770. How to Build a Product Business That Doesn’t Need You Every Day

I want to tell you a story about a doctor who scaled her practice over the last few years. She was stuck at $20,000 to $25,000 a month and could not figure out how to get past it on her own. But she sped up the timeline by hiring a mentor, and she grew really, really fast. And when I say really fast, I mean like really fast, you guys. She went from $25K to $60K from the summer of 2023 to January of 2024. She then went from $60K to $100K in the next 6 months, right? Like massive, massive growth. You could imagine that this rocket ship was pretty exciting and pretty fun, and she was living life. This doctor then decided that she would get pregnant because her son was about 2 years old and life was feeling pretty great. She had an amazing team. She was able to leave the office for a couple weeks. And go to Portugal. She decided that once she got pregnant with that baby, she would scale out of practice. And she thought, wow, I have figured out this practice thing. I have figured out how to be a leader. This doc also had a husband who was really good at marketing. He was pretty handsome too, but really good at marketing. And they together figured out how to turn on ads and essentially eliminate the challenge that they had experienced previously. Not knowing whether their new patients month to month would be consistent. So now that they had this unlock of a consistent stream of new patients, this doctor decided that she was going to open not one but two new locations at the same time while also getting pregnant with her daughter, which was her second child. You might realize at this point in the story that I am describing my own journey, and this episode today is going to. Serve 2 purposes. I'm going to spill the tea because I'm sure that there are some people who are talking about it already, and I'm going to teach you my lesson about discernment. So let's jump in. You know, This weekend at the TWP conference that we went to, Ed Turney, who's from acquisition.com, was talking about learning from other people's mistakes. And the quote that he said, I'm gonna, I'm gonna mess it up a little bit, but it was something like, smart people learn. No, actually, dumb people don't learn from their mistakes. Smart people learn from their mistakes. Geniuses learn from other people's mistakes. So I wanna share what we're going through and what we've learned and navigated over the past 24 months and really over the past year so that I can hopefully create some context and perspective for anybody that's listening to learn from what we've gone through. And Kyle's just kind of here along for the ride. I don't think he knows what I'm gonna, what I'm gonna say today. So we've got a—

Actually don't.

Tripwire here.

I have no idea. And this also gives you a peek, uh, behind the scenes of, you know, we just, We just kind of live our life that way. We just wing it sometimes. No?

No, I would say that we are spontaneous. I don't think we're winging it. Like, we had an intention coming into today of what we were talking about. We don't have things outlined and memorized. Like, clearly if you listen to this show, you know it's not scripted, right? But like, we knew what we were going to talk about. We also are going to be recording another episode later that we already have planned out. We just don't know every word of it. Okay.

Have we planned it?

Yes. We literally just talked about it.

No, we have not. We're going to wing that one too.

But we know what we're talking about. Kyle Roach. Kyle, why do you have to argue with everything? Um, it's okay guys. He just told me how pretty I was, so we're good. Okay. So what have we learned over the past year? God, so many things.

That you look great in that outfit.

Thank you so much.

Obviously.

Thank you. Free People. Okay, so the big news and the thing that we haven't really talked about publicly yet is that as of today, we're recording this on the 21st of August, we are closing our 3rd location. This was actually the 2nd location that we opened, but the furthest one away from us and in a different county compared to our other 2 locations. And man, you guys, it has been kind of nuts making this decision. Leading up to it, there were many nights that we didn't sleep, many days that we felt overwhelmed. Many a time I sat on the floor crying over whether I should make this decision because there are people that work for us that will lose jobs. There is a whole community of people who get care at our office and they won't be able to receive that care at least in that location anymore. And, know, while ultimately it was a pretty sad decision to make, I think on the other side of it, we're feeling so much relief. Did you have that same experience?

Yeah, I mean, it hurts the ego, sure, but companies do this all the time. Yeah, they invest, they grow, and they restructure if it doesn't work out, you know. So when I kind of took myself out of it and looked at it from that perspective of like Verb as the brand. It's not Kyle and Danielle, but like obviously trying to build something bigger, you know, and there's reasons why and we'll get into that. So it was really good. It was working.

Yeah.

And you know, there's a few reasons why kind of the, the bottom fell out. And one of our current mentors was just like, you know, 'cause we went back and forth. Back and forth. And of course, Tennille's not inpatient care anymore. So it's like, sure, she could go see patients technically, but it's an hour away. It's, you know, just—

Being inpatient care takes me away from operations at the other 2 locations.

How can you, how can you be the operations manager plus CEO of the business plus managing all the team, the HR, everything? It was just like, Yeah, no, that's, that's not, that's not an option.

Right.

I think when it's like, you look at it through there and then our, our mentor is just like, kind of like, you can only drag a wounded soldier for so long. And yeah, I mean, it definitely relief. It's the right, it's the right thing to do. The other 2 locations have strong team closer to home. They are closer together. So easier to manage. These are all things that when we first opened, one, we felt like we were invincible at the time. We still do, but you know what I mean? And you just don't think about when you are figuring this out alone, right? And when you were at $25K, we were figuring out the marketing. Then it was, okay, now I'm figuring out the in-office process because I'm hiring And what's the SOP? What is what is my conversion? Now I got an associate. Now I got to coach her. Now I have two staff members, and so you feel like oh, I know how to do this operations management side. But let us tell you, when you multiply your team, your patient base, your marketing, your offices, everything, and there is still one of you. You get stretched pretty thin pretty fast.

Yeah, I mean, it's just the nature of scaling, and I don't think you— I think it's really hard to realize that before you go through it, right? Because I've been talking to clients a lot about this, and I think— let me back up before I start saying this. Next week's episode is going to be about the biggest problem we see with practitioners and with clinic owners, and it's that they are the practitioner, not the CEO. They don't think like a CEO, they think like a practitioner, a clinic owner, right? Where, you know, what you said before, looking at it and taking the ego away, that's stepping into the CEO role. What is the health of my company? What do I do? What do I need to do to make my company healthy? Well, I need to eliminate this location that is dragging us down from a performance perspective, from a financial perspective, right? I need, I need to cut out the cancer, essentially. So I think when you're the practitioner and you're in practice, you need to have a skill set for sure. You need to be a leader for sure, right? When you start to bring in team and you start to, to learn how to lead people well, that is an entirely new skill set that you learn. But it's almost like linear, you know, you bring in one person and like you show them what you do, then you bring in the next person, maybe that's an associate, and you show them what, what you do. And they're watching you and they're learning and they're there with you.

They're listening to you.

Exactly. They get to be a sponge because you are showing them literally day in and day out for 90 days, a year, however long they're training with you and learning from you in person, right? That's kind of a linear process. And then all of a sudden you have this team that is in the motions doing things like you. And if you're one step beyond that, you've got things written down, right? Systems, SOPs, things like that. So you can take a vacation, but ultimately you're still responsible for Keeping that culture going, keeping the operations going because you're in the building. And I think for us, we were like, oh, well, cool. Those skills are going to transfer over to these new locations, right? Because if I'm a good leader over here in my one clinic, I'm going to be a good leader over here in these new clinics with these awesome people and this beautiful aesthetic and all the things, right? And then all of a sudden you realize that the impact you can have directly leading a team that you're in person with does not transfer to trying to lead 3 teams in 3 different places. My body was not in the room. I was not there showing these new people how we do things at Verve day in and day out. And in fact, I had people that I thought were leaders who were going into to my business and were saying, well, I don't actually like the way that she does it, so we're going to do it differently over here. I'm not there to hear that, right? And I'm not there for my team to feel loyal to above that leader that I have elected to be in my place. So I feel like the big kind of through line here is discernment, right? Had we maybe moved a little bit slower, had we maybe been a little bit more discerning about what we want, what it takes, all the things, maybe listen to our mentors a little bit more because, you know, we've got a little bit of that 8 in us, that Enneagram 8, that little spicy doesn't like to be told what to do. Um, sorry, Steph. But no, I mean, you, you just, you assume that your skill set is going to transfer. But what happens when you open multiple locations? When you scale, and I'm talking true scale, not just like add a service, right? Like truly scale, it becomes exponential and you have to become a completely different person so much faster than when you're growing a team or growing one location. And I think we underestimated that. And I think to your point, you know, saying we were invincible, we underestimated who we had to become. And I think we underestimated the logistics that go into choosing a location. And I think that that's really what did us in.

What really did us in, to be clear, is the team and the management and that part of running the business. We had figured out that we were good at marketing and we could get people in the door. And when it was just me pushing buttons behind the keyboard and I got 'em in and then Danielle closed 'em and kept 'em, that was easy. Then, okay, we had a couple associates, Kyle gets them in and, and Danielle shows them what to do. Danielle shows the associates what to do, right? Remove Danielle from that equation. It's a completely different equation. And sometimes the math just doesn't math. So it's just the location we had. It was not a marketing problem. It was a leaky bucket fulfillment, just revolving door of team. problem that ultimately was just exhausting to try to keep that cycle going. I mean, sure, we could keep that office running. We were breaking even, right? It's not to say that we were losing money, but that location was breaking even. The others were profitable, but given the difference, our profitability was not where it needed to be. So it's just like, okay, Can we have addition by subtraction?

Totally. I think opportunity cost is a real part of this conversation.

Yes.

Right? Because whether it was requiring me to go in and adjust patients or it was requiring me to fix problems because there were fires left and right, right? With team, with callouts, with needing to fire the wrong people and, you know, having the wrong people ultimately walk away. Like all, all of that required so much of my energy and attention that it started to impact my ability to lead our other offices well. And it started to impact my ability to show up for our clients. And I think, you know, after 6 months of the back and forth and feeling like, what is the should here? Like, what do I really need to do for us, for our clients, for our team, for our other locations? Like, the answer became very clear because it was costing us too much in terms of the opportunity and the attention. But I think a big thing to point out here too is that when we opened that location, We assumed that there would be an endless supply of team members. Well, first I think I was a little naive and I was like, yeah, people are going to come be on my team forever because I really had pretty low turnover. In fact, my original office—

We had not lost a team member, especially a doc. Our doc stayed with us for years.

And yeah, I, I still have 3 of my original team members at our Orange location that have been with me the whole time. So I think that I just, again, I kind of underestimated the potential of what could happen. And again, because we were moving so fast, I wasn't as discerning as I could have been with bringing people onto our team. So unfortunately, we ended up with the wrong team.

Yeah.

But I think also, you know, again, when you're looking at opening a location and, and we're telling our story here and being very vulnerable, but I also want you to be looking at this through the filter of like, if I do want to open another location, what should I consider? I think the first consideration is Can you generate consistent new patients and not have the up and down, right? That's really, really important. We knew we could do it. We created a scenario where our first month in that practice, between multiple factors, I'll acknowledge, we had a $50K month, right? And then we grew from there and month over month we had growth, but we also had 2 doctors at the time. And when we ended up with less than that and we're trying to hire, we realized that our hiring pipeline was actually the biggest constraint. Our hiring pipeline was full of men who did sports and rehab chiropractic. We are a family peds prenatal office that does only chiropractic, only adjusting. We didn't have people to hire. And so ultimately, we ended up with one doc at that office, and our our offices only become profitable. Our model only works if we have two doctors. And again, I think I underestimated that. But had I had the wisdom that I have now? I might look at this area and say, okay, Orange County has different values than LA County. Different types of people wanna live in those different places. The school that is closest to us, the only school in Southern California, is focused on sports and rehab. It is a very medi-practic school, very different from the way that we practice in our office. Hmm, maybe the graduates coming out of that school may not align fully with what we do and how we do it. And then also we are working with women and children and young families, many of whom in the chiropractic field and profession don't wanna live in California because of the lack of medical freedom and everything that we have going on here politically. So there are 3 really big factors on why it might be challenging for us to hire doctors. So I think the evidence we had was small of like, oh, this is gonna work, we're gonna be able to find the right people. And we didn't look one layer out. And that's the discernment that I'm talking about here is just like, even though you want the answer to be this circle right here, this proof that things are going to work because you're excited, you got to be willing to look one layer out and say, is this actually the right move considering all of the circumstances?

And the location, the city itself is kind of an island. So it's Long Beach. It's south of LA.

Literally Naples Island.

Yeah. It's south of LA. Um, it's, you know, along the water. Sure. But it's not, In Orange County, it's a lot easier for us. We have a larger hiring pool, get the same California constraints and when, you know, obviously proximity to LACC, but it's a lot easier for us to hire at our other 2 locations because people are able, just with traffic patterns and freeways, able to commute a little bit. I could live in a neighboring city and it's easy for me to get there. With Long Beach, it's kind of an island. There's one way in and one way out. So not a lot of people live there, or not a lot of docs. You know, live there or live in neighboring areas because it's kind of surrounded by some rougher areas, right? That are willing to commute there. That's less than an hour drive. So yeah, we didn't think of any of that. I used to joke that once I figured out marketing consistency with lead gen and all of those things, that I'm just going to go up this, you know, the 405 freeway, which follows the coastline of Southern California. And anywhere that there's a Whole Foods and an elementary school, I'm going to open a Verve because that's our patient base. And now looking back on that, it's like, yeah, that was the mindset we had, which didn't work out because it was like, oh, Whole Foods right there, high net worth area on this side of Long Beach right there. Great. There's elementary schools. Perfect. And we found this awesome space.

Sure.

It's 10 grand a month, But look how awesome it is, and it's this old 1920s former church, and it's got these huge like you know this roof line and things like that. Yeah, let's do it. And okay, we have the team. We have senior team that we know. Well, that senior team didn't pan out, and then what? You know, and so we just kind of were looking at it so narrowly. We did not think of all the different. Factors of like the what if, what if that, what if that head doc leaves? How easy is it? And actually, you know, going to the event this past weekend, one of our good friends, Southern California doc, lives in a different part of town, has had a really hard time finding an associate. And for whatever reason, like luckily he just found one, but he has been looking literally for years. And I know there's people all over the country that are like in the middle of Indiana or Texas. I swear to God, there's so many chiropractors in Texas, but little cities I've never heard of. And they're like, yeah, I have a full team of like 8, you know, suburb of San Antonio. I have 8 associates that are all PX certified, whatever. It's like, how, how, how are there so many of you?

I don't know, man.

I, so like one hand you have more competition, right? But on the other hand, you have access of like easier hiring capabilities for aligned, know, doctors for whatever practice type, of course.

But it's got to be like, small business is hard in California, medical freedom doesn't exist in California, and the cost of living is really high. And we are charging the same amount for an adjustment as somebody in Columbus, Ohio. We were talking to one of our other colleagues and she's like, yeah, I also charge $80 for an adjustment.

And I'm like, and your house costs $400,000 and your rent is not $10,000, I guarantee that. No.

Yeah, it's just I think that you can pay people more for the cost of living. I think there are so many factors, but like, at the end of the day, you choose where you're going to be. You just need to ask those questions.

Yeah.

Right? Like, what happens if— and I don't love living in the place of worst-case scenarios. That's just not who I am. Like, manifesting is in my, in my soul and in my core. And, you know, like, when my spark comes back, Kyle's like, oh, what's she gonna create? You know, what's she gonna build?

Here she goes.

That's, that's who I am. And also a few years wiser now, you know, one business closing wiser. I wish I had asked those questions. I wish I had gone to the worst place instead of being in eternal optimism. And I think that that is duality, and that is the duality of entrepreneurship and honestly of this stage of leadership. It's like you have to be So psycho in the way that you are willing to show up and the dreams you're willing to have and like the places that you you want to go, and you have to be able to go to the depths of the bad shit that can happen. And let me tell you, like we are still dealing with a lot of really hard shit. But like with this decision, with every step that we're taking, we're we're getting closer to the other side of that. But that is the truth, and you can ask anybody. They may not be sharing with you on social media and telling you their story. They may not be showing you behind the scenes into how fucking hard this stuff is. But like, you gotta put on some fucking chainmail. Like, you gotta put on armor, you gotta get tough. You have to grow that capacity because there is a true duality as you begin to scale and grow practices. But I think I would love to just kind of, 'cause we could talk about this all day and probably shouldn't. Let's not get back into like a, you know.

No, but I, I, I think, I think you bring up a good point though. It's like at the end of the day, Why are we doing this? What is the end goal?

Right.

What is the success? And I think for us, we realized that it's like, I want consistent revenue. I want to not be tied to basically another job. I want to have the freedom. I want to have the leverage. I want to provide for my kids. I want to do fun shit. I want to do what I want, when I want, with who I want, how I want.

Right.

And we had to weigh the opportunity cost of keeping this open, fighting for this wounded soldier versus addition by subtraction, cutting it, moving on, cutting our losses, moving on, taking the ego hit, whatever. And we gave this advice to another clinic owner at this event. I just thought of it. He's making $85K a month and he's like, I want to open across town, across the river to get to 150? And the advice we said, because they have one kid.

No, 2. They had 2.

2 kids. Yep. What is that going to cost you in terms of time and energy? And you can't answer that until you are in the shit, until you realize, oh, it's too far away. Oh, it's taking up my time. Oh, I'm overspending my time over here. So my other team is resentful now, and now I have to come over here. And you're playing this whack-a-mole and who gets left out? Family at home or your sanity, or it's no longer in alignment with how you are defining what success looks like for you, your spouse, your partner, and your family. So it's the opportunity cost, but it's also the energetic cost of just like, what is this going to take from me? Exactly. So the advice we gave him was you have more max out your one location.

Well, because he's doing what, 16 hours of patient care there? Yeah. Yeah.

So yeah, it's just like, it's like, we think we need a second location to continue to grow.

You don't.

We felt we needed that because we have small 1,000-square-foot offices that cost 10 grand a month. So for us to, you know, we wanted to open 10 locations. Yeah. Hilarious now. But, you know, we felt in order to do that, we needed multiple locations. The average clinic owner can get to $100,000, $150,000 a month in one office.

Yep.

And if you are doing less than that, then you need to really rethink capacity, your mindset, your leverage, your in-office systems to be able to get you to that before you start thinking about another location. I don't care if you have patients. That are driving 20 minutes and say, oh, it'd be nice if you had something closer because that's the trap. Yep. Oh, I have a patient base there.

They need me there. They need me.

There's no other chiropractors there.

And that might be true.

Yeah, that might be true.

It's not enough.

But then you're going to cannibalize the one location you have because now they're going to not come in. So what's better, having one $80,000 a month practice or having two $40,000 a month practices that you barely break it even because now you have twice the team.

And then your team is happy because you're not pouring into them. Yep.

They're not getting all of you. So think about that. That's the discernment, is define what success ultimately looks like for you. Do more with less. As people who have learned from throwing money at problems or scale or line of credit this, oh yeah, let's go build out. Let's do it.

Yeah. Just because you can doesn't mean you should. I think what every single person listening to this will learn over time is that the more money you make, the easier it is to expand, to grow, to make money.

Especially as you— if you learn how to run ads or do marketing, because that, that's what— that was like, holy shit, now we got it, now we can do anything, right?

And I think that the common advice is like, once you're out of patient care and you have the time to do it and you've got the systems, like, go for it, open another location. And I think that there's just more to consider. I think there's more to consider. I think You know, and we could go into depth, and maybe we will. We'll create a resource that's like everything you should ask before you open another location. But I just think that the, the common advice leads us to this place of costing ourselves and costing what we truly want. And I think when you are in the season of quantum leaping and you are, you are just on the rocket ship to the moon, it is such an addicting adrenaline kind of place. Like Take a step back and ask yourself what you truly want, because those blinders get on and you're like, more, more, more, I want to do more. But just because you can do more does not mean you should do more, and it doesn't actually mean that that's going to give you the more that you're looking for, right? And I think that that was kind of the hardest part for me was realizing like, oh, actually this more that I thought I wanted was not the more that I wanted. And actually this other thing that now I can't do, but because I'm stuck in this place with 3 clinics. So I think all of that to say, be discerning. I was talking to another friend this past weekend and she's like, I just opened my second one. It's going really well. We're doing great. I want to open my third. And I'm like, cool. Kind of talked with her about the team she brought over and she's got people that she already knows and who love her and she loves and they're kind of running this new office. You know, I'm like, listen, run an office for 1 year without you having to be in it at all. Like, you're not in the building, you don't help. Maybe you have to—

Patients don't know you.

Patients don't know you. You have to replace a few team members who maybe aren't as close with you. Do that for 1 year before you open a 3rd location and decide if you like it, because it's different. It's different, and you become a different kind of boss. Your team perceives you differently. You know, I, I think that there's just so much that goes into it, and I'm happy if anybody wants to, you know, reach out and voice memo with me, happy to chat you through these decisions. Um, and this is the kind of—

Happy to talk you out of these decisions. Yeah.

Um, no, I mean, there's a, there is a time and a place, and I'm grateful for the 2 that we have, and I'm grateful for the experience we had with our Long Beach location. But I definitely think that there's, that more discernment is better, especially as you start to become more successful. Um, and I think, I think success can be your superpower and it can be a trap. So just be mindful. And, you know, if you want our help ongoing, shameless plug, our mastermind every single Wednesday, we go deep with our clinic owners on these types of topics and whether expansion is the right move right now in terms of location or services or providers and team. So listen, if you don't have a mentor, Please get one. Doesn't have to be us, but just have someone there to help you see the bigger picture and have somebody there who has gone through the things that you're considering. Having a mentor who has not been where you are is not helpful because the lived experience is unlike anything else. But be a genius, learn from our mistakes. We'll see you next week.

See ya.