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Matthew Christie:

When they become a practice owner, that's life-changing. And it's not just the money. Now, it's time to be your own boss, so to speak. It's time to grab that clinical control, and be able to implement the things in your practice that you want.

Corey Brown:

I'm Corey Brown and this is Provide's The Path to Owning It podcast where I sit down with trusted industry experts in Provide's network to give you the tools and advice you need to take your practice ownership dreams into your own hands. From owning your own practice, to expanding or improving an existing practice, we'll help pave the way for you to achieve your dental or veterinary career dreams and guide you through all the nuances of the practice ownership journey. Please make sure to follow us on Apple Podcasts, Spotify, or wherever else you listen.

Corey Brown:

On this week's show, we're going to be discussing what a provider should consider before buying the practice of their dreams and why now is a great time to buy. We are joined by Matthew Christie, one of Provide's regional directors of practice finance, to get his take on this fast growing industry today and the advice he has for aspiring practice owners. At Provide, Matt is responsible for the Southern California region and has over 20 years of specialized experience. He's going to shed light on what it takes to become a successful practice owner, how to reduce risk, and how to eliminate the fear of failure, many aspiring practice owners experience. Matt, welcome. It's great to have you on the show today.

Matthew Christie:

Thanks, Corey. Thanks for having me here today. I'm certainly excited about the opportunity to chat with our listeners.

Corey Brown:

Absolutely. Yeah. Why don't you just start and introduce yourself to our listeners and tell them a little bit more about your experience in the finance industry.

Matthew Christie:

So I've been doing this for a while. I started out right around 2000 as an SBA lender where I made loans to small businesses of every type, whether it was a franchise or just a independent store, all the way up to medical professionals. A lot of that was for real estate, purchasing franchises, and practice acquisition.

Matthew Christie:

The reality is I gravitated towards the medical professionals and after doing the SBA for a solid 10 years, I transferred over to a conventional bank where I made just loans for medical professionals and primarily just to acquire practices. So I've been doing that now for what? 12 plus years, seen a lot of different transactions out there, probably funded close to a thousand deals in my career. And so, just excited about the opportunity today to share things that I've seen, what works, what doesn't, some of the trends that are going on, and just hopefully be a resource to our audience.

Corey Brown:

You're certainly an expert in your field with over a thousand transactions. That's impressive. So from that experience, what should providers consider when evaluating whether now is really the right time to purchase a practice?

Matthew Christie:

I get that question a lot from prospective buyers, "Is this the right time for me to do this?" and I'm not sure that there is a right time. I think there's a time when you're ready. I think you have to look at, really, three things. Number one, are you clinically ready? Do you have the skill set that you need once you take over a practice to service your patients, right?

Corey Brown:

Sure.

Matthew Christie:

When I talk about that, I really like to talk about hand speed. How much production are you capable of doing and the practice that you want to be looking for should match that. Really important thing. Number two, are you mentally ready like have you really thought about what this is going to mean in your life? Once you take over a practice, it's more than a job obviously. You're showing up not from a 9-5 position, you're always on point.

Matthew Christie:

If the alarm goes off on the weekend, if somebody calls in sick, you've got to take those calls, you've got to, really, be ready to embrace that lifestyle of practice ownership. And then, number three, from a banker's perspective, you need to be financially ready. That is, do you have your credit in good order? Do you have your student loans managed? If you have student loans. Have you saved up some money for this event? I mean, we're going to give you, of course, we'll give you 100% financing, even money to run the practice with, but we want people to have something to fall back on in case of an emergency.

Corey Brown:

That's great advice. Yeah, absolutely. How many providers would you say are ready, to your standards, when you talk to them?

Matthew Christie:

Well, I think if you ask them-

Corey Brown:

A different answer?

Matthew Christie:

Yeah. But if I look at them, I see their credit, I see that they're experienced, I see that they've saved up some money, they're ready. They're absolutely ready.

Corey Brown:

So for those that are ready, what do you think one of the most common reasons providers would be reluctant to make that transition from being an associate to becoming a practice owner?

Matthew Christie:

Unfortunately, the biggest thing that holds back a doctor from making a purchase is that fear or that concern. What if this doesn't work out? What if I'm not getting what I'm expecting to be getting? What if the seller doesn't stick around and help me? What if, what if, what if, and I think those build up in the doctor's mind and when that happens, they tend to find reasons to maybe back out of the transaction or maybe just not go through with it.

Corey Brown:

With all those what if questions that are out there, what can you do to ease the provider's mind?

Matthew Christie:

I would say that the important thing to do is stick to the steps, right? Stick to the steps of the transition. First, you're going to go and you're going to get pre-qualified. You're going to look at practices. You're going to put in an offer on a practice. And then, you have the opportunity to do your, what's called, due diligence or investigation into the practice and answer all of those questions that you have about the production, about the historical collections, about how the practice has been running. The next step, obviously, to get with your attorney and you're going to work out the purchase agreement, you're going to work out the lease, you're going to have the landlord, make sure that they give you an acceptable lease. And then, you're going to finalize your loan and close on the transition. If you try to think about all of this at one time, that's where it becomes overwhelming for the doctor. They really just need to stay to the process and step by step, that linear forward motion.

Corey Brown:

Sure. It sounds like relying and trusting their industry partners and having, really, a fantastic team around them is something that I would think would be able to soothe their concerns, right?

Matthew Christie:

Of course, of course. And the right team at the right step. Not only do they want to surround themselves with the right people, but they want to do it in that linear fashion, right? So when you're looking for the practice, you're typically working with a practice broker or brokers, typically casting a wide net, looking at a lot of different opportunities. When you are getting your financing squared away, you're working with us as the bank. When you are doing your due diligence, you're going to rely on some, either third party consultants and accountants, maybe both. And then, when it comes time to the lease and the purchase of sale agreement, you're going to rely on your attorney. So having yourself surrounded with those people? Absolutely going to help eliminate a lot of those fears.

Corey Brown:

With those dentists, if they're still having that little bit of fear or the what if question, we've eased their concerns, is there any one big reason, especially in today's market or with the trends in the industry that  you're seeing, boots on the ground? What would be one of the biggest advantages or reasons for them to become a practice owner today?

Matthew Christie:

Well, I mean, I think they know the reason why they want to be a practice owner, right? It's usually not about the money, right? What typically happens is they get their schedule cut. They have to drive two, three different offices to make a full schedule. They're not getting to use the certain materials that they like to use. They're being told what procedures they can, they can't do. I think when the uncomfortableness, I want to say, of that situation just gets to be too great, that's when it's time to make a move. It's time to be your own boss, so to speak, right? It's time to grab that clinical control and be able to implement the things in your practice that you want. I mean, these doctors went to school for a very, very long time and they're very intelligent people and they know what they like, what they don't like in a practice, and it's just time for them to take control of that.

Corey Brown:

That's great. They definitely deserve the shout out. So Matt, so far, we've discussed what you can do to prepare before buying your own practice. But next, I'd really like to talk about why now is a time to purchase your dream practice.

Corey Brown:

After this break, we'll continue with Matt Christie, Regional Director of practice finance app, Provide, about his thoughts on this topic here on The Path to Owning It. I'm Corey Brown and this is Provide's The Path to Owning It podcast. Today, we're continuing the conversation with Matt Christie, Provide's Regional Director of Practice Finance in the Southern California region, about why now is the right time to buy your dream healthcare practice. So Matt, over your years of experience, what would you say has been your favorite part about finance since joining this industry?

Matthew Christie:

Yeah. I mean, I definitely have had a lot of highlights over the years but when I really think about it, I think that this job, this position, this vocation, whatever you want to call it, gives me the opportunity to really change people's lives. When I say that, I don't take it light. I'm saying somebody could have a job and whether it be as a medical professional or what have you and when they become an owner, specifically a practice owner, that's life changing, right? It is not just the money. I mean, now they get to build relationships with their team. They get to build relationships with their patients. They get to build relationships with the vendors that they work with. I mean, when they're an associate, you're moving around, you're not seeing the same patients, maybe one, two times, and it could be some sort of office where they're transient population, they're moving on.

Matthew Christie:

I meet with some of these sellers that have way more experience than me. They've been at it 20, 30, 40 years and you can tell that the quality of their life has been just so good because they were able to set their schedule. If they wanted to take a family vacation, they could do it. If they wanted to use a certain type of impression material, they could do it. They just had this freedom over that time that an employee does not have and I get to see that. I get to see that at the end of the day for these sellers and I just know that the work I'm doing, really, will change their life. Whether they know it, whether they appreciate it or not at the time, I know that it is going to change their life. And so, I think that's really the highlight of this job and why I enjoy it and what gets me up in the morning and keeps me going late at night and being able to talk these things through with my doctors.

Corey Brown:

I know that you've worked with some of your clients for years and then multiple different, whether it's a second, third, fourth practice, that's got to be really rewarding to see their growth over the time you worked with them.

Matthew Christie:

Yeah. I just got invited to the wedding of one of the very first doctors that I financed in Southern California. I think both he and I were scared to death doing that deal and today, he's doing quite well.

Corey Brown:

That's fantastic. Yeah. Well, let's talk about today. What kind of trends do you see in the dental practice ownership realm today? What's different now than maybe 10, 15, 20 years ago?

Matthew Christie:

Well, it's definitely changed. I think the biggest changer is, of course, technology and the Internet and things that maybe we didn't even have when I first got started. And so, doctors have the ability to do a lot more research ahead of time. They get to read what works, what doesn't work. They get to read what their peers did. They get to read articles by a lot of professionals who work with them, right? So they come in better armed as far as information and what to ask for and what questions and what to be looking at but I also think it maybe overwhelms them a little bit as well. Because there's just so much information out there, there's so many of these horror stories, great stories, in between stories and I think that gives them a little bit of paralysis by analysis so I think that we got a lot of that going on.

Matthew Christie:

I also think that you're seeing a little bit more corporate dentistry coming into our market. As a result, these doctors, especially the ones that have been associating at a corporate office, really have a different perspective as far as ownership. They know what they want to do and they know what they don't want to do. And so, when they're analyzing office, they can look at it a little bit better through those corporate eyes as to how things are working? What types of insurances are being taken in the office? What type of equipment does the office have or will it need in order for them to be proficient at their job? I don't think I saw that as much before. Just overall, I think you're seeing a little bit more structure into the transactions. Just over the years, it's maybe developed where you're seeing it a little bit more delineated as far as the steps taken when you buy an office.

Corey Brown:

Understood. Let's talk about today as well. We're seeing things on the news, record high gas prices, inflation rates. How do you talk to potential borrowers when they bring up this thing and asking you, "Maybe I should wait. Maybe now's not the right time." What's your advice on that topic?

Matthew Christie:

Well, again, being a little experienced here, I would tell you that I've been through a few of these, right? The first one was the .com crash in 2000s, went through the big one in 2008, seen a few different regional situations come up. I will tell you, over those years, I managed a really big portfolio of loans or had access to the management of a big portfolio of loans. The default rate was never more than, I think, about 1%. So as a result, even good times, bad times, it's still a very good investment to be in the dental industry or the veterinarian industry, medical in general. I think you'll see some, maybe, regional effects here or there. But for the most part, when the economy contracts, employers are the ones that will have layoffs, they'll have cutbacks, so forth.

Matthew Christie:

That's when you really want to own your own practice because then, you'll have more control over that, right? You'll have control over your schedule, you'll have control over your hours. The 2000 .com crash, I think my phone had never rang as much because that's when everyone was looking for a practice to buy because they were having a really hard time finding a job. In 2008, I saw a GP dentist getting $400 a day, even in a tougher practice, you were making more than that. If you have a great practice and you build up your practice, you make significantly more than that.

Corey Brown:

A lot of things in the news, again, on people's minds and I know we've talked about as a group a lot is interest rates, right? Maybe talk a little bit about why maybe that's not sometimes the biggest factor or shouldn't be the biggest factor and one's decision to move forward.

Matthew Christie:

So yeah, I do get that and it's interesting because I hear that more from my first time buyers than I do from second, third time buyers, right? That's not their concern. Their concern is cash flow, right? So what's the loan payment going to be and how much does the practice make and does this work for me, right?

Matthew Christie:

So if you have a practice that's not making a large amount of cash flow, doesn't necessarily have potential to grow, that's going to be more of a red flag to a doctor who's owned a practice before than to somebody who is just coming in for the first time. They read the news, just like you said, Corey, they're just sitting there looking at the-

Corey Brown:

They're educated. Yeah.

Matthew Christie:

At their feed and they're like, "Oh, these interest rates, these interest rates." I did these deals when the interest rate was 7% and 8% and it still penciled out. The doctor still made more money paying an 8% interest rate loan than they did working as an associate. So that's the factor you need to be careful of, not what the interest rate is, what's the payment?

Corey Brown:

That's great advice. COVID-19 obviously was a big factor in the medical industry in general. Now, here we are. What kind of impact is that having today? Is it better? Is it worse? What are you seeing?

Matthew Christie:

I can't believe that was two years ago. I still remember going to a dinner, coming home, the next morning, I find out that all the restaurants are closed down. It's just like, "Yeah. Still trying to figure that one out, huh?" When that happened, what did we do? We freaked out. We thought, what? How bad is the virus going to be? Are patients going to be able to come in? What are going to be the protocols that we need to put in place to keep our patients safe today?

Matthew Christie:

Today, fast forward two years, I don't think anyone predicted this, what are the issues we're running into? It's going to be supply side issues, right? Can you get the equipment that you need? I mean, I was talking to one of the major equipment manufacturers and they're backed up four or five months at this point, right? If you wanted to buy a full equipment package, getting your team in place, getting your staff there, that's the problems today that we're seeing as a result of that. Not the things we originally thought were going to be the problems but those. So if you're looking to buy an office, make sure that it has a full staff, make sure that they're in place and they've been there for some time and make sure that the equipment is there, that you're going to need to run the office. If it's not, how long is it going to take you to get that?

Corey Brown:

Yeah. So they just have to think about acquiring a little bit differently, maybe looking at different factors than they would've had to look at five years ago even, right?

Matthew Christie:

Yeah. Five years ago, if you wanted a CT machine or you wanted any kind of radiography, you could just call your supply rep and they'd come down and bring it for you right away, gladly. But today it's, "Hang on a minute. Let's see if we have that in stock. Let's see what the waiting list is."

Corey Brown:

Sure. So for those that are ready to start this journey, what resources do you and Provide have available for providers looking to acquire his or her own practice?

Matthew Christie:

I think the biggest resource that we have is knowledge. "What are your concerns? How can we help you there? Can we make some introductions to someone that would be good to talk to for your specific situation and do you have what you need financially ready to go? What's your credit situation? What do your student loans look like? Do you have some money set aside for this? What, as far as your production or your hand speed, are you comfortable with?"

Matthew Christie:

Those are the things that we're going to measure. We don't want to put anybody in a bad situation. So having that conversation, I think, is our biggest resource and just talking it out. I can't tell you how many afternoon, evening calls I've had with doctors and just talk through their specific situation or the opportunity that they're looking at, "Does it make sense or doesn't it?"

Corey Brown:

That's great advice. We'll end with one piece here. What do you think, after a thousand plus deals, what's the biggest piece of advice you can give today as future practice owners that will have the most significant impact on their practice ownership journey?

Matthew Christie:

Wow.

Corey Brown:

Tough question, huh?

Matthew Christie:

Yeah, that's a tough one. But I guess, just kind of looking back, I would say don't get caught up in the details, the minutia, look at the big picture, focus on the big picture. Look at the practice that you are going to acquire and say, "Is this something that I can see myself doing," right? Focus on the big picture items, focus on the details that do matter, "Is the lease acceptable? Is the insurances that are taken at this office, are they acceptable? Is there anything that my attorney is worried about?" Those kinds of things I would be looking at very carefully but I've had doctors very concerned about the type of materials that are used in there or they're concerned about some of the smaller things and really should focus on the big picture.

Corey Brown:

That's great advice, Matt. I thank you so much. It's been illuminating talking to you today about the experience in the industry to get your advice for future practice owners so thank you so much for your time. We appreciate it.

Matthew Christie:

Well, thank you for having me. I certainly enjoyed it and we could probably talk on for hours about this kind of stuff.

Corey Brown:

Thank you for joining us on this episode of The Path to Owning It. If you're ready to take your practice ownership dreams into your own hands, be sure to visit getprovide.com to pre-qualify and browse our practice marketplace or check out our news page for more helpful resources. The Path to Owning It is brought to you by the team at Provide with production assistance from Sarah Parky, Tiara Thomas, Jessica Arm-Brewster, and Liv Connaughton and is produced by Podcamp Media, branded podcast production for businesses, podcampmedia.com. Producer, Dusty Weis. Editor, Larry Kilgore III. For Provide, I'm Corey Brown. Thanks for being on the journey with us.

Provide, Inc. is a wholly owned subsidiary of Fifth Third Bank, National Association. All opinions expressed by the Provide employee participant are solely their current opinions and do not reflect the opinions of Provide, its affiliates, or Fifth Third Bank. The Provide employee participant’s opinions are based on information they consider reliable, but neither Provide, its affiliates nor Fifth Third Bank warrant its completeness or accuracy and should not be relied upon as such. This content is for informational purposes and does not constitute the rendering of legal, accounting, tax, or investment advice, or other professional services by Provide or any of its affiliates. Please consult with appropriate professionals related to your individual circumstances. All lending is subject to review and approval.