7 Deadly Mistakes Made By New Practice Startups

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3: How to Transition Into Speech Therapy Private Practice

In this episode, I will detail the steps that I took to transition from working a full-time job to opening my own speech therapy private practice and working for myself.  I must admit, as with all major changes in life, this was something that I was scared to do.  I was so used to working for others that I really had to “deprogram”  my mind from all of the all of the schemata that was etched from 20 years of employment (productivity, clocking in and out, always “looking busy”, etc). I remember talking with a good friend and colleague about talking to my then current boss.  I was so afraid to let her down.  I didn’t know how she would respond.  How was I going to get paid?  Did I have enough savings?  Was I as “good” of a therapist as I thought?  Fast forward 8 years later – I should have done this sooner!
 I have had the privilege to speak to speak with many practice owners throughout the years.  Some are very successful and some fail.  The biggest mistake that I have seen is this:  A majority of people go out and borrow a ton of money from the bank, and when they do this, they end up working for the bank. Working for the bank is actually worse than “working for the man”.  That’s not self-employment. There is no freedom in this.
Transition Basic Speech Therapy Private Practice Startup Model

In this episode:

01:25 – What can we learn from Converse sneakers and white Costco tee shirts
02:47 – Frugality
03:00 – A very small overdraft LOC
04:13 – Banks and insurance companies always get their money
06:30 – Cooking at home
06-52 – The Millionaire Next Door – Amazon
07:05 – Keep your current job
07:44 – Office versus community visits
08:40 – Marketing and websites
09:08 – Credentialing
09:28 – A professional presentation
10:04 – “Old School” follow-through
10:25 – Presentations to my community
10:50 – Business cards
11:14 – The transition at 60 hours per week
11:33 – Honesty with others is key

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Successful Jump                Make a Successful Jump

 

Transcription of Episode Three:

Number 1, you can’t go out and borrow a bunch of money from the bank and expect to make a profitable business. Because you know, you’re gonna be working for the bank if you’re doing that.

Well, hello everyone! You’re listening to the speech therapy private practice start up podcast. This is episode number three.  My name is Kyle Meades and I’ll be your host today and I am recording this podcast from beautiful San Carlos Mexico. San Carlos Mexico is a very small beach town located about five hours south that’s Tucson, Arizona. It’s on the beach and it’s just a beautiful area. Last night I recorded episode number two. If you listen to that you’ll realize that I recorded that episode at 10:45 at night. There was a loud banging on the door. We had a tree fall on our car and I couldn’t go back to sleep. And I was very thankful that the tree didn’t do a lot of damage to the car so it kinda pushed me out to make another podcast.

Today I’m just gonna continuing that energy and to get that information out there for you. So, this podcast is going to focus on how to move into self employment the right way. Now for those people who know me personally, you’ll know that I’m not a flashy guy, I don’t drive fancy cars. I don’t have debt. I don’t have a big flashy house. I don’t have those things. I have always been a very frugal person. Even when I was a child, my mom said to me she said son “You’re going to be an entrepreneur”. And I always said “What’s an entrepreneur?” and I had to looked it up. She’s always say, “Go looked that up in the dictionary”. So I looked it up and it worked for me. I knew when I was a kid that I wanted to have my own business. I always knew that. And I always got bumed out going to work for other people. Everybody’s barbecuing and having a great time on holidays- and here I am working and I hated it. I was always complaining, moaning and groaning about going to work. So, for those of you guys who know me personally, you know I’m not a flashy person. I don’t wear expensive clothes. As a matter of fact, you will find me in my work uniform which is a white t-shirt, jeans and I always have these converse shoes on (either blue or orange). That’s kind of what I wear. I do comb my hair and I brush my teeth though.  But besides that it’s the same thing over and over.

But how to move in to self-employment the right way?  And when to move into self-employment the right way?  Well, you have to be frugal.

Number one, you can’t go out and borrow a bunch of money from the bank and expect to make a profitable business. Because you know you going to be working for the bank if you’re doing that. So, when I did start my own private practice, when I moved and transitioned into my own business, I did have a very small line of credit. It was a small over-draft line of credit that I would use to float myself monthly. I wanna say it was about $4000.00 to $5000.00 that would I would float. Because at that time in my life, we had just moved Tucson,  Arizona following hurricanes Katrina and Rita. And I had two duplex apartments at that time. I had four units an area called Uptown New Orleans. It was about eight blocks from Tulane University, and really that’s how I made my income. I mean, I was a private speech therapist at a local hospital there and I made a decent salary working at Children’s Hospital in New Orleans, LA.  But you know, the majority of my income was made through apartments and I got the tax breaks and depreciation etc., through my real estate.

But let me tell you what happens after major disasters such a hurricane: your taxes and your insurance will nearly will triple. I’m sure those in the North East experienced the same thing (around New Jersey) there after that hurricane went through your area as well. Your taxes and insurances will double or triple overnight. Because don’t forget, banks and insurance companies always, always, always will get their money. So that’s why when you start your own private practice, you want to be frugal; You wanna have a little cash in the bank or a little line of credit. Something small, not flashy but something to get you by so that you can pay your bills.

I remember I had two mortgages in New Orleans but after the hurricanes Katrina and Rita, my taxes and insurances, they doubled/ tripled overnight. I was living here in Tucson in one of my apartments. I had six units and I lived in one of those units so I didn’t have to pay rent right there. I had a car loan because of that time I used to drive in old Volvo station wagon until the transmissions fell out on the corner of Broadway in Campbell.  I remember selling that car to one of the nurse’ friends. You know, I was able to walk in to a dealer ship and get a used car. It was a promo car. It is one those incentive vehicles where it had 19,000 miles on it. I think I got it for $25,000. I didn’t have to put any cash down so I was able to get it at a nice, interest rate because I had good credit and I was able to buy that car. And I still drive that car today. As a matter of fact, I didn’t tell you guys last night, I didn’t realize that till this morning as of this recording there was a tropical depression that came through the town of San Carlos Mexico last night. And that was the 21st of September. So, I don’t know what it is about me and hurricanes but they tend to follow me wherever I go. So, that’s the same car that I’m talking about the tree fell on last night. So, that is about the car.

When I lived in this apartment (one of my rentals) I had no carpet. The tenants before me ruined the carpet with their dogs. So I remembered I had my son and we had an air mattress. We slept on that air mattress and I had to rip that carpet out because of the smell. We essentially had an air mattress on the concrete slab floor. We had a little tiny window unit that would cool 750 square feet of apartment space.  In Tucson Arizona, you know that heat is incredible but I was able to survive.  And I still live with that frugal mentality today. I still drive the same car.  I don’t drink alcohol. I save money. I’m not out to impress anybody.   I also wanted to tell you at that time we had fun making our own meals at home. We used to shop at second hand stores. We were big fans of the the Dollar Tree. As a matter of fact, when I did open my first brick and mortar company, a lot of our stickers and materials and supplies came from the Dollar Tree. We still go there today and buy certain things from the Dollar Tree because it’s cheaper. We used to shop at that local budget supermarket down the street called Food City in Tucson. I’m a big fan of the Millionaire Next Door books. So if you really wanna get in to this mentality on how to move yourself into employment the right way, I suggest you read that book, it’s a wonderful read and it will keep you in that proper mind set. But let’s get down to the “nitty gritty”!

Number 1, I kept my current job because that equals money from me. I had to save and save and I didn’t borrow from banks except for that little line of  credit that I had. I remember once I was so broke I tried to re-finance my car to save a hundred twenty dollars a month. But the bank refused me and still to this day, I always refuse the bank offers when they offer me a promo credit card and then say “Hey Kyle, do you want this?” and I say  “Nope, remember when I needed that extra a hundred twenty a month and you guys wouldn’t refinance my car. So, there you go –  right back at you,  “I don’t want your credit card.”  So, I kept my current job. That’s the first thing I did.

The second thing is I saw those patients in the home setting. I didn’t want high-dollar rent. I did not want to have a big expense. I didn’t want to have to pay somebody to answers the phone, etc., I just want to go there and after my current job (my day job) I wanted to go out and see these patients at  home.  They were generally seen after 5 o’clock because that’s when I got of  my first job. I would go see my patient from five to six and six to seven; And then sometimes (once in a while) I will see a kid from seven to eight in the evening just so I could save that money and everything I made from my private  practice at that point, from doing those home visits, went into my checking account, my business’ savings account, excuse me.  Everything went into that savings account and I remember not having the right income to get an office at first, so I saw those patients in the home setting.

The third thing is how do you get your first patients?  Well, I started a website. I used to sited that time called Elance.  It’s where you can hire Virtual Assistant and I hired a Virtual Assistant to help me set up a very solid WordPress website that I had optimized myself for the keywords in my area. Those keywords focused around speech and speech therapy services. The second thing I did was I contracted with the insurance companies. I hired a credentialer.   A credentialer is someone who is a specialist in getting your business credentialed to take third party payers. Third party payers (otherwise known as insurance companies) can be Medicare, Medicaide or private insurance companies ,  Blue Cross Blue Shield, Tricare, United Health Care, Cigna, etc.

The fourth thing I did was I changed my voicemail on my cell phone to have a professional greeting. Because once that phone ring, I wanted to sound professional. And I always said something like “This is Kyle Meades and you have reached our after hours voicemail or if you’ve received this voicemail, I am with the patient. Please leave a detailed message and I will return your call” or something like that. Something very professional to let those people who are calling me for an appointment know that I was busy but I will call them back that same day,  and this is the kicker. You have to call them back on the same day. It’s just called “Old-School-Follow –Through”. You’ve got to follow through with that. And if you listen to my other podcast (podcast number 2), you can’t be flaky. Being flaky is when you say I’m gonna call you back the same business day and you don’t.  You can’t do that, because people will go somewhere else.

Another thing I did was a presentation for a group of pediatricians in the Tucson area to let them know who I was, what kind of services I offer, and what insurance is I took so I could help their consumers.

Another thing I used to do is I would leave business cards on the table or look in a restaurants and businesses –  places that I knew my target market will be visiting such as playgrounds, daycare centers.  There is a place in Tucson and it’s an indoor mall where they have a big play area. I left some business cards there. So I would leave these business cards that say “speech therapy in Tucson” and it really worked. People would call me and I would set up an appointment.  I remember calling people’s insurance companies and verifying their insurances and being on hold for  thirty minutes at a time verifying insurances. Those are just some things that I did to get my first patients scheduled.

Once I got about a 60 hours a week combined between my first job and then my own private practice home setting clients, I slowly started backing down from my full-time job. I was upfront honest with my current employer.  You know, that’s another thing you have to be honest with people. When I took that job, my last paid job, when I was working for someone else, I always told my manager, I said “You know, I’m in the process of starting my own private practice and she looked at me like ” I’ve heard that before”. But I mean it, I was very serious and I said “One day I will get to the point where I will no longer be working for you and I’m going to move on”. And there came a time, I remember that company we had to be employed for a minimum of 32 hours per week in order to keep our benefits because with that company, I had my health insurance, I had a 401K etc.

I remember with that company we had to stay thirty two hours a week to maintain our benefits. And I remember that I kept getting more people on my own. I would back down and I got down to about twenty five hours. And I remember she never cut my benefits but after I got to about twenty five hours, I said to her (her name was Lori, wonderful lady, a physical therapist) and I said “Lori, remember when I told you I was gonna start my own private practice? Well, I’m doing that and  I’m going to give you my thirty day notice. I was very upfront and honest. I encourage people to be upfront and honest because now that I have employees, I have had people flake out quit the on a Friday and just leave me hanging and it’s just not cool. So I encourage people to be upfront and honest with their employers and do the right thing. But that company really helped me. They were catalyst and helping me get my own private practice started.

So, those are some things that I did to get my own private practice going and that’s some of the ways that I transitioned from working for others to being self employed. I call it doing at the right way, so you know, this may not work for everybody but it work for me and you know, when looking back on the whole business that I started, I did it with cash in the bank. It wasn’t a lot of money, I did it with used supplies that I bought on the internet.  So, that’s just the way that I did it.

I want to remind you, if you ever have any questions, or if you need any help starting your own private practice, please get in touch with me at PrivatesSLP.com, and leave your questions, comments and feedback in the website. There’s always a place where you can call and leave a message for me. If you have anything you would like me to speak about on the podcast, I’ll be more than happy to help you in  anyway that I can. This is Kyle Meades and thank you for listening.

Comments

  1. Hi Kyle,
    I’ve been thinking about private practice for a while. I have been a therapist for 7 years, in a variety of settings for children. Children’s hospitals, schools, agencies (I’m currently back in the schools since I have young children of my own) I would like more freedom in the decision making and possibly make more money than working for someone else. Your podcasts are so inspiring for me. I’ve been doing a lot of research and I have so many questions for you. One of my big ones is HIPPA. How did you develop your privacy policy? Did you get a lawyer right away? I don’t have a lot of money so start up will have to be very small in addition to liability insurance and business registration. I would love your advice.
    Thanks!

    • I appreciate your comments. I will answer some of this on an upcoming podcast for you. I remember when I was starting up – I used to overthink things to the point of “analysis paralysis”. For me, getting into action was very important: Choosing a name, getting incorporated, setting up a bank account. All of the other things can be made up along the way. Just start! It doesn’t have to be perfect. Choose that name, get incorporated! See a paralegal (save some money). Podcast 1 and 2 describe how I started 2 businesses (the first was done lawyer-style and the second was done paralegal -style). Feel free to reach out anytime.

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