Join hosts Casey and Jarrod as they delve into the exciting yet complex decision of bringing a partner into your dental practice. Discover the advantages of sharing responsibilities, resources, and expertise with another dentist, and the potential pitfalls and challenges that may arise. Whether you're considering a new partnership or already have one in place, this episode offers valuable insights to help you navigate the dynamics of a dental practice partnership.
Announcer:
Hello, everyone. Welcome to the Millionaire Dentist Podcast brought to you by Four Quadrants Advisory. On this podcast, we break down the world of dentistry finances and business practices to help you become the millionaire dentist you deserve to be. Please be advised, we do speak with an honest tongue and may not be safe for work.
Casey Hiers:
Hello and welcome. This is Casey Hiers back at The Millionaire Dentist Podcast in-studio with co-host Jarrod Bridgeman.
Jarrod Bridgeman:
Hey, good afternoon.
Casey Hiers:
Gorgeous-looking cardigan.
Jarrod Bridgeman:
Thank You. Clearance. Clearance rack. It's how I shop, baby.
Casey Hiers:
It's supposed to be awesome spring weather, and I think we had snow yesterday.
Jarrod Bridgeman:
We did have snow. I woke up to it and wanted her to go back to bed, I couldn't.
Casey Hiers:
I thought my four-year-old was joking when she came running in, "It's snowing. It's snowing." I'm like, "Wow. What a dream she had." Nope.
Jarrod Bridgeman:
You think after the holiday, you imagine it's springtime.
Casey Hiers:
Yeah.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
We planted flowers. They're going to be dead. They're going to be dead. Anyway. Today, let's talk about the pros of a dental partnership.
Jarrod Bridgeman:
Now, in terms of cons, we're talking about like people that were in jail?
Casey Hiers:
No, no.
Jarrod Bridgeman:
Oh, that's an ex-con.
Casey Hiers:
Yeah.
Jarrod Bridgeman:
Okay.
Casey Hiers:
No, and not Comic-Con, I know you dig that.
Jarrod Bridgeman:
That was this weekend. Yeah.
Casey Hiers:
Yes. The advantages and disadvantages of a dental partnership, and with corporate dentistry and all the DSOs that's a hot topic. And so I've had many conversations with folks that they don't necessarily want to be solo, they don't necessarily want to go DSO or big group. And so a lot of conversations around dental partnerships, what's that look like? What's that structured. So we're going to dive into some of the pros and cons, not really rendering an opinion, but just manifesting out the thought of it. Because it's a hot topic.
Jarrod Bridgeman:
Yeah. So let me ask you, alright let's say I'm a solo practicing owner currently, what would be some of the pros? What were some of the reasons why I would want to have a partner?
Casey Hiers:
What's the tug?
Jarrod Bridgeman:
Yeah.
Casey Hiers:
Yeah, no, because let's even back up, right? Associate, you buy your practice. You're the boss.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
That's exciting. And so then what does go through some practice owners' minds where this becomes an option? I'll tell you what, a couple things I hear a lot. One, most people will resonate with, its production while they're away. Many solo practitioners feel guilty if they go on vacation or if they leave because they still have overhead.
Jarrod Bridgeman:
Right.
Casey Hiers:
They're paying their staff. But if there's no production, right? It's, we've talked about this before
Jarrod Bridgeman:
And that week or two weeks on vacation, their patients don't have anybody to come to see.
Casey Hiers:
Yeah. Right? So as the CEO and a practice owner, you are also the primary producer. So that feeling it's hard for practice owners, and the spouse will tell you, to actually relax on vacation. Because they know they're going to spend, let's call it 10 grand on vacation, the family vacay. And then they're going to miss out on tens of thousands of dollars potentially in production.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
And so it becomes hard. And so...
Jarrod Bridgeman:
And if you're like, most of us, you need a vacation after a vacation.
Casey Hiers:
Oh, at least a couple of buffer days for sure. But yeah, I think that production while away, it's almost, it's a sense of relief.
Jarrod Bridgeman:
A sense of relief kind of eases the mind.
Casey Hiers:
Yeah.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
And that makes sense. But we're going to dive into different factors and different other things to keep in mind with. But yeah, I think that production while away, there's a sense of community, right? This euphoria, utopia idea of having some... And ideally who would we all want? Probably someone very similar to us.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
So in our mind, as we're thinking this through it's well if I could just have somebody similar to me, that would be great.
Jarrod Bridgeman:
Unless you hate yourself.
Casey Hiers:
More of everything. Well.
Jarrod Bridgeman:
That's when it gets rough. I think if I met myself in person, I'd be like, "What a jerk."
Casey Hiers:
Well, that's probably a good psychology podcast right there. But well, but no, for the most part.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
But that's where the rub starts to come in, well, what if they're a little different? But yeah, to answer your question, production while away, a sense of community, having somebody there in it together, right?
Jarrod Bridgeman:
Yep.
Casey Hiers:
Dare I say friendship. But I've heard that, having that sense of community where you're in it together. Yes.
Jarrod Bridgeman:
Yes. And you have someone to, I would say, rely on and also to bounce ideas with, and that whole aspect of a...
Casey Hiers:
Shared responsibility.
Jarrod Bridgeman:
Okay, yeah.
Casey Hiers:
Right? Getting another...
Jarrod Bridgeman:
That's a smart way to put it.
Casey Hiers:
Well, you hit it.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
Right. But if you have an idea, being able to have that conversation with somebody who you're sharing profit and loss statements and balance sheets and production. And so you're sharing that experience to then bounce ideas off of where we all know in dentistry, it can be lonely sometimes.
Jarrod Bridgeman:
Same as you with the practicing while away, it's shouldering responsibility. Like you're not the only person, you're not Atlas holding up the entire world.
Casey Hiers:
No that's... Yeah. That's very...
Jarrod Bridgeman:
Good. I know, thank you.
Casey Hiers:
Here's a really good advantage that I think is it's not as much emotional, like some of these other ones, but if you can find a partner who maybe specializes in some other procedures or really likes other areas of dentistry, that can be a really good advantage to looking at a partnership.
Jarrod Bridgeman:
Yeah. It's kind of similar to finding a partner in life. I hate doing laundry, but I like to do dishes and cooking. So the wife and I switched. And so I do those when she does those and we're happy about it. That's criteria right there.
Casey Hiers:
Now, we can get into some numbers, but I have heard this...
Jarrod Bridgeman:
Well...
Casey Hiers:
Yeah?
Jarrod Bridgeman:
Before you get to that.
Casey Hiers:
Yeah, yeah.
Jarrod Bridgeman:
So what would be the advantage? I know this might seem like a very obvious question, but finding a partner who's, let's say knows more procedures, maybe better at or prefers to do them. How would that affect the current owner?
Casey Hiers:
A lot of times, and there's a lot of ways to structure these things, and obviously having a very comprehensive, masterful team to do this is very important. To try to pull this off on your own can lead to a lot of heartache. But for an existing owner that maybe has the space, and we'll get into some of those logistics, but who's maybe the catalyst for this and finding somebody and forming that partnership. A lot of times that existing owner who maybe has the space, they view it as an influx of cash.
Jarrod Bridgeman:
Okay.
Casey Hiers:
Because if somebody's going to buy into, let's say their practice and form that partnership, that influx of cash for the existing owner is a big...
Jarrod Bridgeman:
Oh, yeah.
Casey Hiers:
It gets people excited.
Jarrod Bridgeman:
Yeah. Is there any con to that pro though? Taking all that cash right away? Is there anything that...
Casey Hiers:
I wanted to stay positive for as long as we could.
Jarrod Bridgeman:
Oh, okay.
Casey Hiers:
Because I've got a whole list of the disadvantages.
Jarrod Bridgeman:
I know, but I was kind of interested, like do some people almost take it as hitting the lottery?
Casey Hiers:
I can't answer that. I wouldn't go that far.
Jarrod Bridgeman:
Okay.
Casey Hiers:
But the influx of cash and like we said, the community, the production while away, having a partner, having maybe some expanded procedures, shared responsibility, those are all I think fair advantages to looking into a partnership.
Jarrod Bridgeman:
Yep, yep.
Casey Hiers:
And having those conversations can't hurt some factors that need to be looked at. Are you the only game in town? Is there one or two other dentists where that partnership really has a strategic advantage in your geography? How about current overhead? We've talked about that in the past podcasts. But if your existing practice maybe has the space, but your overhead's brutal, you want to get some of those things looked at and corrected before putting all your financials on the table and potentially having that partnership, I think is really important.
Jarrod Bridgeman:
Yeah. It might be hard to sell part of a business if the business doesn't look great on paper.
Casey Hiers:
Well, you're just going to get... Then it comes in, well... The second partner that comes in "Well, when I came here, your overhead was 74%, but yet now we've done some really good things and it's lower." Everything needs to be documented, no gentleman's or lady agreements. Right?
Jarrod Bridgeman:
Right.
Casey Hiers:
You want everything very documented, but who's got the space, how's the overhead, how is current patients per day? There's a lot of logistics and factors that must be looked at beyond the emotional advantages of this. And I heard one time, it was like, "Well, my cash flow is just going to be better."
Jarrod Bridgeman:
How did they think that was going to be? What was their reasoning?
Casey Hiers:
That's a big jump to... I didn't get a good one. That's a massive jumping to a conclusion that just magic wand, everything's going to be fixed.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
This, having a partnership, just magically improving cash flow, you may want to take a step back and consult some people and look at some data before you come to that conclusion.
Jarrod Bridgeman:
That's kind of the same thought of some of those people who think that they add just more practices and more practices, that they'll get more money.
Casey Hiers:
Yeah.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
I've got one practice with 74% overhead, I want three more.
Jarrod Bridgeman:
Do you? Do you really? You must love adult babysitting.
Casey Hiers:
That's right. So let's get to some disadvantages or at least things to be aware of when looking at a dental partnership, right? Too many cooks in the kitchen. That's a term I probably use too often, but ultimately a lot of people like being their own boss and like being in charge and while they would like all the advantages to just happen, you have to also have the disadvantages.
Jarrod Bridgeman:
Right.
Casey Hiers:
And so aligning clinically with somebody, are they more of an aggressive case acceptance person? Less aggressive? Do they give away a lot of free dentistry, a little bit of free dentistry? What's insurance look like? What's the strategy, and what's your guiding light on all that? That damn well better be discussed before getting into some partnership.
Jarrod Bridgeman:
No kidding.
Casey Hiers:
And a lot of times it's not. Right? What's your view on employees? I even heard a terrible... Well, I heard a unique story. A partnership and one of the younger guys got divorced and then started dating one of the hygienists.
Jarrod Bridgeman:
Oh.
Casey Hiers:
And then the ex-wife's coming into the office to stir up controversy about all that had transpired. And the older dentist who brought in the younger guy to have this kumbaya partnership's looking at this going, "I'm in junior high right now. I did not sign up for this. This is terrible." That's a unique...
Jarrod Bridgeman:
Unique, but also I could see it being bad not only for the morale of all the other people that worked there but what if she was coming in when there was like patients in the lobby pitching a fit?
Casey Hiers:
Oh, it can be terrible, but it's again, do your morals and ethics align? Does your clinical view align? So many things.
Jarrod Bridgeman:
Because you brought up the cooks in the kitchen thing and that makes it's because if you were used to making decisions on your own. Sure, it's great now to have someone to share that responsibility with, but you can't just now up and do something.
Casey Hiers:
Well let's say you and I have a practice. Hey Jared, I want to spend $50,000 in marketing next year.
Jarrod Bridgeman:
Wow.
Casey Hiers:
And now you love marketing, so like in this scenario you're like, "Hell yeah."
Jarrod Bridgeman:
Yeah.
Casey Hiers:
But in that scenario, maybe you go, "Well, I don't." Because you know that you're going to send a kid to college and that you have your own unique reasons why you don't think $50,000... So then you've got, how do you resolve conflict within the partnership?
Jarrod Bridgeman:
Right.
Casey Hiers:
That doesn't get thought of when you're talking about influxes of cash and production while you're away.
Jarrod Bridgeman:
Yeah. And the tough part is that's something that's going to be hard to figure out before you sign onto the partnership. It's not a five-minute conversation.
Casey Hiers:
I don't have a patent answer on how long, but the amount of conversations on all these topics that should take place on a high casual level should be a lot.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
And then once you get down to formal agreements, it's just like, there's a corny example but before I got married, we sat down and literally said, "Where are we going to spend different holiday? What are expectations? What are the boundaries? Let's plan ahead." And in a marriage that's important and a lot of people don't even do that. In a dental partnership, I think it's very crucial.
Jarrod Bridgeman:
Oh, it's a hundred percent crucial.
Casey Hiers:
So if you were a dentist, what do you want? Do you want to be the solo owner or do you want a partner?
Jarrod Bridgeman:
Yeah. That's the question to ask ourselves.
Casey Hiers:
Devil's in the details, right?
Jarrod Bridgeman:
Yeah.
Casey Hiers:
It depends on dozens of factors.
Jarrod Bridgeman:
Now, it's maybe a different story if you're getting up there in age and you're looking to bring on a partner, then sell the rest off to when you're ready to retire.
Casey Hiers:
Yeah. Well, and this is in my mind, it's more...
Jarrod Bridgeman:
I was thinking this like two people of the same age, kind of.
Casey Hiers:
Yeah, middle of their career.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
Let's have this partnership, let's take on this city, let's take on this state. Let's build something versus yeah, to your point, transitioning out. This is geared more towards that partnership, what's it look like? But for this, the purpose of this podcast, the pros, and cons, the factors involved, don't put on those rose-colored glasses where it's just all Kumbaya. We know better. We've seen lawsuits and breakups and just terrible things setting practice owners back years and years and years. But it's a hot topic right now. And there's certainly success stories out there.
Jarrod Bridgeman:
For sure.
Casey Hiers:
Where people have addressed these things.
Jarrod Bridgeman:
We even have clients at partnerships that have done amazing things.
Casey Hiers:
Oh, absolutely.
Jarrod Bridgeman:
Yeah.
Casey Hiers:
Yeah. Twos, threes, fours, fives. There's ways to make it work. And the upside can be really, really good. But what they don't take into account is how many things can derail it.
Jarrod Bridgeman:
Right.
Casey Hiers:
And there's so many of them.
Jarrod Bridgeman:
Right.
Casey Hiers:
So at least for this podcast, I thought we'd just touch on a few of them and food for thought.
Jarrod Bridgeman:
I love it. I love food. Thanks, Casey.
Casey Hiers:
Thanks.
Jarrod Bridgeman:
Hey, before we go, Casey, I wanted to mention again that we are going to be in Las Vegas on May 12th and 13th. We'll be in Salt Lake City June 2nd, and June 3rd. And Omaha, Nebraska on June 16th and 17th. These are for our events. We'll be having a couple of days in the Top Golf and a couple days of dinner. If you want to check us out online, you can obviously visit our website. Check out our events page to see more information about our events. And you can also see us at, we're on Facebook, we're on Twitter, we're on Instagram, we're on LinkedIn. Just look for Four Quadrants Advisory and feel free to like us and follow us and all those kind of things. And keep up to date with all the things we're doing. All right, thanks.
Announcer:
That's all the time we have today. Thank you to our guests for their insight and for sharing some really great information. And thank you to you, the listener, for tuning in. The Millionaire Dentist Podcast is brought to you by Four Quadrants Advisory. To see if they might be a fit for you and your practice, go on over to FourQuadrantsAdvisory.com and see why year after year, they retain over 95% of their clients. Thank you again for joining us and we'll see you next time.
