Listen to executor and implementer Dr. Andre Bruni who purchased a failing practice then expanded to multiple practice ownership with an interesting story along the way! He and Dr. John Meis will talk about patient relationship, business strategy and looking for opportunities while you listen in on this live interview from our latest Summit event in New Orleans, LA.
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EP18: ‘‘Why Create Mediocrity, When You Can Copy Genius?’ Transcript:
S1 00:00:02.313 [music] Welcome to the Double Your Production podcast with the Team Training Institute, the one place designed for dentists and their staff who want to grow their practices by following in the footsteps of those that have done it, who are in the trenches, who know exactly what you’re going through. And now your leaders, the stars of the podcast, Dr. John Meis and Wendy Briggs. [music]
S2 00:00:27.568 Hey, podcast listeners. Today we’ve got kind of a unique episode where we just recently had a really awesome weekend in New Orleans, Louisiana, at our annual Summit event. At this event, we have a lot of different speakers and companies come in. But we also really take the time to interview our successful members and to learn from each other. So that aspect is going to be brought into our podcast today. So this is a live interview with Dr. John and Dr. Andre’ Bruni, who has a really interesting story. And in the words of Dr. John, “He’s an innovator and an executor,” and has really done a lot of different things with his practice. And so a lot of our members found his story really awesome, and we’re excited to hear from him. So if you want more information about our annual Summit, or any other events where you can come and see us live, see if we’re coming close to you, go ahead and catch us at www.theteamtraininginstitute.com/podcast. And there you can find a way to get in contact with us and see where we’re coming up live next. So again, this podcast, I hope you love it. It’s really a lot of good information. So stay tuned, and I’ll turn this over to Dr. John and Dr. Bruni.
S3 00:01:49.759 All right. Very good. So next up is Dr. Andre’ Bruni. Come on up, Andre’. All right. How you doing?
S4 00:02:06.034 Good.
S3 00:02:07.345 So I got a list. Let me get you a mic here. I’ve got a list of who was coming to this event. And Andre’s name wasn’t on there, and then he was here, and it was so exciting. So Andre’, why don’t you fill everybody in on your story?
S4 00:02:24.819 I graduated from dental school in 2001. I acquired my first practice right out of school from a guy who was, what I didn’t know, was dead last in his class. He was applying to endo. But he got in, and so I bought a practice. It was doing about $600,000 a year. Started in 2001, got into sedation with DOCS and Whitehall Management and started getting into trying to do more, bigger case treatment, bigger treatment cases, and learned from the best. I followed Whitehall’s Superstar series. I don’t know if you’ve got a lot of Whitehall people in the room.
S3 00:03:08.374 Those were the good days, right?
S4 00:03:09.546 Yeah, it was.
S3 00:03:09.700 That was some good stuff.
S4 00:03:10.790 Greg put out a series called Superstar series, and I’d listen to it over and over and over. I’d listen to it probably 20 times back-to-back. And Mitch Friedman–
S3 00:03:19.815 [crosstalk].
S4 00:03:19.815 –I idolized him. He was one of the guys on there. And I said, “Well, if these guys are throwing up these incredible practices, my philosophy is if somebody else is doing it, guess what? It’s probably possible.” So I used that as a guide to implement a lot of things in my practice. And fast-forward about four years, after we started to build and save some money, my wife was in dental school. She came out in 2006. We had built a practice down the road and just relocated. And so that’s kind of where our journey started. And then we, I guess, had some– we were unique in that time was when Katrina had happened. And it wiped out New Orleans, and they had implemented some tax incentives called GO Zone. So during the process of my construction, the hurricane just happened to hit, and we were able to benefit from some tax savings in building a new building. So I said, “That worked out pretty good.” I’m like, “Well, maybe we should do another practice.” So we built a second location, and just before the tax incentives expired, we had put a third in Mandeville. So we had three practices by the end of 2010.
S4 00:04:34.951 And then we started hanging around people like Dr. Meis and Mortensen. And once you get into the realm of group practices, you start to be around people that know how to do things better. And I’ve always been a proponent for not– there’s a saying that says, “Why create mediocrity when you can copy genius?” I’ve always been a good copier. I don’t like to make my own mistakes. I like to sort of see what other people– what’s worked for them and just move forward with their advice. So yeah. So that’s a little bit of my history. And then we continued to grow, and we kind of wanted to expand. So I approached Walmart in 2011, with the idea of doing the first– they were talking about, oh, Walmart’s taken over dentistry. Well, I was the guy, so [laughter].
S3 00:05:34.956 No rocks. No rotten fruit here.
S4 00:05:36.759 But it’s not Walmart that’s taken over dentistry. I’m going to let everybody know and inform you, it’s guys like me that are looking to lease space from Walmart. So you have DSOs that are out there. Walmart is the landlord. They just want to lease their space. It’s in the front of their fourth wall there. And so I came up with the concept of doing a dental office inside the store which was the first of its kind. Nobody had ever done full-service dental inside a Walmart. And I approached them with the concept, and they were like, “Look. We get calls from dentists every day who want to be in Walmart. What makes you different?” I’m like, “Look, what we want to do here is consistency, quality, oral cancer screenings. We’re saving lives. We’re open on Saturdays. We’re doing everything that the modern-day consumer wants in a state-of-the-art facility.” So they bought in. We did four locations. Three out of the four locations did a million dollars in the first year, and we were doing it more as a pilot.
S3 00:06:32.244 Right. And these were– describe the offices because they were very, very [crosstalk].
S4 00:06:35.887 So they were– I mean, we had 900 square feet to work with. So, I mean, we designed this thing to the gill. It was like the cockpit of a plane. We had four operatories, seven and a half feet wide, recessed trash dispensers, rear wall. We had a consult area, a waiting room, sterilization. And I was the first– we decided to go up because of the space challenges. We wanted to get more chairs, better-utilized space on the first floor. So we were the first ever concept to go upstairs. We built the second story on the Walmart. It had break room, restroom, laboratories, all the HVAC and mechanical was upstairs just to utilize the downstairs space better. So it was a pilot. We had worked hard. There was a lot of tape we had to cut through. They didn’t want to allow us to take Medicaid. I fought with their legal department that we should be allowed to take Medicaid. I mean, it’s Walmart. So we made that stride, and we got that accepted through our initiative. And so while the pilot was going on, they were looking at it. I continued to grow. We acquired practices. I built more practices. So we ended up at about 15 practices. And I’m just going to keep talking.
S3 00:07:55.643 Yeah. You’re doing good. Yeah. I have some questions, but just keep going. You’re doing good.
S4 00:07:59.753 So as we started to grow, and I was part of John’s Apogee group. We had met with this similar CEO forum in Phoenix through this whole process. And as we grew, I mean, it was really a huge benefit for me to be able to rely on people that are doing what you’re doing. All the knowledge that you need to know is in this room, or within your reach, or your grasp. So we got to 15 practices. And I always said to myself if I wasn’t having fun anymore, or if it got to a place where we could make a life-changing exit, I would do it. And that’s when I was approached by Heartland and decided to sell in 2014.
S3 00:08:49.893 Yeah. Very good. So Andre’, in a very short amount of time, built an enterprise, right, because you really didn’t start the enterprise stuff until 2006. So in eight years, you went from 1 to 15, plus Walmart, or does the 15 include the Walmart?
S4 00:09:09.642 Including the Walmart. There was four inside a Walmart.
S3 00:09:11.006 Yeah. Yeah. So that is growing an enterprise. Now, that is really fast, and it was really– I was involved for a lot of those years. And it was really fun to watch because Andre’, he’d leave with his 90-day plan, and he’d come back with 180 days done. It was pretty amazing. He’s a great executor-implementer, and that’s why he was able to do that. So you got approached by the DSO to buy your practice. So tell me about how you went through the thought process of should I do it now? Should I not do it now?
S4 00:09:48.359 Yeah. So there’s a lot of thoughts going on in your mind. For me, it was just a simple mathematic calculation. If you look at the time value of money, what money in your hand today will be worth, what do you need to get? Assuming no growth in the practices, what’s it going to take for you to earn the same amount of money that you’re going to get in your hand today at the closing? So the nice part about liquidity events, or selling of your practices, is that it’s not a taxable income at ordinary income. You’re taxed at capital gains which is 20%. So if you’re normally out there, and most of us are in the 40% tax bracket, if you’re out there pedaling and 40% of what you’re– really 50% when you count in state tax, goes to the government. I looked at it like, okay, I’m going to get this much in my hand today at 20%. It kind of became a no-brainer. And I also, I guess, held onto a lot of the real-estate that the practices are in. So that earned extra income for us as well. But that was kind of the deciding factor and also about quality of life.
S4 00:10:59.846 I mean, admittedly, I was in four states. I had four kids at the time. Our model did not involve any kind of ownership. And so when you talk about the model five, or whatever it was, with just the associateship model, that was us. We offered no ownership. So when a doctor left, guess what? I was the doctor. So I was in Alabama. I was in Missouri. I was in Mississippi and working all over. And some of the dentists you try to hire from Staff Care, or some of these temp agencies, I mean, we– it could be painful. We had one of them. Can I tell this story? Do we have enough time?
S3 00:11:42.433 Yeah. Yeah.
S4 00:11:43.333 I mean, you have to understand what the challenges are with the different models. I mean, we lost a dentist in Kirkwood, Missouri. So we call Staff Care, and they get a dentist up there. And they call me frantic, the assistants, they’re like, “Dr. Bruni, this guy is drunk.” I’m like, “He’s not drinking. No, he’s not drinking. I mean, surely, he’s a dentist.” “No, he’s patting the girls on the rear. And we just smelled his drink that’s in the freezer, and it’s straight vodka in a Gatorade bottle.” I’m like, “Okay, I’m calling Staff Care.” Then I call them, and they argue with me. They’re like, “He’s not drunk.” I’m like, “Look. He’s got to go.” So he leaves, but in the process crashes people in the parking lot. The customers of Walmart had to wrangle him out of there, out of the car, and they arrested him. And so, I mean, that’s one of the horror stories that I have. But it’s real.
S4 00:12:42.209 And the problem with associate-driven models is that we’re in the business of dentistry, right? And if you don’t have a good doctor, you don’t have a good business. And your practices will go up and down like a roller coaster with each doctor that you lose, and you can only do that so many times. And eventually, you lose enough doctors, then you get the kiss of death, and it’s done. You’re done. So you can spend as much– you can triple your marketing budget, and people are done. They won’t respond. And so I’ve learned a lot in this process that while it was nice for me to have 100% ownership, and cash out, and everything else like that, it was really, to me, unsustainable to keep going that route without the structure of, let’s say, Heartland that has a lot of attractive programs for new grads and stock options and some things. Theirs is an associate-driven model too. But there’s some other perks in there that I didn’t have.
S3 00:13:44.060 Yeah. And watching you, one of the things that I learned was don’t get them so far spread out. If you were to do it over again, and you probably will, would you try to keep them more closely together?
S4 00:14:00.862 Absolutely. I mean, why make it more difficult on yourself? There’s millions of teeth within 10 miles, and you don’t need to make it difficult. Because the challenge is you need regional managers if you’re going to do multiple locations. You need people that travel to these locations, somebody you trust that’s going to put their hand on it. And for them to travel and be away from their families, it makes it more difficult. And so when you don’t have that infrastructure, or you challenge the infrastructure that you have, it just puts more pressure on your employees to do more, so–
S3 00:14:35.554 Now one of the reasons why you had them so far spread out is that you– some of the practices you bought were an unbelievable bargain.
S4 00:14:49.204 Yeah. So I’ve always been a proponent of buy low and sell high. It’s not always about finding the best, beautiful practice, and sometimes there’s a diamond in the rough. I mean, we bought a practice in Millbrook, Alabama, and basically we bought it for the building. The hygienist was there. The doctor had passed away a year prior. And it was listed with a practice broker, and they wanted something just very nominal for the practice. I came in and offered just the cost of the building, and the family took it. They just said, “Sure.” And then we went in there, it was old equipment and five operatories. But they had a four-year patient track record, and the hygienist was there. They would get intermittent doctors coming in and checking hygiene. But the thing that I think I really realized at that point is patients don’t just have a relationship with the doctor. They have more of a relationship with the hygienist because they would tell the hygienist, they said, “Look, just tell us when the next doctor shows up.” You know how hard that is? There’s no doctor. That’s who they cared more about was the hygienist and the relationship with the person who cleaned their teeth for the last 20 years. And so as soon as we got a doctor in there, the practice exploded. We did a million dollars in the first year. We had to put about maybe $150,000 into it. But from a practice where I paid zero for it because other than the equipment, we went to a million dollars in the first year. So you can’t always say, oh, you have to be looking out for– and you have to look out for opportunities is what I’m trying to say.
S3 00:16:28.715 Yeah. Yeah. Very good. So any questions for Dr. Bruni from the room? Yeah?
S5 00:16:35.118 So did you have [inaudible]?
S4 00:16:37.132 Yeah.
S3 00:16:37.365 So the question is, did you have systems in place, or did the DSO bring systems in place and kind of how’d that work?
S4 00:16:48.201 So I guess at the level of three practices, I had the opportunity to visit Heartland and talk with those guys and learn from them and implement some of what– their pay structure. And so I was like if it worked for them, it works for me. Like I said, I’m not going to reinvent anything that’s not working. I mean, if it works for the largest DSO in the country, I thought it could work for me. So at three practices, we implemented their compensation structure for doctors. But I had some incredible team members. I mean, I’m not– most of this stuff, like Dr. Bencaz, I mean, I relied on my team members, just some incredible, wonderful people I enjoyed working with. And we’re still wonderful, great friends to this day even though they don’t work for Heartland anymore. But they were the ones growing, and pushing, and out there, and helping, and doing. So I owe a lot of it to them.
S3 00:17:43.981 Your main operations person, I’m trying to think of her name.
S4 00:17:46.971 Lisa Stopenall.
S3 00:17:47.580 Molly? Oh, Lisa. Yeah.
S4 00:17:48.128 Yeah. And this gal– I mean, when you find those people, you need to really nurture them, pay them well. But this lady, I mean, we call her Sister Teresa the palm reader. She could just look at a person, read into their soul, know where they needed to sit on the bus, if they were a good person, bad, and she knew them. If you would tell me two or three people that you knew, she could tell you somebody that you knew. It was just weird, but she had a genius about her that she could really put people in the right position. That’s what it’s all about is fun. That’s your business. It’s your team. It’s 80% doctor, 20% everything else, but that 20% plays a big part into the successes.
S3 00:18:34.426 Yeah. It’s a team sport. You can’t do it alone. Any other questions?
S6 00:18:39.860 [inaudible] marketing strategies?
S4 00:18:41.622 Yeah.
S3 00:18:41.726 His question is, can you comment on your external marketing strategies?
S4 00:18:45.231 Yeah. So we did a lot of marketing, and I guess my philosophy is that a new patient kills all pain. We would spend a lot of money on marketing. I mean, we probably spent 8 to 10% of our budget on marketing, but they were going right out the door. But our top line numbers were there, so I didn’t care too much, to be honest, because they kept coming in. But I think that we probably could have done a better job of spending a little bit less on marketing, focusing in on patient retention, reactivation, internal marketing, because, I mean, it was a lot of money we spent on marketing. And for the Walmarts, I mean, we had– part of the idea, too, behind that was patients are shopping there every day. They’re with their kids. Moms could drop the kids off at the dentist office, go make the shopping. I mean, I had some dentists that loved it. The whole reason we didn’t really grow that is because when I affiliated with Heartland, they decided that that wasn’t the best use of capital against my expectation. And so we never developed the Walmarts further than the four that we had done.
S3 00:19:57.658 Other people are doing them now.
S4 00:20:02.077 They have over 20 that are successfully operating now within Walmart. Yeah.
S3 00:20:09.553 All right. Very good. So one of the things I love about Andre’ is he’s such an innovator, and he’s got a plan. He works that plan. He’s very, very consistent. He’s a really good executor and being around folks that just look at it differently. I would have never thought of the Walmart. Now, I remember you brought the lease. Remember that?
S4 00:20:31.514 It’s a 47-page lease.
S3 00:20:32.512 So no lease– to the mastermind group. And we all picked that thing apart. We thought the whole thing was– you were the only one who thought it was a good idea. Is that right?
S4 00:20:42.519 Yeah. Everybody was kind of down on the idea.
S3 00:20:43.918 But, yeah, we were cheering him on to do it, but we all thought it wasn’t such a great idea because of some of the limitations in the lease. But we wanted to see what happened. And actually, the lease thing didn’t end up being a problem, did it?
S4 00:20:58.861 No. No, I mean, I guess they had everything in there that could potentially go wrong, and as Walmart, they’re going to cover themselves. But they were really good to work with once you get through all the hoops. I mean, you have a Fortune One company with a ton of employees that have insurance, so it wasn’t hard to find patients at all. But yeah. So if any of y’all want to talk to me and pick my brain, I’ll be here for a little bit after the seminar. But really I think the focus– I think for those of you who want to execute a multi-practice strategy, sometimes be careful what you wish for because you just might get it. And, I mean, looking back, for me, I think it fits my personality. But there’s other dentists– I mean, we both can agree that, hey, they think they want to do this. And they think that they can go out and just make it happen. You need to know who you are, what you want. And sometimes more is not better if that makes sense.
S4 00:22:11.878 But for some– I mean, what I felt like I was doing in the practices that we touched was making it better for the patients that we served. And so I had associate doctors that could go in there and earn $400,000, but they felt like, “Oh, well, I can do this on my own.” I mean, we really did a good job of setting the table for them to produce and serve patients in a great way in a state-of-the-art facility. And sometimes people try going off and doing it on their own isn’t better than what they had before. And so just something to think about before you embark because it’s a huge financial commitment. You have to take a lot of risks. There’s people like, “Well, well, how did you do it?” I lived in a mercury cloud for the first eight years. And I was a $200,000 producer, 200 to 250, I worked five days a week. That’s what I produced, and so I was able to earn and save and reinvest. And I think it’s important to go with what you know.
S4 00:23:21.663 I’m going to divest quickly on a change in here, but sometimes we earn a lot of money as dentists, but we’re so quick to give it away to people that don’t know what they’re doing. And so stay with what you know. Invest in dentistry. Invest in your practices whether it’s one practice, or two practices, or 20. Be careful of just giving your money away to people that think they know better than you because they took a weekend course at Waddell & Reed or something. And so I learned a early lesson. I think it’s important. I like to share this. When I was in dental school, I’m a risk-taker, I’m an entrepreneur. I used to day trade my student loans. So I took $10,000 and turned it into $120,000 in about four months. That was in 2000. This was in 2001, the dot-com bubble. I lost it all in two weeks. But I say that because I learned an important lesson. The stock market– and this may go against the law. I don’t know what y’all believe. The stock market is the biggest Ponzi scheme ever invented, and we’re at the altars of CNBC hoping and praying that this thing goes up. And companies were just saying, well, buy this, buy that. From that point on, I never bought another stock again, never. I don’t own any stock. But I invest in what I know, and I know myself. I know my practice. I know dentistry. And I also invest in real estate and income-producing properties that are tangible that I know can generate a solid rate of return. And so just when you get money and you’re looking at where to put it, go with what you know.
S3 00:25:01.439 Yeah. Sounds good. Big hand for Dr. Bruni. Thanks, Andre’. That was great. Well done.
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