5 ways good doctors set up their businesses to fail

If your business isn't working the way you expected, it's not because you're bad at business. It's because no one ever taught you how it actually works. We were trained to master algorithms in medicine, but when it comes to revenue teams and growth, we were never taught anything. We weren't even told to figure it out. We just assumed somehow we'd know. Like it would magically make sense. But it doesn't. The era of the seven Figure Physician CEO is here. And it's not about working harder. It's about learning entrepreneurship as a system. The same way you mastered ACLs and pals, you can master the algorithm of building a profitable scalable business. That's why I recorded the Seven Figure Physician CEO audiobook. Whether you're building a medical or non medical business, and whether your goal is your first million, first 2 million, first 5 million, first 10 million, this is where the journey starts. There is no calvary coming to save us. We are the calvary. So. So go get your audiobook now. Www.entremd.com 7Figurebook. And let's rewrite the narrative for physicians starting today. Hi docs. Welcome to the Entre MD podcast where it's all about helping amazing physicians just like you. Embrace entrepreneurship so you can have the freedom to live life and practice medicine on your terms. I'm your host, Dr. Umna. Well, hello my friend. Welcome back to another episode of the On Trendy podcast. As always, I am super pumped that you are here. And today we're gonna be talking about something that's gonna be such a game changer for your business. This is something that will ensure that you continue to enjoy being an entrepreneur, will ensure that you don't become a statistic, one of the many businesses that fail. And it's things that as doctors we predisposed to. So you might find you're doing one, two or three or all five of these things. Okay, we're going to be talking about five ways good doctors set up their businesses to fail. And I said good doctors on purpose because this is usually done from the place of a very good intention. It is a great service. It will be great for the community, for the clients, the patients and all of that. But it's just not designed to work. It's designed to take off, maybe survey people, generate some revenue, but ultimately fail. And if you can take these things and kind of run an audit on your business, you are setting yourself up to be that person who will go on to have a business that has a really long lifespan. My first business, which was my private practice, is now 13 years old. And some of these things are the things that I put in place to ensure that it continues to thrive. It has, you know, survived a pandemic. I wasn't there at the, at the beginning of the last recession, which was, you know, 2008 wasn't. It wasn't in existence then. But it did survive a pandemic. It is thriving right now in the midst of the, this recession, hyperinflation and all of that stuff. And I have multiple other businesses, and so this is going to be great. And I want you to run through your business as you think about this. Okay? Now, so let's look at these five ways. The very first way is no boundaries. No boundaries. This is the way we set it up to not succeed. And what that means is we're always available, or we try to always be available. We try to offer services without even paying attention to whether we can afford to from an energy team or financial standpoint. We just want to do all the things for everybody because that's the thing they should get, right? And the way I look at it, and, you know, I say this as a physician, so I'm not judging, but a lot of times we have this messiah complex, right? Like we're going to fix everything. And a lot of times, truthfully, we can't. We can fix some things. At the end of the day, yes, we're physicians, but we're human and we have the limitations that other humans have. We have dreams of things we can do for people, but based on the stage where we are, we have limitations in our bandwidth, our time, our energy, our team, the capital for our businesses. And if we can respect that, right, if we can respect that, then we can set ourselves up to run, you know, more successful businesses. So let's look at the way this plays out. Let's say you run a direct primary care practice, or DPC practice, and you say things like, you can call me whenever you can, email me whenever you can, come in as many times as you need to, and all of that. The question is, is that truly sustainable? Is that truly what you want? Because the way we show up, what we say, is what creates the expectation of the patient, expectation of the client. And so is that truly what you want? Because if it's not, you don't want to set that up from the beginning. Do you have the capacity? You're running this by yourself. Okay, in the beginning, when you have three patients, five patients, 10 patients, of course you can pull that off. When you have a full panel of 200 or 300 patients, is that what you want to be doing? Do you want to be available 24,7 for 200 people? Do you have the capacity to do that? Do you want to bring in a team big enough to do that and then manage that team? If you can't, you can't. Right. Many times in private practice, I would see people say, oh, my patients really deserve to have this service. The insurance company doesn't pay for it. I don't want to charge them cash for it. I'm just going to do it. Okay, that is a boundary issue there, right? Because the question is, okay, so you want to do that, and then what happens? Because the fact that it's good for the patient doesn't mean that the money is going to fall from the sky. And so, yes, they would love it, they would want to have it. They don't want to pay for it. Insurance doesn't want to pay for it. So you're paying for it. Right. And in the beginning, again, sometimes it's a lot of fun. When you have 2,000 patients on your panel, is it still fun? So think about your business this way. It is a playground with a fence, okay? Which means that you have the things that you can do and then you have a fence, which is the border of the things that you cannot do, okay? And it may be things you cannot do at this stage you're at, or it may be things you may not be able to do ever. And so you want to start looking at those things like, where, where do I have no boundaries? You're a pediatrician in an. In a practice where you accept insurance and your patients are calling you at 10 o' clock at night for a rash, a diaper rash that has been there for three days. Is there an education you've given them that makes. It makes them think that, yeah, this is what I should be doing? Because at the end of the day, you are human. At the end of the day, you are going to need to sleep. At the end of the day, we don't want you burned out and leaving. So one of the things we do to set us up for failure is we have no boundaries. Like, whatever anybody wants, we just do it. Whatever we think they want, we'll just do it. No, your business is a playground with a fence. Okay? So put, put the fence in place. All right, so that's number one. Number two. Number two is, is poor pricing. Right? Poor pricing. And I bring this up as well, because sometimes we're like we want everything to be affordable to everybody. And so we price things in a way that it doesn't matter. At the end of the day, this business is going to fail, right? And so I, you think about it and I'll just give a simple equation here, we'll move on, right? How do you generate a profit? And maybe I even go back a step further. Why should you generate a profit? Because profit is what gives you the license to continue to operate as a business owner. Okay? If there is no profit, if there is no margin, there is no mission. And so sometimes we're so focused on the service part that we think like money is dirty and we're not going to talk about it. But if you don't figure out the money, you cannot deliver the great service, right? So why profit? Because that's, that's the only way you continue to operate as an entrepreneur. And so what that means is that the cost of providing the service, the cost of providing the service has to be less than the revenue you're receiving for the service. Okay? Period, end of story. Like that's just what needs to happen. And so when you look at your pricing, your pricing model and you're like, okay, well, I want my, my clients to have all these things. So say you're a coach. Okay? I want them to have, I'm creating this program. I want them to have all these workbooks that are going to be mailed to them. I want them to have, you know, this boxer access so they can reach out to me whenever I want to do this event for them that they get to attend. It's an in person event because they're part of my program. Maybe you're doing all of that because you've seen someone else do it, right? But the thing is this. I cannot tell you how many times I've seen people say all of that. But then the pricing is such that they are going to have to come out of pocket to foot the bills for this thing that they want to offer. And you may do it once and you may be so excited because maybe it was your first time of hosting an event and your first time of this and first time of that. But the thing is, then after that, then what right is that sustainable? Are you going to get a second job to pay the bills for your business because of the way you priced it? And so we need to, you know, take the time. And I've created many episodes on this about understanding the value you offer, ethical pricing, how to sell confidently, and all of those things we must Own pricing appropriately, we must own it, right? And if we don't own it, we set up our businesses to fail. If you are a cash pay practice, right, you set it up like the way you have set it up. Is it set up in a way you will ever have a salary? Is it set up in a way you can ever afford a team? Is it, is it set up in that way? Or is it set up such that you're just putting in sweat equity, right? Like, meaning that you're like, no, it didn't cost me anything, just cost me my time. Yes, but it costs your time. And think about the opportunity cost of that time. We have to price what we do appropriately. We have to price our services, our products appropriately. The third thing I see is violating the law of the business model, okay? And there are multiple models, but I just want you to think about two broad, really broad ones. There is high ticket and low ticket, right? So you know, there are things that, you know is 100 bucks or is 100 bucks a month, or it's 100 bucks one time or 500 bucks or whatever. And there are things that are 3,000, 10,000, you know, 20,000, all the way up to any number you can imagine, right? So there's high ticket and low ticket. Now the law states, right, if you are low ticket, then you're also high volume, okay? If you're high ticket, you can be low volume, okay? So, so, so you can't have low ticket and low volume doesn't work that way, okay? You can have high ticket, high volume, but chances are you can't give them what they need, right, for your, for your high ticket thing. But so typically you can get away with lower volumes if you're doing high ticket. So a lot of times what happens is somebody's like, I want my clients, my patients to have very affordable care and I want to spend all the time in the universe with them, okay? And so it's not rare that I'll hear somebody who is working in a private practice that is insurance based primary care say, like, I just want to spend an hour with my patients. And I'm like, okay, I know the problem with that statement is that you are low ticket, okay? You are low ticket. And I'm just going to make up numbers here. Let's say you're doing 200 bucks for per patient, which many people are not doing. Let's say you're doing 200 bucks per patient and you say, I just want to see a patient, I just want to spend an hour with My patients. So for an eight hour work day, that means that you're going to make 1600. Okay? But now you also know that there's a mortgage to be paid, there's utilities to be paid, there's team members to be paid, there's malpractice to be paid on all of that before paying you. Right? And a lot of private practices, their overhead runs about 50% and so, well, 50, many are higher, but let's say 50%. Now I want you to think about that. So if you are doing 1600 a day, that means that 800 is already your overhead and you're left with $800 to pay yourself. And for there to be a profit for the business. Do you see that we're violating a law? And so if you are low ticket, that you going to need the higher volume to make up for the low ticket, right? So when we, when we violate the laws of the model, then we set ourselves up not to succeed. Okay? The fourth thing is not building a team. A lot of times, you know, and this shows up a lot because building a team is hard work, is hard work because you need to grow as a leader. It means you have to learn to guide people, lead people, coach people. It means you have to learn to have difficult conversations. Conflict management. It means I just have to deal with the messes of people. Okay? That's just what it means. But it is hard work. But the return on investment is unbelievable. It is unbelievably amazing. And the truth of the matter is you do not get freedom as an entrepreneur to figure out the team thing, right? Like you have a team so they can do stuff and you can do other stuff, right? They can show up in the areas where you're weak and they can have strengths there. So all of a sudden your weaknesses don't exist anymore. They can take on tasks that you're doing and they can take care of those. So you don't have to take care of them anymore. If you're somebody who's like, I know I have multiple businesses in me or multiple passions or I know this is a phase of my life, is the team that will give you the freedom to go on and do other things. Okay? But the thing is, again, it's hard work. And so a lot of times people don't want to do it and they're like, I can just do everything myself. And the thing is, this one is too small of a number for greatness. Okay? John Maxwell said that. But so you're not, you're not going to go very far. If you don't figure out the team thing. Now, if you just want to build something that is not really a mission based business, right, this is just something you're doing to pay the bills and all this stuff, sure, you can get away with it, but if you are trying to build something that's going to have a huge impact, is going to be innovative, is going to be profitable, is going to change the world and it's going to give you financial and time freedom, then you're going to need a team, okay? And that is a skill worth acquiring. It is a skill. So there's nothing like I'm not good at, you know, at building a team or I'm not good with people and all this stuff. It's, it's a learnable skill. In fact, when I first heard that statement from Brian Tracy that all business skills are learnable, one of the things that, one of the first things I had to start learning was hiring because I was so, I was so terrified of hiring. When I started my first practice, I had my first practice. When I started my first business, I have one practice. The hiring thing was I was not doing it. So I was so scared of it. This is evidence to you that, you know, hiring is a, it's a skill. I was so scared of hiring that I was my own front desk. I would answer my own phones. I'm like, thank you for calling Ivy League Pediatrics. This is Ella, right? Ella was my alter ego because of course I didn't want them to know the doctors answering the phone, you know, then they'll try to get all the free visits and all those things. And so, you know, I answered my own phones, I did my own vitals, I saw the patients, I gave the shots, I did my own billing. I did it all in the beginning because I was so scared of hiring. And then I learned it. It's a skill. And now in all, across all businesses, I have great teams, you know, and so it's a learnable skill. But not learning that sets you up because what that means, if anything happens to you, I want to say anything, I don't mean something bad like you had an accident or you're in the hospital or anything like that. But I mean, some. You, you had flu and you had fever, you had a fever, you know, and the impact on your revenue is so ridiculous because you're the business. And you also set up something that is not sellable. And people are like, well, I don't want to sell my business, but you don't you're going to exit your business one way or another, okay? So you're either going to. You sell it or you're going to. You're going to. At some point, you're going to retire. Maybe you hand it over to your kids or they don't want it, and then you just have to get rid of it and let it shut down. Like, one way or another, you're going to exit your business. If you build a team, you build the systems, you build the processes, then you get to choose the terms under which you're going to exit your business. Right? So that's something. That's something to think about. So that's number four, not building a team. Number five is focusing on selling alone, Focusing on serving alone and not selling. That is a. That is a big, big, big, big, big trap. And again, it's one that, as doctors, is so easy for us to fall into. Right? And so it's like, I just want to serve people. I want to help them. I'm making a difference in their lives. Great. But when you are making a difference in the lives of people as an entrepreneur, you do not have one role. You have two roles. Role number one is to serve them. Role number two is to do it in a profitable way so you can continue to serve them. Okay? Because if you serve them but you don't do it in a profitable way, you have to shut your doors and you have to stop serving them. One of the best things you can do for your business, one of the best things you can do is become really good at selling, become really good at understanding numbers. Numbers. Not pretending. Oh, that I don't do that numbers thing. Like. No, we look at the numbers, we look at the PNLs, we look at the cash flow. We look at the projections. We look at them. The number one reasons businesses go out of business, cash flow problems. It's not bad service, right? So we have the service part down, packed. But we have to understand money. We have to understand how to create it, how to manage it, how to stretch it. We have to understand all of those things. Okay? So deciding I just really want to serve. I'm not worried about the money. If I serve them well, the money will take care of it. I mean, that's not the way that works. We do both. Okay? I cannot tell you how many of my patients walk up to me and they're like, I am so grateful that you did not sell out to the hospitals. This is the only practice where I come to, and I don't Feel like a number. Okay. If I was not building something that was profitable, there's no way that they could have. They could be saying that, right? Because I would have sold out. Right? I would have. And so I want you to think about this. So no boundaries, poor pricing, violating the laws of the business model, not building a team, and focusing on serving alone rather than serving and selling. Okay. And actually selling and serving because you can't serve anybody till you sold to them. Right? Okay. So I want you to take this. I want you to take this to heart, and I want you to do an audit of your business and go like, okay, which of these mistakes am I making? How can I tweak this and then throw some massive action behind it? Right. To start resolving those. Right? Resolving those. You know, it doesn't matter which one it is. It doesn't matter. But I want you to be able to build a business that will thrive and a business that you will love and a business you're not burnt out from, and a business that continues to serve and to earn for decades. Right? And a business that if you wanted to sell, it's set up to sell because you built it that way. Like, how beautiful is that? Okay. All right. Now, in these areas, if you're like, man, I'm really. I'm really struggling with these. I'm not sure how to do this. I've been trying to do this on my own, but it's really frustrating. I want to invite you to come join. The number one business school for physician entrepreneurs is the Entre MD Business School. And you would join over a hundred physicians who are on this path, who are raising prices, who are setting boundaries, who understand the laws of the business model. So they're not violating it. They're building teams, and they're focusing on serving and selling. They're doing both. Okay? Because this is our bread and butter. These are the things that we work on. And you. You get to see so many examples of how it's being done in so many different businesses. You get access to be. To be coached through these things every single week. And it is just fantastic. So check it out. Entre md.com forward/business. You can fill out an application. We do an application because we want to make sure it's a good fit for you and that you're a good fit for us. Right? Because we have a really great program and community, and we want it to continue to be that way. And we also want to make sure that for you, you are going to get a huge return on Investment for it. That's what we look for. Okay? So send your application onchampd.com business the team is on standby to take care of you. And I just want you to, you know, I know sometimes business can be challenging, but I want you to think about this, right? You could be that person who's going to build that business that you know like a year from now, six months from now, two years from now, right? You have this business where you have the boundaries in place so you work hard when you work and you have times when you don't work. And it's beautiful. And your, your clients understand, right? They understand. They've been trained to know this is what is appropriate to do and what is not appropriate to do so that you can still have a life. Right? Entrepreneur doctor. That doesn't mean you no longer have a life. And you, you understand your pricing, you price appropriately, you understand the model you're in and you work the laws of the model. You have a team. And so your business is functioning like a well oiled machine and you are serving and selling. Your money's working, your cash flow is good. That can be you. I know maybe you think about is other entrepreneurs who can do that. No, but you can. These are all learnable skills. Okay? So I want you to go do that audit. I want to go turn your application into entremd business school and start working on this stuff. And I cannot wait to celebrate all the successes that you created. So thank you for listening. Please share this episode with another physician entrepreneur in your life and I'll see you on the next episode of the Entremity podcast. Hey, if you love listening to the Entremity podcast, I want to invite you you to join Entre MD on Demand. It is my signature subscription program that gives you access to a library of business courses designed to help you do one thing as a physician entrepreneur and that is to thrive. Just head out to entre.com ondemand and I love to have you join us. See you on the inside.