In this episode, join Bethany as she gives some expert insight into the confusing and complex topic of creating a successful cold start practice. Drawing on over two decades of experience, including cold starting her own practice and guiding numerous other doctors in their cold start journeys, she offers invaluable insights into effective strategies and common pitfalls.
Bethany cautions against the allure of equipping a new practice with the latest gadgets and technologies from the outset. Instead, she emphasizes the importance of cultivating a solid, dependable patient base with basic needs, and progressively enhancing technological resources and treatment capabilities as the practice flourishes.
It’s also important to have the right motivation and acquire the necessary business skills for success, similar to optometry training. Bethany advises practice owners to be easy to do business with, deliver an exceptional patient experience, and start out with good habits and solid business practices from the beginning.
Embarking on a cold start practice can be a remarkable opportunity for professional growth. Tune in to this episode to discover the most effective approaches to achieving the success and work-life balance you’ve always envisioned, while avoiding the common errors associated with this challenging yet rewarding endeavor.
December 20, 2023
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Becca Starks: We have the ear with the students to hear what they’re looking for. They’re very, very few students that we’re working with, with the class of 2023 that will even consider an opportunity that is not private practice.
Dr. Bethany Fishbein: Hey, I am Bethany Fishbein. I am the CEO of The Power Practice and Host of The Power Hour Optometry Podcast. And I just want to first congratulate all of the new optometrists graduating this week from the optometry schools across the country. It’s such an exciting time. It doesn’t feel like that long ago since I and my classmates at New England College of Optometry in 1997 graduated. It goes fast. It’s really an exciting time. So congratulations, first of all, and this show is inspired by and dedicated to you and all of the people that you are hoping will hire you. Once you get your licenses and get out there into the world. So I’ve invited a guest, I have Becca Starks, Becca handles Enterprise Accounts and Operations for KMK Careers. And she’s here to help me sort out some of the things that today’s optometry students are looking for, and help educate some of the optometrists who are looking to hire young optometrists about misconceptions they may have or differing perceptions of this graduating class. So, Becca, thanks for doing this your second podcast ever. That’s awesome.
Becca Starks: Yes, thank you for having me. This is exciting.
Dr. Bethany Fishbein: Yeah, thank you. It’s an interesting time because we work with mostly established optometric practice owners. So most of the people that I’m speaking to day to day are employers of young optometrists, and they have this vision of what today’s graduates are like, and then I get the opportunity to speak with optometry students and recent grads and they’re not necessarily like that perception at all. So hopefully, you can help us bridge the gap a little bit.
Becca Starks: Yeah, absolutely.
Dr.Bethany Fishbein: So, talk about yourself for a minute here. I want you to just talk about KMK and KMK Careers because when I want to data on students, I knew you were the one to go to. And so I want all of my listeners to understand your involvement with young optometrists today.
Becca Starks: Yeah, absolutely. So KMK for those that don’t know KMK’s foundation is the KMK board review, which was started 18 years ago by Dr. Kyle Cheatham. And now fast forward 18 years we are inside of all of the 23 optometry schools nationwide. We have a team of optometrist instructors that traveled to all of the schools and we have a relationship with both third and fourth-year optometry students and 98, This is a big number to remember 98% of optometry students utilize KMK to pass their boards. So essentially we have a relationship with almost every single optometry student nationwide from the board’s perspective. And so we now have a new division of KMK specifically on careers which is just a natural extension of supporting those same students and finding their first career.
Dr.Bethany Fishbein: So you’re initially talking to these students when they’re students studying for boards. And then they hopefully pass boards and you know, move on and take more boards and pass those and move on. So what are the services that you’re providing for these students once they’ve graduated as doctors?
Becca Starks: Yeah, so it’s really fun. Personally, I am mostly an employee you’re facing so those that are looking for these candidates. However, we have a team of career advisors and all day long, they’re the luckiest ones in the world. They get to speak to these upcoming grads. So right now they are around the clock talking to those that are about to graduate here and a couple of weeks or maybe have graduated just recently. And uncovering what they’re looking for in a practice is really it’s a one-on-one relationship, so it’s totally free to students. They sign up to get a career advisor. They have calls with that career advisor to uncover what are they looking for what type of practice is it specific specialties, just anything that may be the true motivating factor as to why they want to go to a certain practice. And then essentially we play matchmaker so the career advisors speak to students all day long. I speak to employers all day long, and then we come together and get to build a bridge between the two and hopefully connect great candidates with a great opportunity.
Dr.Bethany Fishbein: Maybe it’ll be the next Netflix show after Indian matchmaking, Jewish matchmaking. It’ll be optometric career matchmaking. And be a celebrity.
Becca Starks: I think some of us would watch that, at least your listeners would probably enjoy that.
Dr.Bethany Fishbein: My husband and I would watch it so
Becca Starks: same.
Dr.Bethany Fishbein: So I mean, you’ve got a line of sight into exactly who today’s optometrists or today’s graduating class, today’s brand new optometrists are, can you give some facts and figures of what that class looks like?
Becca Starks: Yeah, so essentially, from a demographic perspective, it’s highly female. The data is showing 70% female and 30% Male.
Dr.Bethany Fishbein: 70?
Becca Starks: 70 Percent.
Dr.Bethany Fishbein: Wow.
Becca Starks: Yes. And there’s information I believe you are going to be able to put in the show notes. But there is a really robust report. I believe it’s lots and lots of pages. I don’t remember how many but there are highlights within that on pages nine and 10 that give a really good but really quick summary of demographics of this class, within gender within race. There’s even financial information about how many needed to have financial aid, that sort of thing, and some really detailed information even about by school breakdown.
Dr.Bethany Fishbein: Are you able to roll through some of the things in there that kind of stood out to you?
Becca Starks: So the biggest thing that stands out to me is female and how as you it shows kind of year over year how that transition has changed from much more female than male as it was in the past. Same thing with race, I believe I don’t remember how many years ago it was but just not too long ago. It was predominantly white for professionals graduating and now that’s shifted to highly other races, whether it’s Asian or black or other races that are included in that.
Dr.Bethany Fishbein: And what about the financial piece? Because I feel like that’s such a big topic for new doctors. Is this need to pay back student loans? Do you have any stats on the amount of debt that students are graduating with?
Becca Starks: Yeah, so the report itself shows 85% of students are utilizing some type of support financial aid, loans, and the average for a graduate right now graduating is about $200,000 in debt. So definitely it is.
Dr.Bethany Fishbein: That’s just from optometry school or that’s including undergrad debt?
Becca Starks: That’s actually a good question. We just get the stat of 200,000 and I assumed it was just optometry school. But that’s a good question.
Dr.Bethany Fishbein: So young, female, and any change in like age demographic? Or is it typically right out of college a year or two out of college starting into Optometry?
Becca Starks: Yeah, So typically, it is kind of a typical route straight out of undergrad and to optometry school. There is about of the 16-1700 graduates there are about 150 of those that are considered you know, like other avenues whether that would be part-time or returning back in at a later point in time.
Dr.Bethany Fishbein: Okay, so out of 1500 you’re talking about? Very typically, right? 1000 young, female, probably non-white doctors.
Becca Starks: Yeah.
Dr.Bethany Fishbein: If you had to say this is what’s typical. This is the majority.
Becca Starks: Yeah.
Dr.Bethany Fishbein: With debt?
Becca Starks: Yes. A lot of it.
Dr.Bethany Fishbein: Okay. So, when you talk to this typical doctor and are getting into the field of matching into a career of their dreams, what are they telling you that they want?
Becca Starks: Yeah. So it’s been interesting to learn that so the things that I came into this thinking people would want my background was actually at LinkedIn for five years before coming on to help launch this division of KMK and I thought it would be very different. I would think pay would exceed everything else. But, interestingly, location is the top deciding factor for these new graduates in determining which practice they want. Obviously, that is the hardest answer because no one can do anything about the location of their practice. But we can touch on this later. Kind of some ideas and tips for those to try to recruit folks into harder locations but definitely the location. Again, before and above pay even this work-life balance coming into play that is much more of a topic. Then I think it has been in years past. Not necessarily meaning, Hey, I want to come in and I want to never work. But this generation is much more just passionate about having that work-life balance of the work to live not live to work mentality. And so location, work-life balance, obviously pay, and structuring pay in a way that is understood to the candidate as well too. So being very upfront about what that pay is so that they know before even applying and putting that in a way that they understand what they actually can make because sometimes it can be hard with percent of production, knowing what that means.
Dr.Bethany Fishbein: So let’s go into those a little bit more and I want to just go back one to work-life balance because I think that’s probably the biggest misunderstanding between a doc maybe in their 50s and a doc in their 20s. This idea of working to live instead of living to work and it’s respectable and it’s necessary and mental health is important and it’s and life has to work for you. But these older docs, that was not their world. And so when I hear it, it’s complaints. They won’t work weekends, they don’t want to put in 40 hours. They’re asking for a four-day workweek. They’re like it’s coming across as we’re lazy. We’re not dedicated to the practice. We don’t want to be here we’re not going to work as hard as you and it. It creates a disconnect from the start like somebody interviewing, who says I don’t want to work every weekend. All of a sudden has all these judgments thrown on them that they probably don’t deserve. Do you see that with the docs that you’re talking to and you’re matching?
Becca Starks: Oh, absolutely. Yeah, it’s the same thing I hear to have. You know, that’s typically the demographic of employers that I’m talking to all day long to have, you know, they came out and maybe cold started or they came out and bought a practice and they’ve been doing it for 20-30 years and like. What?
Dr.Bethany Fishbein: Right and they remember, or maybe they’re still working 70 hours a week and they’re there, you know, every day in the practice and their day off there when the cleaning themselves because that’s what the owners do. How do you coach of 50-something and 60-something-year-old practice owners into understanding that it’s not laziness and it’s not to they don’t want to work?
Becca Starks: Yeah, so that is it is a big misconception of the students that it is laziness, and specifically, most students are expecting to work at least one to two Saturdays a month. So it’s not that they’re coming in and saying I only want four-day workweeks, and I’ll never work a weekend. They are expecting a true full work week and one or two Saturdays per month. To your question about how to coach an owner in that situation. I think it’s just taking a step back and looking really high level at your practice as a business and I’ve had this conversation with many owners of I don’t know why we are open Saturdays, honestly, we’ve just always done it and so determined are we doing this because it’s just always been done or when determining this because it is a true business need. And so same thing with later hours or that sort of thing. If it is a true business need 100% voicing that to a candidate that’s a friend and that’s that’s great, but there may be situations where again, it’s just we’re doing this because it’s been done forever. And actually, our patients wouldn’t mind if we didn’t have a late night or we had a late night instead of a Saturday or vice versa.
Dr.Bethany Fishbein: Do you think docs have like a little bit of that? It’s like that hazy mentality? Like I went through it I put in my time therefore you you need to.
Becca Starks: I think it could be a little of that. Me not being an optometrist. I have to tread lightly because I have not earned my dues. But in the conversations that I’ve had, I think it is a little bit of that at least.
Dr.Bethany Fishbein: Yeah, I worked weekends for 23 years. I’ve never missed it Saturday. I’ve never called out sick. And now I’m going to change my whole practice because this 24-year-old kid doesn’t want to work, like there’s that so what are the students are the new grads thinking about these practice owners, doctors who are in a different demographic from them because there’s got to be misconceptions going that way also.
Becca Starks: Yeah, I don’t get to hear a ton of the misconceptions from the student side. But I think there’s just both sides can teach each other something right like maybe that student can come in and show this business owner who’s been doing this forever, like, wow, I could totally do this differently. And, wow, I’m kind of relieved that you came in and brought up the idea of work-life balance because I as the business owner, really needed that, and wow, my life is different because of it and vice versa. There’s obviously so much that the practice owner can teach and pour into these new grad optometrists. But as far as misconceptions from them, I haven’t heard any to be honest.
Dr.Bethany Fishbein: I hear that they look at a private practice. They think they’re not going to be paid as much. So they’re thinking that not necessarily that the owner is cheap, but that it’s not. It’s not as profitable, therefore there’s not as much money in it for them. You didn’t mention the mode of practice. You talked about location, work-life balance, and pay. Are students coming out looking for commercial opportunities? Are they looking for private practice or looking for MD offices? I mean, obviously, students are looking for each of those, but what are you seeing most frequently?
Becca Starks: Yeah, great question. So motor practice is very important and private practice remains. Top of the list for I’d say close to 90% of the new grads.
Dr.Bethany Fishbein: Serious?
Becca Starks: Yeah, because I hear the same thing. I hear a lot from private practice owners that say that almost come to the call with me very nervous, like “Becca, what’s going on? Why might all the new grads want private equity and why do they want retail? And can I really afford to hire them? Because it sounds like they’re throwing all the money in the world with them.” And then it’s interesting because we have that ear with the students to hear what they’re looking for. They’re very, very few students that we’re working with, with the class of 2023 that will even consider an opportunity that is not private practice. So there’s just a handful of folks that have said all maybe look at private equity or retail, but the vast majority say I truly, truly, truly want to private practice and there’s even a really good group that says, “Not only do I only one a private practice, but I already know that someday I want to partner slash buy this practice as well.”
Dr.Bethany Fishbein: Do you think though that it’s, it’s like self-selecting a little bit because retail opportunities are so easy to come by? That they might not even consider needing to work with a company like yours? They just need to go on Ziprecruiter, Indeed, and type in optometrists job and the geography they want and they have their choice. Are you talking to them before they’re job-seeking?
Becca Starks: Yeah, so we actually start a process with them a year before they graduate. And so we have them fill out a profile with us it looks just like a LinkedIn profile, but it’s specifically for KMK, and go in and select all of the different types of practices that they’re open to. And so, we have both from the data from what they input on their profile and then they all have a one-on-one call with a career advisor as well. And so that’s where those points come from, both in the data they enter and then the conversations they have with a career advisor.
Dr.Bethany Fishbein: And is that when a student should be starting their job search is early in fourth year?
Becca Starks: Yeah, so we were really surprised in the timeline as well that a lot of students start having conversations about the fall before they graduate. So this class of 2023 they were starting interviews, October timeframe, and then a lot of them were during their Christmas break, timeframe holiday break, going on visits to practice owners. And then as soon as the New Year transitioned over there were many that were in contract. So definitely, Fall time is like you can feel good. About yourself being ahead of the game, wintertime is still very safe, you still have a lot of opportunity to be reaching out to candidates, and then as we enter into more of the springtime, a lot of I’d say probably half if not more of those that we’re working with are 100% in contract ready to go.
Dr.Bethany Fishbein: When you start working with them. Is there any issue with students who are starting the search and still haven’t passed their boards or won’t have the credentials to work when they graduate?
Becca Starks: Yeah, Yep. There is information from ASCO also about passage rates. And it goes into detail even of school by school, but it essentially shows year over year the decrease in passage rates, and I think we’re at about 70% passage rate, right now. 73%. And so there’s a huge population of students that don’t pass typically it’s part one where the struggle is and so there are some students that will even graduate and still have not passed boards. And another misconception there is, “Oh, these students are lazy or they’re not understanding the information, and I don’t want those students because they won’t be good doctors”. And completely not true. Those are students that could either be not very good test takers. These are also the population that came into optometry school right in the heart of COVID. There are some that have just had really rough life events around the time that it is to take boards and so but they are all great people that will be great doctors, they simply just need to pass this test. Many of them have had really great GPAs some of them have other degrees that help them with the practice management side and so it’s just a matter of getting past that one test or many of them.
Dr.Bethany Fishbein: And how does, how did they navigate that with the job contract like, will an employer sign something with a student who hasn’t yet passed boards?
Becca Starks: Yes, we are running into that actually part one. Board scores were just released this past week. And it was a lot of that there was a lot of celebration and there was a lot of sadness around those that didn’t pass. And the good news is, I don’t know that I’ve come across a single employer partner that we work with that isn’t at least open to the idea of bringing on someone that’s graduated in kind of a super tech role. It’s kind of how we position it to practice under that optometrist owner until they graduate and we even have some that say, “Hey KMK I know that you, as an organization, do great at coaching them and helping them after they fail boards.” I will even invest in that side of the house to ensure that they can pass boards not only to show that, hey, I believe in you and the hardest time in your life student but also that gains them a really loyal employee that again, is going to be a great doctor has just had trouble taking this one test.
Dr.Bethany Fishbein: Coming in as a super tech though, obviously, they’re coming in at a lower pay scale and they would come in as an optometrist, and they have those student loans. So let’s talk about compensation of obviously it’s going to vary around the country and regionally and how many hours and all of that but what is it that a new OD is looking for as far as the ability to earn money?
Becca Starks: Yeah, good question. So, specifically with this new grad population, the way that I kind of coach, the employer partners that we work with private practice owners is, a lot of times they’ll come into the call and say why pay 16% of production, but with this new grad population, they aren’t able to really wrap their brains around what that is, you could have a $1.5 million, your practice and they still just don’t, they can’t really understand that. And so the recommendation that we give is to at least have some sort of salary and we have information and concrete data on specific areas of the nation. So by all means, if, if we can support you in any way with that, I’m happy to to make sure that you’re competitive, but having some type of salary listed up front is what’s going to entice these new grad population because they can wrap their brains around 140,000. They can’t necessarily wrap their brains around 16% of production. And so totally understand, then obviously the argument private practice owner, I hear you what’s going on in your head is. “Well, I need to motivate them to work hard. Like if I just give them a salary, then what’s the motivation to work hard”, and so there’s been kind of this really nice avenue that we’ve taken with a lot of partners that’s worked well in that advertising a salary a little higher than you probably would have normally, but then decreasing to a really low percent of production, so that there’s some salaries that’s there that’s enticing to a new grad, but a lower percent of production. So for the first year only, so year one higher salary and lower percent of production, and then having that shift for year two and year beyond your two to a lower salary, higher percent of production. And so what that does is again, entices this new grad to apply, and even want to learn more about your practice because there’s a salary, but that little bit of percent of production will get them to realize in their first year of working well. I’m doing the math, and if I would have went on the percent of production, I probably would have made more than my salary. This is making sense this is motivating me to work harder. And then again, you can even have it in the contract that upon year two that shifts to a lower salary that’s guaranteed and a higher percent of production. So as they’ve gotten their feet wet, they’ve learned they’ve been mentored that first year shifting then into percent of production.
Dr.Bethany Fishbein: So you’re coaching your doctors to do a salary plus a percent of production?
Becca Starks: Yeah, that’s pretty typical.
Dr.Bethany Fishbein: And what about benefits and stuff like that is that important? Yes, it is important. Is that something that a brand new grad is going to give enough importance to that it’s going to help them decide one place versus another?
Becca Starks: Yeah, such a good question. So I’ll give both sides just agree very important. I would say the majority of private practice owners that we’re working with are offering some sort of benefits, whatever that might look like. Some are very comprehensive, some are very “Hey, we will pay 50% of your medical and leave it at that.” But now that we are in this lane of there is competition from private equity and from retail. Those are just a no-brainer. In those avenues. And so to remain competitive from that regard. They will get a full package of 401K’s with matching with benefits with PTO, all of those things, if they’re considering a retailer or a private equity opportunity in comparison to your private practice opportunity. And so, again, I think most I talked to very few that say “Hey, I’m just percent of production and I don’t give any days off you just you if you’re here you make money if you’re not, you don’t but you can take whatever days you want type of thing”. I have a handful of those but for the most part, most private practices are offering the salary with percent of production, at least something towards medical, and then most do have a 401K whether there’s a match or not with that.
Dr.Bethany Fishbein: Are there other intangible benefits, other things that would make a practice more attractive?
Becca Starks: Yeah. So I think the thing that’s so such a great opportunity with all of the listeners that would have that are trying to hire than our private practice owners that have been doing this for years to a new grad specifically is mentorship. And so those that are willing to do that are excited about that. Well, maybe “Hey, I haven’t really even thought about that. But I’m gonna share over the last 20 years, I really have learned a lot that I could pour into this next upcoming generation”. And so being very vocal with that, even in a job description, or whatever it is that you’re creating, to entice candidates to come your way and some people put a really extensive plan behind, “Hey, we have a weekly meeting, and you get lunch hour with me every week and we will cover XYZ and some it’s kind of informal of just “Hey, I’m going to be with you I’m alongside you. You can call me when you want”, whatever that looks like, or even if you haven’t, some team members that are fairly recent grads, being able to vocalize that to have hey, we’ve got folks that I brought on board as new grads and couple years later looking them go and so the mentorship side is again that intangible free opportunity that I think a lot of people don’t even necessarily recognize they have the ability to give.
Dr.Bethany Fishbein: Is it mostly clinical mentorship they’re looking for? is it practice ownership? like when you say mentorship, what are they hoping to learn from you?
Becca Starks: Yeah, definitely medical at the top of that, but there are again, those those candidates that just know that they know that they want to be very involved in the practice management, the business side of the house. And so for those candidates that are interested in it, being willing to say “Hey, here’s I’ll show you all of our programs and all of our software and how I design the day and this is how I designed the business side of the house”, and so in those situations for folks that are interested in that side, I think it’s important to have just kind of an open door policy of “I’ll show you all that. I’ll show you that number. So I’ll let you in on this.”
Dr.Bethany Fishbein: So for practice in a particular geographic area, if you can get your salary and benefits close, but they don’t necessarily have to be higher. They just have to be within range and you can kind of check off all the other boxes. Is there a type of practice like heavy medical versus refractive versus specialty that people are looking for?
Becca Starks: Yeah, so definitely looking at highly medical. And then what I would also say is kind of another somewhat intangible, but if practice owners are open to new specialties that maybe you don’t have in your practice right now. But hey, if there’s somebody who comes in and is passionate about whatever it may be, and they want to bring that into my practice, that’s a really enticing thing for a candidate to really see themselves. They’re in the long haul of “Wow, I’m passionate about myopia management and this practice says, by all means bringing that on.” That’s such a great thing to be able to offer to a candidate and so definitely, medical and specialties are really where the candidates are wrapping their brains around of how do I see myself there.
Dr.Bethany Fishbein: And what if you’re in rural Wisconsin, where there’s just not a huge population of optometrists looking to settle? What’s the best way for a practice like that to set themselves up to find somebody to join because so many of those are great opportunities to become part of a community to ultimately partner buy a practice have a really low cost of living like it’s how do they make themselves attractive or show how attractive they are I guess I should say.
Becca Starks: Yeah, and I think that so often because I get the luxury of talking to these practice owners in some of these more rural areas. And every time I’m just like, Wow, if I could just record this and let all of these candidates see this owner care about the type of patients they get to see a lot of times it’s the smaller communities that because there’s not a nearby ophthalmology or another office like those are the most medically focused practices.
Dr.Bethany Fishbein: Absolutely.
Becca Starks: Yeah. And so, so often I feel better. Oh my gosh, if I could just package this up and get a candidate to truly wrap their head around it. So one of the things that we do on the candidate side is our current advisors do as soon as a student comes in and says, “I only want Miami in New York and LA”, we try to mentor as well and show your kind of cost of living and let’s truly take a look at this and let’s look at your lifestyle and look at
Dr.Bethany Fishbein: Miami, LA, how about rural Wisconsin?
Becca Starks: Right? Yep.
Dr.Bethany Fishbein: And consider Minnesota.
Becca Starks: Exactly. We play that game all day long. Yep. And then to the practice owners, a lot of what I tell them is, they’ll tell me I say they get to brag. So give me your brag book, when they come on as a partner to me, tell me what’s so great about your practice. And then they’re typically ready to end the call and I say, “Okay, based on your area, we also want you to brag on the geographic location just as much as the opportunity and so getting a candidate to truly understand what their life is going to be like, not just when they’re at work with you all day, but once they leave work, and what does this community look like and what can I do there? Is it great for hiking, is it great for the music scene, and the art scene? Is it great to raise a family and maybe I’m not thinking about that right now. But in the next couple of years, I will be.” And so I always say “Somewhere in your job description, however, you want to do it. It’s a post that you’re putting on to kind of an Indeed or an AOA. Having information, just typed information about your geographic area and what makes it so great. And then also, the other added thing you can do is you can always create videos.” Videos are I feel like that’s kind of how we’re all digesting content at this point. And especially this generation of these new grads, and so if you can even do a quick it doesn’t have to be professionally shot but videos of you just speaking informally, almost as if you’re speaking to a candidate who wouldn’t be right in front of you talking about again, envisioning their life there, the more that a practice owner can make a job description or job post about the candidate instead of themselves. The better that that’s going to relay to the candidates have just really getting to understand “Okay, this isn’t what I thought I was thinking Miami, but now I can kind of envision how my life could be in Wisconsin.”
Dr.Bethany Fishbein: That’s a really strong and valid point. Because when I think about a job ad, it’s all about what we need and what we want. We’re looking for an optometrist to work these hours to do this and when I’m interviewing candidates for Associate optometrist, but really for any position I’m always sensitive to an applicant, who all they’re telling me is what this job is going to do for them. Right. So I’m very critical of it as an employer when they’re like, I’m looking to build my clinical confidence in myopia. I’m looking into, you know, whatever. And I think what are you going to do for me? But in the ad, maybe it should be the other way off, Here’s what I’m going to do for you so that they’re interested and intrigued by the post enough to then come in and want to tell me what they are going to do for me so
Becca Starks: Absolutely
Dr.Bethany Fishbein: Cool.
Becca Starks: We even have one it’s a Power Practice member that wrote a personalized it looks just like a letter you would receive from your grandma in the mail and it was so different and so eye-catching and so engaging. It was truly just a personalized letter, Dear Candidate, and then it just spoke really informally like, Hey, I get it. Words are hard, school is hard, but here’s what it would be like living here. Imagine if you could leave work and go out and do this, this, and this and your two hours within this big city so you can go catch a basketball game and be back home at night. And so it was just very, again trying to get that candidate to envision their life not only with that practice but in that geographical location. And so that was an incredible example.
Dr.Bethany Fishbein: Did it work?
Becca Starks: We’ve gotten some interest. We don’t have anybody signed on yet, but it has enticed interest.
Dr.Bethany Fishbein: And talked about KMK a little bit again, just before we close. So if a practice owner is looking for an associate, they can reach out to you or how do they go about tapping into this database network matching service that you guys have?
Becca Starks: Yeah, absolutely. Yep. I would be the point of contact Becca Starks. And I’m sure you can put my email in the show notes, but it’s just Becca@kmkodcareers.com. And yeah, we typically just do a really informal introductory call and learn about the practice, learn about what they’re looking for. And then go over kind of our offerings. We’ve got two different offerings to choose from, just depending on what the practice owner is looking for. And then yeah, we just go from there. It’s really simple. It’s free to be in agreement with us and having us promote a practice. And so basically, we get that agreement going and then our current adviser starts promoting any of our partners that we’re working with. And then essentially once we have a student that is a great fit, we play the matchmaking game.
Dr.Bethany Fishbein: I love it. Thank you. I think this is valuable information for new grads to help them understand what they’re going out into and some of the misconceptions they might be facing. But hopefully, we did our part today to try and reduce some of those and really give today’s employers a more real picture of new grads who are looking for jobs. So thank you so much for taking the time to do this and give this service to all of the optometrists out there.
Becca Starks: Absolutely. My pleasure, Bethany. Thank you. So much.
Dr.Bethany Fishbein: Thank you
Read the Transcription
Bethany Fishbein: I would rather a practice see patients for the first six months and build a list of people who are going to benefit from some high-tech piece of equipment than open their doors with that piece of equipment in hand and not have anyone to utilize it and not have money to put into marketing because they spent their initial practice budget only on equipment.
Hey, I am Bethany Fishbein. I am the CEO of The Power Practice, host of The Power Hour Optometry Podcast. Feeling a little bit sheepish because I did this podcast and didn’t hit record, but now I am hitting record. I do not have a guest with me today. It is just me. And what I wanted to share is some thoughts that I have surrounding creating a successful cold start practice.
My husband and I cold started our first practice in July of 2001. So I’ve been through this journey myself. We’ve also worked with many practices through The Power Practice who are cold starting their business and have had an opportunity to be part of the creation of all kinds of different businesses, see what works well, see what works, maybe not as well,
and see the things that really don’t work at all. So that is my experience and the background for what I want to share with you today.
I’m encouraged that so many people are thinking about cold-starting a practice. And the first thing that I would say is that sometimes what drives you to think about cold starting is something that you don’t like about a practice that you’ve been working with or a place you’ve been working in the past. Maybe you’re in a commercial practice and you don’t like the hours. You don’t like the pace of patient care.
Maybe you don’t like that you’re being asked to work weekends. You don’t like the cap that you perceive on the money that you’re able to make. And so it’s normal to think about cold starting as what you want to do when you escape from the situation where you’re not fully happy. That was my situation as well. But when you start to think about actually doing this, the best practices, the fastest growth, the most fun process, the most exciting builds come from owners who have a vision for what they’re trying to create for their patients and for their community and for their staff. And yes, there are going to be benefits in it for themselves they’re aware of that and they want those too. But the self-benefits come after the benefits to everyone else.
So, practice owners who go in thinking, I want to create this amazing place where I’m going to give patients this experience that’s better than anywhere that they’ve ever had. My patients aren’t going to wait. I’m going to have the latest and greatest technology. I’m going to have people who are so nice, so much nicer than other doctor’s offices. Patients are going to be able to come in and I’m going to have chocolate chip cookies for them, this vision of what they’re building. And as they start to create it, it’s really fun to be a part of for them, for the people around them, for the staff they’re ultimately going to hire, for their consultants, and also for patients. As patients come in and start to see it, they feel like they’re part of something special.
The practices that seem to struggle are the ones that are born out of a motivation to deliver a result for the practice owner. I talk to practice owners, why do you want a cold start? I want a cold start because I don’t like having to work all these days a week. I want to be able to set my own schedule. I don’t want to work weekends. I want to be available for my kids. I want to see patients at the pace I want to see patients. And it’s very self-motivated. And those are the practices that practice owners that really struggle. It is incredibly possible that as the practice builds, the practice owner will get all of the benefits that they want for themselves, the ability to make as much money as they want to, maybe not as much as they want to, but the ability to make more money than they can make as an employed optometrist, the freedom to set your own schedule, the choice to do what you want to do. But those things, take a lot of time to create when you’re creating a practice from nothing, or even when you’re buying a practice that’s doing things differently than the way that you envision.
When you’re working towards the end result of building, it’s fun, it’s exciting, you’re getting closer. When your primary motivation is, what is this going to do for me? It’s kind of an endless source of frustration in the beginning, for the long period of time that you have to work to get to those goals. You’re frustrated by the conflict of, I opened this so I wasn’t going to have to work that hard. Why am I working harder than ever? I opened this so I was going to have flexibility over my own time and not have to be in the office. Why do I feel like I need to be there all the time?
So if you’re thinking about opening, if maybe you’ve already opened and you’re, not doing well or doing amazing, think about what is your why? What are you creating? What’s the primary driver for you to get up and do this every day? Having a primary driver that’s not needing to work that hard is a much faster path to success and one that’s much more fun to be on.
To that end, I would ask you to think about the idea that up until you start thinking about opening your business, if you’re employed somewhere, your job is optometrist. And if you think about what it took for you to become an optometrist, it took a lot of education in all of the areas around optometry. You went to school for this for years to learn to be a good optometrist. You studied, you practiced under people who were optometrists who are teaching you where you could ask questions and have feedback on what was good, what was bad.
As you start to think about opening a practice, all of a sudden you’re taking on a new job as not only an optometrist, you know how to do that one, but the one that you haven’t been trained for is the job of business owner, the job of leader, the job of manager, the job of HR, of managing the financials of a business, et cetera, et cetera, et cetera. We never learned how to do those things in school. And as you’re opening, you need to be learning the skills that will serve you as a practice owner. You can’t just be an optometrist anymore because as an optometrist is in the exam room, seeing patients. You will spend some of your time being that in your new business. You will also spend though a lot of time either being or supervising the people who are managing, marketing, accounting, building, cultivating a business.
It is worthwhile to look online and start to take continuing education, around practice management, around HR. And these don’t have to be optometry specific courses, courses on conversation, on leadership management, project management. You heard last week, this is not academic courses. It’s not MBA level theory and practice that I’m talking about. Just like when you think about what you learned in school and optometry school, the first two and a half, three years versus what you learned once you were in clinic hands-on patients, so much of this is what you’re going to learn hands-on, but you can take the non-clinical education that’s all over the place out there online, in books and magazines, at conferences to learn the skills that you’re going to need as a business owner, because it’s a completely different skill set than the one that you have as an optometrist.
For the heavy skills, the legal, the initial financial setup, negotiating your commercial real estate, for putting together a unique business plan. These are things where you really need to look at what your knowledge level is and what an expert’s knowledge level might be. So, as you are setting up, it is a worthwhile investment to pay, people who are really, really good at the things that you yourself are not good at or don’t know. And even before you open, last thing, and then we’ll get into once you open, we see a lot of new practice owners today who are very focused on the technical optometric equipment side of the business. As you’re working out this business plan, as you are, thinking about your initial budget, you’re working out a cash flow spreadsheet, I would urge you to think about marketing as being one of the most valuable return on investment kind of spends as you can have in the initial months leading up to and first three, six, 12 months of having your practice.
Everybody wants the equipment and they’re getting, the equipment in their initial startup loan, or they’re using their initial startup loan to fund the purchase of sometimes really high end equipment. That’s okay. Except when there’s a finite amount of money and people spend it all on equipping this office they want to have in the future and then find they don’t have enough patients in the office to be impressed by the equipment, to have the experience to potentially be the ones to tell others.
My thought was always that the practice is going to grow each year some percentage over the previous year, right? A new practice should grow some percentage wise from year to year to year. So as big as you can make that first year’s business, the bigger you’re going to be in year two, even bigger in year three, et cetera, et cetera, et cetera. It’s like the retirement calculators that show you if you invest this much this early and it grows by whatever percent. So our goal when we opened was always to make that first year as great as we possibly could so that any additional growth would be growing a bigger number, if that makes sense.
To do that, our focus was on what we could do to bring patients into the practice. And for quite a while, any profit that we had, we were reinvesting in marketing, reinvesting in marketing to build the practice that year. And this is not just digital marketing and website and SEO. It’s all kinds of creative things, whatever you can think of almost, to let people know about your business and start to get patients in the door. I would rather a practice see patients for the first six months and build a list of people, who are going to benefit from some high-tech piece of equipment, then open their doors with that piece of equipment in hand and not have anyone to utilize it and not have money to put into marketing because they spent their initial practice budget only on equipment.
As those patients start to come in, one of the things practice owners don’t always think about is that what happens that first year or the first, time a patient is going to come into your office, even if you’ve been in business for 20 years, really sets the tone for what that patient’s going to expect next year when they come in and the year after that and the year after that and the year after that. So this is kind of a stressful one to think about because in the beginning, you’re still figuring it out. You’re going to have all kinds of bad habits, but working to deliver a patient experience, working on communication, with patients and working on closing the loop so that patients buy the products or get the services that you’re recommending is going to help you start to build a patient base of ideal patients who are going to be great patients in your practice.
If your patient comes in that first time and you do a great job, they get contact lenses, a year’s supply of multifocal lenses and a pair of glasses, and they end up spending whatever, $1,500, then that patient mentally says, okay, when I go to the eye doctor, it’s about $1,500. When they come back next year, that’s kind of their mindset. If it’s less than that that year, they go, oh, okay. If it’s a little more, they say, it’s not that bad. And that repeats as that patient comes back year after year. If that patient comes in and there’s, nothing additional, and you’re not set up to even find out what their copay is. So you’re not collecting anything at the visit and they walk in and walk out, then that’s their expectation for the following year.
It’s worth it in the beginning to work on setting the fees and processes that you would like to have in your practice. One, two, three, 10 years down the line. Of course, there are always things that you’re going to want to tweak and change. That’s business ownership, but don’t start doing things that you know you’re not going to want in two years because you’re shooting yourself in the foot, establishing patient habits that aren’t serving your future business.
As far as practice habits, one of the things we always work to do was to really be easy to work with. Sometimes new practice owners get so far into the weeds on policies and billing and it’s hard because you’re reading online, maybe have colleagues. So you’re hearing more experienced practices, telling these horror stories of patients who don’t pay their bills, who walk out on the insurance, whatever those things are. And so sometimes people take it too far where they say, okay, I want to establish these good patient habits. So I’m going to let patients really know the rules up front. And I’m going to put these signs up. Tell patients it’s their responsibility to know about their insurance. And once an order is placed, it’s fully non-refundable and any checks written are going to have a $50 charge. And if they no-show for an appointment, they have to pay $75 because in trying to set up the idea that we’re going to do it right from the beginning, they’re thinking that all the rules need to be laid out up front. Patients should know they’ve got to follow them if they’re going to be here.
The thing is, when you’re brand new in practice, you probably have a fairly brand new staff. You’re going to mess some stuff up. You’re going to make some mistakes, normal. And when you make those, you’re really going to hope and expect that your patients are going to give you some grace in not being seen during your second week of business. Something gets screwed up with the order and they’re not going to be there. And so it’s really important to know that you’re going to tear you apart in an online review so that your first review you get is one star and it makes it harder to get patients from there on out. To get that, you want to be focused on delivering a patient experience, how patients are going to feel when they’re in your office. Are they going to like being there? Are they going to like you? Are they going to like their experience in the business? Are they going to want to? Are they going to want to help you, support you, and tell their friends because they like you and they’re hoping you do well? And you get that by being easy to work with and understanding that just like things happen for you, sometimes there are things that happen to them.
If you have three patients all day, then when somebody comes late to their appointment, you see them because you can. And someday you might not be able to. So I’m aware, as I’m saying this, that it sounds like this is going against what I just said of setting habits, but this is the habit that we are going to try and accommodate you and take care of you as far as we can go to do that. Somebody running late at the end of the day and you’ve got to pick up your kid at daycare, in that case, you can’t. In the future, when you have a large practice and busy schedule and people coming in, you probably can’t. But when you can, you can let patients know, great, I actually don’t have a patient right after you. I’m happy to see you. No problem. And just do it.
For billing, you don’t want it to be so complicated that the patient needs to understand every nuance of what goes to their medical and what can go to their routine vision. And they need all of a sudden a course in insurance interpretation. You can do the service that the patient is expecting to get when they come to you. And if you don’t have a patient right after you, then you can let them know, great, I actually don’t If you find something different, you can have that conversation with the patient. Really consider what to do when you have situations like a patient not loving the
glasses they picked out.
That patient on this early stage of your practice, you’re building what your reputation is going to be in the community, what you’re going to be known for. Do you want to be known for upholding your policies? Or do you want to be known for taking the right care of patients? And I’m making it seem more black and white than it is. There are doctors who want to be known for upholding their policies. And that’s okay. Knowing your policies, your values, what’s important and what you’re trying to create up front and building towards that is fine. It’s the ones who want to be a place people love to come, want to be welcoming, want to be easy to work with, want to have loyal fans. But those loyal fans are walking into a wall of signs or a long document of if you do this, then this, and here’s the fee and here’s the fine. That is setting up a mismatch.
Something else that I think is really important is watching the numbers of the practice from the
beginning and not just watching the numbers, watching the right numbers. The numbers, one metric that I think a new practice owner needs to be concerned with is cash flow. Because really everything else that people want to look at is a driver of cash flow. The big thing that
you want to get to, kind of the reason that you look at all the other numbers, is to be able to
measure your cash flow and see where you are. It is normal in a new practice that the practice is
losing a little bit of money in the beginning. Because you open your doors on day one, you have all of your expenses, you’re paying your staff, you’re paying for your space, and you may not have
all of the patience yet.
Hopefully you have some if you’ve invested in marketing instead of only high-tech equipment. But it’s normal to have negative cash flow, initially, which is why part of your opening a practice loan involves some working capital. They know you’re going to need to spend some money as you start to make it. So looking at negative cash flow isn’t the most exciting, sexy number to look at. It’s not fun to be like, I lost $14,000 this month. I lost $8,000. But you have to, because it’s cash flow that’s going to let you know, when you start to break even, when the practice is paying its own bills. It’s cash flow that’s going to let you know if you’ll have enough to start paying your loan, if you have one of those loans that you don’t have payments for the first six months.
So you need to know, okay, in six months, I’m going to start having this payment. Where do I need to be in order to cover it? It’s cash flow that’s going to let you make decisions about staffing and purchases. And it’s cash flow, ultimately, that’s going to allow you to start paying yourself from the business. So it’s pretty common for new practice owners to be looking at number of patients. They will look at their schedule, because as entrepreneurs, we kind of rise and fall by that schedule. On the days where it’s really busy, you feel invincible.
On the days that nobody’s there, it feels like you’re sinking. But you can have six patients in
a day that don’t generate as much as one. Different patient on another day. It’s too common that we see practices that are focused on patient numbers, sometimes even focused on collected revenue, which is another one that everybody wants to watch. How much did I bring in? But we know from
experience that practice owners can be bringing in a million dollars and not have positive cash flow to pay themselves at the end of it. So cash flow is what counts. When you apply for financing to open a practice, they’re asking you for a cash flow projection or cash flow pro forma. And that’s to get you thinking about how much money is this going to make after all the bills are paid? That’s the number that you need to be focused on. And I recommend for new practices, predicting it, tracking it, measuring your actual against your predictions, so that starting from the beginning, if you’re not where you need to be, you can make that correction early and start to make decisions with what to do with profit as you start to see it.
To that end, as you start to see that profit, one of the big questions that a new practice owner will have if they haven’t been in a situation to go full time in their practice from the beginning, and most people aren’t, is when can I start to pay myself? And when is that? Pay that I’m paying myself going to be enough that I’m able to leave my other job where I’m working. Because a lot of people, when they start out, they’re being an associate somewhere. And when do I leave that job and go into my practice?
I will say that I don’t see too many people making that leap too early. I do see more people making it too late. And the advice that was given to me when we were in this situation, I remember. We had opened our practice and I was working just filling in at a place in the mall just to have income and trying to figure out when do I make that leap? And so it was told to me and it stuck with me ever since. My advisor and mentor, Gary Gerber, at the time said, how much are you making at the mall? And this was a long time ago. And I was like, I forget what it was, $450, $400. He said, okay, if you took this eight hours, and used it to work on your practice, would you be able to generate more business than that $400?
That changed my perspective on the value of my time. It wasn’t about when the business could afford to pay me that $400. It was if I spend these eight hours doing something for the practice, what’s the impact that that’s going to have on the top line? And then filtered down in the blanks. Filtered down to the bottom lines and to the cash flow. The thing about it is for that philosophy to work, when you make that leap, or even before then, you have to be willing to spend that time.
Because if you do it the other way, and you say, well, when the practice can pay me $400, then I don’t need to work somewhere. And I get a day off. If you’re not using the time, it doesn’t work. You’re using the time to build the business, to generate the revenue, to be able to pay yourself more.
And even when you’re in the practice, before you’re leaving another job, there are going to be blocks of time that you have where you’re not seeing patients because you’re brand new and there might not be that many patients for you to see. You might not open with a full book every day.
So what are you doing with the time that you’re not seeing patients? Because using that time, you’re not going to be able to pay yourself more. And even when you’re in the practice, you’re not going to be able to pay yourself more. And even when you’re in the practice, it’s infinitely more valuable than thinking, I don’t have any patients today. I guess I don’t have to go in. I guess I’m not going to work on the business. So if you’re going to be in your practice 28 hours a week and you have 20 patients, the ideal is to block those 20 patients into 10, 12 hours and then use the remaining 16 hours. Sorry if I didn’t do that math right. But use the remaining hours to work on activities that build the business.
That’s the most valuable time you can spend. And when all of that time is used up and you know now you’re seeing more patients, you have less time to build the business. And if you had more time to build the business, you’re confident that you would and could use it to generate more business than your salary that you’re getting for that day working elsewhere. That’s when it’s time to take the leap. When you are in this early stages of this journey, you have time. And right now, today in this world, there are so many things that you can see and learn when you spend that time online. It’s also hard, though, when you start to see tons of information overload from practice owners with varying levels of success, varying levels of experience, and varying levels of pessimism or optimism, these are people you don’t really know.
So one of the things that makes things harder sometimes is comparing yourself to other practice owners that you see online. Sometimes it makes you feel great. You… Have an incredible month. Somebody posts online. They didn’t have a great month. And you think, this guy’s been in practice for five years and I had a better month than they did.
So sometimes it can make you feel good. But in a lot of cases, the thing that gets ignored online is that every practice owner is kind of on their own journey and building something different that they envisioned and is individual just to them. So asking a question. And people answering. They don’t necessarily know what you’re building before they throw out an answer. Somebody might be answering your question who’s never open to practice but just has an idea in their head of how they would do things. Somebody who’s answering your question might be online because they’re struggling in their own practice and they’re telling you how to succeed in yours. And somebody might be answering online who’s done something.
Somebody who’s done something very close to what you want to do, wants to share their knowledge, gives great advice, but you can’t always tell in an online post which is which. Keep in mind that your journey is your own. What you want to build is probably a little bit different than what somebody else wants to build. And the best advice is from people who know you, know your practice, know your goals. And are advising you of things you can do to get to your own goals faster, not their goals or anyone else’s. And as you go through this process, I think the most important thing to remember is to enjoy the ride.
There are very few things like the roller coaster of entrepreneurship. You can go from feeling doomed to feeling great to. Struggling to succeeding, to being so terrified, to being so proud, sometimes in the course of a really eventful day. It’s not something that people have the courage to do. It’s not something that a lot of people have the courage to do.
Lots of people think they would love to do this, but for some reason or another decide they can’t. So when you decide you can, you’re already ahead of all the people who are ahead of you. You’re already ahead of all the people who wish they could. And dealing with the lows, figuring out how to get out of them, understanding the problems, starting to solve them and seeing this all as kind of a giant puzzle that you’re working to fit the pieces together. Dealing with the frustrations makes the success that much sweeter.
So if you’re planning to open a practice in the new year, take some of these to heart. Most of all, enjoy the ride. If we can be there. Be of any help at the Power Practice. We would love to. You can always find out our information at powerpractice.com. And you can find me on LinkedIn. Happy to answer any questions. Thank you so much for listening. We’ll see you next time!