S2-Episode 1-The Financial Blueprint Every Medical Spa Needs to Scale.

In the Season 2 premiere of MedSpa Unlocked, Ashley James—Founder & CEO of DermAesthetic Consulting Group (DAC GROUP)—sets the tone for an entire season focused on what most medical spa owners get wrong from the very beginning: financial planning and business structure.

Drawing from over 24 years in the medical spa and aesthetic practice industry—and firsthand experience launching and scaling multiple clinics—Ashley shares the raw truth about her first practice: no financial plan, constant stress, unpredictable cash flow, and operating purely on hustle. While it ultimately succeeded, she makes it clear—success without a financial roadmap is unnecessarily hard, risky, and unsustainable.

This episode is a direct, no-excuses breakdown of why every aesthetic practice must start with a financial pro forma, clear projections, and a defined funding strategy before signing leases, hiring staff, or purchasing equipment. Ashley walks listeners through the real financial pitfalls that cause medspas to fail—not because of lack of talent or demand, but because they run out of cash.

From understanding true overhead costs to the hidden expenses that destroy margins, this episode delivers a foundational blueprint for building a profitable, scalable medical spa business the right way—from day one. 

Key Takeaways:

• Why Financial Planning is the #1 Priority Before Opening a Medical Spa
  Learn why skipping a financial roadmap leads to stress, instability, and unnecessary risk—even if you’re skilled and driven. 
• The Reality of Startup Costs in an Aesthetic Practice
  Go beyond rent and payroll—understand hidden expenses like inventory replenishment, taxes, benefits, recruiting, and operational overhead. 
• How to Build a Financial Pro Forma That Actually Works
  Discover how to map out revenue projections, expenses, and timelines so you can sustain your business through the ramp-up phase. 
• The Truth About Profitability in Medical Aesthetics
  Example: Botox carries ~50% cost—meaning your revenue is not your profit. Learn how misunderstanding this destroys cash flow. 
• Why Most MedSpas Go “Upside Down” Financially
  Identify the common mistakes—overspending, poor planning, and lack of financial awareness—that lead to failure. 
• The Importance of Operational Cash Flow
  Understand why having capital to sustain your business before profitability is critical to survival. 
• When You’ll Actually Start Making Money
  Real talk: most practices don’t break even for months—plan accordingly or risk shutting down early. 
• How to Secure Funding for Your Medical Spa
  Breakdown of: 
  •  SBA loans (recommended for startups) 
  •  Traditional bank loans 
  •  Private investors
     Learn the pros, cons, and what lenders are really looking for. 
• Why You Should Never Sign a Lease Without a Financial Plan
  One of the biggest mistakes Ashley sees—committing before understanding your numbers. 
• How Top Aesthetic Practices Use Financial Strategy to Scale
  Financial planning isn’t just for startups—it’s a yearly requirement for sustainable

Transcript

Welcome Back And Season Two

SPEAKER_01 0:00

Welcome to MedSpa Unlocked, the podcast for ambitious medical spa owners who want to build, scale, and dominate in the world of aesthetics. Each episode delivers the strategies, tools, and insider knowledge you need to create a thriving, multi-million dollar practice. Hosted by Ashley James, known to many as AJ, former award-winning multi-practice aesthetic owner and operator, international speaker, sales and business mastery expert, and best-selling author of the MedSpot Growth Formula. AJ is also the founder and CEO of Durham Aesthetic Consulting Group and the visionary behind MedSpa Business Builder, a cutting-edge performance and sales system that accelerates growth and drives real results from medical aesthetic practices. Today, she's one of the most highly sought-after aesthetic practice consultants in the nation, widely regarded as one of the industry's top authorities, and she knows exactly what it takes to rise above the noise, outpace the competition, and build a truly profitable, sustainable business. Join AJ and industry leaders as they unlock the secrets to success in aesthetics right here on MedSpa Unlocked. Now, let's get started.

Startup Blueprint And Funding Focus

Hard Lessons From First Launch

Hidden Overhead You Forget To Budget

Projections And Botox Cost Reality

Cash Flow For The Ramp Up

Pro Forma As Strategy And Safety

SPEAKER_00 1:25

I am Ashley James. I go by AJ, and I am the CEO and founder of Dermasthetic Consulting Group, co-founder of uh Mobile MedSpas, and uh founder of the National Med Spa Training Institute. If you have tuned into our podcast before, you know that I bring over 24 years of direct industry experience, owning several of my own aesthetic practices, but also being a well-known industry expert and trusted consultant helping physicians and providers scale exponentially. So it has been some time since we have uh recorded any seasons here on MedSpa Unlocked. Um, and quite honestly, that is due to just our own personal success. Um, we are just growing, growing, growing every year. Um, we've added to our team and um quite honestly, our clients come first. So we just not, we just not haven't had really any time to really focus on the podcast because primarily we've just been, you know, working with clients, helping them um design, you know, effective business models. We um have been helping clients to grow and we've just we've just have been having a blast. So um I I promise you that I am dedicated to cranking out more material and content. I I do value each and every client that uh that works with us, but also, you know, in in deciding to transition this part of my career and going from med spa owner to consultant, you know, my my career really transitioned from that into, you know, having purpose. So I have so much education, so much knowledge, and so much experience that I feel is very valuable to share with new owners and and and current owners of aesthetic practices. And so, you know, there's a lot of of purpose here and what I'm trying to do. And um I I think it's important getting that message out. So welcome to season two of MedSpa Unlocked. I'm super excited to be here again. Um, this time uh sharing uh, you know, video of us as well as uh audio. So um my uh junior consultant Paige Whiteman, she'll be joining us in a few of these these up-and-coming episodes. But this season is dedicated to the startup blueprint, the financial foundation for new practice success. And um, in this episode specifically, it's uh part one and part two. And part one today that we're gonna we're gonna launch is really about developing financial success and securing funding. Um, and I really want to talk about why financial planning is the number one thing that needs to take place before you ever uh start your aesthetic practice. And I want to talk about the different types of funding that's available, uh, whether it's SBA funding, traditional loans, private equity, um, investors, what what is the best way and where do we get our funding? Um, in part two, which will be tomorrow, we're gonna invite uh some of my SBA lenders that I work with on a regular basis, and we're gonna really talk through projections, equity, um, what the banks are looking for as far as management within the practice, how to structure your sources and usage to get approvals, and really kind of digging into the mistake that owners make that creates declines in their funding. So, a lot of really valuable information is is coming up in uh this episode, part one and part two. So let's go ahead and dig in uh to really what I want to talk about. Um, you know, I've owned four of my own practices, and my very first practice I launched when I was only 23 years old. I thought I knew everything and I looked back and knew absolutely nothing. I was one of those owners that thought, okay, I'm gonna write my plan on paper and I'm gonna go in there and I know what I'm capable of doing. I know that I'm good at sales. I was a laser provider. Um, I had my doctors, I had everything in place. And so I went into this business like, I'm gonna sell and then I'm gonna pay as I go. And um, you know, for a lot of you ambitious owners that are listening, some of it, sometimes it works out. Um, for me, it worked out. However, it was hard as hell, let me tell you. Um, and you know, there were a lot of nights that I laid awake in bed wondering how I was gonna pay the bills. I wondered how I was gonna pay myself. Now, I never missed a payroll for my employees. Their payments always came first, but you know, there were a lot of a lot of tough weeks, a lot of tough months where, you know, I wasn't sure if we were gonna make it. Um, and that really had a lot to do with the fact that I wasn't properly prepared financially going into it. And so, you know, since that practice, I I've sold that practice. I opened three additional practices after that. And and those other three practices compared to the first one, I had a financial plan. And I can tell you with 100% affirmation that it was way easier to have a financial plan in place the second, third, and fourth time than it was the first time. I would never, ever, ever go back to launching a business without a financial plan. And here's why without a financial plan, you really don't know what your expenses are until you have expenses. You may accommodate for all the basics, like this is what my staff's gonna cost, and this is what my rent's gonna cost, and this is what my you know patient booking system is gonna cost. Um, this is what, you know, I can anticipate for advertising, but there's so much more that goes into your overhead that you don't necessarily know until all of a sudden you have a bill for it. And what I'm talking about could be things like your quarterly taxes. Um, it could be replenishing your Botox or your derma filler. Um, it could be, you know, offering um benefits to your employees like 401k healthcare. Um, it could be, you know, having to terminate somebody and then have high have recruiting fees to find somebody to replace that person. Um, there are so many fees and expenses that go into operating a business beyond just the obvious. So if you don't do a financial performa, if you don't have a financial plan, um, some of those costs can be hidden and you could be, you know, spinning your wheels round and round around not knowing where your money's going. The other thing is, you know, and the other reason I think that it's important is because you have to have projections, you have to have goals. And I really believe that in order to have those goals, you have to realistically plan for what revenue is gonna look like. You know, are you gonna make money the first month? Is it gonna take you a few months to make money? When are you gonna start making money? What is your direct cost to offer your services? Um, and let me just touch on that for a second. You know, I I would say here at Dermacedic Consulting Group, we probably have four out of 10 of our customers who are nurses approach us about opening a Botox business. And it is crazy to me that they don't know that the cost of Botox is 50%. So, and maybe some of them do, if you're listening and you're one of them, that's great. But a lot of these owners going into this space don't really tie the cost to deliver these services in with their performa. Um, and this is where a lot of people get upside down. So, for example, if if you know you are projecting that you are gonna earn 20 Botox customers your first month open and you're gonna estimate that the average client is going to do at least two areas of talks. That'd be like what, 50 units? Um, that's going to be, you know, what's what's your cost? So if you have 10, if like you have 20 customers that are going to do 50 units on average and those units, let's call let's say you you charge 14 a unit, you're making an average of$700 for those 20 customers, right? So you're generating about 14,000 in revenue. Well, if you're a brand new practice, unfortunately, Allergan does not give you any discounts on being a new customer, you're gonna pay full price for your uh bottles of talks. So it's gonna be about a 50% direct cost. So out of that$14,000 in rent revenue that you think you have to help pay for things as you go, you actually only have about$7,000. And out of that$7,000, you have to replenish your Botox, you have to replenish your stock, you have to pay for your employees, you have to pay for your rent, you have to pay for the lights to be on. So, you know, knowing what your numbers are and having accurate and realistic projections on what type of sales and revenue and expenses and operational costs you can anticipate month after month after month is critical for growth. And more importantly, making sure that you have operational cash to get through the ramp up phase. And so, you know, what I mean by that is, you know, you need to be able to afford all of the expenses, even if the revenue doesn't come. Opening a business is not, you know, you build it and they will come. I, you know, I kind of joked around about that in the first season that, you know, this isn't Iowa, where you build it, they will come. It takes work and a lot of consistency over time to build a successful aesthetic practice. And so you may not profit or make any type of money the first or second month. You may not break even, you know, for three or four months. And so, how are you gonna afford your employees? How are you gonna continue to afford ad spend or marketing that is gonna drive leads to your practice and give you opportunity to earn business? If you don't have cash flow, you will very quickly go upside down. So, you know, going back to my very first practice, I didn't have any of this in place. I just kind of was a hustler and selling as much as I could. I was selling laser packages, I was pushing my employees to sell and obviously providing amazing care, but I never knew how much I was gonna grow the next month. I never knew if I was gonna have an unforeseen expense. And I really didn't have any numbers to go off of until I had been open for a full year where I could then go back and say, okay, last year I had a fluctuation of sales and clients during March, April, and May. And then I had a decrease in revenue in September. I didn't have that information in advance, and therefore it made it really, really kind of touch and go the first year. I'm not, I'm not gonna lie. So, you know, anytime that I have a customer that schedules a strategy call with dermaced consulting and says, you know, hey, AJ, I really want to open up a practice, I need some assistance. My very first recommendation is we got to do a financial performa. We have to map out what the business model looks like. We need to know projections, we need to know what you're willing to invest to make this happen and really kind of dig into the numbers. And, you know, it it's not an easy process to do it on your own, especially if you've never done this before, if you've never been in the industry, you don't know the averages, you don't know the average cost of a laser lease, you don't know the average cost per square foot of your space rental. Um, you may not know what it takes to invest in marketing to really gain some traction and to get the phones ringing. Um, you may not know what the average client spends per visit. So this is why, you know, Dermaced Consulting Group, we we offer financial performa and business planning because we utilize our experience in helping more than 80 practices launch and being in the industry myself for over 24 years. Um, that's valuable information. And so if if you're listening right now and and you have not planned on doing a financial performer or you don't even know where to begin, reach out. We can definitely help you. Um, and I'll be really honest with you, I love making performas. I'm a numbers girl, so it's one of the things that I get really, really excited about, which is kind of funny because when I was in elementary school, I hated math. Absolutely hated it. And and my mom laughs at me all the time. She's like, I never in my wildest dreams thought that this would be something that you enjoyed. Um, but I do, I really do. I love crunching the numbers, I love anticipating what's to come. I love kind of projecting, and then I use that as my roadmap. So my performa is what I use to set goals for the clinic and for the employees and the KPIs. Um, and really it's what's behind the entire strategy. So um that is honestly the most important thing that I think a new business owner needs to have. And this is something that you should be doing every year. Um, even for you uh clients who are listening right now or or listeners who are already in business and already own a thriving med spa, it's a really good idea to continue to do these projections every single year, taking into account what you did last year and really kind of plugging in what you want to achieve this year. I just think that knowing your numbers and having a financial plan is really gonna benefit you. There's really not a negative to it. Um, but most importantly, I think it it protects you against liability more than anything. Um, you know, if you're a new owner and, you know, you let's say that you you come and you say, okay, I've got$400,000 that I can invest into making this happen. What if it requires a lot more than that and you don't know? Now you've invested all this time and money into a strategy and into a plan that just fell short. Not because you didn't believe in yourself, not because you didn't have the right services, not because you didn't have the right employees, but because you ran out of cash. Um, I unfortunately can't tell you how many times I've had a customer come to me needing help because this is what happened. So don't be that person. Um, invest in a business plan, invest in a financial performa before you ever start putting things together. And, you know, that's a really important tool too. Um, you know, something that I unfortunately also see a lot is, you know, people reach out to us for help after they've already signed space leases. So nothing wrong against that. But if you're coming to me and you've already leased a space and you're saying, AJ, I need help launching a business. I have a little bit of an anxiety or panic attack at that point because there's a lot of information that we have to gather. There's a lot of planning that has to be done to make sure that that seven-year or 10-year lease that you just signed actually pans out. So um, you know, never, never, never commit to anything until you know what your numbers are. That that's just that's the number one thing that I can recommend. And why I believe that a financial performa knowing your your finances in business is just important.

SPEAKER_01 17:35

This podcast is brought to you by Dermasthetic Consulting Group. Whether you're launching your first medical spa or ready to scale an existing one, we help you build a business that is structured, profitable, and designed for long-term growth. From startup strategy and compliance to advanced sales training and our proven Convert More Consult system, we focus on what actually drives revenue, helping you increase conversions and improve operational performance to eliminate the gaps that are holding your business back. If you're ready to start scaling with a clear, proven strategy, schedule a private strategy call with our team today. Click the link in today's episode to schedule.

Funding Paths And Why SBA Wins

Investors And Revenue Share Tradeoffs

Part Two Preview And Closing

SPEAKER_00 18:18

The other thing that I kind of already touched on is, you know, operational cash is kind of like the bloodline of a business. If you don't have operational cash, you can suffocate yourself. Um, if you're getting ready to expand your practice, making sure that you're having the extra funds to afford that is also a safety net. Running out of money is the worst thing that could ever happen. And unfortunately, I see this a lot with people that bring on equipment too quickly or um don't know their numbers and they're spending, spending, spending, and uh not really realizing what's going out, and they can get upside down very, very quickly. So, you know, whether you're expanding or this is your first practice and you're getting ready to launch, you know, where where and how do we secure funding? Um, here at Dermasthetic Consulting, we work with a lot of banks on a regular basis. Um, I've actually become friends with a lot of the banks that we use because, you know, they understand me, I understand what they're looking for, and that helps us to position position our client for the right success and getting the right loan and the right interest rates for their project. So, you know, if you're doing SCA lending or if you're going through a private bank or even a private investor, it really just kind of depends on what your goals are. So tomorrow we're gonna have one of my SBA friends on to really kind of talk about the differences. But today I'm just gonna briefly kind of go over uh what some of those differences, pros and cons of each are. So I I'll be honest, you know, if I'm doing a startup with somebody, I'm always recommending the SBA. Um, quite honestly, I feel like that's the easiest type of funding to get if you have the right business model and plan and if you have a financial performa with an SBA lender, typically they're going to provide about 80 to 85% of the loan and only require anywhere from, I would say on on average, it's like 15 to 20% equity investment into the loan. Um, but I do have some banks that I work with that only require about 10%. And so what does that mean? Um, you know, if you're if if you need, let's say,$700,000 to open up your med spot, and that's from, you know, pre-launch to ramp up the first, you know, four to six months, the bank is gonna want you to invest 20% at most. So that's$140,000 if you're looking for a$700,000 loan. So when it when I when I talk about, you know, what is your budget? What are you able to invest in your business? That's really what I'm talking about. I'm not talking about the total investment. I'm talking about how much cash do you have to put into this business to make your vision a reality? And um, you know, quite honestly, 20% is is is fair. Um, but if you're not willing to at least invest, you know, 10 to 15% into um your business, then you probably shouldn't be doing this anyway. Um SBA loans are, like I said, the easiest to to acquire. Um, there's a specific process, and and really what it is, is it's the banks are having their loans secured by the SBA. So they're typically easier to get approved from. Um, they have better interest rates typically than a private. Bank, and that's because private banks don't have that SBA security net. So they're taking on all the liability and the risk versus the SBA, the government's taking it on. So typically the interest rates are a lot lower than a private bank. But with a traditional loan at a bank, you're you're also going to have probably lower terms. I have seen private banks like US Bank or like you know, community banks offer anywhere from like three to seven year loans, whereas the SBA, the average is anywhere from like 10 to 15 to 20 loan, 20 years to pay that loan back. So, you know, that gives you a lot of flexibility. If you're if you're acquiring a$700,000 loan and the government SBA is giving you 15 years to pay that back, that's a really small loan payment. Um and it makes it a little bit easier to digest, especially when you're you're just getting started. So that's why I typically do recommend the SBA. And um, if you've never gone through an SBA loan, that's something that we can definitely help you through. I know that it can be a little bit overwhelming with all the things and that they're requesting. But uh here at DAC, we do this every day, all day for our clients. And so it's become pretty routine for us. We know what the bank is gonna ask for documents, we can anticipate their questions, know how to answer them. We know what the business model needs to look like to get approval. Um, we know what it needs to look like to minimize risk. Um, and and we really are good at, again, at financial planning to make the bank feel comfortable. So those are just some key differences. Now, I I have had customers that get private investors, and and if you have that, that's great. Um, typically with a private investor, they're gonna want some equity in the business. And, you know, so that would be something that you would need to determine if it's right for your business or not. And um, you know, I I'm always a believer that if you don't need to give away uh ownership of your business, then don't. Uh there are a lot of new um online platforms um in the industry, um, not to call anybody out, but like Moxie, for example, where they offer a one-month low fee to help you launch your business. Um, and it looks very affordable. They provide a bunch of different tools. And for, you know, some people, it's a really great solution. However, they also take a high percentage of your income. So I think it's like seven or eight percent, don't quote me. But, you know, I personally don't want to be giving seven or eight or any percentage of my revenue to anybody other than than myself. So um, those are some things definitely to take consideration of if you're gonna be using a system like that or if you're gonna be working with an investor, um, they're typically gonna want anywhere from 10 to 15% return on their investment. So it typically ends up being a little bit harder and more costly. And it is it is very hard to find find an investor. So unless you have a friend or family that that just wants to give you a bunch of their money. So um anyway, qualifications for an SBA loan versus a private loan are also much, much uh more lenient. So with an SBA loan, they're okay with the fact that you don't have any collateral. They're okay with the fact that you don't own any equipment to secure the loan with. Um, they typically are are very much aware that that this is your first time and that you don't have really anything to your name uh physically wise to secure the loan with, versus, you know, traditional banks are gonna want, you know, you to sign off your house or they're gonna want a personal guarantee. They're gonna want, you know, if you've got equipment you've purchased, they're gonna want first rights to that if things go upside down. So um with a traditional loan, they're just harder to get qualified for uh without really, really strong credit, collateral, and consistent revenue history, which again, if you're a new business, you don't have revenue history. So it makes it extremely, extremely challenging for new owners who've never been in business before to get a private loan through a regular bank, um, which is again why I like the SBA. So, all right. So that being said, coming up tomorrow, we have one of my dear friends from the SBA that's gonna be joining us talking about how to get the right approvals, gonna be going over details of what banks typically look for. We're gonna talk about equity investment, what to do with your sources and usage uh to make sure that you're getting approvals with the SBA. So a lot of valuable information coming tomorrow if you're looking to acquire funding for your startup or your expansion. So don't forget to tune in tomorrow. So thank you for joining me today on MedSpawn Lodge, powered by Dermaesthetic Consulting Group. We are one of the nation's leaders in aesthetic business strategy and growth. My purpose is to empower forward-thinking owners and provide into providers to elevate beyond day-to-day and build scalable, profitable, enduring practices. True success in aesthetics is never accidental. I cannot stress that enough. It's the result of vision, precision, proper strategy, and execution. I am Ashley James, and I invite you to continue unlocking what's possible for your business, your brand, and your legacy. Until next time, lead with intention, operate with excellence, and never stop evolving. Have a good one.

SPEAKER_01 27:39

Thank you for listening to MedSpa Unlock. True success in aesthetics is never accidental. It's the result of vision, precision, and disciplined execution. If today's episode resonated with you, we invite you to subscribe so you won't miss future conversations and to continue unlocking what's possible for your business, your brand, and your legacy. For more resources, education, and strategic support, visit us at dermasthetic consulting.com or connect with us on social media at Dermasthetic Consulting. And if you're ready to take the next step in building your aesthetics practice the right way, we'd love to help. Until next time, lead with intention, operate with excellence, and never stop evolving.