Helping Healthcare Scale
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Helping Healthcare Scale
Dominic Mazzone: Revolutionizing Healthcare Scaling with Real Estate Strategies and Entrepreneurial Insights at MedSpa Partners
What if you could revolutionize your approach to scaling healthcare organizations by leveraging unique real estate strategies? This episode is your chance to gain insights from Dominic Mazzone, CEO of MedSpa Partners, whose entrepreneurial journey includes launching 19 ventures across various industries. MedSpa Partners owns 40 locations.
Dominic shares his transformative experiences, from running a car detailing business to pioneering an internet funeral company. We unravel the fine line between management and leadership, emphasizing the importance of learning from both triumphs and setbacks in building successful healthcare ventures. Dominic's reflections from his tenure at WorldCom highlight the necessity of self-awareness in discerning leadership traits, providing listeners with valuable lessons on effective leadership.
Join us as we discuss the strategic importance of prioritizing quality over quantity in clinic acquisitions and the operational challenges that accompany scaling up. Dominic delves into the power of equity distribution, demonstrating how it aligns the interests of senior leaders with the company's vision and fosters a culture of collaboration and resilience. Through the compelling saga of launching a medical aesthetics roll-up business, we explore the vital role of building a network of key opinion leaders and the art of navigating initial entrepreneurial hurdles. This episode is packed with practical wisdom and encourages an inquisitive mindset, urging entrepreneurs to harness expert knowledge for collective success.
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I think the inability to scale is based on the fact that you can manage but you can't lead, and there's a big difference between those two things. I've met great managers and I've met great leaders. Rarely. You find both, but you need the right people for the right part of the job.
Speaker 2:The goal of this show is to help healthcare organizations scale by leveraging real estate strategies and interviewing high-level healthcare executives in order to pull out lessons learned along the way. If you'd like a free site selection analysis from our team, visit us at wwwreuniversityorg and drop us a line.
Speaker 4:Welcome back to Helping Healthcare Scale. I'm your host, austin Hare, and I am pleased to welcome our guest, dominic Mazzoni. He is the CEO of MedSpa Partners. It was North America's leading medical aesthetic platform and they have about 40 locations and they've been doing exceptionally well. Dominic, thanks for coming on the show.
Speaker 1:Sure Thanks for having me. I appreciate being here yeah you're welcome.
Speaker 4:So I know we were talking earlier and you have quite the extensive background in different entrepreneurial ventures and I think this is number 19, which is crazy, and so I would love to just give some context to the audience about who is Dominic. What are some of the things that you've tried in the past that kind of helped shape who you are and how you got to where you are today?
Speaker 1:Yeah, god, it was a lot of different things. I started my first business when I was 16, which was a car detail business in san diego. I've done everything from gosh that to by the time I was 17, I was promoting american bands in tijuana um you were living in. Tijuana I was living in San Diego. I'm bringing American bands down from San Diego. I've done a bunch of stuff in real estate. I had a small investment fund that act as as a bridge lender. I started the first internet funeral company.
Speaker 1:Internet funerals, internet funerals. Yeah, we took the whole funeral model and we moved that online. Yeah, we took the whole funeral model and we moved that online. That was a business that shook up the industry massively. As you can imagine, it's great to not be in the funeral business anymore. It's not the funnest business in the world, but it was fun digitizing it and shaking it up, so that was a lot of fun.
Speaker 1:And then just, I've done a lot of consulting as well. All kinds of different sizes of business. Smallest one was like a million in revenue, the largest was like four and a half billion, and so got to see a lot. And it's funny because all of the things I've seen and I've learned and I think you said what kind of led you up to where we're at now and sometimes, when you're first of all, those businesses weren't successful.
Speaker 1:You don't have 19 businesses and have them actually be successful. You can have one or two businesses and have been successful. When you're running at that pace, you just don't. And you'll learn a lot from that and a lot of times I think we are in the middle of doing things that we don't realize is building a book of experience that you are going to utilize and you are going to use in future endeavors. And sometimes you're getting your butt kicked all day, every day, in something and you're like I'm not getting any value out of this. And it's not. You actually are getting a lot of value out of it. You're gaining a ton of experience and you're going to take that experience and you're going to do something that's going to end up being really successful. Yeah, I think it's important.
Speaker 4:It's a great point, because my first job was working at McDonald's and I remember I couldn't sit down. It was like eight hour shifts, after taxes make a minimum wage. I think I took home like $32 back in the early two thousands and cleaning toilets, everything. But I remember thinking like, okay, I am not going to do this for the rest of my life, like I, that's what at 14 years old, like my first real, quote, unquote job. But the takeaway from that was like, yeah, this is what. That's what motivated me to work hard at everything else that I did and that I tried, so that I wouldn't have to go back and do that. So, exactly to your point, you don't know exactly what it's going to build, what kind of skillset you're going to get from that job or that opportunity, and I think that's cliche. But that's why it's important to like just try your best. You know what I mean. Give it your best. Because the second you become reluctant and passive or apathetic, you're like you're only hurting yourself.
Speaker 1:Yeah, yeah, it's true. And even in jobs, if you're going to start a business and that business is one day going to be large and you're going to have a lot of people like we're bearing down on almost a thousand employees right now and I learned a lot from a lot of different types of leaders. I learned a lot of positive things and I learned negative things where I went. Oh, actually, that's not a good thing to do. I don't think I'm going to do that when I'm a leader. And so all those different experiences to really help you be a leader in whatever you're going to do, as long as you're you have enough self-awareness and enough general awareness to understand what you're actually seeing and experiencing at the time.
Speaker 4:Yeah, yeah. Do you have any examples of each of those, though, like any examples in your life where you thought, wow, that was really great, I'll make sure that I keep doing that. And then, on the other end of that, it's oh, I'm never going to do that when I'm a leader or I'm a boss.
Speaker 1:Yeah, absolutely. Maybe I'll start with a negative one. I just remember working big corporation, worked at WorldCom out of Chicago now, and at the time WorldCom was this very aggressive company and we had an extremely aggressive sales force. And I'll never forget like there was an eight o'clock Monday morning meeting and our director was this mean nasty guy from Georgia and we were living in Chicago and he didn't realize that he actually had a bunch of adults and these weren't little kids that he was dealing with and what ended up happening was is people just A had animosity around that. And the second thing is that all these people didn't sit through the Monday morning meeting. So now they're at a disadvantage. But as a leader, you're at a disadvantage because all your troops actually don't know what the messaging is, and I just saw a lot of ego involved in that.
Speaker 1:I try to run my company in a way where my team knows what to expect from me on a day-to-day basis. I wanted to be the same person every single day, and that doesn't mean that every day is the same. It's just that my handling of the situation is predictable. I don't provide them with something that's highly unpredictable, because that creates a lot of instability and I tend to be a benevolent leader who is very attentive to performance and very intense and I will call out lack of performance. But I'm not a yeller, I'm not a screamer, I I I'm not the kind of leader who's going to actually make people feel like they don't understand where they stand, and I think that's a really important foundation to have a very successful company and a good culture if you provide stability for people when it comes to the way you actually lead for people when it comes to the way you actually lead.
Speaker 4:Okay, yeah, I like that, and so maybe we can harp on that a little bit, because I think you probably know this that does nine out of 10 businesses fail, or seven out of 10, or whatever it is. But especially when it comes to there's also levels of failing. You guys have 40 locations, which is awesome, and there's I talked to a lot of people, I know a lot of people. They have aspirations to grow a group platform or a group organization, and then they never get off the ground or they can't get past one or three or five locations, right. What do you think was pivotal to your guys' growth and scaling, especially in medical? They call it the dark tunnel right Between two and seven locations, where things don't necessarily want to land. You're not going to be chair side if you're the doctor or whatever as the primary owner at that stage. So what do you think is? Maybe do you think that has to do with the leadership of the people, or is it something else?
Speaker 1:So I got a lot of thoughts on that. I think the first three here. Let's start here. So we have 40 locations. We have 40 large locations. We run a different kind of platform than most Our location. Sometimes a single location is equal to 10 locations of other platforms sometimes. So we run a different kind of model Square footage wise or revenue wise or what exactly.
Speaker 1:Yeah revenue and EBITDA wise, like a lot of our clinics again are like 10 times the average clinic, and I acquire clinics as a profession. That's what we do. We are an acquirer. I much rather buy a single location that's high producing than seven or eight locations that are just doing little bits.
Speaker 1:It's harder to manage and you don't get the operational leverage that you really want to really juice out some really great profit out of that. Let's start there. I think there's a real fascination with number of locations and we've got to change that to a fascination on quality when it comes to what you need. It's really interesting because I went through the same thing, right Started with zero locations, and I could tell you that the management and the structure and the processes you have multiple inflection points as you go off the chain Two clinics, five clinics, seven clinics, 12 clinics, 15 clinics, 20 clinics what worked at two and seven and 10 doesn't necessarily work when you're larger.
Speaker 1:And why a lot of folks do fail is their inability to realize the inflection point is happening and actually do something about it and change. I mean, for my organization I really pride myself on having a great team that we constantly are memorializing the inflection points and saying this is now a change. We have to change how we're doing things because it doesn't work. We're too big now and we have to change those things around. And it doesn't even take this on a personal level, like if you have three locations and something goes wrong, you could tend to it, you could go and you can tend to it.
Speaker 1:When you have 20, 30, 40, 50 locations, you cannot tend to everything. You actually then become an HR company and you actually have to hire correctly and you have to delegate correctly and you have to make sure that the accountability within the organization is set up in a way where people can make decisions, be accountable for those decisions, because you need many hands instead of just a few hands that you had when you were smaller. I think the ability or the inability to scale is based on the fact that you can manage but you can't lead, and there's a big difference between those two things. I've met great managers and I've met great leaders. Rarely. You find both, but you need the right people for the right part of the job.
Speaker 4:Yeah, that's interesting, and even that there's countless books, literally endless content. Right that you could talk about managing and hiring people. But I guess my question is did you find you had to give up any equity early on or any point in order to get good employees, good high level leaders in the company?
Speaker 1:Always, Absolutely, Absolutely. We did that. We set that structure up on day one. It's definitely for our senior leadership right, Because people that are trying to squeeze and hold on to every bit of equity they have and not let anybody share it's just a kind of a penny wise dollar foolish situation. My team will run through not a wall but multiple walls. Not necessarily they have to run through themselves and they have great incentive to do that. If you're not providing any incentive for those folks to go out there and kick some serious butt, they're not going to do it.
Speaker 3:A job is not a job anymore, and what I mean by that is for senior leaders.
Speaker 1:A job is not enough. What you want is real opportunity and a feeling of ownership.
Speaker 4:Okay, yeah, and that makes a ton of sense. I think a lot of people have a fear, not necessarily around giving up the equity. At least I have, this is me, so just speaking personally and, um, the fear wasn't so much about giving up the equity and me having less equity. The fear was giving it to the wrong person and then having to take it back, and I know you can do things with like phantom equity, so essentially, like, if they don't make it past a certain point, they don't get it. But like, how did you deal with it? I'm sure at this stage you've had to come across people who were you give them equity and they were the wrong fit. Like how did you address that?
Speaker 1:yeah, you do. That happens sometimes. It's the cost of doing business isn't. And the thing is sometimes what is the wrong person? Sometimes it's the right person at the right stage in the business and then they're not exactly the right person in the later stage of the business and we've had a situation like that where I had someone who was great for the time of the business, when it was all half like the beginning stages and all that it were great, but then it got to a point where the business evolved so much further and we needed a different skill set in the seat, and that's just the cost of doing business so what did you do?
Speaker 4:they did, they did. They still have their equity was Was there like a buyout?
Speaker 1:Yeah, they had a piece of equity. But it's when you structure equity in a way where some is time-vested, performance-vested on liquidity, that's how you solve for it. So there's a certain piece that's guaranteed it's going to be there and there's a certain piece that you're going to have to be. You're going to have to be here all the way along the ride. Be you're gonna have to be here all the way along the ride. You're gonna have to be here at the end of the ride.
Speaker 4:Get to appreciate that half of the equity. Yeah, yeah, that makes sense. I think a lot of people and I definitely include myself here, I do have a tendency to be greedy or think that we can't give this up or we're not gonna make enough or how are we gonna survive. But like, at the end of the day, you can always just do more together. And the proof in the pudding. That's why it's cool having guys like you come on and talk about it. Hey, you got to be generous, got to give up equity, and then you bring more people along for the ride and it's more fun anyways.
Speaker 1:Yeah, yeah, I don't know, I've always had just more of a philosophy of more is more. It's just going to generate more in the future and it's all going to come out in the wash.
Speaker 4:Yeah. So going back to you said you started with zero locations like what got you into this business and what was the vision that inspired you to actually get started?
Speaker 1:Yeah, I was advising on a similar strategy in orthodontics. I met a dermatologist who was very knocked out by the business and the industry. I really liked the industry. I liked what was happening, spent a lot of time researching it all together. The whole deal was dead four times. It got pulled out of the ashes four times by me.
Speaker 4:What do you mean when you say it was dead? Were you trying to raise money from a bank or private equity? What was it like keeping it?
Speaker 1:There were three reasons for being dead. Actually it was one was I couldn't get any doctors to say they wanted to do it I couldn't get financial sponsors to say they wanted to do it.
Speaker 1:Then I got doctors that said they wanted to do it. I got financial sponsors said they want to do it. Then the doctors didn't want to do it again, and then the financial sponsors didn't want to do it again, and then the financial sponsors didn't want to do it. Like it was a roller coaster everywhere. I had so many PE funds just tell me to go away. This is impossible. This doesn't make sense and med spas is such a hot market right now and back when was 2017, when I started this journey, journey 2018 there was no such thing as a medical aesthetics roll-up. There was medical derm roll-ups, but not medical aesthetic roll-ups. Since I started, that area for the industry.
Speaker 1:I did trailblaze.
Speaker 3:That's something I thought yeah, I understand why people said no, like it was new.
Speaker 1:they didn't understand it and didn't know what was going on. But I'm very stubborn or ignorant or naive One of those three are a combination of all and I just kept pushing until I finally got it there. And then, boom, I got it. I finally got a financial sponsor who really understood it, really understood what I was trying to do, and said, yeah, we get this, let's go and do it. And then, and then I was able to pull some doctors in and then just worked like crazy and got more and, and then built it to like what it is today.
Speaker 4:So when you say got a financial sponsor and then got pulled doctors in, that sounds like you did more of a DeNovo versus like actually acquiring a practice. So it was your first one at startup, the first one that you did no.
Speaker 1:So what we pulled doctors in is that I pulled their practices in. I got them to agree to sell us their practices and you got to realize like there was nobody really buying and it took a lot of convincing for them to understand this is a good thing and you're going to get millions of dollars, like on day one when we do this, and so it took a lot of evangelizing, but I finally do it.
Speaker 1:And then I had the financial sponsor, of course. Finally, that had all the money to do it, and so that's how it all came together.
Speaker 4:Yeah, that's cool. And so even back then, day one, acquisition number one, you're going after the big clinics, like you are today. Exactly what you wanted back then.
Speaker 1:Yeah, yeah, we're going after big, huge clinics and I can say we have some of the biggest clinics in North America. It's always been a focus. We've always just shied away from the smaller ones.
Speaker 1:We've done a couple of those and I don't love. I don't love doing them. I think the big clinics have a lot of attributes that I like, but also fits in what we also have like in the medical aesthetic space. There's this whole idea around key opinion leaders who are like the top of their the top of their game, the top of their industry, and we got a great group of those folks and they enjoy the community that we provide for them as well, because they're all learning off each other and it creates a really great environment for not only those doctors but also new doctors that are coming in, younger doctors who actually get to be around and learn from all of these incredible people. So that was basically our strategy.
Speaker 4:That's great, yeah, so I know we're getting close to the end of our time here together, and just two questions like what's the one thing that you know now that you wish you knew when you got started? This?
Speaker 1:business in particular.
Speaker 4:Yeah, this business.
Speaker 1:Oh, my God there's so many things.
Speaker 4:You can do a couple, you can do one or two.
Speaker 1:Yeah, I think in general, healthcare roll-ups are tough. Healthcare roll-ups in general are tough. So I think for me, getting all the incentives and motivations correct from the beginning would be great. You learn over time and you get much more intelligent over time and smarter, but it's just alignment of motivations and incentives is really important early on and that's something I wish I knew. Everything I know today I knew that five years ago. I think that would have been great, but yeah, I would say that's the biggest thing. That's, in particular, for our platform.
Speaker 4:Yeah, that's good Okay and then is there anything that you want to talk about or you want to add that we didn't address yet, that we didn't bring up so far.
Speaker 1:Gosh, so many things. I just if people are listening to this and really focused on the healthcare space. I think two things like one is I am I've been an entrepreneur my whole life, so I'm very pro entrepreneur. The one thing that us entrepreneurs, though, lack is asking enough questions. I think the mindset of an entrepreneur is you've got to go out there and push like crazy and you want to go and you want to open things, you want to make them all happen. Sometimes it could be a ready aim fire situation. Instead of ready fire, sorry, ready aim fire, but a lot of times, sorry, it's a ready fire and then aim, and it's just not good. Ask a gazillion questions. Talk to people that are smarter than you.
Speaker 1:I pride myself on being the least intelligent person in my company. I think I've surrounded myself with very intelligent people who can not only do their jobs but really articulate the issues that they're seeing. At the same time, drive strategy, drive execution. Surround yourself with people that are going to challenge you and that's going to make you so much stronger. A lot of times, entrepreneurs can fall into a mode where they don't put people around them. That'll challenge them. You do not want to be the smartest guy in the room. If you are the smartest guy in the room, it's limiting to you, and I think that's that's something that I've learned over time, and I'm really happy where I am at this point because I do realize that, and so I consistently try to find people that are going to bring so much more to the table than I could.
Speaker 4:That's a really great point, because you have this dichotomy of humility and asking questions, and then ego and pride, which is the belief you can get it done. Neither one is good without the other. Of course, everybody knows people who have way too much pride and ego right. But if you have way too much humility, on the other hand, you're not going to get it done. You have to have the belief in yourself to be able to go, that you can execute this, but the humility enough to answer the question, and so that's such a balancing act. That's probably why so few people scale such great organizations.
Speaker 1:Yeah, austin, actually that was really well said on your part. I think you're. I think you're right. You need a drive. Doesn't live well usually with a passive, methodical, thoughtful mindset. Drive is drive and drive wants to just go. But when you can actually get that combination, it works wonderfully. Um, because we've also seen the other side, where and sorry I don't know if I broke up there on you, austin- I broke up a little bit.
Speaker 4:Yeah, yeah, I can see the other side.
Speaker 1:Yeah, the other side is thinking about something forever and never executing, and we see that all the time. Right, we see people talk, talk, talk because they're thinking. But that drive part of it of just saying screw it, man, let's just go for it, let's just make it happen is not there and that's just. An important ingredient of men does need to be tempered by some of the other things, and I can tell you that I was a crazy entrepreneur in my teens and in my thirties and a much more thoughtful entrepreneur in my forties and now into my fifties.
Speaker 4:Yeah, that's great. Yeah, no, I love that. So, yeah, I guess, as you wrap up here, what's a good way, if people want to learn more about what you're doing or get in touch or anything like that, what's a good resource for people.
Speaker 1:Yeah, we're MedSpa partners. I'm, of course, on LinkedIn that's the only social media I'm on, just because I don't have time for much more than that but yeah, yeah, occasionally. But we're MedSpa partners, that's what we do and yeah it. I really enjoyed this Awesome. Thanks for taking the time with me.
Speaker 4:You're welcome. Yeah, guys, so check them out on LinkedIn. Medspot partners. Dominic, thanks so much for your time.
Speaker 3:Thank you, awesome. If you need help finding the perfect location for your practice or you're ready to invest in commercial real estate, email us podcast at leadersreecom, r-e, as in realestatecom, or go to leadersreecom and fill out our form. See you next time.