Carl Guthrie is with ETS Dental. He is the Regional Director of Recruiting covering the Southwestern U.S. including Texas, New Mexico, Arizona, Colorado, Oklahoma, and Hawaii. ETS Dental was founded in 2001 by Mark Kennedy and is headquartered in Roanoke, VA. They specialize in locating and placing General Dentists and Dental Specialists with independent practices across the country. They have conducted searches in all 50 states for thousands of practices seeking Associates, Partners, and Buyers. ETS Dental’s recruiting team is made up of 6 general dentist recruiters and 2 dental specialist recruiters.
VIDEO - DUwHF #1289 - Carl Guthrie
AUDIO - DUwHF #1289 - Carl Guthrie
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Howard: It is just a huge honor for me today to be podcast interviewing Carl Guthrie, he is with ETS Dental that's Executive Talent Search he is the Regional Director of recruiting covering the southwestern US including Texas, New Mexico, Arizona, Colorado, Oklahoma and Hawaii. ETS Dental was founded in 2001 by Mark Kennedy and it's headquartered in Roanoke, Virginia they specialize in locating and placing general dentists and dental specialists with independent practices across the country they have conducted searches in all 50 states for thousands of practices seeking associates partners and buyers. ETS dentals recruiting team is made up of six general dentists recruiters and two dental specialists recruiters Carl has served the dental industry as a consultant recruiter for twelve years he has worked with over 3,000 dentists and practices over this time giving him tremendous insight into the current demands both associate candidates and hiring practices. Carl is a native of Lafayette Louisiana which is up the street from New Orlans where he graduated from the University of Louisiana at Lafayette with a degree in marketing and legal studies he began his career with ETS in 2007 while living in Roanoke Virginia and he now lives in Austin Texas with his wife Devin and son Jackson so that he could be closer to my foreground children in Beeville Texas thank you for doing that how are you doing?
Carl: Great thanks thanks so much for having me.
Howard: So you were ETS was founded in 2001 now that was 911 that was a year 911 which really changed everything because the United States 325 million people that's about four percent of the global eight billion population so the United States it's four percent of population has about four percent of the PhDs so all these American companies were always recruiting PhDs mainly from Asia that's where people just love to get PhDs in math physics chemistry and biology and 9/11 ruined that it's so hard to get from 911 to now it's been so hard to get foreign-trained Phd's to move to factories when I talked to patients they say you know my biggest rate limiting react constraint is I don't have a mechanical engineer and if five mechanical because they live in a small rural area and they're like dude if I could get five mechanical engineers to walk into my business I could double it in five years so but in you know it's just hard and so now you're an equally hard thing these DSOs are telling me i just lectured a couple Sundays ago at a big DSO conference in Scottsdale Arizona and they were telling me that now they don't even want to go into small towns because recruiting to get a millennial dentist or anybody to go into it like my grandkids live in Beeville how hard would it be to get a periodontist to go to Beeville?
Carl: Yes it's tough I mean and just like the dss are saying they it's it's tough to get the docs to look out of the major cities you know for years we've said move out into the you know especially during the recession you know that's when I started was in 2007 and so things sort of snowballed into you know that depression recession.
Howard: No you said it right you said it right it was a depression with liquidity the 1929 Depression was depression and they thought they should save the banks and that caused one-third of banks go under so the guy in charge of the Fed during Lehman stay actually had a PhD from MIT in depression and he said no, this time we're gonna save the banks by giving up the dollar and he printed like eight trillion pieces of paper so it was a depression with liquidity but anyway in 2007 what I had that effect on you?
Carl: Yeah so I mean we you know it's really when you started hearing about you know corporate dentistry we didn't have to turn DSO yet you know we were approaching that you know that's when you you know you were seeing the Heartlands and the Pacific's you know really upping their numbers of practices and acquisitions because there's a lot of senior doctors that just wanted to you know if they could because they were losing their retirement which was their practice but you know doctors graduating dental school we were we were talking to them too you know hey move out to you know Midland Odessa or you know you know upstate New York in different places so you know now it's it's we can try to tell them the same thing because they do want they say they want higher income but there's a lot of stability a lot of opportunity just staying in the cities they don't they don't have to leave Dallas anymore they can graduate from Baylor and they can find a job but the competition for the DSOs and those clients that we work with private an and large group yeah they're they're begging and using every resource they possibly can and try to get doctors to move to smaller towns.
Howard: So your timings off a little bit you got into dentistry at 2007 the company started in 2001 2007 to today 2019 does it kind of smell like 2007 again to you do you think there's Lehman's day around the corner if do you think that and do you think it'll have a material impact on what you do in dentistry?
Carl: I think the demand for dentist is is gonna be increasing I mean we have more doctors entering the market but the demand for them is huge I mean they're right now candidates can really pick you know dr. associate seekers can can go wherever they want, they really can and the chance for recruiting doctors and in bringing them in if they don't like what you have to offer as an employer they're they're going to just try a different place now no I would say I don't necessarily smell the same thing now I still think there's a lot of growth but I'm sure a lot of these groups and especially private practices are sort of a hedge and you know hedging their bets and I think doctors who want to sell or affiliated with groups are more likely gonna do that you know now are sooner than later just because they're starting to kind of hear the signs are at least hear people speculating we're on the brink.
Howard: You don't see it down there?
Carl: No I mean where I am in Austin Texas I mean right they can't even build houses fast enough for people.
Howard: So for our international viewers I have to tell you I'm the term that makes the least sense to me is the United States of America I mean even the Federal Reserve has nine branches it's really like nine countries flying under one plot flag and he's down in Texas which is the number one booming healthiest economy it's on the border it's got fresh immigration it's got no zoning laws it's the most pro-business state it's like they do everything to promote growth whereas California does everything to stop growth in fact they're the ones fueling Arizona the whole 32 years I've been here new patient after new patients new patient said well my boss said we had to either close down our business or move it to Arizona so we moved to Arizona and all the employees came with it. So you're saying that if so the people in the dental transition save you're gonna sell your practice it's a seller's market the dentist selling is practice it's his market yeah if you're but you're saying if you're a dentist looking for a job it's their market they then go whatever they want?
Carl: It is I mean we've not I mean there's there's groups that are offering 30 40 thousand dollar sign-on bonuses to move to small town Oklahoma or you know you know some of these Midwestern towns so you know they're we're seeing the rise of the guarantee you know daily amounts that doctors want they used to come out and they would take the percentage and say okay I'll make it it was sort of what they were offered but now they're demanding you know six seven hundred dollars a day in parts of the country it still regionalised what you're gonna see in comp so I can't tell you what the doc and you know in Texas is getting paid is gonna be the same in say Massachusetts because it's not.
Howard: What would states you're Arizona, Colorado, Hawaii, New Mexico, Oklahoma and Texas?
Carl: Yeah those are the states that I focus on.
Howard: How do you get all the good states?
Carl: Yeah I guess look I mean I started in 2007 with all the West yeah I had the West Coast you know I had California I worked through Oregon and Washington and a number those so it you know when you're talking about a lot of the folks pushing out of California and going in Arizona and in other states yeah I saw it.
Howard: Are those states pretty homogenous Arizona, Colorado, Hawaii, New Mexico, Oklahoma and Texas could we lump them into this six state sample size or is that a pretty diverse set of states?
Carl: It's a little there's some diversity there mid Texas a lot of times stands alone in especially with its economy and its strengths New Mexico stands by itself because there's no dental school there and not that it's hard to get a license but getting a license takes a quite a bit of time in New Mexico so there's a number of things that make it tough I think a doctor can make a lot of money and see a lot of Dentistry there's a demand form there but is it they are they are witnessing that struggle because there's no dental school feeding that state we'll see if there's any deals with the new dental school in El Paso that'll be interesting to see if that helps them at all.
Howard: Arizona is ground zero for DSOs because um they we have more dentists working for a DSO than any state and a lot of them say it's because you know basically if you're a licensed dentist from any state in America you get reciprocity in Arizona correct?
Carl: Right yeah
Howard: So is that has that been how was that is that had any material impact on Arizona, on the dental market in Arizona?
Carl: Well yeah I mean they're gonna and what they're gonna do they're going to think we saw something similar years ago in Nevada you know they kind of opened up the spigot to where you know if you promise cross your fingers you know across your heart hope to die you'll practice in a small town in Nevada what do they do they all ended up in Vegas and and and and some in Reno but it really flooded those markets the state had to come in and say okay we're gonna tighten up they did became an ADEC state you know only for a while CDCA now.
Howard: An ADEC state?
Carl: Yeah the board the American dental exam and the board exams play a role in trying to attract some of these doctors so the to the reciprocity part in Arizona yeah I mean if a doc wants to get closer to the west coast who realizes they're not gonna find something very fruitful or just supersaturated and say California you know Arizona also offers you know you know better access you know probably to even if you want to go skiing or get into the mountains sometimes - so but yeah you're definitely right with the DSO presents I mean Arizona is a hotbed.
Howard: Yeah I am so basically it came down to our governor Arizona's ground zero for dental DSOs with 18.7% of dentists affiliated with the DSO according to Marco Buju SEC PhD ad a chief economist at a ta orgs /h bi now Arizona will be open for opportunity every dentist in America with universal licensing recognition and and but the most bizarre thing is that the chart from mark buco check the PhD economist said ADA I mean the first four states on the list of 0% dentist Alaska, Montana, Wyoming, Delaware working for a DSO and by the time you get the bottom list there's Arizona eighteen point seven percent so what is so when you're looking at Arizona with two dental schools and community water fluoridation and will take your license today and the next or New Mexico no dental schools hard to get license transferred is that your does that make a big difference I mean if you were a young dentist coming out of school would you say you know try to jump those hurdles and go to New Mexico it'll be worth it the long run?
Carl: Definitely worth it in the long run but I think that you know the conversations that I'm having every day with doctors about the amount of debt that they're graduating and you know wanting to just jump in and get to work quickly you know they they don't want to wait you know three four months to get a license and you know that definitely you know hampers them it's a dollar today's worth more than a dollar tomorrow so you know let's go ahead and just get this going and and there being that your dental schools are in major cities that they're just you know younger doctors or you know and just not the lump but 100% into it but most of them want to stay in a vibrant community at you know a metropolitan area that has a lot of things going on and they're just not you know comfortable making that jump to to some smaller towns or going into a state that they're just not familiar with or hear much about.
Howard: I know I can't even get my daughter-in-law to move to Phoenix so I understand this whole deal I offered more than three thousand dollar signing bonus to it but I just can't compete with with Grandma living up the street from him she was born there so when you when you what percent of dentists are getting a daily guarantee?
Carl: Based on what we're seeing it's it's almost a hundred percent I'm basing that off of what we're seeing the clients that we're working with the doctors that we're talking to are looking for a daily guarantee the ones that may be the ones that aren't getting it are going into a practice that they just felt was a slam dunk or they're you know they're being hired on by you know sort of a community name-brand where they know there's not going to be a shortage of production but yeah I mean it's...
Howard: and what is that guarantee rate usually?
Carl: It's gonna vary you know from coast-to-coast I mean you may see seven you know 650 to 800 dollars a day up in the Northeast in Texas we're seeing a lot more in the you know if we're talking newer grass you know six six fifty you know some of these practices for more experienced doctors will pay you know seven eight hundred dollars a day you go to California I think you're still seeing you know five maybe sometimes up to 600 a day the other thing that we thought...
Howard: California would only be 500 to 600 a day?
Carl: Yeah I mean there's just there's so many doctors and that's a day I mean we're talking a lot of those Doc's are working multiple part-time jobs.
Howard: So that's because California has six dental schools I mean is that the bottom line?
Carl: and in what nearly 30,000 license dentists so yes I mean the population you know is is not necessarily where the dentists are located you know not everyone in California lives in SoCal you know in the LA San Diego market or right there in the Bay Area and you can probably do really great if you just go to Sacramento if you live up through you know Central California or the Central Coast.
Howard: So California daily rates are closer to what?
Carl: I'd say closer to five for a new dentist point of view I mean more experienced doctors could...
Howard: Okay so I got so much to say on what you said so far so yeah you know what's really neat about lecturing around the world for thirty two years you've seen every rodeo before so when the when the governor of New Mexico I mean the governor of Nevada told his receptionist to get him a dental appointment needing a teeth cleaning and she told him at the end of the day that she'd called every dentist in Las Vegas and she can't get him in anywhere for a month he was so livid that he started a new dental school Nevada and started this unlicensed adil and I had seen that rodeo before five years earlier ten years earlier in Australia same thing Prime Minister couldn't get a damn dental appointment and he was so livid he opened up a couple new dental schools but he did something drastic they had about 10,000 dentist and they had 2,000 foreign trained dentists living in Australia and he said well were these dentists from where'd they go to dental school and he got the list of all their dental schools and he says these countries all make great cars great economies I mean you're talking about Germany South Africa all these England Ireland all these great countries and he gave licensures bike so that day so in one day you pretty much went and I'm rounding this off but in one day you basically went from about 10,000 dentists down under to 12,000 and that changed everything you just can't increase the supply of dentists 20 percent hold the population stable I mean United States population Australia population both of those countries don't even grow their population at one full percent a year so when you add 20 percent dentists to a stable population it changed everything so when dentists are talking about student loan debt and they're talking about all these economic problems the one problem they're never going to be able to adjust back from is supply and demand and you're you know you've gone from graduating about 4,500 dentists a year to about 6,500 dentist a year how many dentists are coming out and your and your numbers?
Carl: You're I mean yeah we're in that same ballpark I mean that you know we're definitely over 6,000 image it was an amazing push what just you know what in the last five years that we've added a handful of new dental schools and you had a number of other schools that up their enrollment rates just to tackle that quote-unquote shortage of dentists that we were expecting.
Howard: and we've seen this rodeo before so when I was a freshman the senior class had two hundred my class only had 125 because when I got into school the big pushes my god we have way too many dentists so that you were closing down I think it was seven dental schools they were closing them down and Chicago lost one you know Georgetown Emory Farley Dixon and all these dental schools were closing down and the class I shrunk and then they got too low according to someone and they now they're going back up and whatever goes back up though you know some days strong some day they'll have to turn around and go back down but you're saying California has six dental schools so the daily guarantee is closer to like 500 Texas is a strong economy they're doing good what's a daily guarantees and in Texas?
Carl: statewide put it right around you know 600 a day for a new doctor coming out
Howard: 600 a day and when you're when you're talking to these dentists you're saying they got a lot of student loans the national number I see is $284,000 per average kid is that about what you're seeing?
Carl: Well since we're talking to the doctors that actually have the student debt I mean we definitely see it more you know in the you know four hundred and up category you know.
Howard: What is the range your seeing?
Carl: More like 350 to 500 is more typical of what we're running into because we're we're generally talking to the doctors you know who are sort of you know they bootstrap their careers they're graduating they're doing this through financing and they're not making it they're not gonna take over a dental parents practice and have you know had the full you know has their tuition paid for so we not picking on anybody but yeah whenever you get that national average I have to assume that that's also counting all the kids that have zero debt graduating from dental school.
Howard: Okay so that's a median number for all dental graduated I expect that's not a median number for just the kids you have student loan debts.
Carl: Yeah I don't know
Howard: So you're saying that the dentist that you're working with so Carl Guthrie is saying the average dentist he works with has three hundred fifty to five hundred thousand dollars of student loans?
Howard: and what is the difference between that student with three hundred and fifty K to five hundred K is the five hundred K guy married with a kid, what's the difference? I mean that's significant difference that's a lot more.
Carl: It's going to depend on the school you're gonna be going graduating from the most the most expensive dental school in the country and you know if you're gonna have the living expenses of living in the city you're gonna have doctors that are gonna have you know families and you know they're gonna graduate and already have the wife and two kids and some are already driving you know the Cadillac yeah so it just depends on the school and in a particular life situation.
Howard: and another thing you know I tell dentists with diseases and going to dental school there's more than one country out there I can't believe that people don't realize that the United States of America is not the only country like like you find you find dentist that their whole goal was to being ended honest and they didn't get accepted into school you can buy your way into endo school in the Caribbean and Central and South America and in Europe I mean you could go live you could live in and Romania I mean that would be the time of your life and when you come back here when you're a bored sort of when you're in an endodontist license in America do the employers care if you graduated from the Caribbean or Romania or NYU?
Carl: Yes definitely some definitely do you right yeah I mean you're gonna have doctors that you know put a number of reasons on why they may not like it and you know sometimes it may just have to be you know sort of you know just a superiority perception of American you know getting that US education but...
Howard: What percent of the people hiring would you would look down on a foreign trained dentist?
Carl: I would put that more so probably you know like the ten fifteen ten percent or less.
Howard: Yeah they go for it and they just have to you know.
Carl: and I do feel that you know they understand that hey I also want to practice in the US I have to get educated again you know I have to go through you know dental school again even though it you know maybe an accelerated you know foreign trained doctor course or get a certificate you don't get a specialty certificate and.
Howard: Hey my one of my physician friends that I actually go to you know partied like it was 1999 all through a ASU and didn't get into any med schools and he finally got married, had a kid got focused and had to go out of the country to be a doctor and he is one of the greatest doctors in the world so you know everybody's timing is different. So when you're um when you're look let's start with the old guys since I'm old if I'm an old man and I'm looking to hire an associate dentist what tell me I mean we were always hear the Millennials are different but how does how does an old guy looking for an associate dentists what should he be thinking about this young market?
Carl: When you're looking at the market I mean it's you know the biggest thing is understand you know what is it you know they want and you know get out of your head about well this is how I started this is how everyone should start you know when you became a dentist you know not you but a doctor you know 30 40 years ago yeah you graduated you you throw your shingle and you just you made it happen every which way that you could but now we're now at a time that's different than any other time in dentistry where doctors in dental school are hearing a whole lot of different information I mean you have you know a lot of DSO recruiters that are in the dental schools every day talking about benefits and base guarantees and see and all these things that they hit within those companies so now when you're coming out and you know these a doctor that wants to hire an associate and doesn't understand why these doctors why are all these candidates demanding you know a six hundred dollar guarantee they want 30% of the BLA and they want me to mentor them and train them and but paying them like they have it well that's you know the market has come to that and the doctors also aren't practicing or rather starting a practice out of dental school they're gonna associate for three to five years before even considering being a partner are an owner of a practice.
Howard: and what are they hearing in the dental schools so they're I assume they're mostly hearing from the big boys the heartland yeah spans the Pacific Dental so what are they telling them?
Carl: I mean a lot of it has to do with the structure and security of what what these organizations have I think it'll come down to you know the level of autonomy training mentorship and income that they can receive from each company then ultimately the if they feel there's a good cultural fit with those companies and I would tell any new grad that no I don't want to work corporate well that's that's a bad way of looking at it you can't lump all those all practices all corporate love all private practices into the same boat because their internal culture and systems and sort of their vision and mission all were different and you do have to fill them out I mean you're gonna go into a bad corporate practice just as well as you're gonna go into you know a bad private practice with you know you know bad staff or people that just don't get along and the same goes for really good experiences you're gonna go in where they treat you like royalty and you know pay you what you want train you up and yeah you just have to feel them out.
Howard: Yeah when I got out of school it took me four it took me four months to get my rented thousand square feet built out open so for four months I worked at the biggest dental clinic chain in Phoenix at a time I was called sunshine dental with four locations and what was so cool I was doing my four year dental school requirements to graduate every week I mean I had come out of school I'd done 15 canals of Indo 15 units of dentures 55 fillings you know whatever I was doing that every week and I was like I felt so fortunate that I had a dental office and then what I really loved about it is it was a group practice so if I could only get the crown and the front root out and couldn't get the back root out you know Dr. Patel would walk over there and are Nick Gidwani and just you know show me in three seconds how to get the other one out and so it was it was just great yeah and these guys work for you know Heartland who has 900 offices and then when they graduated they didn't learn one business thing from Rick Workman and Pat Bauer because they work the whole time they go this is corporate and I just want to get out and say yeah now you get out now you old one dental office and you didn't learn one damn thing from the only man who owns 900 offices right because of your attitude your bad attitude so yeah so your attitude is gonna determine your altitude just if you've got about you just fix it because it's not doing anybody especially you any favors. When you look at him when you look at a dentist he's wants to hire he wants to get a job and what and you got two dental offices in this town that want to hire this kid what are some of the red flags that the one on the Left is not very good the one on the rights better or what what are the red flags that you see and these young kids getting a job and that the old man should fix?
Carl: Yeah I mean a lot of it is is is why you know do you understand why that practice wants an associate so you know did that practice owner decide I want to work less I just want to cut back on my day so in order for that to happen I'm going to hire an associate okay well did you find out that owner understands you know when you go in there he's gonna have to give up some level of production in some of his income for you to be successful as an associate in his office do you have run into that quite a bit where you know this is the first ever associate and they just went in and there was no plane and the associate thought hey there's a job I I'm gonna I'm gonna go in there this guy does implants and in a lot of surgery and I love doing that and they find out he's not gonna give any of that work up to them as the associate he needs them to do fillings and see the kids so you know let's let's make sure that we clearly understand you know why you know doctor A wants an associate and why doctor B's reason is different so if they've had other associates before find out what's happened with those associates you know why the last person leave and why do you have five associates this year and so we we go through those stages with with doctors that are seeing that are looking and make sure that you know they're they're answering those questions you'll what's what's the new patient flow like what's that doc what's the owner willing to give up for you to be successful and have you both talked about your expectations because the other thing is that associates tone oftentimes conveyed their expectations of the opportunity really well they'll tell the owner oh yeah this is great everything they just yes men and their interview and they don't say that I want to be a partner and owner you know in the next year or two and then they leave in six to twelve months because then they found out of you know my boss doesn't want to give up any any ownership you know that's just not the path here.
Howard: Yeah so it's something you see all the time that's the most really successful people have the least amount of social skills like Steve Jobs I mean so you're a social animal there's an eight billion herd and so your whole biology says oh we all just get along work together and that's the best way to survive well we're past those days but that's still how you work and so what you got to do is when you get to work and I'm just like how does a dog how's the kid you need to clap their hands say okay okay let's go to work and the people who have the most uncomfortable conversations will solve the most problems so you you're not there I see it with dentists where you'll see a 60 year old dentist interviewing a kid for an associate and the whole interview this old man's trying to sell himself the practice that he went to the Pankey institute like dude dude you're selling the whole deal come on come on let's go to work this is an interview and you said it perfectly to the young kid what are you looking for and a young kid should say what are you looking for and you say well I'm working five days a week I'm old I want to cut down to three I got too many patients I'm booked out that's very different then I'm sorry I want to start dating an associate because I'm looking to find a guy I have chemistry with and respect and I want to unload my baby I mean when you have a practice 40 years you don't want to give it to Charles Manson just because you got a good price you're looking for someone to carry, hell you got kids and grandkids going to that practice so the bottom line is so you're just saying the same with everything it's communication communication communication quit trying to be someone's friend and the way I coach my dentist fried, a guy called me Sunday and he's having a meltdown and what some other dentists thought about something I said look dude you know modern humans are about 50,000 years old at about a hundred and ten billion I'm have died and if the eight billion alive today you're never gonna meet seven point nine nine nine billion of them so in your world really everyone's dead or you're never gonna meet him so why do you freaking care what Karen the yoga instructor said I mean just you're not in there for a friend that's why I call my podcast dentistry uncensored I don't do this show because I'm looking for a friend I'm doing this show because I really genuinely think I might help one dentist make one decision and if that's all this thing does it was worth it. So unrealistic expectations what do you think the young kid has blinders on when they're looking for that perfect practice I mean you do the kid in dental school where you know he just you know they're a little detached from reality they think they're gonna go work for dr. Disneyland and you know what is the most detached unrealistic expectations that you're seeing out there?
Carl: I think the biggest ones is you know they don't want to to leave I'll use the major city example again where I don't want to leave Dallas or Houston but I want to start in a practice that's gonna be completely fee-for-service allow me to do implants and high-end cosmetics and full mouth restorations and make 200 plus a year as a new grad and you know that's that's an extreme example but an actual example I mean I've had those conversations and normally if that doctor is just gonna be coming out of dental school I'm like well that's that sounds great but you know maybe you need to go out and do an AED or something and get a few more you know a few more reps under your belt before you can think you can do that and even after that you're still gonna have to put in the time and that's that's a big struggle and I don't know I know that's kind of lumped in with the you know the millennial mindset or or others they just want to get out there and and just do it all and you know we just need you know I would just want the doctors to to understand it takes a little bit of time it doesn't have to take forever but you can you can definitely get there and with the you know with the opportunities that are out there there's tons of opportunities for doctors to work and if they're looking for the perfect practice coming right out of dental school they're setting themselves up for some disappointing because they will have to make some compromises and put some things off for a couple of years and until their experience or even their reputation grows to take advantage of what they've been able to build for themselves but it's just not gonna be instant.
Howard: and which town I mean my gosh I wouldn't want to leave Dallas I mean their Dallas Cowboys I mean they're 4 and 3 and then go to Houston they're there 6 and 3 I mean what do you what do you advise that you go to Washington Redskins for the only won one game what do you what do you hate these young kids so so you're saying that quality of life matters they they want to live in Dallas they want to do in Houston they don't want to live in Beeville Texas where my grandchildren live so and I don't think dentistry is competitive when they tell me that there's too many dentists like a lot older dentists tell me there's too many dentists I mean what do you mean there's to me that's you've been looking for an associate for a year you haven't found one and I interviewed a kid a couple months ago and you know he told me he said well I just want a daily rate of 650 but I don't want any production I mean I shouldn't have to come in here and have any level of productivity I mean I should just come in here and do the best job I can and you pay me symphony I'm like are you stoned I mean I mean it's that I mean does economics is it a joke to you I mean you're just sayin communism all for one one for all little it's just all drink vodka and sing Kumbaya are you completely and I'm like how did you get a doctorate in dental surgery and you're completely disconnected from any form of economic reality but humans are compartmentalized if they want to believe something they'll figure out a way how to get to that.
Carl: A good follow-up question to that is hey do you want to be a practice owner or a partner in the future at some point and a lot of them will say yes you know well you know what dentist suppose okay well that's great are you gonna just pay yourself a guarantee you know even if you don't have the money coming in how you gonna do that so you know it's let's put a little a little spin of reality on that but it's...
Howard: and there's not a lot of reality there's not a lot of reality on things that. So let's go back to let's go back to when you're hiring these dentist associates where was I going with that there was so you're saying that they were going to live in their own place they're gonna want daily guarantees what would um what percent of the dentist associates you're talking to look you in the eye and say dude I always want to be an employee I never want to be an owner I just you know I want to get married have kids do the 8 to 5 thing I do not want to own my own business?
Carl: Very very few I mean some I think maybe just it's still you know in entrepreneurial culture and in dentistry and they maybe some don't want to admit it.
Howard: but what percent?
Carl: I would say well less than 20% are gonna admit that they don't want to do that at all
Howard: and how long do you think the average dentist is an associate before they buckle down and buy their own?
Carl: The ones that they do it probably now more like 3 to 5 3 to 7 years.
Howard: Okay so let's go with I agree completely so the way I see this market is they six thousand graduates a year and they want a job for five years so you have thirty thousand dentists man-hour years for the DSO market to work with that yeah that's all it is that's all it is you cannot show me any math these DSO people they just keep they're thinking they're gonna double and double and they're gonna be Walgreens and CVS and we're all gonna work for Mcdentals and Albert he's talking about I'm you know Walmart's getting industrial I don't care who gets into dentistry they only have thirty thousand associate dentists years to work with and then your and then at the end of that road we're all gonna be at the same table looking in the same mirror looking at the same dentist she says I have worked for five different other people for five years and I'm so miserable because you can't get two dentists to agree on anything and I finally I'm opening up my own damn practices I'm finally gonna just have to do it my way and you're saying that that's what you see what will percent of the dentist after they graduate from school in five years on their own practice?
Carl: I don't know the answer there I can say that historically the doctors that we're working with in placing with practice seventy percent or so are going to be those doctors with three to seven years of experience so you know after they hit that five seven-year marks they're going in and buying something or they have settled into a career spot where they want to stay.
Howard: Okay so let me give you let's jump around to other industries just so everyone knows if you graduate from dental school I mean from a computer programming school and you're a computer programmer of any type science everybody from Amazon Facebook Google they all want to hire you and what do we see with them Millennials are staying with the FANG Facebook Apple Amazon Netflix uber these companies they stay with them on average one year I mean one year and you're sitting there working at Amazon and you think it's all great and Amazon's like we're paying you all this money and we're giving me a free Pepsi's and chips and sandwiches in the break room and we got foosball and everything's hunky-dory then someone walks up to and says hey dude you've been programming supply chain management for Amazon for a year hey you want to jump over to Uber for the same the same coin and do driverless cars like you know that does sound fun that's right and they're gone they're gone so so nobody's keeping the money land and I think it's cool I mean I would I wouldn't want to work somewhere that you hate it so I'm so for you personally are you mostly how do you make your coin are you or is that old guy like me saying I need an associate how do you make money or you're married with a kid right?
Carl: I am
Howard: So how do you earn a worm to come home and drop that in baby birds mouth?
Carl: Yes so our paying clients is the dental practice whether it's you know private practice or small groups we've you know as a company we focused primarily on the private practitioners and the small groups are emerging DSOs so once a practice usually gets to you know a group gets to say 25 30 offices you know they're dancing with or they've joined up with you know a PE or got you know went through a merger they usually get to the point to where they're building in their own you know full-service HR department in their own recruiting team so you know we'll work and represent the practice themselves.
Howard: Did you say small groups are 30 offices are emerging DSO?
Howard: So give me your terminology on thirty emerging DSO is 30 offices?
Carl: Yeah I say less than 30 offices.
Howard: Less than 30 and that would be your market because at over 30 offices they'd already have your business function in-house.
Howard: So they have accounting and marketing financing and in regex okay so your ceiling is 30 offices and under is there another distinction for DSOs it's a say less than five offices you call emergent ESO less than 30 offices what would you call it if they had five offices?
Carl: The can still be emerging or business model and goals but you know small group could also be what I call...
Howard: A small group and we'll say that's five and under?
Howard: Okay and are you if you place a hundred dentists how many of them are with DSOs that have around 30 offices and under versus small group versus just individual have a private practicing?
Carl: Yes so we're we're doing probably about sixty sixty-five percent of our business with the small groups you know that five you know kind of in under ten offices you know and in the larger groups you know those emerging DSO is I'm calling them will probably do about twenty to thirty percent of our business there so we are seeing a lot more of our business with with multi office multi doc organizations rather than just the typical you know mom-and-pop private practice.
Howard: Okay so you're saying sixty five percent is for the emerging DSO with thirty and then what percentage was small?
Carl: That was about sixty sixty-five percent yeah.
Howard: So sixty five percent was for the the bigger DSO is with around thirty off ?
Carl: No that was a smaller groups oh that's more a bulk of what we're doing
Howard: Okay so 65% of your ETS recruiting is for small group less than five offices?
Howard: and what percent is of your ETS recruiting is for solo practicing dentist?
Carl: You know fifteen twenty percent there that's leftover.
Howard: Okay so if that guy is listening to you right now he's all alone he's in one of your state's Arizona Colorado Hawaii New Mexico Oklahoma Texas and he wants to hire an associate dentist how does that work how does he call you how much does he pay for that this isn't a commercial this is Dentistry Uncensored, he goes to ETSdental.com
Howard: and ETS dental which stands for executive talent search dental .com and how does that work how much do I got to pay you to hire an associate?
Carl: So budgeting for an associate recruiting is is gonna be just think of it as you know one two three days of production for that doctor is what we're gonna usually look at so you know full-time doctors are what we do the most of I mean we really do very little part-time recruiting and so doctors pay anywhere from say twelve to twenty thousand dollars a month for I'm sorry in total for a general dentist if they if they're looking for specialist oral surgeons pediatrics are probably the biggest and demand and then you also have the endodontists and the periodontist we don't get a lot of demand for prost are usually running in the mid 20s for party
Howard: So a solo practicing dentists will cost how much? Twelve thousand?
Carl: 12 to 18
Howard: Well that's a big spread what's the difference between twelve and eighteen?
Carl: Experience and the challenge and you know location maybe but you know we're gonna try to you know a doctor that's coming out of school we're not gonna charge you know a full time or a full price for a doctor.
Howard: What happens if I give you 12 grand and I hire Karen and three months later she quits?
Carl: Yeah so we work with our Doc's to make sure you know we're understanding what's going on behind the scenes and what their goals are and we'll tell them if we just can't help because the last thing we're gonna do is want to just fork over and you know throw resumes at you but if that doctors say comes in and there's a fallout in the first you know three months we will prorate for those first months and you know so if you may we'll generally spread out our fees over six months so if you're say your fees 15,000 and it's six monthly payments of 2,500 you know at 3 months you've made three payments but you that doctors doesn't make it will stop billing you you're not gonna...
Howard: So HR is the most difficult task they will figure out how black holes and gravity works a thousand years but they're gonna find out about how humans work and when there's a fallout who's usually the crazy toxic one is that the young dentist associate or is it the old man?
Carl: More often than not, unfortunately , it's the practice there was it got it goes back to the miss expectations or you know there was a lack of you know communication upfront about what's there just a misrepresentation of the performance of that practice.
Howard: That's well put so when dental associates don't work out there a communication problem and there was misrepresentation they weren't busy enough.
Howard: They didn't have enough new patients they thought they were yet mentored because you place a lot of implants but it turns out that you're doing them yourself I am over here on a composite milling machine.
Carl: Yeah and I don't mean misrepresentation even to say they're lying I think a lot of doctors unfortunately just don't know what they have a lot of times when it comes to the you know the financial or...
Howard: I just lectured on in Scottsdale like say it was a hundred of the biggest DSO captain's around and they were they were telling me a lot of interesting things at lunch and afterwards that they used to have associates come in and work for them and they would do like molar endo and they'd teach them how to place implants and they'd worked there for a year or two and leave and then of the over the first five years they had to repay and endodontist to do redo you know twenty to sixty percent of the implants you know twenty percent I know a lot of these guys are saying they're starting to redline and say no man first three four years out of school we're gonna get a endodontists to come in and do all molar endo and we're gonna get a periodontist place all implants and I've reached that I have personally reached that I have paid I have made some local periodontist very wealthy by paying them cash to redo my associates implants so how hard is it to get a endodontists to come into your practice or and do all the molar endo and or a periodontist place all the implants?
Carl: I think those I mean there's there's endodontist and periodontist to make their living just you know floating around a particular region or metro area I mean oh they'll come in and do that work for you if you want to hire them, I mean it's it's a different story I'd say that you know periodontists are definitely out there and want to work full time somewhere stable if you kind of let them do their you know do what they're good at but you know if you're just a general practice looking to bring in some help you know one day a week and you just load their schedule up with you know a bunch of molar RCT then yeah I think you can you can find those those folks out there to show up you know at least a few times a month.
Howard: Now are indeed honest and periodontist are they getting a daily rate minimum to?
Carl: Most of the time I'll not be accurate with my number since I've got my head in general dentistry but yeah I mean they're they're gonna get some type of daily guarantee I mean sometimes you know especially like a pareo they're gonna come in and do a lot of implant work and so forth you may just split 50-50 with them.
Howard: Is that legal it's fine to pay them 50 percent?
Carl: Yeah I don't think there's a legal yeah it's yeah
Howard: Okay well there's a lot of fee smothers
Carl: As long as they're not paying you for the referral you're paying them for the work.
Howard: That's paying for the referral is the feet kickback fee split that's go to jail yeah by the way I've lived out here in Arizona and dentists have gone to Joe they're the ones that got the most trouble was when when a small town only had like three dentists and they all met at the dentist's office and wrote a letter to the insurance company telling them that they had to raise what the insurance was gonna pay them for a crown or all three were gonna quit and of course they signed it and mailed it to the dental insurance company it took everything the Arizona State Dental Association could do to keep those three bozos out of jail yeah I was the one thinking well maybe they should just go to jail I mean at what point do you have to tell a dentist stay in your lane a lawyer you're not an insurance commissioner in fact you're actually an idiot but anyway enough of that so yeah I mean yeah every time a dentist gets in really really really crazy trouble usually they were pretending to be a lawyer or an insurance commissioner or whatever. So are these so it sounds like the associates are looking for mentorship what percent of your business and activity in revenue is from actually a transition where you found the dentists an associate dentist to come in and work for him and buy the practice do you also do the transition?
Carl: We work in helping practices connect with people so we're not transition experts nor are we brokers but a lot of times just based on our relationships with doctors and and what we've done to help them with associates you know those those have led to you know a transition or two to a sale but you know I'd say at least you know good at least a quarter of what we do maybe a third is is going to lead to some type of partnership or just a complete transition of the practice because a lot of doctors are calling us want that heir-apparent that's gonna take over.
Howard: Okay and how do you it sounds you know they they a lot of individual dentists get on dentaltown and say you know I want to go get a job at Heartland or one of the big boys and they said this is our contract take it or leave it and then other ones are saying dude that it's a poker game called call bluff and say I'm walking know they'll change it I mean so you see a lot of hands when they say this is our stock contract this is Aspen Dental Bob Fontana said sign there or go home new or false?
Carl: So a lot of your bigger players have pretty much the boilerplate contract I don't I don't think they really Bend on it much they they may bend on signing bonuses and so forth you know kind of know what you can negotiate a lot of times with with bigger groups they won't bend on say a guarantee or the percentage or the non-compete and number of those items but you know sometimes if you wanted to tip on portions to try to negotiate you know you know Aspen dentals aren't necessarily always in a highly sought-after area you know same goes for some of these you know Heartland has offices in some smaller areas there's a lot of groups that do and and oftentimes you can say okay well you know I'm interested I'll go there but you know will you do a you know twenty thousand dollar signing bonus or relocation package or whatever to to help you make that move and so those those can can sometimes help you get a little bit more out the deal then are you know then just that typical stock you know Heartlands gonna pay you 25% plus you know profit share bonus and that's it.
Howard: So yeah and I think I'm you nailed a bob Fontana Aspen Dental right on the head I I think they had the best business model they they are going where the dentists ain't they go to Medicaid areas where the dentist no me no like in Phoenix everybody wants to go work in Scottsdale on lifestyles of the rich and famous and there's Aspen going out there where there's hardly any dentists accepting Medicaid and have an internal in-house denture van in fact I've had several of my patients I they came in and they said yeah I got this real a night I had done Aspen I said just curious why why did you go there here well I called your office they said well you had to come 8 o'clock in the morning drop it off all day and you'd pick it up at the end of the day yep that's right well I went to Aspen and the guy they had the lab I went in there gave my denture sat in the waiting room for an hour got it done I mean so they have a more focused as well. Back to communication when these it doesn't work out misrepresentation you don't think they're lying they just didn't think about it does some of this come down from I want an associate versus I need an associate?
Carl: Yeah I think doctors understand especially if they get older you know I'm working too much you know either is just they're just tired or they just want to change in you know more personal life stuff you know personal time in their life some some do because they think it will make them more money and I think there has to know there has to be a sound business plan and business reason for this I mean you could probably make more money or keep your money as a practice owner if you just closed a day a week rather than hire an associate you know it's it just really depends on what you as an owner a willing to give up at least short term to to have a have a successful associate because I think an associate can bring you more and make you wealthier and give you more of what you want as a business owner but you have to you know just like when you started the business you have to be able to to allow that to come to realization you can't just flick the switch and it and it happenes next week we just could yeah you hired somebody you have to pay them.
Howard: I think one of the best threads on dentaltown I don't know if you've seen it does having an associate does having an associate truly profitable and here's 50 different dentists talking about of the fact that they're looking back over their 10 years with associates and not associates and they don't even think they made money off their associates.
Howard: So what's your thought about that?
Carl: You have to you have to put in the work and in the doctor the clients that are they're successful with their associates have a plan you know they're in there they're putting money into marketing and making sure that new dentists or rather new patients are coming in they're also not micromanaging their associate if they if they have an associate who's only getting to do fillings and just see the kids yeah you're not gonna make money you just hired a hiring hygienist and have them you know just add more hygiene to your practice you know what do you want if it's gonna make your life easier if it wants to make it wealthier you have to have you have to have a plan and you have to be willing again to when you gotta trust I mean you're gonna hire a hygienist you can hire a dental assistant and at some point you're just gonna expect them to know what they're doing and you just let them do their job and I see that a lot with especially older owners they just don't want to give up anything and then they want to micromanage and tell the young associate everything they do is crap whenever they could get them to some CE you're really truly mentor that's how you can make money off of your associate you have to really open the door for that that pipe to to work.
Howard: and what is the cost of associate dentist turnover I mean when you look at some dentist and every year he's got a different associate and and you can't blame all this on Harlan all that because you see in the private practice and you see it at Amazon, Google and Facebook and Netflix and Uber where they're throwing money away I mean they just throw money away and flush down the toilet so it what is the cost of when you're an owner old man and you got a new associate every year?
Carl: Yes I mean if you're really your business is built on having that associate and you have an associate that's producing say forty fifty thousand dollars a month and you go a month without one there you've lost forty grand I mean now how quickly you know could you you know what could you do with that forty grand that you now missed in terms of opportunity costs but you're also going to you know simple things as putting their name on the door you're gonna buy equipment you're gonna hire assistants you're gonna do a number of things to make sure that that associate comes but if you if you treat them like garbage or you don't help them continue to grow I mean you're just throwing money away hands up hand over fist to them so yeah it's gonna come down to each practice and what they really invest but I would say easily you know tens of thousands of dollars to lose them every dollar you spend you pretty much can lose four to five times that in in turnover if it gets too much.
Howard: So are you only happy when it rains you said garbage people say he treated me like garbage is like okay that is an awesome band you sound like you're only happy when it rains you've seen garbage?
Carl: Along time ago.
Howard: That's an awesome band love that song so my gosh I can't believe we went over an hour and we did all this again how do they contact you?
Carl: Yeah so I mean ETSdental.com is you know our direct website and there's BIOS on all of our recruiters we we really do like to put a face to the name instead of just having a generic info@ETS you know so you can email me directly anytime at CGuthrie@ETSdental.com and my direct phone number is 540-491-9104 people can text or call me there.
Howard: 9104 that's it that's a Midwestern Kansas Texas thing 540-491-9104 Carl Gunther I know you're driving to work or now but Guthrie is... Carl why is there no y in Guthrie?
Carl: No idea
Howard: So what you said at the beginning to show that you got like eight you got a six dentist now you're not a dentist
Carl: I'm not a dentist but we have six dentist recruiters yeah.
Howard: and those are what Gary Harris is what?
Carl: So Gary Harris is a he's our specialty recruiter focuses on pediatric specialists and orthodontists.
Howard: and is he a dentist?
Carl: He is not none of us are dentists.
Howard: Okay orthodontist I have to weigh in on hiring an orthodontist is that my god I wouldn't have somebody do ortho if you can't finish the cases I mean before you were gonna have an orthodontist worked one day a week I mean you need to go sign up with Rick, Richard lit the only board-certified orthodontist who teaches general dentists you need to know this because obviously it could happen that you could have an orthodontist in your office with a hundred cases all banded up or Invisalign and then something happens and now you don't have one you see that problem?
Carl: I do especially in the general dentistry practices I mean there they wanted to add or through to their practice and whether they use the GP to do it or had an ortho and then they lose them yeah that's always the biggest sticking point of should they do it or not.
Howard: because that I have seen in my own backyard and I've seen in Albuquerque New Mexico both of these are your territories were a general dentist and Albuquerque decided he was gonna be an ortho King and after a year he's hated it and he didn't know what to do and he couldn't find an orthodontist and the local orthodontist across the street said you know what I'll finish all your ortho cases and so obviously who's he been sending all his ortho to who for 30 years so this man and then in my own backyard it almost made me cry were north on us got into the Lehman's day crisis the economic meltdown you know that the United States is a country but that LeMans day mostly affected Texas Arizona Florida and California compare that to Wyoming and Idaho no way it killed us out here and we lost an orthodontist and it was so sad and patients didn't know what to do and that orthodontist across the Street said I'll finish all of you just just all finish it well the goodwill it created I mean ever all the general dentists love this orthodontist they were all sad that he didn't make the crisis and whenever you think of that his story you get a tear in your eye and think of that Canadian orthodontist who finished all those cases for free and that's a blood bond you can't get away from him so if you get in over your head just walk across it's like I day you got a failed root canal what are you gonna do fly out and show the x-rated Gary Carr in San Diego and have them posted on his T do community as opposed to what just walk across the street to the antibiotics and say dude I screwed up look what I just did well you know just just press the flesh I the dentist who are always out there running for mayor the dentists are always going out and pressing the flesh. I think the best thing to do is eat these charity things I mean all these states put on some dental deal for poor underprivileged people and all of and a lot of dentists I know say well you know I do a lot of my office I know but you don't you do it by yourself, why don't you go down there and do it with these other people because you're gonna help a poor guy why you're doing a root canal with four other dentists that you might have never met I mean it's not what you know, it's what you know and it's who you know. Is there anything I should have asked Carl that I wasn't smart enough to ask?
Carl: No I mean it's really I mean we talked a lot of practices and and kind of going back to to communication and understanding expectations and that's why we spend a lot of time talking to doctors and they sometimes wonder why do I talk so much when I'm on the phone with them is you know I really want to understand you know why are you doing this what do you want and we're gonna go out there and we're gonna really you know matcom this deal we're gonna try to make sure we're putting two people together who who have a really good chance of being successful because we don't you know we pride ourselves on having you know less than seven percent fall out with our placements because of all the communication everything that we're trying to do up front so that's if any doctor is trying to take anything away from this on either side of the hiring or job search coin it's you guys you got to talk to each other and also you know make sure you you interview more than one doctor at a time and doctors should interview with more than one practice at a time because putting all your eggs in one basket doesn't necessarily always work out and you'll lose out on opportunities if you if you push others aside and not talk to them so if you you got one interview and two others want to talk to you and you say no I'm just gonna see how this one goes they're gonna move on and yeah may not work for you.
Howard: So in MBA school they call that in decision making Alice's you know they're your square box is a decision at hand I want to buy a house I want to get a job the triangle at the other end is this as you went with the number one error and decision making is between that Square and between that triangle you didn't fill out all your circles and the circle so you went and looked at a house and said that's a great house $100,000 I'm gonna buy it today and you buy it then you find out there was one across three twice as butter for half the price same thing always fill out your circle just you know if you live for a job just keep looking so they so you gave us your email number your email address was a cguthrie@ETSdental.com your the states that you're working on or Arizona Colorado Hawaii New Mexico Oklahoma in Texas but if they go to ETSdental.com there are six of you guys that are doing this covering the whole United States right Gary Harris, Rob Kosovich and is he polish or polish or Ukrainian Russian?
Howard: Okay tell them I'm sorry that I dummy Morgan Pace, Karen Rhoads, Marshall Hatfield, Marcia Patterson and so I think we cover oh I also dentaltown has free classified ads have you seen classified ads on dentaltown.
Carl: We use them.
Howard: You do, talk about how you use them and what we should know about dentaltown classifieds?
Carl: Yeah I mean you've got jobs from all over the country I mean we we posts on there and we've we've made some great connections with doctors over the years from there and in often time it's because they've got pulled in by your online community that's built and they may only look at those job listings so it's definitely a good place for it.
Howard: If you go to dentaltown.com/classifieds we have four thousand nine hundred and sixty seven ads posted as of right now for a total value of two hundred and sixty one million dollars that's all the practices for sale I lectured at that practice brokers Dill's and everybody wanted to buy me lunch and thanked me they said they buying and selling their practices you know the lead and the reason the lead is so great for dentaltown is they say you're in Arizona if you call the Arizona Dental Society they got a great classified ads all that stuff but it's all Arizona but the guy but you don't know who the guy in the Navy is stationed in South Korea that wants to come to Arizona and he's looking at a national place so my gosh and that it's all free on classifieds don't make any money on classified ads or any of that stuff and other than that, hey Carl it was awesome thanks for coming in and keeping it real and I want you to find me an associate job in Beeville Texas I'm gonna come down there and work one day a week and play with my grandchildren five days a week and if you I you come to Arizona I would love to have a endodontists and a periodontist come in my practice I'm serious well I don't want to pay children within five years out of dental school to do molar endos and place implants anymore and I have found that all these DSO guys that own 30 offices said yeah Howie how long did it take you to figure that out 32 years yeah we we we figured it out after a million dollars of paid remakes and that how we figure it out so it's tough tough tough. Carl Guthrie ETS Dental recruit thank you so much for coming on the show today.
Carl: Thanks so much Howard, appreciate it.
Howard: Alright have a great day