257: From Failing Dental Practices to Profitable Multi-Location Growth

And at some point, you make this mental shift of. My greatest asset is my time. I have a limited capacity to impact others. And what am I going to do with this limited aspect of time?

Hi, I'm Emmett Scott, and just like you, I've had my ups and downs in the dental industry, but times are changing. The DEO has built a map of how to succeed in one of the most challenging industries to navigate. On this show, we talk to dental industry leaders, solve problems, and get you the answers you need to face these challenging times and thrive. Welcome to DEO's Growth Solutions Secrets podcast for dental organizations. Now let's get started. Hello, everyone, and welcome to another episode of DEO Grow Secrets. I'm your fearless host, Emmett Scott, and Today I've got Dr. Seth Huesch and Dr. Clark Brenton from Avery Dental Group, which they founded in 2017. It's grown to eight locations across Oregon and southwest Washington. They've absolutely been crushing it. Been in DTO for a while now and just excited to dig in with them. They've done a ton with implants, all in X and all of the above. And so, Clark, Seth, great to have you here. Maybe, if you don't mind, maybe just take a minute, Clark, we'll start with you. Just tell who you are, your story and then how did you and Seth connect?

Absolutely. Yeah. Thanks for having us. Seth and I met the first week in a dental school. So serious. Yeah.

Did you know then did you walk up to him and like, you're going to be my business partner someday?

Not that, but we did know that we both liked to ski and bike and that kind of thing. So that's kind of where the friendship started. I think that's cool. Riding our bikes to school.

And what was your dental school path?

We both went to Oregon Health Science. I was a National Health Service course scholar, so I had a four year commitment to public health. So I went into it knowing that. So that was kind of my. My focus. And Seth, I guess yours is a little different.

Yeah, I finished school in Hawaii undergrad and came to dental school with two kids and by the time I was done, I had three. And I figured we need to do something serious to support all these kids. But yeah, Clark and I, we were just buddies. Played basketball and did some triathlons during dental school and, you know, just kind of were buddies, but we lived. They put the dental school on top of this mountain, you know, top of this hill. And there's not much parking, so they encouraged people to ride bikes. So we'd Ride bikes as an apartment manager with my wife. And eventually we got Clark to move into our complex. He's one of our tenants.

They gave me a sweet deal on rent.

That's right. But no, we. And you mentioned implants, Emmett. And we. We've had interest in it kind of from the beginning. The weekend before dental school graduation, we. Well, let me back up a little bit. They had had a Oregon Dental conference. And we met one of the guys at OCO Biomedical. He invited us to come up. He said, hey, it's a thousand bucks. You should come up and do our course in Seattle. And we said, that's great, but I don't have a thousand bucks, you know? He says, what about 500 bucks? And I said, we'd love to come. We don't have 500 bucks. He says, if I gave you a ticket to attend, would you show up? And Clark and I said we would show up. So we got.

Let me add a little more detail.

You guys are tough negotiators, being poor.

Let me add a little more detail to that. What Seth left out was we went to the Oregon Dental Conference, which we got into for free as dental students. And we went to every implant booth in the. In the whole building and asked to attend a course for free. And everybody else told us to get lost. This is the only guy that would, like, entertain any sort of negotiation with us. And he told us no. We talked him down to $500. We're like, sorry, we can't even do that. So we left. He called. You know, having run courses now for almost a decade, I know exactly what happened. They didn't fill their course. He called us, like, three days before. He said, hey, we got this course in Seattle. You guys can come for free if you want. So they had.

We said, we will fill that seat. Yes, we'll be there. And so we got.

How long had you been out of school? Had you even.

So this is the weekend before graduation.

Wow.

Okay. And Chuck's last year was teaching it, and it was great. So we went up there, we did the course, and, you know, we've done some restoring and had some exposure in school. But he's like, no, you need to be placing these things. He said, if you. If you can get some patients lined up, I will come to your office and help you place your first implants. Right? And so I went to Texas. Clark went to New Mexico. And I made a list of all these cases that would be great. Cases had two pages worth. And eventually I called Chuck up, and I said, hey, were you serious about coming to the office to play some implants with me? And he said, yeah, I was serious. And so I called Clark and he flew over from New Mexico. This, this, you know, CE guy came into town and I placed. It was over 20 implants in two days. And you know, we gave the patients discounts, but I, I got a handle for it and Clark was there with me. And we haven't really slowed down since. I don't think so.

But by the end of that, I think he was kind of like, I think he expected to come out. And I don't think anyone's ever worked him that hard.

And he's like, can I have my 500 bucks now? Right.

Well, he saw, he did sell a kit to Seth, so got some limited value out of it.

So when did you guys come together and say we should start something together?

So that, that's also an interesting story. I'd been, I was just finishing up my commitment, so I went to New Mexico. But like I said, I, I, while I was doing public health, I was moonlighting doing IV sedation surgery and implants. So we kind of both had seen the potential of, you know, running a GP office. And I was low social economic, demographic, demographic practice. So was Seth. But we saw how much demand there was in that model. Like, man, if there's demand in this segment of the market, there's got to be demand in every part of it. So my brother, for my birthday, I finished in my four year commitment, he gave me Shoe Dog as a gift. I don't know if you've read it. It's the Phil Knight.

Oh yeah, really good.

And it just got us. It got me fired up. And then it's like, Seth, you gotta have this. So I ordered him a copy on Amazon and sent it over to him and he read it. And then we're like, man, we've got one life. We gotta. Because I was kind of felt a little stagnant in what I was doing, you know, trying to figure out my next step and same thing for him.

And let me interject, when Clark says he feels stagnant, he was bored. And so he started his pilot license training on the side. He'd go before and after work and got his pilot license down in New Mexico because it wasn't quite stimulating enough to be doing what he was doing. So, yeah, so we get. But Shoe Dog was a big impetus. That is true. Big time.

Yeah. So we're like, I mean, you talked to, you know, one of the things you talk about Is like, what mistakes do you make? Our mistake was just like, hey, let's do this.

We're like, we're a business plan right out of the gate, right?

Yeah, basically, yeah.

If.

Let's move back to start.

If a guy can start Nike, we can start this dental practice, right?

Pretty much, yeah.

Let's go.

So how did you buy your first practice?

So that was another mistake. There was a group of four offices, like a small DSO that was going belly up. The one partner had already left. There's one left. There was four locations. One had an active lawsuit with an associate that was really messy. So we left that one aside and bought the other three. And then we bought the practice from one of our professors from dental school. So we started with those four, and that's all we could get the bank to land.

That's amazing. You got them to lend you that right out of the gate and. Yeah, this is 2017.

Seventeen, yep.

Okay. And you guys both move to the same place at this point because one's a new.

Yeah. So we.

Texas.

You left me back.

So I left Texas. Exactly. My wife was eight months pregnant, and I said, we're moving. And the doctor said, you really shouldn't move with her this pregnant. And it was like, well, we are. And so she said, if you're gonna go, you better put her in an airplane. And so we did and put her in first class, and we landed in Oregon and had our fourth kiddo. And.

But.

And a little bit later, we got those three practices, and we attacked on the fourth shortly after that. But, yeah, it's kind of just a leap of faith, I guess, if you will.

And right out of the gate, were you marketing them as and implants, or how are you marketing the practices?

No, it was just trying to get our arms around multiple practices. Right.

Like just general dentistry. Bread and butter at this point.

Yeah, General dentistry. But. Yeah, but, you know, we always. We had that super GPU mentality, I think at that point where we. We loved implants both personally. But I don't think at that point we had our business model figured out where it would be. GP practice with implant center on top of it. It was more, let's buy GP practices and keep specialty in house. Was kind of the original model.

And you two were like the super gps. So you. Did you have a couple associates that came with those practices?

Yeah, we did. We had one of the. The doctor that we bought his practice, he stayed on in that location to work back for a while, but almost immediately, we lost the associate. You can imagine what was happening behind the scenes in a failing Group 4 offices. But we were pretty naive at that point. So within, right after we took over, we lost the associate in one of the locations. So I became the doctor in two locations. There were two full time equivalent or two dentists that I was covering for. Back and forth between two practices that were 45 minutes apart. And Seth was down in the one down south. And we just kind of, kind of limped it along and made it happen. Yeah.

And. And were you able to get it to grow that first year or how did you navigate or was it just like, holy smokes, what did we do?

Yeah, it was both of those. We, we both came into it like, okay, we've got, you know, each of us personally had probably six figures of savings. So we went into thinking, okay, we've got buffer, we'll be fine. We got eaten alive cash flow wise at first. You know, I personally burned through that probably within like just because we were. It was so hungry from a cash flow perspective because we took these offices and talking about it now, it feels so stupid, you know, but it's like in our mind we're like, oh, we just have to take these things and it's just like flipping a house. Right. You get it for a bargain. And then we knew nothing about cash flow and you know, but you know, looking at it now, it's like, no duh. We bought failing practices and they.

With. With payroll happening every two weeks. Right. A supply cost that were coming down the pipe and yeah, just Right.

So it was real time very, very quickly. Like, okay, so Seth and I were like, we just need to get in and do what we know how to do, Produce our brains out and outrun this problem. So we did, you know, within that first year, we'd at least, you know, stop. Stop the bleed, so to speak.

Was the patient flow sufficient enough or was. Or there was just so much care to be provided.

Yeah, I mean, at first it was this, especially in the neglected group, there was so much dentistry. So it was also, it was a. At least for me and Seth can speak to him. But for me it was a big emotional challenge too, because I was going. The one practice where the associate left, they'd had, I think three or four docs within the last year, just windmill. So, you know, I showed up and every time I'd show up, I was there three days a week. And every time I'd set foot in the door, there was like some unhappy person yelling at me and asking me who I was. And why I was there. So, you know, there was. On the patient side, patient side, team member side, everything. Yeah.

Because you guys weren't. Weren't only trying to be these super gps, but, like, you had payroll, you had to figure out how to calculate, and you had staffing that you were hiring, and people who said, typically what I see you buy a practice, and then all out of the word woodwork, everyone's like, oh, by the way, they promised me I'd get a raise in two weeks. And you just have all that noise happening, right?

Yeah, yeah. A lot. A lot of turnover because you had all these disaffected people from this prior group. But, you know, you just kind of take it day by day and work through it and try to stay in front of it.

You get 24. I guess 24 or 36 months in, and then Covid hits. So just as you're probably.

Yeah.

Starting to turn a corner.

Yeah. We opened a De Novo right before COVID so that was interesting, too.

When did you kind of start feeling like, okay, I think we do have something figured out here a little bit pre Covid.

I think after, like, on maybe our second to third year, I felt like we hit a good stride. Like, we were. You know, we'd figured out the. The full arch thing at that point in this market, there was very little competition in that space. So.

Right.

I feel like we are doing really well before COVID to where, you know, that point we added more locations. I think we were at seven locations. Yeah.

Novo right before COVID So you guys went pretty fast.

Yeah, we were pretty aggressively in the beginning.

Yeah.

Yeah. And we. You know, we were talking about this a little before you hit record, Emmett, but we. We were up to 10 locations at one point. One of the best things we did was get back to eight.

Yep.

Yeah. I remember having a conversation with the Heartland CEO, and at the time, they were at about a thousand locations. They've blown past that now. But I said, how do you get to a thousand locations? And he said, I. I sell the losers. Um, and as he went into it, it's like, even for them, they don't always. You know, they buy a group, several of them don't work. And as I talk to DEO members oftentimes, especially when they first come in, it's a. It's a new concept that sometimes the way forward is kind of taking some steps backwards. Right. And that's not.

Yeah.

That's not failure. That's learning.

Yeah. You know, I.

And frankly, yeah, a lot of that Advice came from our conversations with you, Emmett and our coaches with the eo. We did the shark Tank, you know, deal and it was like, you guys should probably get rid of some spots. And so we, we did, you know, looked internally and critically and listened also.

The stages of grief, of denial before acceptance.

Yeah, yeah, no, I think so. And we're so attached as entrepreneurs to our business models that I think it, there's a little too much identity associated with their success and their failure. And so.

Well, that was one. You know, when I, I did my mba, the biggest takeaway for me was just like to move decisively and to not, you know, you look at the, the sunk, sunk costs. It's, you know, oh, we put so much time and money and effort into that. But from a cash flow perspective, does it continue to lose tens of thousands of dollars a month? You know, do we want to continue to suffer because we suffered in the past or do we want to just cut our losses and folk because we have a limited amount of bandwidth. Right. Does that bandwidth go better to our flagship office to take it from three and a half to four and a half million or is it on the struggling practice that we can't crack 800 that we have to subsidize payroll every month?

You guys had a good milestone. You were telling me this year, do you mind sharing that like each of your practice now or.

Yeah, I was telling you 25 wasn't a double digit growth year for us like we've had. You know, that's been kind of our thing that we've been proud of is we've been able to do that every year. This year we didn't, we were pretty even but we didn't have all of our practices independently cleared a million in collections. So I think it's the first year that we've had, haven't had like a loser on the board.

Yeah, it's awesome. And you've got some that are well above that.

Yeah, yeah, yeah.

You're in the all in X space and I know people get concerned about some of the bigger players in the space. How have you kind of found your niche?

I think it's again, we talked a little bit before the call. I think it's that our focus is really as ownership in the DSO space. Right. We have owner partners, JV partners in a lot of the locations and we have that mentality of where clinicians as, you know, as business operators, we're also clinicians and trying to really stick with that identity. So when patients come through our practice you know, they'll talk about some of the big players. And I went here, there, and, you know, I, I don't think we're never disparaging because there's, there's segments in every market. Right. And for a lot of people, those places might be the right fit, but ours is just a low pressure thing, which is counterintuitive. But by not pressuring them, we're able to win a lot of those consults just by saying, hey, we're here if you need us. You know, go wherever this is informational. And I think they feel the sincerity in that. And then also that, you know, our team, we have great teams. When you go into the practice, the teammates are all really personable. We put a lot of, I think, training effort behind that too, to make sure that everyone that comes in for a consult is treated with a lot of respect, you know, attentiveness. And I don't know that they get that feel at some of the bigger places. So I think we've been able to still do pretty well in the space despite the competition.

Looking at your leadership style, 2017, 18 versus 2026, if you were going back in time, how do you think that you've evolved as a leader of these practices? What's different from the Clark and Seth back then that's, that's better, and maybe even that you're embarrassed about. I always say if I'm, I'm not embarrassed about who I was a year ago, I'm not progressing. So.

Yeah, I mean, I think. Go ahead.

Yeah, I'd say we have more confidence in ourselves, like, as leaders. I think we second guessed ourselves a lot in the beginning. Like, we were like, I think this is right. And then we kind of get other suggestions and we'd second guess ourselves. And we got to a point we talked to each other a lot and we're like, we know, like, we've, you know, we've experienced a lot. Like, when I was in Texas, I opened three or four clinics with the group I was down there with. Clark learned a lot bouncing around and like, we have more confidence in what we're doing versus 2017, 2017, 2018, where we, we're still developing kind of as leaders. And now we can rely on some experience. We've, you know, Clark's gonna. Has his mba, just, just that confidence. And I think, you know, having that confidence, people want to follow that. They follow that confidence and inspiring hope for those in the organization. Like, hey, guys, look what we're doing. We're doing really good Things and. And highlighting that we do, you know, a summer party every summer. We do, you know, Christmas parties every Christmas. We're highlighting the good things that we're doing, and people want to be a part of that.

And I would take that. That's all very true. And I think we had to sit down at one point a few years in to say, hey, let's start trusting ourselves. But I'm going to take a little different direction on that question. Emmett and Taka, about kind of communication styles. I grew up with the model of kind of like the strong, silent leadership. That's how my dad is. And I had the going into it, like, oh, well, I'm going to lead by example. I'm going to work hard and everyone will follow. Which we know doesn't work very well in an organization. And maybe it does at a single practice level where you show it, teach it, and then they emulate it. But I realized pretty quickly in a group that wasn't going to work. So then I moved into a phase of leadership that I'm not proud of at all, which was because I only knew how to be nice and how to lead by example when we started. And then I developed the jerk side, which was, okay, I'm going to, like, you're not listening. I'm stressed out. I'm going to come in and show you that I'm in charge. And we also know that's super ineffective. So I had kind of worked through that, found my voice, but I wasn't good at doing it in a constructive way. A watershed moment for me was actually, I think the first time I saw you speak, Emmett, is maybe three or four years ago. And somebody. You were doing an interactive thing and somebody was just not very smart. And you're talking to them and they weren't getting it at all. And you basically told them that they were not very smart and they weren't getting it at all. And they had a big ego in the nicest way I've ever seen anybody do that to the point of. I was just. That's the only thing I remember from that. That whole conference. And I went and found you in the food line later and I asked you, like, I don't know what that is. I've never seen it. But where did you get that skill set? And then the disappointing answer that you developed it over 20 years of hard conversations. It's not something that you get overnight. But you did turn me on to a few books. One of them was Radical Candor, which I think is a good Read. Because I think a lot of us, we try to be nice people in life, and we want to be nice, but what we do is we avoid critical conversations, but because we want to be nice. So that was, I think a big turning point for me is that you demonstrated was I can be a nice person and also be very direct. So I think that's. And I'm. I'm definitely not to your level on that, but that's where. Where I'm headed. You know, when I think about leadership is when I go into an office because there's limited capacity. You can't just go in and hang out and just have FaceTime. The FaceTime is important, but it needs to be with a purpose. Showing up to the office, boots on ground to figure out what's going on there, and then having a friendly conversation with the office manager, asking some questions, but then also giving some critical feedback, but in a friendly way. Then same thing with the doctor, the clinical team. I think it's. How do you manage, like Seth was saying, inspire, but also manage behavior and make corrections while maintaining a good relationship. It's, you know, at least for me, it hasn't been easy, but at least knowing what I'm shooting towards, I think is, you know, allows us to progress on that.

I saw a meme a little bit ago that I now love, but it said, to know what you want, to ignore what others are saying and to press forward is called courage. It's also called stupidity, and that's what makes life hard. You know, I think trying to figure out leadership styles, right, kind of falls into that. What am I willing to. I kind of put it in this bucket. What am I willing to tolerate and not tolerate, and how do I communicate that? And I think in the beginning, to be a good entrepreneur, you have to be willing to tolerate a lot because you're taking so much risk, you don't know what you're doing. You kind of need to be humble in the process. But to get to the next level, you need to be willing to not tolerate certain behaviors. And how do you then have those conversations? Kind of, as you were saying, Seth, like, okay, we do know what is right now. What's the right way to approach that? I do love the radical Candor book. I think what really impacted me about that book is in her four quadrants where she said, okay. When she looked at Steve Jobs and the Google leadership that she worked in, and she said, okay. It's really on a spectrum of how clearly do you communicate and how deeply do you care and obviously someone who doesn't care and doesn't communicate well, that quadrant, you know, just fails. But the quadrants I thought were most interesting as those who don't care but communicate clearly were better liked leaders than those who care but don't communicate lead clearly. And they called that ruinous empathy. And I was like, holy smokes, I'm a ruinous empathy. And then to figure out how to kind of step into communicating clearly has been a quite a journey. It sounds like that's something that you've taken on, which is amazing.

So, yeah, work in progress.

It's, it's, it's so much development of yourself, of your team. And I think it needs to be also said developing team leadership has been a big part of it. You know, we, we, you know, back in 1718, we, we held it all ourselves and now we have these partners in the locations. They're doing weekly level 10 meetings with their managers and other leadership in the offices locally. We do quarterly, you know, VTO stuff. We're doing, you know, one on ones. We do monthly doctor meetings. We're just more routine in checking in, looking at things, looking at metrics. There's more accountability with key performance indicators, there's more tracking. You know, it's just, it's just more systemized and a lot of that we have thanks to, you know, DEO and just kind of believing in giving it a try. So I, it'd be a disservice not to highlight like our, our manager McKenzie who's, who's wonderful, she's VP of Operations and she, you know, she goes and has really good people skills to manage a lot of those tough conversations. But we have local managers in the locations and doctors who have buy in. And so I don't know that, you know, we're the owners of the whole group and the founders and everything. But it really is, once people start buying in, it kind of develops its own energy and momentum, which is kind of fun. And there's a lot of nights I leave, you know, our Thursday night doctor meeting that month and I think to myself like, that was awesome. I'm like almost a spectator and I'm leaving with this momentum and this energy. Like that was really, that was really awesome. You know, like the doctor's up there talking about something he learned at a CE and then we have a guest speaker and then our guy who does our marketing shares something and we have things shared from our operation side and it's, you know, once you get that momentum going, it, it's a lot More fun than the survival days, that's for sure.

Yeah, it is.

And how did you guys cross over from the perspective of I'm paying them a salary, whether that's the associate or the team, they should just do it. Right. Because it sounds like you've. There's a magical moment when you as a leader realize that they're kind of your customer too. Right. The developing them and taking time to invest in them despite your overwhelm. That's really where the magic's gonna happen.

Yeah. It's so funny you, you say it in those words because that's exactly, I think the conversation.

Yeah.

Three years ago, I had that conversation with Seth. I was like, seth, I just realized something that really dumb, which was that, you know, for so long we think of, you know, and that's a big thing we push to all of our team members is the patient experience. The patient experience is like, you know, we've been so focused on the patient experience and we need our offices to continue to do that. But you and I need to be focused on the partner experience. Right. We made a conscious decision to pivot from associates to partners. But we have to like our customer is, are the partners that have bought in that trust us, they're taking a chance on us. So we have to deliver to them. We have to communicate well to them. So everything we do, you know, when I put the CEO hat on in the day to day, that's the perspective I'm coming from. How does this impact my partner in this location? How does it impact his team? You know, so that's, that's kind of when we're making decisions on technology. We're going to get all that. We try to get buy in, you know, I guess literally buy in from, from all the partners. We'll have those monthly meetings. We'll present options, say, hey, we've, we've looked at this, this is the research we've done. But we're taking it now to you to think or, you know, to look at it. This is the discount we get as a group. This is why we think it would be good. But ultimately we want, you know, your feedback, your thoughts, your buy in. And that's been a really great way to run things from a communication perspective. We first started, we'd think up, you know, all the ideas and then we'd tell MacKenzie, the VP of Office, to go to the offices and implement it. And we got all this pushback of, oh, corporate telling us corporate this. And Seth and I were like, corporate, what do you mean? Corporate. It's Clark and Seth.

It does, yeah.

So all we did, the only change we made was to present those changes at Dr. Meetings to the dentists and say, okay, now take this back to your office. It was a night and day difference on the buy in and the implementation by them coming back. Because then, you know, in their practice they're like, oh, well, doctor wants me to do this as opposed to somebody coming in from corporate to, you know, make their life hard.

What would you say to a single practice who either one hasn't hired an office manager yet or has an office manager, but maybe he's not fully utilizing them, maybe they're scared to let them see financials. You know, there's that, that weirdness where the office manager is asking for raises for everyone, but the dentist is struggling to even make payroll, you know, and they're just not on the same page. How would you coach them?

Yeah, I think that's also something we lived, right. You talked about like, what do you tolerate and what do you don't. What do you not. When we started it was like, if it makes financial sense, we tolerate it, if it doesn't, we don't. So I think there's like a live and die aspect to any business of that, but beyond that, it's creating the culture, right? And as we started, I had this mentality of like, you know, I saw every vendor with suspicion, almost like, oh, they're trying to take, we need money and they're trying to take money from us. And at some point you make this mental shift of. My greatest asset is my time and my, you know, I have a limited capacity to impact others and what am I going to do with this, this limited aspect of time? Because the money follows. Eventually you learn that when you get the culture in place and you develop a team, the money kind of follows. And I think that is a hard, at least me, it was a hard shift and I think it's a hard shift for dentists because we're taught to create with our hands, right? We go in and we create something and we get paid for it. So trying to step in, we, we, it's hard. It's not like a lawyer, all they do is talk and they get paid for it. A dentist, if you're not making or doing something, you don't get paid. So to create that or make that mind shift into, okay, me communicating and talking to these people and training these people actually has a real financial impact. It's, it should be obvious, but it, I think coming from a technical Perspective as a dentist, it's hard because we want to, we're in all the details, we want to know everything about everything. We want to. You know, that's the classic thing of the dentist, micromanages the whole office. And you know, I think it's like that, letting go of the rope where you go, you communicate first. You have to communicate well. Right. The other thing is they say, oh, well, I tried that and it was a disaster. But it was, they wanted them to read their mind. They didn't have good SOPs, you know, they didn't have procedures in place. They didn't train well. But what I would say to them, I guess in a nutshell, is if you want to get to the next level, you can't do it all yourself. You need to develop a team. And it's, it's just like having kids and teaching them, you know, to load the dishwasher or fold their clothes. It's twice as much work for a short time and then it, you know, it really opens up.

It's fascinating. Cause, you know, Obviously US Coaching 2000 practices every week and just the number of conversations I have, I get to see patterns. And some of the patterns that I see, not just among dentists, but high performance team members, is those who, things come naturally sometimes are the worst at leadership. Right. Because they're just like, you just need to do it, you know, because that's how they did it. They just leaned in. They're a type personalities and their lack of patience. They're seeing a problem, fixing a problem accelerated so much of their career. And now to be able to see a problem and sit on that and, you know, using your analogy to train someone else to slowly load the dishwasher, to have patience rather than urgency around something is so different. The way I see it manifest oftentimes with dentists is to your point, they become cost managers, not investment managers. Right. So it's about like, how do I reduce costs everywhere, but not necessarily how do I get the highest return on investment even for their own time? So they find themselves doing $10, $50 an hour jobs partly because they're unsure how to do the $10,000 an hour job that they really need to learn next.

Well, in those, yeah, they're unsure and it's, it's, there's uncertainty around it, right. There's, there's fear of failure. That's the other thing that I think is really common for, for dentistries and probably like you said, any higher performer is fear of failure. We spent way too many Years in school, taking tests that if you get it wrong, you know, you get a bad grade or you fail the glass. Whereas in business, like, you know, I look at our, we're talking about our last year a little bit. One of the things we wanted to do is bring marketing internally. We put together the avatar of who we thought we wanted to hired a very qualified person who's a great person, but it was the wrong person for the job and it was a complete disaster. But in that process, we got connected with the person who's now our VP of marketing, who's amazing and a great fit. So, you know, we went face first into failure to end up where we wanted to be had we been, you know. But there's a lot of uncertainty in that move of are we gonna have this six figure salary? We don't know exactly what the position is, but we know we need to develop it. If we would have just sat on it and not done it for fear of that failure, we'd be a year later and still not, you know, have that, that task accomplished. I mean, the same thing with our VP of Ops. We had an original VP back in 2017 that was a terrible fit. Created a lot of stress and problems, but led us, you know, indirectly to our current, to McKenzie, who's, who's been amazing.

That's a fascinating part to me, how many times people say, yeah, I tried that before and it didn't work. And my comeback is, did you ever like anyone in junior high school? How did that relationship work out? How about, how about high school? Did you date anyone there? How did that relationship work out? Right. Like it takes iterations on relationships to mature into what's ultimately going to be a marriage and, and so forth. But it's not like you stop dating because junior high, you know, didn't play out well. Right. But I think to your point, it takes a lot of courage to lean into iterating. You see that on like associates piece. You know, I try associate and it didn't work out or they're not as good as I am. And it's like, yeah, you're just not a good enough leader yet, but we can get there.

Right.

So well, and that's. I've seen that, like you said a lot of times, I'll bring in an associate. I had one that was such a wrong associate. I mean, we ended up having some real issues he did with the board. And it's a whole long story. I'll tell you someday. It's, it's wild. But what it did is it created a space where we could replace that associate with the right associate. And oftentimes we fail before we succeed or we fail and realize that's not the route we want to go. I mean, over in the beginning we thought we wanted to do everything. We opened a dental lab, we opened a supply company, we opened. We did all kinds of crazy things. We look back and we've learned. And we even had a marketing company in those early days. But now we've learned how, and now we have. I can talk to you. What we have going for our lab now, which is mostly in house 3D printing and then some international support. Clark can speak on that. Shutting down supplies, which just doesn't make sense. Although we sold a lot of masks

during COVID Yeah, I mean, our original plan, aside from the super gpu, was to have a completely vertically integrated business. Right. Which sounds great on paper, but again, it's bandwidth. Yeah, yeah, it's bandwidth. There's only so much time and attention. So like supplies from a P L. Cost structure is a very. It's not very impactful. Right. We're like, oh, well, if we import all our supplies and shipping containers from China, you know, reverse search where Shine and Patterson are getting all their supplies from, contact those vendors directly, fill the shipping container, shipped it over. And I mean, on paper, we saved a lot of money. You know, we got probably equivalent to half a million dollars of supplies for 70 grand, which is great. But then you have to store those supplies. You have to get them out to the practice. You know, the logistics are nightmarish for a project like that.

Right. By the time you're done, you're like, we could have done 10 cases and

it would have been totally.

Yeah, exactly.

Yeah.

And you know, so it's like, okay, the people that do that do well, but they, they focus on just that. And they do it at scale, not for 10 offices.

So it's not just shutting down a couple practices. What's happened in your guys maturity is just overall focus. Right.

And shiny object syndrome kind of.

Yeah, yeah. I think back to your point of like, I need to have those $10,000 an hour conversations. But I don't know how when you hit that, like the immature or easy thing to do is be like, oh, well, I'm frustrated in this part of the business. Let me go open a car wash. Let me go start a supply business. Cause that feels good, you know? Cause I'm. Then I'm taking tangible steps. I can see stuff happening. But what you really need to do is go read a leadership book and have some hard conversations that don't feel great.

Yeah, that's super powerful. Or this practice isn't doing well. My office manager isn't great. I know what I need to do. Open a second practice. Right. Like, yeah.

I mean back to lessons learned. Right. If I've talked to Seth about this, like if we're, if I was to go back in a time machine to 2017.

Yep.

What I would do is, I mean you guys call in, do call it, nail it and skill it. Right. We'd go and we'd create the flagship with perfect systems and then we would find great cash flowing opportunities and practices for sale. I mean we, our, our intention when we started was we'll buy anything that we can get approved for essentially. Right. So we had our first four and then our next one was a dentist that you know had had a bicycle, really bad bicycle injury and he had to immediately stopped practicing and he was willing to sell our finance. So we picked that up and then there was an abandoned dental building that hadn't had a tenant in there forever. And we're like, oh, this is a great deal because it's already built out for dental. You know, not they're all good deals

as long as you don't take them out 12 months or 24 months. But at that transaction moment that's when they're really good deal.

At one point we bought an ortho office. We did. We had an orthodontist lined up that fell through and you know, so then we went from having what we thought was an asset to a liability that we had to pay to get rid of. So you know, I think it, yeah, that's what we mean by the shiny object. Every time we see a too good to pass up, it's there, there are reasons that other people have passed it up.

Yeah, it's awesome when you going back to what Seth says, you know yourself, but you also get a discipline on taking on the hard things. And in my mind too, sometimes you have to go from a student to f student activities and, and relearn or learn how to lead in those areas. Maybe to close this out. Let's go to some shiny stuff. As a flaming entrepreneur, where do you see, you know, this last five years I feel like have been a real beat down in some ways in dentistry because all we've had is labor cost inflation inflating without being able to necessarily move revenue quite as quickly. Now you guys have done some amazing stuff with your LNX to move revenue a Little more. But I do see relief coming through AI. I do see a lot of activities that we are paying for that can start to be automated and move our team up into activities that have higher value. I'm curious where you all are testing some things. I mean the great thing about do is having 550 entrepreneurs right now all testing different technology that's moving fast. You know, if you hate it, just wait six months, it's better.

That's right.

But have you guys been testing?

So, you know, when I think of AI, I think there's two, two aspects that I'm pretty excited about. One is what you just talked about, which is like the reduction in labor costs. Right. And we, we went to Filipinos a few years back, so we offshored a lot of our back office type stuff to Filipinos.

And India.

Yeah, India and the Philippines. And also on the lab side we have the digital design lab in Nepal. Yep. In partnership with the dental school over there. So they do all of our design. So that's really dropped our. And now, now we're FDA listed and they're actually doing the manufacture of finals as well. So that's been a huge cost savings. And we're actually also just in the process of rolling that out to other DEO members, other friends, those, those kind of. So that, that's been a really cool thing. But then with AI, I just see it as almost a transition. You know, instead of these remote Filipinos, a lot of that, the, the menial task, those go over into AI. You know, we have, you know, the integrations with Mango. Yeah. The big one that we're doing right now is Clara Type, which is, you know, where they take the data lake. You upload all your data From Practice Management QuickBooks and then you create your own LLM that you query. So that, that's where I think a lot of the, the power is in AI is because we've had the last 10 years there's been really good data aggregation. Right. It's like all this data is available and nobody has the time or bandwidth to analyze it and make sense of it. So with claritype, the exciting thing is we can take all this data that we've had and we can immediately pull real time reports to understand what's happening with our data. It's like, I don't know if you saw, saw in the news with Astronomy where they're now, you know, they're making really quick progress understanding black holes and some other these supernova phenomenon. And it's not that they didn't they had all, all these pictures and data that they had from Hubble and all this imaging. They, they had all this data, but all they've done is overlay AI over the top of it to look for recognized patterns that, you know, humans just don't have enough throughput to go through and understand. So I see that kind of as like a, I guess a cosmic example of what applies to dentistry is, you know, we've got all this data that's telling a story, but there hasn't been anybody to give us a Reader's Digest. And you know, that's where I see AI on that side. And then also with our, we're using like Patient Prism and Mango Voice and some of those products that's been a huge, I think value add is there's all this, we spend a lot of money on marketing and you know, there's the, the feedback loop is tightened up now where we can see where we're losing leads real time and within 30 seconds call back and, and save a lead that somebody whiffed and then also recognize the training opportunities so it doesn't continue to be costly. So those are where we've, I think made good progress. We've looked at some of the others. Like the AI receptionist, you know, six months ago is pretty atrocious. It's getting, like you said, like just in six months it's gotten leaps and bounds better. So we're just starting to implement that. And then, you know, personally, Seth and I, I think our legal bill was about a third of what it used to be the last couple of years with the introduction of ChatGPT and not that we're not using a lawyer, just cutting the hours down by doing drafts and then sending it to them and saying, okay, we have this contract ready, can you review it as opposed to create these associate contracts or whatever the case may be.

Yeah, it's super powerful. We did a call with Josh Rankin just a couple months ago and he's Starting to achieve 30% margins, net margins in some of his practices with the elimination of some of the front desk and just the flow. And it still feels what I call very Microsoft. Lots of drivers having to connect with each other, but I can see it becoming applesque over time. And ultimately I think what happens here is the things that no one really cares about, like no patient comes in and says, man, your insurance authorization process is just amazing. You know, like nobody cares about that. So the more we can streamline that back end components of things and make things simpler for the customer, the More we can actually serve the customer and have all energy towards that. I do.

Yeah. And I guess that's the other. Other point too where it's been really helpful is creating SOPs and processes was really time consuming and costly because of that. But using AI, you know, we can create SOPs so much more quickly and easily. And then even, you know, like we wanted to come up with a dashboard of information and using, you know, vibe coding, we can go in and mock it up and demo it before, you know, you go out and pay somebody big money.

You can use radical candor concepts and say, I need to have this conversation with an office manager. Use Kim Scott's radical candor to give me feedback on the best way to have this conversation. But what if they say this. But what if this happens? You know, what if in my performance review. Da da da da. It's really. Yeah, it's really incredible to help us to the next level. Well, guys, this has been awesome. Thank you for being so open and vulnerable. Anything else you want to say to maybe somebody who's listening and trying to figure this out? Like, where would you point them?

Well, you know, I'll. I'd be sad if I didn't mention this, but we also meet with Michael Irving regularly and he's a big technology guy with his background and knowledge and interests and stuff. And so I, I just want to give a shout out to. To the, you know, Clark and I have these ideas but we don't. We don't know we can be confident and lead, but it's really nice to be able to touch base with a mentor and run through things and get feedback and that's been a really big help. Our tribe leader, having that one on one time. So shout out to Michael Irving for sure.

Yeah. And that was going to be my answer is where would I direct them? To the deo, of course. Right. Yeah, it, I mean, it really has been impactful for us. We joined probably three or four years ago, but the first year I don't think we really engaged. So I think, you know, it's like anything you get out of it, what you put into it, you know, there's a mountain of resources available, but the coaching has been super impactful. Like Seth said, it's nice to have somebody that's a little further down the road to run idisbuy and say, hey, we got this going on. And they can say, oh yeah, I had that and I tried this and that and you know, not like we're always going to. Again, we're going to make mistakes but it gives us some perspective and sometimes a little bit of that courage too.

Awesome. Thank you both and appreciate the kind words to Michael and to our coaches. For those who are listening to this and think I want to be as cool as Clark and Seth, come over to deodental group.com and you can come join our other entrepreneurs and coaches. Really created something special here with the the app, the resources and great entrepreneurs to be able to connect with. So thank you both, appreciate having you on and until next time keep smiling. Thank you for listening to deo's Growth Secrets podcast for dental organizations. Continue the conversation on our Facebook group and meet other dental leaders. Get questions answered and the strategies you need to succeed. Plus we have some free resources for you right there on the Facebook page. Remember you're not alone. Let's do this together. Join DEO's Growth Secrets Group on Facebook and until next time keep smiling.