Helping Healthcare Scale
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Helping Healthcare Scale
Dr. Dipesh Patel: Navigating Strategic Growth in Healthcare Real Estate and Ethical Practice Leadership at Blueprint Smiles
Unlock the secrets of strategic growth in healthcare real estate with our special guest, Dr. Dipesh Patel, the visionary founder and CEO of Blueprint Smiles. Discover how Dr. Patel expanded his dental empire from six to eight locations around Atlanta by expertly navigating the complexities of real estate transactions. Learn from his firsthand experiences about the crucial role of lease agreements in ensuring successful exits, and why having the endgame in sight is non-negotiable when negotiating terms.
Next, we delve into the unique challenges and opportunities that various real estate environments present for healthcare growth, particularly in North Georgia's dental landscape. Dr. Patel shares how the pandemic reshaped patient behaviors, influencing the shift towards remote work and impacting dental practices in high-rise offices. Gain insights into his transition from hands-on clinical work to a managerial focus, allowing him to steer the expansion and support of a burgeoning group of dental offices with strategic precision.
Finally, we explore the current economic climate's impact on dentistry, where managing growth and team dynamics requires a delicate balance. Hear our discussion on the timing of team expansion, the financial implications of growth, and aligning business choices with personal aspirations. We also cover macroeconomic influences such as inflation and interest rates, and offer strategies for stable growth amidst these challenges. Dr. Patel’s emphasis on ethical practices and an operator-first mentality provides a roadmap for maintaining control and ensuring sustainable success in today's market.
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There is a trade-off. It's extremely hard for a period of time to make the same financial rewards clinically that you are making and have the time.
Speaker 2:A lot more stress too, because now you're responsible. You're not just responsible for one, if you have a private practice. You're not responsible for one lease or one office payroll. You're responsible for six or seven or eight and no matter what, the first of the month that rent's due, the twice a month payrolls do every other week, and, yeah, that number grows exponentially. So there's definitely an added layer. I just remember thinking when I had my fitness centers it was like, okay, if I'm doing this much margin, so if I can just make this much money, then I'll be comfortable. But the problem is, in order to make that much money, you're also growing your expenses. 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 2:Hello everybody, welcome back to Helping Healthcare Scale. I'm your host, austin Hare, and we have a repeat guest today. It's Dr Dipesh Patel. He is the founder and CEO of Blueprint Smiles. They've got eight locations around the Atlanta area. Last time he was on the show they had six. Since then there's been some changes. He's obviously grown a couple of locations. They had their first daughter. He's obviously grown a couple of locations. They had their first daughter. He's coaching at the DEO and we're just going to dive in and start talking about some actionable items today. So thanks for coming on the show, man.
Speaker 1:Thanks for having me again, Nils. It's been a great journey over the last 18 months A lot can happen.
Speaker 2:Yeah, for sure, let's talk, maybe just talk about the two locations that you added, One de novo, one acquisition. That's a pretty different approach, a lot of having people focus on just one or the other.
Speaker 1:so what made you decide to do both and maybe just walk us through what that was like yes, our first practice when we started the kind of group it was acquisition based, and as our systems got a little bit cleaner over time we went to de novo. So our first two were acquisition, our last in between, our last four were all de novo and so then our seventh one ended up being a de novo. Now our eighth one became acquisition. So we've done both sides of the coin. We went back to acquisition because as the cost of capital got higher, cost of real estate got higher a little bit, we wanted to make sure, as we're trying to expand and grow, that we have both avenues covered. So if it fits, it fits for us. The, the acquisition, actually the de novo ended up being in a strip mall. So we like the geographic location of it. I had a, a core tenant as a shopping shopping center ingles was there, yeah yeah.
Speaker 1:So I don't know if that's in florida or not, but they have ingles in georgia. But so we decided that was a great location for us to expand and it touched a few of our other locations, so we have a rule with us as we expand.
Speaker 2:I think that's cool. We talk a lot about grocer anchored plazas, and at least try and get as close as you can to these large grocer anchors. How did you guys find this location? What's the story there?
Speaker 1:Yeah, so this was an interesting kind of story that fell into our laps. We actually a dental broker, not a real estate broker actually brought it to us, and the reason being is somebody else had owned the place before they had shut down and this is getting into lease agreements. But the previous person who had sold the practice to this person that shut the business down now held the practice again because of how their lease agreement read. So the landlord was going after the previous person, not the person who defaulted and walked away from the building, the previous person who sold it to them, and that broker the dental broker was trying to get them out of it essentially. So that's why a dental broker had it and not a real estate broker, right, so a lot of complexities behind it.
Speaker 1:But one thing, how we learned from the transaction is always have the end in mind. So for anybody who's buying real estate, owning real estate, renting anywhere, make sure your legal considers the end in mind of one day you wanting to exit and I know we said we had eight, we almost had nine and we stepped away from a deal because of that end in mind as well. So that taught us a lot. There was a location that we thought about purchasing and we couldn't come to terms with the landlord that we were going to take over for and because we were going to rent in that regard, and it was upon exit.
Speaker 1:We were saying, if we were to exit this business one day, sell it to a single practice, sell it to a DSO or whatever we want to in the future. What does that look like? And sell it to a DSO or whatever we want to in the future, what does that look like? And we couldn't come to terms with it and we couldn't get the language in the contract. So we stepped away and that was actually. We learned that lesson from that de novo that I'm talking about that we purchased because somebody else was stuck with it.
Speaker 2:Yeah, I think to clarify on, what you're saying is essentially there's a guy. He signed a lease whatever call it, 10 years, it doesn't matter in Ingalls. He was the guarantor of that lease and the landlord. When they signed the lease, they said, hey, you're on the hook, no matter what. He probably didn't think, he probably wasn't thinking about what it looked like if he ever sold or shut down or whatever. He probably just assumed that the person who's buying his practice or that he was subleasing to would take over the responsibilities. But the landlord essentially said no, like you're the guarantor, you signed a lease with us. I never signed a lease with this new guy. You had that agreement with them. They're closing down. I don't care what they're closing on, you're on the hook because I have an agreement with you. And so what you're saying is, when you were trying to go through and identify what's your exit, having the end in mind, no-transcript Because there's a few years left on the lease.
Speaker 1:Now. The landlord didn't have a problem with us at all, right, the landlord liked the fact that we're going to be there for 10 more years. We're a slightly bigger group than a vacant space at this point. So landlord didn't have a problem with us at all going into that space. But for the previous six months you had a non-owning provider having to pay rent to a landlord, right, and it wasn't his space, and he sold the practice four or five years before. So that kind of taught us a great lesson of when we're signing new leases or going into any space, make sure that you think about the exit. And, like I said, we almost bought our ninth location and we stepped away because we couldn't come to terms with the landlord on that assignment language.
Speaker 2:Okay, yeah, perfect Lesson learned. A lot of times you don't know what you don't know. When you came up with that location, it was presented to you. Did you do any sort of demographic analysis to make sure that it checked? How did you decide that? Decide that, okay, we believe this is going to be a good location for us I grew up in georgia, right?
Speaker 1:so I know we don't like to leave everything up to emotion. Uh. So we do demographics research in the back. So we're trying to see what's the population ratio per dentist. We're trying to see what's the growth rate of that area, what's the median household income. Uh, does the dentistry we do fit the clientele that's here and is that the dentistry that we're going to provide? So if you guys know Atlanta pretty well, like you, take a place like Buckhead, for example, very affluent, so you can do a fee-for-service cosmetic high-end location, but you got to cater to that population. That's not our model, right? So we use demographics plus our model to make sure it fits. So we know can we grow into this place?
Speaker 2:Is it going to be the right long-term bit Okay?
Speaker 1:cool and how's it going since you guys opened? Are you guys hitting projections so far above? Below, I would say slightly below what we wanted right.
Speaker 1:We opened in the second half of the year, so that's never as good for practices. I've always seen January to June a little bit, be a little bit better than the second half of the year, but I think we're going to get right back on track. Yeah, it's weird that it lined up better than our previous six locations as far as visibility, strip mall, everything you would look for, great location and the city's growing and it's taking a little bit longer to materialize Right. So one thing I've learned is you can line up everything perfectly and there's some outside factors you can't control, right. Yeah, it's good to line it up perfectly, and there's some outside factors you can't control, right. Yeah, it's good to line it up perfectly. I can't imagine being in the same location. Not having lined it up could have been worse.
Speaker 2:Yeah, when I was in the health and fitness space before I even worked in did anything with commercial real estate and healthcare and dental and all that kind of stuff I remember you we had picked this location.
Speaker 2:It was like near downtown Orlando and really high population density, but the income demographics weren't great. So the location was crushing it because so much population and but we like mistakenly thought let's go to a place that just has like much higher income demographics, cause we get a lot of people like off the street who are just like very low income, do not qualify for our services. So let's go to a more affluent area. We didn't even really consider the population density that much and so it was like what happened was, yeah, we went to a much more affluent area but there's a lot less people, and when we looked at the numbers we thought about it later.
Speaker 2:It's wait a minute. If you just take the percentage of what we were looking for as affluent, take the percentage of affluent people from the highly populated area and extrapolate that there's actually more affluent people in the first location than they're on the second, just because of the sheer density of it and like it was like man it's, it's so commonsensical. In hindsight it's like how could I even made that mistake? But again, you don't know what you don't know, and so it's. You have to go through the ringer sometimes and just get your hands dirty and make mistakes in order to learn, moving forward I absolutely agree with you.
Speaker 1:past lessons, unfortunately, have taught us a lot good, bad. We had a good that came out of one right. I'll give you guys an example. My first location that I bought this was 13 years ago in a strip mall and we pretty much were getting kicked out because the city wanted to buy it and we didn't have a choice. Luckily we're already moving, so that kind of saved us. But the city bought it and our lease didn't have enough options and they could kick us out it and our lease didn't have enough options and they could kick us out.
Speaker 1:Now, because of that lesson, our third location we made sure we had enough renewals when we bought that one. So fast forward, and this happened in the last 18 months, as we last talked to fast forward. 10 years later, we wanted to move out of a location because a bigger conglomerate bought our facility but they essentially we were holding up them from their projects, so they essentially had to pay us to move out. So fast forward. One place we're going to get kicked out. This other situation we ended up getting $350,000 plus just to move and they had to wait till we found the location we wanted to move to. So that kind of worked out brilliantly for us. So just that lesson learned. You made a mistake on the first one, you learn for the second one. We made sure that wasn't going to happen and even from that first story I was telling you guys that prevented us from buying our ninth location, that lease assignment situation.
Speaker 2:So what about? Let's talk about that acquisition real quick. What was the story behind that?
Speaker 1:Yes, the acquisition. We look for a specific type of acquisition. I have to have enough chairs, I have to be 15, 20 minutes from one of our other locations this one fell into our laps as well where somebody had built this facility out. They weren't doing really well at the practice and wasn't making any money, but since we came from a de novo, we didn't need much revenue. We liked it for the facility right. So the build-out costs of this facility would have cost me more than I did to purchase this practice and they came with some patients. So strategically it worked out really well and that's why we ended up going back to acquisition, Because we weren't inheriting the doctor, little to no team. They did have some patients and the way we looked at it is that $600,000 we're buying this practice for, with some patient base and some potential cashflow, it would have cost me more to build out the place.
Speaker 2:Yeah, plus the all the equipment you were getting right. Yep, yeah, so, yeah, so that was more of a strategic way. Yeah, so, location wise, it was in a place where you guys were already identified and you were looking for huh, that's interesting. So, yeah, that's lucky, because that doesn't happen very often. The stars align like that yeah.
Speaker 1:Since our practices are separated out. North Georgia is growing pretty well right North of Atlanta. We want to be within 20 minutes of any one of our existing locations, so there's a decent footprint that we could still go to. It's probably very similar to like Orlando and some of the cities in Florida. Right, they're like Tampa and stuff. The outskirts are growing so much that I don't have to hone in on just a specific place to go. That's the only place I can buy my next practice. There's probably 10, 15 places in North Georgia that go. These would work if something opens up. So this just happened to be one that opened up that worked, and it's in a medical complex as well. But it's in a, I would say, a mid-rise medical complex, one of the first floor of a six floor building, and so no signage out front, none of that. But we six floor building and so no signage out front, none of that. But we have done that in the past with a high rise situation of ours, where we're on the 21st floor of a high rise.
Speaker 2:So we've worked out different forms.
Speaker 1:Yeah, that one's worked out. So we've almost done different forms of real estate. I think you were talking off air prior to it, but with experience, we have a standalone building that we own. We have a building that we own in a medical complex. We're in a high rise. We're in a strip mall, we're in a mid rise, and once you've seen all the forms of real estate, you can tend to start evaluating how a different business functions within those real estates too.
Speaker 2:Yeah, maybe compare and contrast, like a high rise compared to a single freestanding building with street visibility. Those are about as opposite as you can get and it seems like they'd be a different, almost like a different business model, at least a different marketing model to get patients into each of those.
Speaker 1:Different marketing model. That's what I would say. A business model, I think can still stay the same, right, a marketing model for sure. So on that drive-by one, you're getting that visibility. Cars passing by they're going to remember your name. You may spend slightly, a little bit less on maybe Google ads. Right In a high rise there is no drive-by. No one knows you're in that building. The only way people are finding you is through Google. But there is one positive that comes from that high rise that whole building is full of businesses and people as well, right, so you get to market within that entire building. So when you go into a high rise like that, when you sign your lease, if you're doing a new build out, you can negotiate with the landlord to say, hey, can I have two days where I get advertised on the bottom level. So everybody that gets ready to take the elevator they know we're in here.
Speaker 1:So all of a sudden you have that entire building of people as well. You could advertise to some person behind that.
Speaker 2:What percentage of your patients were from that building right advertised to? So what percentage?
Speaker 1:some perks behind that. What percentage of your patients were from that building?
Speaker 1:I would say 20, 30 percent of our patients from that building and there is a pro and con to that right. Pro was it's awesome, con was covid right, so covid hit it hurt. Right, because no people stopped going to work. It became a zoom world, right, so people stopped going to work. Now, all of a sudden, the people that are commuting 20, 25 minutes to go to that office now the dental office is in their building that they don't have to go to. They started going to the dental office near their home instead. So we did lose some patients during that transaction. Luckily, the building is starting to refill itself.
Speaker 2:Yeah, I was going to say it seems like that would have been a temporary thing, but I guess, I don't really know, it's so variable, like from geographic location, in terms of when people start going back into the office. So you're seeing that office that, I guess, high rise, starting to have a lot more occupancy now with a lot of businesses in the last year, at least in the Atlanta area.
Speaker 1:A lot of businesses are at least doing I forgot what it's called, but where?
Speaker 2:hybrid roles hybrid right.
Speaker 1:So instead of going fully, you can be remote. They're doing hybrid, so people are coming in a couple of times a week, so that's a help, because the buildings don't want to stay empty as well. So for landlords that own these buildings, I think they're going to start putting in some legal clauses in there as well, saying that if you take over this space and you have workers in this space, you can't do a fully, they may make them do it where you can't even do a fully hybrid model anymore. Because for landlords, they don't want an empty building, because then when people come to the building, they have other responsibilities for that building as well.
Speaker 2:Okay, let's talk about how you went from. Last time we talked you were clinical three times a week. You're operating kind of chair side. Now it's zero. What did you do to make that transition?
Speaker 1:So it was always a plan right for me to step away clinically if we wanted to grow the group. I found it really difficult to be chair side three, four days a week and then only have a day to support the group. So it was a strategic plan. We were planning on getting out me and my business partner, who's also a dentist. We both stepped away from our main locations at the pretty much the exact same time. So we went from three days to two days originally. So I was four the year before, then I went to three, then I went to two as we brought on an associate and then from two to zero happened really quickly. I've been like a month.
Speaker 1:So I'll tell everybody once you get down to two you're going to probably step away. At three you're in there enough to have rhythm that you might still want to stay. You get to two, you're more days out of the business or working on the business than as a clinician. That kind of helped us drive away. But what kind of help is? Obviously recruiting providers right. You can recruit the right doctors to take over your seat and then use that extra time to grow the business, supplement it. It will eventually go get back Now. That being said, for everybody that's listening, financially I'm not quite back yet, right, because my hands made a ton of money with my clinical skillset and I had that plus the business. Now my hands generate no dollars for me, that's what I was going to ask.
Speaker 1:Because you're paying somebody else for it.
Speaker 2:So it is a trade-off. When you do that transition, you take a pay cut. Yeah, because now you're paying somebody to see all those patients and it's not cheap, obviously and then now you're responsible for ramping up revenue, which doesn't happen overnight.
Speaker 1:Correct. So you have to. If you're stepping away, you have to be able to grow the business with your extra time. So that way, if the office grows from two to 3 million, that spread maybe makes up for your clinical dollars. Right, but just know that even when that business grows it's going to take a while to make up your clinical docs that you're making.
Speaker 2:And what does that mean? When you say grow the business, maybe talk about what that means exactly, because you could take it a million different ways. But, like for you, how did you? What did you start doing with your time once you stepped away chair side?
Speaker 1:But like for you? How did you? What did you start doing with your time once you stepped away? Chair side? It was strictly focused on like numbers, growth for the office, numbers growth, sufficiency. So essentially P&L-ing right the office. So I'm going I need to increase top line revenue. Is that getting more marketing and getting more patients and more providers? And could we grow that top line revenue while cutting costs wherever we can efficiently, so that way there is more profit going to the bottom line? Because if you step away and you're doing $2 million in a practice and your hands are doing a million of it, you step away and another doctor comes in and they do the same million dollars with their hands. Well, you just lost $300,000 of take on income on a normal general dental pay rate 9%. So you're not going to make that up. If you're good at margins you might be 20%. So to make up 300,000, you got to grow 1.5 million.
Speaker 2:Yeah.
Speaker 1:So you got to go from two to 3.5 to make up that same spread almost.
Speaker 2:So you got to have a certain and it's obviously, you know, hard to do with one location or impossible. That's why there's a certain number of locations that you need Cause, if you can, if you're doing whatever, call it like 2 million in revenue per clinic, then to get to and you've got five clinics getting to that 1.5 extra million is only a percentage. So that's sounds like probably, as you're growing, six you could. It didn't really make sense. Seven starts to make more sense and the time you get to eight is okay. I make a couple of little tweaks and now I can see a path to replacing that income and then it starts to snowball from there.
Speaker 1:Absolutely To support it. To happen, you have to scale one way or another. And that's scaling like you said, adding more locations or, if you have capacity, at the same location. So I tell people, before you ever think about buying a third or fifth practice, make sure you're at capacity for your single one first, or first two. If they're at 2 million and you actually have a capacity to get to five, 6 million, use the time to get to there. You're more profitable in one location that's bigger than three that make up one location right Any day. So you do have to make sure you focus on that clearly.
Speaker 2:So, since we talked last, what do you think has been like the biggest challenge, maybe even something that you didn't expect, that you've had to work on and overcome?
Speaker 1:It's a I I. It's interesting to consider it as like the dark tunnel, like you always know about it and but until you're in it you don't really know about it. So as as we're at like six locations, we only needed so many people on the leadership side. We already have five locations and, more importantly, we're at five locations. We only needed me, my business partner, maybe a director of ops, and we could run the show.
Speaker 1:As we've started expanding to eight now I need to hire a lot more people on the leadership side an HR director, a trainer, somebody overlooking RCM. You're adding all that payroll to the leadership side. That payroll is supplemented from profits for the office. So you can get into a situation where you're growing and still losing money because you need those people for infrastructure and if you don't have those people, you're not going to grow. So the balancing act between when do I add the people? If I added too late, causes chaos to the team. If I added too early, it's too costly to the P&L. So it's a balancing act and I knew that was going to happen, because you hear all the stories. You don't realize how tough of a balancing act it is. So most people would think, oh, if you're at five, you get to eight. You must have gotten back, not really the case.
Speaker 1:Right, I right. I think we may have to get to 12 before I ever get back right, as long as I don't have to add extra people.
Speaker 2:Yeah, and it's, there's no one way to do this. It's like there's has been people, obviously, that have gone ahead of you and paved the path for the most part, but there's just so many different strategies, like so many people are good at so many different things, and, um, there's no one way to make money, I guess is the best way to say it. But just and that can be such a hard decision too is where to put your focus. Where do you rely on your unique strengths and, in your case, your example that you're giving, like, when do you hire? Because, yeah, your revenue is growing, revenue is growing and profits growing. Then you got to make a hire Boom that cuts right into the profit, right, and then your profits cut way back.
Speaker 1:But the idea is that they it'll get higher than it was before and yeah it just it takes a lot of discernment really yeah, looking back, I think I made the right decision for what I wanted personally and I've told this on maybe your podcast and other people's podcasts right for anybody who's thinking about stepping away from the chair. As long as you're clear for what you want out of your life, then all makes sense right. If you really like clinical, stick with clinical. You can make a ton more money being a great clinical doctor and owning a practice or two than sometimes growing a DSL right. I've seen it over and over. But if you like the leadership side more than the clinical side, then go that route. There is a trade-off. It's extremely hard for a period of time to make the same financial rewards clinically that you are making and have the time A lot more stress too, because now you're responsible.
Speaker 2:You're not just responsible for one. If you have a private practice, you're not responsible for one lease or one office payroll, responsible for six or seven or eight and no matter what the first of the month, that rents due, the twice a month payrolls due every other week, and, yeah, that number grows exponentially. So there's definitely an added layer. Like I just remember thinking when I had my fitness centers it was like, okay, if I'm doing this much margin, so if I can just make this much money, then I'll be comfortable. But the problem is, in order to make that much money, you're also growing your expenses and so, like the EBITDA margins, they stay the same.
Speaker 1:It just gets on a bigger and bigger scale, and so there's always just like a level of stress involved in it. Yeah, there's no stress either way. So you really have to follow your passion right. You really do. And if you follow your passion I think the money will eventually follow right. You'll eventually make it. So I tell everyone follow your passion, distribute your passion, follow that, be really good at the money. I promise you'll follow quicker there. But if it is a leadership side and the business side, follow that passion. Just understand that it was a blessing and a curse at the same time. In dentistry, as a doctor first, our hands generated a lot of money and that can mask a lot of business stuff for you. But it can also prevent you from doing probably what you're more passionate about, cause it was hard for me to step out of the chair knowing that my income was being generated from my hands.
Speaker 2:One more topic I wanted to discuss is just what have you seen happening macro over the last two years, 18 months, both in terms of like macroeconomics and just in terms of dentistry in general? A lot of private equity also a lot of private equity has found themselves in a tough position. Some of the groups are out of covenant. What's been happening and where do you see it going from here?
Speaker 1:Yeah, I think you hit it right on Two years ago I'll say about two years ago everything was going pretty well until inflation hit and the interest rates increased, right. So a lot of PE companies got held. They essentially got stuck with their groups. They worked in a four to six year cycle where they are essentially needing to sell it to somebody else and what ended up happening is because the interest rates went up, they ended up having to hold on to their groups and they got upside down and I think that's what you're talking about covenants. They got upside down.
Speaker 1:So that was through HR inflation. I don't think it was really. Interest rates, yes, they went up and everybody was affected, and PE is no different when it comes to that. But HR inflation is really what ate up dentistry, in my opinion, when hygienists went from averaging 40 to 50 pretty much overnight assistance from 20 to 25. If you look at that's not six 7% we really got 20% HR inflation. And so the single practices, the groups, the PE sponsored DSOs.
Speaker 1:If you couldn't gross your own offices with same store growth, you're going to be in a lot of trouble. They got in trouble right, because if you look at just a straight P&L, if your interest rates are higher, your HR costs are higher, your margins were okay. Margins now got squeezed. If you can't grow that top line revenue at a pace to offset this, then all of a sudden you don't have a profitable business, you probably have a losing business. Then people get out of covenants and a lot of them are holding onto their assets. So you had a lot more. The multiple rates went down right Post COVID extremely high. They've all went down and there's less buyers now. Now there's every PE journey. They're all coming back into the market, but not at the rates they used to and they're being extra selective of who they purchase and what they give money to.
Speaker 2:Now, yeah, selective of who they purchased and what they gave money to. Now, yeah, if you exited in 21 and you got out, you timed it perfect. But yeah, if you held on, you just saw valuations go down, whether you're PE or private practice or whatever. But I think it'll obviously stabilize, right, you're in a situation where you have to refinance the debt and the interest rates are extremely high and you have an underwritten for that. Then you might have to do a fire sale, but I think the groups that were going to fire sale have already sorted that out, I think.
Speaker 2:And so now it's this level of like stabilization, like those major discounts might not be there anymore, but like it's going to stabilize. And so I think, moving forward, it's just going to be a little bit more. I don't know how you would call it like stable, right, Like maybe the IRRs a lot of these groups could see within like 35 percentile rates. Now I'm probably averaging closer to 18. You know what I'm saying? Like maybe 22, like just like maybe 15, but like a lot more, like kind of stable, predictable, less of these, less of these outsized returns, but what would be what you would think would be normal for an economy or an industry.
Speaker 1:Yeah, it's just going to normalize right Something that probably needed to happen. There was a lot of rack and stack going on in dentistry for a while because of rates, right.
Speaker 1:So people without any operational background, with PE sponsors, were buying up a lot of groups because interest rates were so low and they're like, hey, I'm going to buy 10 of these, 10 of these, combine them together, put a bow on top, pretend like we have some operational systems and I'm going to go sell it to the next person and just take that arbitrage spread. I think, because of what happened, these companies that are getting into dental now or are still in dental, they're surviving or they're getting in because they realize that whatever we buy has to be operationally sound. And if it's not operationally sound and we don't know how to run that operation, then we shouldn't probably buy it anymore. And I think that's why multiple support coming down as a whole, it's for those reasons.
Speaker 2:So what about you? Where are you going from here? What's your five and 10 year goals or timelines?
Speaker 1:I think, knowing what's happened, my buddies in the PE world have sold and vice versa. That's really probably not our objective. Right? Our objective is to take it slow and steady. Same sort of growth, buy offices strategically, like we have over the last couple of years, and see how long we can keep it going the way we want to keep it going without ever needing outside sponsorship. Right, Honestly, it's great not having another boss, right. The second we take outside money, you have another boss, they have pressures and you get pressures. I rather the pressure stay internal with what we're doing. And so you know, next five years, if we have five more practices, great. If we still only have eight, that's okay. As long as we're doing it very strategically, very ethically, we're not just growing for the sake of growing. I think we'll turn around and say that was a success.
Speaker 2:Good man. What's a good resource for people to reach out and get in touch if they just want to learn more about what you guys are doing?
Speaker 1:Yeah, probably. Linkedin is probably the best source, so you can probably find me on LinkedIn. That's my first name. Last name, dipesh Patel. You can find me through blueprintsmilescom. You can get my information through there. I don't really sit on. That's probably the best way to reach out to me. I love it. I love it. Anything else that you wanted to touch on before we wrap up today? No, just in general telling the audience everybody's still going through a tough time. Right, things are stabilizing. If you're operator first, you're probably in better hands than people that weren't operators first in dental. So if you have an operational mentality and you're growing your practices, focus on same store growth. If you keep doing that, you're going to ride the wave. Just fine. But pay attention to your P&L. Right, that dollar raise does add up over time. Pay attention to the P&L because if you don't, then really you're not really running a business. You just have a great hobby for yourself that you get to work in.
Speaker 2:Awesome man. Thanks so much. It has been a lot of fun, awesome Thanks.
Speaker 1:Austin.
Speaker 3: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.