigger dent in my student loans, or I need to wait five years, seven years, people are telling me that I shouldn’t go straight into practice ownership.

Dr. Richard Low:
And our hypothesis of the podcast is once you figure out if practice ownership is right for you, then in general, the sooner you get into it, the better. We talk about compounding interest, compounding ability to be a practice owner and get ahead-

Dr. Richard Low:
Compounding income, man.

Ryan Isaac:
Income. Seriously.

Dr. Richard Low:
Compounding experience. It’s huge.

Ryan Isaac:
Yes. So that’s where we get a lot of people, and I think we do a great job of pushing people mentally on this, of, if you’re going to own a dental practice, move up your plans. And I will … first in line, my partner, George Hariri, he bought straight out of school. We have a lot of people who’ve bought straight out of school. That’s not for everyone. We’re not saying that’s the standard. I think one to two years of getting your feet under you, making sure you’ve got clinical confidence, getting some liquidity is a great thing to shoot for. But if you’re starting to look like three, four, five, seven years, maybe you can accelerate it. And I’m one who I thought I would own a practice once I got out of the Army. I started this podcast thinking fully, I’m going to be at least four and a half years of podcasting about practice ownership without being able to own a practice, which feels really hypothetical. Not hypothetical-

Dr. Richard Low:
Hypocritical.

Ryan Isaac:
Hypocritical.

Dr. Richard Low:
And hypothetical because hypothetically, you’re speaking about things you haven’t experienced yet. Hypothetically hypocritical.

Ryan Isaac:
Exactly, exactly. But because I was so sold on this idea of accelerating your timeline, I had a pretty unique opportunity to move to Indiana, which is where we were going to be long-term, earlier than I expected in the Army. And I took a nonclinical role as a medical recruiter for the Army for the last two years, since December 2018. And I set the goal to either buy or start a practice within a year once we moved here a couple of years ago. And called up some brokers and the first broker I talked with, I told her, hey, I’m looking for a larger practice that could fit multiple doctors in one practice, like three or four hygienists. And she was like, I don’t have a practice like that, but I do have these three that we haven’t listed yet. And they all have doctors in them. The seller is willing to stay on, great situation, good people, good practices. And I was like, huh, okay, maybe that could work.

Dr. Richard Low:
Maybe you’ll get three.

Ryan Isaac:
Maybe we’ll go from zero to three while I’m still in the Army.

Dr. Richard Low:
Did it fuel the continued angst for the podcast though?

Ryan Isaac:
Yes. Oh, for sure. It provided plenty of material for learning, and what I realized was if you own three practices and you’ve got great people in them with great partners, then the only things that you deal with is that all the problems that bubble up, which just in the normal course of life and practice ownership, stuff is going to bubble up. And if you multiply that by three and staff turnover by three, there can be some really stressful moments.

Dr. Richard Low:
Yep. While you’re still in the Army.

Ryan Isaac:
While I’m still in the Army and running Shared Practices.

Dr. Richard Low:
Doing dentistry, running Shared Practices, and being a medical recruiter.

Ryan Isaac:
Exactly.

Dr. Richard Low:
[crosstalk 00:11:33] easy. Great.

Ryan Isaac:
Well, not recommended. But coming back to this point of maybe it’s possible to accelerate your timeline and get into practice ownership a little bit sooner. So I think between the episodes on our podcast, where we talk about new grads buying practices, things like this, our encouragement is accelerate your timeline if that’s the direction you’re going, and it’s not right for everyone. And we totally understand that. We’re not trying to say practice ownership is a panacea that everyone should do.

Dr. Richard Low:
You’re saying there’s people who should be and want to be career associates.

Ryan Isaac:
Absolutely. And that’s super-respectable because … in fact, I was talking with a doctor recently and I asked him, what are your two least favorite parts about practice ownership? And he said, marketing and leadership.

Dr. Richard Low:
Like all of it and all of it.

Ryan Isaac:
Right. He’s like, I was sold the idea that practice ownership was going to be like the bomb. And it has been really stressful and I’m not doing great and I don’t love it. And that’s okay. Sometimes you have to learn that through experiment. But it’s not right for everyone. And that’s fine.

Dr. Richard Low:
What about early on, on this kind of early path, one of the biggest questions we get when we talk to students is, how can I pay off my student loans as fast as humanly possible while also navigating this, I have to make a gigantic career decision and build a practice or own one or buy one and transition into that part of my life too. What do you see with people trying to pay down student loans too fast, right out of the gate?

Ryan Isaac:
Yeah. So this would be kind of mistake number two is not stockpiling cash. I took your guys’ advice very seriously, I had Reese on the show early on in the podcast, that liquidity is way more important than paying down student loans. If you have an extra $100,000 that, say that you had a phenomenal year or two years as an associate, and over the course of the year, you know, your saveable extra money was $100,000 and you’ve got $400,000 of student loans. The banks would much rather you have that $400,000 of debt and $100,000 sitting around than the $300,000 of debt and nothing sitting around.

Dr. Richard Low:
And no cash.

Ryan Isaac:
No cash. So I think the biggest mistake is the order of operations. If you want to get aggressive about student loans, that’s fine, but let’s hit pause on that until you’re in practice ownership. And let’s build up that liquidity, because whether you’re doing an acquisition or a startup, you want to have cash on hand. You want to be able to weather the startup storm if you’re hitting some bumps on the startup process. I’m closing on another practice situation tomorrow. And I’ll talk about that in a second, but I’m getting an SBA loan and they needed a cash injection. They needed some money to go along with that SBA loan. There’s so much in that transition phase that if you can have three to six months of living expenses just socked away, even though you’re missing out on Bitcoin, on Doge coin-

Dr. Richard Low:
Oh, [crosstalk 00:14:50] gods, man, you’re going to make some people mad about that. It’s true though.

Ryan Isaac:
It is true, and I am missing out on all of that. I would love to be screwing around with the market right now, but I’m in a situation where practice ownership immediately in the near future and liquidity is far more important to me than the risk and the rewards in the market right now. So feel great about the 0.2, 3% interest you are earning on your online savings account of this money. That is the best investment you could make is just stockpile that cash.

Dr. Richard Low:
It is. It goes back to point number one, which is don’t delay that ownership opportunity if that’s where you’re headed because the power of compound income and compounding experience is just not something you want to miss out on in order to buy a fraction of some Bitcoin or the emotional reward of slapping an extra $20,000 down on your $600,000 student loan.

Ryan Isaac:
Totally. Well, and I get it, I’m a Dave Ramsey apostate. I did the Army scholarship because at the time I was drinking the Kool-Aid, I was hardcore all in on Dave Ramsey. And I was like, you know what, Army’s going to pay for all four years of dental school. It’s a great opportunity. And it was, I’m not saying that it wasn’t, and I’m very grateful for it, but knowing what I know now, I’ve seen other scenarios play out, including, I’ll share an example here, one of my best friends from undergrad, his name’s Dr. Scott Smith. He decided on dentistry after me and my other roommate freshman year. So we all lived on the same floor of Deseret Towers at Brigham Young University back in 2004 and all decided independent of each other. Well, not independent. We all decided to be dentists eventually. And Scott decided later and got into dental school a year after Todd and I, and then tried to get the military scholarship and got disqualified because of medical reasons.

Ryan Isaac:
So then my podcast came out and he starts listening and we started talking and he decided to go for it. He’s like, okay, I’m six months out of dental school. I’m going to go ahead and try and find a dental practice, finds a practice, buys a practice. And he texted me at the end of that year, the next full year. And he said, I paid more in taxes this year than I made as an associate my previous year. So [crosstalk 00:17:23] that right there gives you a little bit of a scope of what’s possible. He then texted me a year later and he said, dude, I’m a millionaire now because of Shared Practices and practice ownership. Thank you [crosstalk 00:17:35].

Dr. Richard Low:
So cool. Yeah, the profession of dentistry it’s ranked by the Department of Labor, I think that’s who keeps the statistics, as number two, because they only look at payroll data. It’s number one in income because of net income the dentists take, and you want to get rich as a dentist, go make a lot of money as a dentist. That’s how you get rich as … the way that you compound that wealth and get a little bit wealthier down the road, of course, is investing in different things. But the way to get rich as a dentist is to make a lot of money as a dentist in a incredibly profitable industry. It’s insane.

Dr. Richard Low:
And sometimes let’s take a step back and I’m like dentists work in an industry where they can, in most cases, get funding for anything they want to do fairly quickly at great rates and terms. And then use that money to build a business as big or as small as they want that sometimes has like 50% profit margins. It’s bonkers. And you can do it until you’re 70 years old if you want to and still make six figures working a day or two a week as a 65 year old. [crosstalk 00:18:41]. Yeah, yeah.

Ryan Isaac:
Wait, but I do want us to go back to that [crosstalk 00:18:42] one more thing. And I think there’s a generation who gets to ask the question of how do I get rich as a dentist? There’s the next generation, which is my generation of how the heck do I get rid of this half a million of student loans? And unfortunately, or fortunately, depending, you have to go into more debt to be able to get out of that debt and be a practice owner. You don’t have to, but that is, if you’re going to go that way, the sooner you get there, rather than paying down your student loans, the more leverage you’re going to be able to have to pay off those student loans in a massive way. And that’s the … delay paying down those student loans so that you can move them all you want later if you still are so inclined.

Matt Mulcock:
On The Dentist Money Show, we teach dentists how to make smart financial decisions.

Ryan Isaac:
You’re correct.

Matt Mulcock:
I mean, is that all it takes, Ryan, to make smart financial decisions, listening to our show?

Ryan Isaac:
Matt, it’s a good first step, but to put your financial future on the fast track, the next smart decision is to go to dentistadvisors.com. What you do there is you click on the Book Free Consultation button, right in the middle of the home screen. And then you schedule a time to talk with one of our very friendly dental-specific financial advisors today.

Ryan Isaac:
The third one would be pretty similar, which is not getting into the right type or starting the right type of career track. What do you have in mind when you say that people are just not getting into the right type of practice or the practice that fits your vision, I guess is the way you would word it [crosstalk 00:20:13].

Dr. Richard Low:
Yeah. Yeah. So what we’ve seen, our hypothesis, another hypothesis early on is buying the right practice is going to make a massive difference, but we kind of missed the overall vision of what kind of practice do you want to have? And this comes back to, we’ve got two models that we really like to focus on. Number one is the solo practice. Practice owner is the practicing dentist with the teams centered around that dentist. That’s like the default though, the single doctor practice. There’s so many good things about that practice model. There’s less of the overhead and stress of a large team. There’s a lot of efficiency. If you want to figure out how can I make the most money with the smallest team and overhead and drama with my own two hands and I don’t mind the clinical dentistry for years to come, that’s the way to go.

Dr. Richard Low:
There’s another model which we really recommend, which is a multi-doc practice. So not multi-practice ownership, but a practice that it can accommodate more than one doctor. And the reason that this becomes a pretty amazing opportunity is that your overhead and your costs tend to shrink as you’re able to scale in one location, because you can get more out of the different hours, your fixed costs come down as you can get more and more people in that office. And you can get to the point where your hygiene base begins to cover your overhead or a large portion of that.

Dr. Richard Low:
And as an owner, there’s a lot of advantages, especially if you want to go the other direction and you want to kind of take a step back from dentistry and say, hey, I like the business side of things, I like managing people more than I like the clinical dentistry. And figuring that out really quick is super important because of the real estate. If you get into a solo-doctor practice, whether it’s a startup or an acquisition, and then very quickly realize, crap, I want to expand, I want to grow, I want to scale, I want to have a lot of people in this one practice, you’re going to be kind of trapped because the real estate limitations of having four or five operatories, six operatories, and not being able to have two full-time doctors at the same time in the same place is going to cap your growth. Even if you can figure out all the marketing in the world, you can figure out all of the-

Ryan Isaac:
Yeah, you’re just limited at some point, you just don’t have the space.

Dr. Richard Low:
You’re limited. And a lot of people don’t know this about themselves. They don’t know what kind of dentist do I want to be. Am I a clinical dentist who happens to be a practice owner? Or am I entrepreneurial dentist who is clinically passionate about a few things, but really I really like the business side of things and want to be less hands-on clinically. And figuring that out as soon as possible is key. Because if you’re going to do a startup, then do a startup with eight-plus operatories if you’re going to be that second dentist. So many startups do this beautiful, gorgeous four- or five-op practice, and they have to figure out the marketing because they start with no patients. They figure out the marketing. And then two years in they’re busting at the seams and this beautiful office no longer accommodates their growth.

Dr. Richard Low:
So I think this question of which kind of dentistry do I want to do, do I want to do more of the me doing the dentistry, it’s the Dr. Low show, let’s make this happen. And maybe even three or four days a week, you can do a lot of dentistry in a very small amount of time, very efficiently with a lower overhead, with a tight well-run practice. Or do you want to be a business owner? Do you want to have team leads? Do you want to have multiple doctors? Whether that’s a partners or associates or whatever the model is, those are our two recommended models. And the thing that everyone gets hooked on is this multi-practice over here that doesn’t necessarily scale well and comes with its own set of difficulties.

Ryan Isaac:
The one you did.

Dr. Richard Low:
Which is what I did, and I’m doing again, ironically.

Ryan Isaac:
Different beast though. So I guess you’re hitting on something that’s interesting to me. I’m 40 years old, I’m mid-career, and I’ve had a lot of different changes of mind over my life so far the last 20 years about what I wanted. And often you just don’t know until you push down a path. So I guess two questions come to my mind. Is there a way you can speed up in your mind for a dentist the learning curve of figuring yourself out? So you know where you want to be headed, and you listed this as the fourth mistake, but once you realize you’re down a path that is not the right one for your vision long-term, how do you pivot and how do you do it quickly?

Dr. Richard Low:
Yeah. So, great questions there. I would say the first one, there’s two great questions that you can ask yourself to figure out which direction you’re leaning as a dentist. The first is, what lights me up? So what am I excited about? What am I fired up about? Am I fired up about the clinical aspect of dentistry or the practice management side? Am I fired up about materials and procedures and surgery, or am I fired up about systems and managing people and scaling and marketing? The second is pick your problems of, what’s the crap hits the fan that you want to deal with? Do you want to deal with a large team turnover, inter-office drama, all of that that comes with a larger team, or do you want, I want my problems to be that one patient who’s in my chair, I’ve got to figure this out clinically, this is my issue.

Dr. Richard Low:
And you don’t have the ability to maybe necessarily take as much time off, but you’ve got a much smaller team with much less drama and turnover and other problems there. So in terms of pivoting, I would say that once you’ve figured this out, the sooner you make a pivot the better. So I figured this out a little bit for myself. My vision in dental school was I want to have three dental practices and be the traveling specialist between them. So I went and did this residency and I was like, okay, I’ll do the endo and the surgery, the extractions, the implants between three offices. Well, it turns out that, number one, three different offices aren’t going to have great systems in place and all the equipment needed for all these different procedures.

Dr. Richard Low:
There wasn’t necessarily a ton of volume of these procedures to keep me busy. And then also there’s just the stress of running three practices. I realized that that was maybe not the direction I wanted to go. And number two was that I had partners who really like scaling via acquisitions. They like to buy profitable, healthy practices and then keep them profitable and healthy so that they can buy more practices. If you don’t keep your practices healthy and profitable, you can’t get further lending to get more practices. And I realized really quickly that that was not the direction I was excited to go. I was not excited to scale and to have a fourth and a fifth and a sixth and a seventh practice under me because I was honestly drowning, probably my fault, full-time in the Army with three practices, and Shared Practices. [crosstalk 00:27:28] just a little overcommitted.

Dr. Richard Low:
Yeah. So I got to the realization that this was not my vision, this wasn’t really my long-term goal, and made the decision to walk away from these three practices. And I had some amazing partners that helped me buy these practices on the front end and then helped me kind of transition out of them on the back end. And they were really good people, which made this whole me flip-flopping on them work out much better than probably it should have. I think I got lucky with how it all worked out the way that it did. So just recently, this last fall, decided to walk away from these practices and start over and try and get, number one, more focused on one specific procedure. I realized I was doing the endo, I was doing the surgery, but I was never going to get as good as an endodontist without committing and going to endo residency.

Dr. Richard Low:
And I was never going to get as good as someone who does implants all day, every day. So I pulled back and said, okay, how can I do this all the time? And that’s when I decided to move on. And that was painful. That was hard. That was difficult.

Ryan Isaac:
It is hard. Yeah.

Dr. Richard Low:
And kind of felt weird. I’ve kind of lived my life publicly on the podcast and there’s this whole set of weirder expectations around, I said I was all about this and I’ve said this on air.

Ryan Isaac:
You just got to backtrack now.

Dr. Richard Low:
Yeah. [crosstalk 00:28:59]

Ryan Isaac:
That’s fine. I mean, you grew, you learned, that’s what we humans do, that’s what we’re supposed to do. It’s a weird notion to be like at 20 years old, I’m going to make some life-altering decisions and then stick with them for the next 60 years.

Dr. Richard Low:
Totally.

Ryan Isaac:
It doesn’t happen that way.

Dr. Richard Low:
And I think there’s a tendency to end up on the wrong point in this scale of either a larger practice where you’re managing people and you realize you don’t love that, or a smaller practice where you do want to manage and grow, and you’re kind of stuck and you have to make some drastic changes to get out of that situation or to transform that situation into what you need it to be. And it takes a lot of courageous steps to cut back to two days a week or three days a week, or get that second piece of real estate and expand, even though you’ve got an existing lease and you’re going to have to figure all that out.

Ryan Isaac:
All this kind of just keeps going back to the first point you made, which is don’t delay your practice ownership in your career when you’re right out of school, don’t delay it in the middle of your career when you need to make a change, don’t hold onto these things. Make a change, figure it out, make a change. It’ll be hard, but it is when you’re a student just graduating and it’s hard when you’re 45 and you need to make a change too. But you do it because the long-term, there’s just huge benefits long-term. Last thing, you listed this last mistake, you phrase it as focusing on the how of practice management instead of the what you should actually be doing based on metrics. So what does that mean? Focusing on the how versus the what.

Dr. Richard Low:
I think there is a thought, or at least this was definitely my thought, one of the early names for Shared Practices was Dental Systems Academy, something stupid. And the thought is, if you could just get all of the right systems in your practice, the how-to, how do we do billing? How do we answer the phones? How do we do scheduling? How do we market? If you could get all of the how systems right, then your practice is going to be perfect. And in fact, there are some people out there who will teach you great systems, in particular, there’s a dentist who teaches a whole manual of, these are the systems that if you come in and implement, you’re going to have a phenomenal practice. What I realized when I got into these three practices was, man, there’s a lot of systems in my practice that maybe aren’t perfect, but they’re functional enough.

Dr. Richard Low:
And if I come in breaking all of our systems and saying, hey, there’s a slightly better way of doing this, this, this, this, this, and this, number one, my team is going to kill me because every time you ask your team to change, whether it’s [crosstalk 00:31:43] yeah, it’s a big deal. And so knowing what to change and why and why that’s holding you back from where you’re trying to go is far more important than having a manual of all of the specific systems that are ideal and if you just did these, your practice would be perfect. So knowing what to do is more important than how, but knowing what to do is going to depend on multiple things.

Dr. Richard Low:
Number one, it’s going to depend on your practice vision. Do you want to be that multi-doc office? Therefore, if you do, your steps to get there are going to be completely different than someone who just wants to streamline that solo practice. Then if you do want to do that, what are the things that are holding you back from getting there? And that’s going to be so specific. And like we just said, change is very hard often on the team, especially if they’ve got years of doing things one way that was good enough, that was easy.

Ryan Isaac:
Man, especially if you purchased or acquired a practice with a veteran team, that’s been there for decades, that’s tough.

Dr. Richard Low:
Exactly. And people are saying, I’ve been doing this for 34 years.

Ryan Isaac:
Yeah, you don’t know. I know.

Dr. Richard Low:
I’m 34 years old and they’re telling me they’ve been doing this for 34 years. And I’m like [crosstalk 00:32:58]

Ryan Isaac:
It seems like a long time.

Dr. Richard Low:
That is a minute.

Ryan Isaac:
Maybe you know.

Dr. Richard Low:
Yeah, you have a point. So knowing that what is something that you’re going to learn from your vision paired with metrics and sometimes maybe some outside perspective, maybe that’s a friend who’s been on this same journey or we’re biased, we’ve got a mastermind, we’ve got a coaching service. And then we’re holding actually a course in July on metrics-based practice analytics and a two-day course, my partner, Dr. George Hariri, is teaching this course on how to make decisions around your practice based on the data that your practice is actually giving you, which most people-

Ryan Isaac:
Yeah, now you’re talking my language. I like that. [crosstalk 00:33:45].

Dr. Richard Low:
Yeah. Most people, they have a hard time with the data. Have you run into that with dentists, where you [crosstalk 00:33:51] data?

Ryan Isaac:
Well, and the problem with data is everyone’s like, yeah, let data make the decisions, not emotions, but the problem with making decisions on data, it means you need data, which means you have to be incredibly organized and you have to track meticulous amounts of data in separate categories, which is usually not a job most people want to take on by themselves or do it very well very long. Because after a while, you’re just like, this job sucks, let’s go back to the way I was doing it. So that’s the problem with data is you got to spend hours and hours organizing, tracking, monitoring, analyzing, then deciding on the data. That’s our base philosophy of financial planning is how good financial planning is run, with data. And it’s a lot of work to just even have the data, just to [crosstalk 00:34:34] a meeting and have data, it’s hours of work before that even took place. So yeah, that’s why I think people just … it’s hard to do. It’s hard to implement.

Dr. Richard Low:
Yeah. And then knowing what to do with it. And I’ll admit here-

Ryan Isaac:
Then knowing what to do with it. Yeah.

Dr. Richard Low:
This is coming from me who’s got this whole podcast on practice management. I had Practice by Numbers hooked up to these three practices. We’ve now switched over to Dental Intel. But at the time I had Practice by Numbers hooked up to our three practices. And I did not do a great job of looking at the data and making decisions based on it, because it was overwhelming. I was just treading water. I was so overwhelmed that I didn’t have time or the mental capacity to open up all of these metrics and numbers.

Ryan Isaac:
Well yeah. [crosstalk 00:35:21] you’re now not only organizing it, not only tracking it and doing it correctly, but now having either enough time or experience and expertise to even know how to interpret it, then make decisions on it and then have some kind of accountability to follow through on those decisions and stick with them. It’s like a five- or six-step process of making decision-based data that is so much harder and more time consuming than people realize. It’s the only way to make large decisions if you want to avoid big mistakes.

Dr. Richard Low:
Well, and you can spend a year fixing certain systems in your practice. And if you’re spent a year fixing systems that are the wrong systems, the wrong problem that are not going to allow you to grow, that are not the ones that are holding you back from your vision, you’ve wasted that compound experience and income that we’ve talked about.

Ryan Isaac:
Compound income, man, compound experience. It doesn’t get talked about enough. I like that you brought that up. That’s awesome, man. I feel like we could do this forever, but we’re going to leave everyone hanging and we’ll do this again another time, but to close this out, where can they find the man himself, Richard Low, or Shared Practices? Where do they go to get in touch with you guys?

Dr. Richard Low:
Sure. Sharedpractices.com, events.sharedpractices.com is our upcoming event. And then the podcast, if you search Spotify, iTunes, any of the major apps, we’re in there, and we’d love for you to come and take a listen. And also Facebook group, we’ve got an amazing group, just like yours, Shared Practices on Facebook.

Ryan Isaac:
I don’t think I’m in that, man. I need to jump in there. I want to see what’s up.

Dr. Richard Low:
You should be. I’ll let you in.

Ryan Isaac:
All right, let me in. Richard, thanks for taking time, man. Really appreciate your expertise and your opinions here. This is really great stuff, man. Everyone reach out if you have any questions for Richard at the place he said, and thanks for joining us. Thanks for tuning in on another episode of The Dentist Money Show. We’ll catch you next time. Take care.

Dr. Richard Low:
Take care.

 

Practice Transitions