Growing Your Dental Group — Knowing When To Scale and Pitfalls To Avoid: Emmet Scott & Jake Puhl

All right, so Tom says, what are the most common mistakes for practices as they try to scale early on? Maybe three to five locations, moving towards 10 to 20 locations.

The number one mistake is they worry about how many locations they have. Right. Meaning that their actual benchmark for success is about number of locations. And it loses sight on. At the end of the day, are we bringing value to the patients? Are we bringing value to the clinicians working in those practices? So by far that's the biggest mistake because that gets you operationally focused by getting around locations. And all of us have seen companies where like, they created all these processes that weren't really helpful to the customer.

Right.

And so as you get too focused operationally, you lose sight of the customer. So that'd be my number one is don't judge your success on locations. I'm not saying that they are, but, but be careful of that. Right. Judge your success on impact on patients, let's say.

And then let's look at it from another angle. Let's say going from if you're doing three to five locations, you might be at 6 to 8 million or something up to. So you go on that 5 to 10 million range, up to 20 million range. What are the biggest mistakes in there? So 5 to 10 million. Ish. Up to 20.

Yeah. I think as you lose clarity and not make the investments on the data. So because the margins of this business are so strong, as much as, you know, we hate when insurances bring it down and so forth, there's margins there that allow us to not be as good on our accounting. And so without that clarity, we're making decisions that end up biting us on cash flow. So people say, hey, I want to centralize my call center or I want to do billing team or whatever. It might be like a centralization type process. I think that's a mistake if you're lacking, you know, clarity financially.

Right.

Like the, the investments I would make first is one marketing. Because if I have a lot of patience, it covers a lot of sins. Right. A lot of my other mistakes and my docs are super happy. So that's, that's the first investment I'd always be prioritizing. Number two would be financial clarity, you know, kind of speaking at high level and assuming, of course, clinical teams getting everything they want.

Love it. So here in the chat, if you want to post, keep posting some questions. We've got some more questions coming. I will add, we went around in a call the other day with some do members and everyone named their kind of first really high level executive or top executive, which you're looking at at that 5 to 8 million dollars range. And they're starting to see some success. And it was either an operational person or a CFOE style high level controller. But it's getting information on your money, right? Figuring out where the cash is and how it's working.

Oh man, that's another mistake. And of course I'm speaking to these. Cause I've made them all and I've seen others. But the operational person, that's like the junk drawer. You know how all of us have the junk drawer with the scissors and everything else in it. When we go to hire that operational person, you know, it's like, hey, what do you want them to be able to do? Right? Well, I want them to ensure that my practice managers are executing on this. I want them to come up with my marketing plan for this. I want them to interface with my accounting. I want to make sure that we have supplies. Like you start organizing like, wow, if you can find a human that can do all of that, right, Without a team. So we call it on ours. Oh, this has gotten to unicorn phase. Like we're looking for a unicorn out of this capabilities. That's a common mistake that all of us have made where it's like, I just need a person who. And then you look at the list, right? And you don't really group the list too by like humans. You know, it's like, I need someone who can get all my accounting right and come up with a cool social media. You know, it's like, well, those are two totally different capabilities. Vetting all of that early on is important.

I won't get us on an EOS kick. But that is one of the biggest downfalls of us. Although there's a lot of many positives, but people hear this idea of visionary integrator and then they get very excited about this integrator that's gonna basically make all their dreams happen. And that's. It's somewhat of a unicorn scenario. It's sometimes it's a little bit harder to pull off than it's doable, but it's harder to pull off. So Ashley says the unicorn phase. So true. We just went through that. So that's a great one.

And I would just point it out and you know, ask yourself, like, is there, are there humans on Earth, right, that can do all of those different capabilities? Now here's, here's the thing. I wouldn't judge. Are there humans who are passionate about X? So sometimes people are like, Well, I got to give them this other stuff because no one's going to want to, like, you know, input billings all day. So that's why I gave them the social media. So we're doing it from our own mindset because we like the creativity. No, actually there's people out there would love nothing more than just input billings all day.

Right? Love it. And, you know, one thing that we've looked out for is just, I think a clue to that is when you have a creative side of the brain activity and then a logical, analytical side of the brain activity. And you're looking for somebody who's like, really good at both those. You want somebody who can help bring culture and HR and help all the people issues, but you also want them to put in KPIs and run spreadsheets. And those are often a unicorn, Jake.

This is how sensitive it is. This is how sensitive humans are. When we were building out our billing team, we had these different phases, right? So those who were, you know, sending out the claim, posting the claim, and then Appeals, we noticed that the appeals piece, we were really struggling with the right people there. Okay, well, the reason is because Appeals was the only one where you picked up the phone. Totally different capability than everybody else who's like, I input and I don't talk to anyone. Right? So it's like, oh, we have to actually think about that position, even though it's in billing. So I think being sensitive, those are just mistakes, you know, that we've made

not taking humans perfect. How do you know when you're ready to grow? Let's say you have a couple locations, two, three. And you know, at times it feels like your systems are all over the place. At times it feels like you add another location, everything's gonna crumble. But as the entrepreneur, you know you want to. And then you also know that growth only comes from going out of your comfort zone. So, you know, you need to push the limits a little bit. So how do you analyze yourself when actually it is time to grow or when it's time to sit back and get your legs underneath you?

Holy smokes. That's an awesome question.

It's hard.

Yeah, that is. I mean, that's the dichotomy of entrepreneurship, right? It's like, when are you being the risk taking Elon Musk, right, entrepreneur? And when are you really being the irresponsible, immature, flaming entrepreneur, you know, that doesn't appreciate what execution really takes?

Right.

I mean, that is such a journey for all of us. The fact that someone Knows that that exists and, like, asks that question, just puts them on the right path. Because, you know, I've talked to people who are like, emmett, this is easy. I'm gonna have X number of locations tomorrow. And I'm like, great, More power to you. That's awesome. And of course there's people like, hey, until everything's like, perfect, you know, am I scripting up front? Like, she says exactly it the way I want. I'm not opening another location.

Right.

So those are our two dichotomies there. How. How to decide I'm ready for another location. Let me think. So the first is that can't be like, I just want more locations. That's. That's got to be, like, not on the table. You do have to have some level of financial clarity. Ultimately, this is a risk tolerance game for you personally and for your team. I would say that my team is probably my best judge. Okay. Yeah. That just clicked for me, is because if my team's all in, it doesn't matter what happens because we're all in. When I outrun my team, I know I'm alone. And when it fails, I am screwed. So that's probably my great governor is I put a team around me that I trust that wants to go there, by the way, that's not like, so scared to go. Like, they want to go there. And then I'm like, hey, this is the next opportunity. Hey, we could do this. They're usually pushing back on, like, but how, but what about this now? How would you solve that? Man, that provides a ton of protection and support. And then you're just constantly upgrading the team around you to be able to accelerate that. So I would say you don't go forward. I don't care how good the deal is if your team's not in.

Well, this is the follow up question because. And I like these, they're nuanced. And, you know, everyone knows intuitively there's no one answer. But I think, I think a lot of times, you know, we hope that there's. There is one answer. There's just principles, right. That you kind of mix and match together. But let's say you want to grow and you feel like you have financial clarity and all these things, but your team, they're resistant because there's like, oh, you ask your team and they're like, oh, we don't want to grow now. We want to grow soon, but just never now is the right time. But we're totally on board with your vision. And then there's team where it's like they're just not on board with growing, and they're never going to be on board with growing. And maybe I answered my own question there, but how do you, you know, like, how do you assess whether your team is just not ready to grow

with you or there's something else going on in that dynamic, too? Jake, that is what we love about business, is what is the capability of the leader to influence the team and in a way that they're still able to give feedback. Right. That you're really developing as a team. So. And do you have the right team around you? So, you know, we're talking about. We're talking about how to build the next practice. What's really going on is how to build the right team so that you can get as many, you know, practices and have impact on patients as fast as you can. Right. That's really the underlying question here, is how do you get the right team around you? And I would say if the team is not reducing your anxiety, you're either missing someone from the team or you have a wrong team member. Right. And so anyway, that's how I. And then you just got to give it time to be able to develop that and go and go and go,

and you got to just get experience. I mean, you got to try out different ways and develop that entrepreneurial kind of. I hate to call intuition, but it's really. Because intuition is hard to grasp, but there is an element to that of just knowing, you know, just kind of once you get that experience. And so. Okay. Yeah. Yeah.

So I also asked myself, if I fail, does it destroy everything? If it does, then I probably need to get a little bit more underneath me. If it. If it doesn't, you know, on that next step, then why not take the risk?