Bob Laing was born and raised in Van Wert, Ohio which is located in rural Northwest Ohio. His Father, Grandfather, and Great-Grandfather have all been dentists, working in the same family practice which has been serving the Van Wert community for 80+ years.
Bob graduated from Miami University in Oxford, Ohio in 2016 where he completed two Bachelor’s Degrees in Zoology and Political Science. He is currently a second year student at The Ohio State University College of Dentistry. After graduation he plans to return home to work with his Father, and serve as a fourth generation dentist in his family’s practice.
Throughout his experience as a front desk and dental assistant in the family practice during his high school and college years, Bob developed a passion to learn more about the human relations and business aspects of dentistry. During his first year of dental school he learned about the Dentistry Uncensored podcast from a friend and classmate and began listening and learning as much as he could from the many resources that Dentistry Uncensored and dentaltown had to provide.
Laing discovered the 30 Day Dental MBA program after he joined dentaltown and began listening to the program every chance he got. After listening to the 30 Day MBA series a couple times completely though, Bob has developed a list of notes and questions for Dr. Farran to see if there are any updates, or additions that could be made to the curriculum now 18 years after its release.
VIDEO - DUwHF #970 - Bob Laing
AUDIO - DUwHF #970 - Bob Laing
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Howard: It is just a huge honour for me today to be podcast interviewing Bob Laing, thank you so much. He flew all the way from Ohio to Phoenix, Arizona, just to come on this show, I feel so honoured. Bob Laing was born and raised in Van Wert, Ohio, which is located in rural northwest Ohio. His father, grandfather, and great grandfather have all been dentists working in the same family practice, which has been serving the Van Wert community for over 80 years.
Bob graduated from Miami University in Oxford, Ohio in 2016 where he completed two bachelor degrees in Zoology and Political Science. He is currently a second year student at The Ohio State University College of Dentistry. After graduation, he plans to return home to work with his father and serve as a fourth generation dentist in his family’s practice. Throughout his experience as a front desk and dental assistant in the family practice, during his high school and college years, Bob developed a passion to learn more about the human relations and business aspects of dentistry.
During his first year of dental school, he learned about the ‘Dentistry Uncensored’ podcasts from a friend and classmate, and began listening and learning as much as he could from the many resources that ‘Dentistry Uncensored’ and Dentaltown had to provide. Laing discovered the thirty day Dental MBA program after he joined ‘Dentaltown’ and began listening to the program every chance he got.
After listening to the thirty day MBA series a couple of times completely through, Bob has listed out some questions for Dr Farran to see if there are any updates or additions that can be made to the curriculum now 18 years after its release.
So were you listening to thirty day MBA on Youtube or iTunes or Dentaltown?
Bob: So it all started because I had never listened to a podcast a day in my life. And I'm sitting home after our first year of dental school during winter break and I text my buddy Tom when I'm about to drive back to Columbus and I say, “You tell me you listen to these podcasts. So tell me what to listen to.” He just texted me right back “Episodes 648 Dentistry Uncensored. I'm like, okay. So I get on the apple podcast app and I'm trying to find Dentistry Uncensored, I find it, I download it.
It was an episode where you were talking to; I think the title is like ‘The Dental Coach’ and you were talking to a consultant, I forget his name. I was just so amped, I loved it. It was a great podcast, I liked the way you talked, I liked your attitude on things. So then I was like, “Okay, let's download more” and I listened to another one because it's a two hour drive back to Columbus.
Then I'm starting to see if there are other dental podcasts and there's all these dental podcasts that I had no idea about. I found the ‘Thirty day MBA’ was on the podcast and it was by you and I said, “Okay, let's listen to this” and that's how I got started listening to it.
Howard: The Dentaltown app now has thirty ... sixty dental blog ads. Do you have the Dentaltown app on your phone?
Howard: So the dentaltown -- if you go under –
Bob: This is where I found all the other podcasts; I went here and found them.
Howard: I know there are some dental podcasts that they put on iTunes? But so many of the dentists I talked to found it on Dentaltown.
Bob: Yeah it's in a list.
Howard: You have sixty, I mean there is ‘Dentistry Uncensored’, ‘Dental Success blog, ‘The Dentist Freedom Blueprint’, How to open a dental office. By the way, look at that ‘How to open a dental office’, how many views are on there?
Bob: Six hundred and eighty five thousand [inaudible 00:03:27]
Howard: Six hundred and Eighty Five Thousand Nine hundred and Thirty One views, podcasts are huge. Dentists Metrics, Dentist Implant Practices, Dental Op.
Bob: There is one called, I think its The Young Dentist, there are ones for dental students, people that just out of dental school too, it's great.
Howard: Yeah, I mean it's just amazing. So do you listen to them all audio or do you listen on Youtube channel
Bob: I listened to ‘The Thirty day MBA’ for the first time, all audio and then one day I was on Youtube and I typed in your name because I wanted to see if you had any videos and because I didn't know what you look like. So I looked it up and then I saw ‘The Thirty day MBA’ was on Youtube too and you had actually video recorded it and I didn't even catch that the first time I listened to it.
So then the second time I listened to it, I watched them all on Youtube and I got to see you with the slides and the slides actually help too.
Howard: So would you say I have a face for iTunes?
Howard: Yeah, not Youtube, that's what everybody tells me. But you know what, that’s the one thing that we do differently on our podcasts, 95% of all the podcasts in the world are just audio files on [inaudible 00:04:46]. But the two largest search engines are Google and Youtube and I think we are up to sixty five hundred subscribers on the Youtube channel. And what millennials tell me is they go home, they pull up Youtube on their iPhone, then if they have Apple TV they throw it up on their big screen.
Bob: That's what I do.
Howard: And same thing, we have four hundred and eleven courses on Dentaltown. What they say is number one, they don't want to go to a seminar that's eight hours long, they don't want to drive across town and go to convention, check in, register, blah, blah. They only like to learn about an hour at a time, so they do Dentaltown online CE on their iPhone, on the App, throw it up on their big screen and then if you have got to go to the bathroom or the phone rings, you can pause it. You never have to take notes because once you have the course you can watch it infinitely. So if you need a handout or something like that. It's very different than when I got out of school.
Bob: If you want to take good notes, the thing I've found the most beneficial is, I can just press back fifteen seconds. What did he just say? Okay, yeah let me see that again. That's the best part about the recorded CE classes on Dentaltown, the Youtube videos, Podcasts, is if I want to hear it again, I can hear it again.
You know some of our dental school classes, they have now started recording them and those are the classes I do the best in. Because I can actually go listen to the lecture again and actually get the information down that I want. So it's huge. It's a great platform.
Howard: Plus when you go to a convention and take a course and you show up in your underwear with a beer and a bowl of popcorn, I mean they are looking at you like something is wrong. You know what I mean? But at home, you can do that. How do you get four generations? That is so cool. Why do you think it's going from grandfather, great grandfather, grandfather, father, you?
Bob: I don't know, but my great grandpa was born in North Dakota and was going to Chicago. I don't even know how he got to Chicago and he saw a pretty girl from across the room and said that is the girl I am going to marry and he starts talking to her. I think his family was in pig farming, I think that's what it was, and they raised pigs and sold them and things like that.
So when he met my great grandmother, she was in nursing school or had just completed nursing school and she said, “You are going to have to get a real job.” He said okay, so I don't know how it happened but he ended up becoming a dentist and he did it, I think in like a two year program or something because this is --
Howard: What year do you think graduated from dental school?
Bob: I think he graduated from dental school, gosh I am not sure, but if I had to guess I'd say it was probably the late 1920’s, early 1930’s.
Howard: So do you have a museum in your office?
Bob: No, I wish we did. We have pictures, we have pictures.
Howard: Because the few dental offices I know, like Bob Ruwwe in St Joe, Missouri, his dad was a dentist, his grandfather was a dentist and he set aside an area with the antique stuff that his grandfather had. And it's not only so romantic for me and Bob because I knew his grandfather before. I think the last time I saw him with a patient, he was 92 years old.
Howard: It's just so cool because people lose sight, you know. They always think the sky's falling and then I'm like, do you know what dentistry was like a hundred years ago? It's like, people are so upset about this in 2017, it's like, do you realize a hundred years ago when there weren't vaccines, Spanish influenza killed 5% of Americans during the flu season? One in twenty dropped dead. During the civil war, one in every thirty Americans was killed. And today is worse? No.
But you should do that and patients think it's really, really cool because if you're fourth generation dentist, this is not a hobby for you. This is a life, a tradition.
Bob: It's a calling. I've never wanted to do anything else, you know, it's what I've always wanted to do because when I finally understood that it was a family business and like when I would sit at my grandpa's house and I knew that he was a dentist and my Dad was a dentist.
Howard: So did you ever know your great grandfather?
Bob: No, he had passed away before I was born.
Howard: And, and how old were you when your grandfather passed away?
Bob: My grandfather? I was eight years old.
Howard: So do you remember him much?
Bob: Yeah, I remember him.
Howard: Even at eight years old?
Bob: Yeah. I remember when they would babysit me, he would sit and he would watch my stupid cartoons with me, you know, my grandma wouldn't do it. She's like, those are stupid. And he'd sit there on the couch and I don't know, reading newspapers or something but he put his arm over me. So yeah, I remember my grandpa clearly from eight years old.
Howard: That's cool. So, I just got to live with three more years so my grandchildren will remember me. So now, going back to your great grandfather, if he graduated in 1920, was he originally an outdoor dentist? First of all, was he in the same town that you are in now?
Bob: He was in a little town, an even smaller town just north of Van Wert, called Ohio City and it's not a city, it's pretty small. But they ran an operation, I believe out of the house, like out of their house and that's where he worked. Then my grandpa went to dental school. He was the oldest of, I think they're, gosh, my, my great aunts would be so mad at me. I think there were six kids and so he was the oldest of them and he came back and he said, “Okay Dad, I want to work with you.” This is my grandpa wanting to work with my great grandpa. My great grandpa said, “No, here are the keys, I'm leaving, I'm going to Florida.” and he moved to Florida with two of my great aunts and they went down there and now they both married people. He taught at the University of Florida.
Howard: Dental School?
Bob: Yeah, dental school, that's where my great grandfather taught.
Howard: Your great grandfather did?
Howard: University of Florida?
Bob: Yeah and then he moved back to Ohio after teaching, after his two youngest daughters were able to go through school for free at University of Florida. Then he came back to my grandpa and said, “I want to work with you son” and my grandpa was like, “This is my practice now, I don't know how I'm going to fit you in here.”
My great grandpa kind of got pissed and he went and he opened his own office, so one time in Van Wert, there were two Laing’s running two different offices. My old great Grandpa, with like one chair and then my grandpa running the original practice. Then he retired after awhile but yes, so he eventually ended up moving back to our town, our hometown in Ohio.
Howard: So the most interesting conversation I ever had was in St Joe, Missouri with George Ruwwe Senior, then his son. When I met him, grandpa was like, I don't know ninety, I think I knew him for like, I don't know, eighty-five to ninety or eighty-seven to ninety two, something like that. And then his son was a practicing dentist and his grandson was a practicing dentist.
My jaw almost hit the floor because I said to him this silly question, I said, “So what was the greatest invention or what was the greatest thing that ever happened in Dentistry?” Knowing he was going to say the high speed handpiece because in his basement he had all the old jack rabbits and me and his grandson, are the same age and we were playing with jack rabbits and he gave George Ruwwe Junior one of his jackrabbits, those were really fun. So I knew that was going to be the answer. You know, what he said to me, the answer was, The Great Depression.
Bob: That was the greatest thing to ever happen to dentistry?
Howard: And I said, “What do you mean? He said, “I graduated in ’27, we were all outdoor dentists, we had a barber stool, we cut hair, shined boots, and we pulled teeth. The anaesthetic was whiskey and during prohibition we had it in a medicine bottle, we didn't have it in a liquor bottle and then nobody enforced it with the dentists because they all felt sorry for the patients. So you would give them teaspoon after teaspoon of whiskey until they vomited and once they vomited they would pull the tooth.
I don't know if you've ever been hammered before, but you know you can't feel anything. But he said that in ‘29 the market crash and they thought well just the rich people lost their money it didn't affect any normal people. But ‘32, you know, it took until ‘32 to trickle down and ‘32 to ‘36 was the great depression.
All these stores went bankrupt, I mean we lost a third of the banks and so the rents fell so cheap, they damn near went to zero. Everything is being boarded up and they were like, well, let's board it up and it's minus 20 outside can I move inside the boarded out building? So rents fell so low they moved inside and he said, “You know, when we moved inside, we became professionals and that's when we quit shining shoes and cutting hair and wearing white jackets and saying, no, we're no longer barbers and shining your damn boots we are inside, we are indoors and we are doctors now.” He said that moving from outside to inside was what made the sovereign profession of dentistry.
I was just like, “Wow, yeah, that is wild. And now people, the sky is falling because of dental therapists and PPO’s. Its like, “Shut up dude, you're inside with air, you have central air inside and running water and clean toilets. So I don't want to hear your whining.”
So a lot of kids in dental school, they are torn because they're like, “Wow, my mom's a dentist that's why I'm a dentist. So I want to go back and work with my mom. But god, do I really want to work with my mom?” Because I mean, it's tough, you are business partners and he is your dad, so how do you emotionally -- is it easy for you because you had a really functional relationship with them or do you just realize there's pros and cons and you're good with it?
Bob: I have a very functional relationship with my Dad, which is great, but I didn't think about, I didn't even know about all the complicated things all through undergrad. And even during my first semester at dental school, I wasn't thinking about that. It wasn't until I started listening to your podcast, then other people's podcasts, then joining the Facebook group, when I realized there's got to be a contract, there's got to be a separation out of monies.
Like I didn't even know that, that all existed and thank god I finally found a real source of real life dental information rather than maybe the one dental business class I'll take because I would have had no clue. So I didn't really think about it now. Now that I think about it, I think it's going to be fine. I think it's going to be great.
I think that, you know, that that's the whole reason that I'm so into this is because I want to learn how can I make change because my dad's office still on paper charts, still old school radiographs, no digital radiographs and all the staff has worked there for at least ten plus years. So, I'm a young kid going in and I don't want to go in and try and change everything. I don't want to try and act like I'm, you know, I don't want to throw anybody off because I don't have any credibility.
When I walk in that operatory, just like you say, the assistant, you know, Connie, my dad's assistant for thirty something years, she's the one that when I walk out, the patient's are going to look at her and say, “Do I really need this?” So I'm learning so much from this about how can I go in and make the changes I want to make and make a successful practice. But also, do it in the most effective way possible.
Howard: So a couple of things I hope you picked up on, number one he said he has a functional relationship with his Dad, but you don't know what that really means, but what was a dead giveaway for me? How many staff does he have and how many of them have been there 10 years or more?
Bob: He has two part-time hygienists, one assistant, one receptionist.
Howard: And how long have they each been there?
Bob: The assistant has been there for thirty plus years. The hygienist have been there I can't say for sure, but I got to think they both ... one has at least been there for fifteen plus. I'd say they have each been there for fifteen plus would be my guess. And then the assistant is newer, but he's in –
Howard: You said the assistants been there for more than thirty years
Bob: Sorry, not the assistant, the front desk.
Howard: Front desk, that's 30 years? Then the assistant?
Bob: No the assistant has been there thirty years, the two hygienists fifteen plus but then the front desk has only been there for four.
Howard: Okay, so you said the new girl has been there four years.
Howard: Two of them been there fifteen each and one has been there thirty. So you're going back to a town and this is what you see all the time. So this is dentist is on wife number three and no one in the office has been there three years. And then here this guy has got people who have been there fifteen, thirty years, that is the first sign of functional.
There is something if you can't keep your staff, you can't keep your spouse, you can't keep your patients, you can’t keep your associates. So if your dad is able to keep an assistant there for thirty years and two hygienists are for fifteen, he has to be a functional guy. He has to be a given and take, get along relationship --
Bob: That is very much who he is.
Howard: -- relationship oriented. Not I will throw you under a bus to save a penny, you know what I mean?
Bob: He is not that way at all.
Howard: I mean it's the difference between the companies in Japan that make great cars versus American car companies. When Mr Honda owned ‘Honda’ and they went on to have a recession and they would have to lay off a bunch of people he said, “Well, I'm not going to do it”. So what did he do? He got a list of everybody that had bought a car in Japan and he would take his workers because the factory was shutting down. And he made them repair kits and he gave them surveys and data sheets. Then he said “I want you to go to Bob Laing, he lives in Van Wert. Is it Van Wert?
Bob: Van Wert, yes
Howard: Van Wert, Ohio. What is the population of Van Wert?
Bob: The city is about ten thousand and then it's Van Wert County and the county is about thirty two thousand.
Howard: And how many dentists are in Van Wert?
Bob: Six, that is the county, there are six in the county.
Howard: So he gives everybody documents. So they are coming to you, Bob Laing, you bought a Honda car five years ago and then will you please follow the survey? Is there anything that didn’t work? Well, you know the windshield wipers don't work. So you go out there and they fix the windows drivers, but then they'd write up a report for the engineers. So then the engineers are sitting there and they got two hundred letters come back in, and then they would say, well how do you think it should be fixed? Well instead of doing this, you should've made it like this or this or that and the whole car is made in one place. Whereas in America the parts are all made all around --
Bob: The tier one, tier two, the tier three factory, all of that.
Howard: And the engineers are in a different city, like Boeing. Boeing, airplanes are made in Seattle and the management is in Chicago, I mean how dysfunctional. That would be like you married and you live in Chicago and your wife lives in Seattle and your kids are all in Wichita, it's just insane.
When they were doing this report, the last question is “Would you like a new car?” And they would say, “Well, yeah, you know, I'm thinking about buying this, that”. Then when they had enough orders to start the assembly line, his workers would come back, they would fire up the assembly line.
So here's America, our sales are down and you have been with us for ten years, you have got a house, mortgage, all this stuff, now you are unemployed, your benefits run out in six weeks time, you're going to lose your house, lose everything, and then, and then a year later, “Oh no, we want you back.”
And then meanwhile, the CEO is making $15,000,000 a year in stock bonuses and Wall Street. And I mean, it's just ... I mean, gosh!
Bob: I agree with you.
Howard: And customers for life, it comes from employees for life. If you can't keep your employees, you can’t keep your customers and all that stuff. So, how many operatories does your Dad have?
Bob: Five. Two are hygiene specific and then three are operatories.
Howard: So there are six dentists in a town of ten thousand?
Howard: But the county has got thirty two thousand.
Bob: Yes and there are six dentists in the county.
Howard: So here we go with thirty two thousand people divided by six is one dentist for every five thousand three hundred and thirty three. So for the country where one for every twenty eight fifty, by the time you get within a mile of the ocean from San Diego to Monterey ... from San Diego to L.A on the beach, you are at a dentist for every five hundred people. Downtown areas in ... half of America lives in a hundred and forty seven metros and the average downtown metro is about a dentist for five hundred.
When you go to an area where there is a dentist for every five hundred, I mean a Cyclops will crush it. So you have got to pick your poison, I know a lot of you listeners are saying, “Howard, shut up you have said this a million times”, but listened to ‘Dr. Demographics’. I mean it's supply and demand and if you're coming out of school $350,000 in student loans, you go to North Scottsdale or you go to Venice Beach or you go to some of these areas. I mean, you either aren't a spender and you're going to live way below your means and it's going to take you ten years to pay off all your student loans and all that stuff. Or you are going to go rural and just crush it.
Again, if the dental school deans, who seemed to be very concerned about the rural underserved areas, I mean 11% of the counties in Kansas, Nebraska, and Iowa don't even have a dentist. But to keep accepting people into dental school based on what they got in their algebra, trig and geometry, which is total bullshit, no sense. It's piled higher and deeper, only an academic idiot or someone who works for the Pew association cannot figure this out, everyone else knows.
If you don't have dentists on Indian reservations except Indians from the Indian reservation, what's the chance that you would go practice on the Navajo Indian Reservation?
Howard: Zero, you don't even speak Navajo. Don’t you think a Navajo should live on the Navajo and who...? I mean, god, the Navajo know the Navajo. If I was Navajo, I would want to go to Navajo dentists, they speak the language. They would know our culture. They would know --
Bob: I’m rural I'm going to school in a city now. I want to go live rural again.
Howard: And why is that? Why did you not -- where is the Ohio State Dental school?
Bob: It's in Columbus.
Howard: Columbus and what is the population of Columbus.
Bob: Columbus, I'd probably say ... oh gosh, I don't know off the top of my head.
I'd like to look it up. I don't know, yeah look it up for me.
Howard: Do they still have that restaurant, ‘The Refractory’.
Bob: Oh yeah, you've been there?
Howard: Oh my god.
Bob: That place is rich, isn't it?
Speaker: Population is eight hundred and sixty thousand.
Howard: So basically I have seen three cool real estate deals in my life, like outside church. So the Catholic Church has lost a lot of property with all these lawsuits and settlements and plus downtown areas, the people went to the suburbs and now it's a decayed area. And somebody bought up an old Catholic church and turned it into a restaurant.
Bob: French! Amazing!
Howard: Oh my god! It's the coolest deal. I mean as somebody who went to Catholic mass every day from birth to seventeen, I thought that was the coolest experience. You know another cool experience? Water is eight pounds a gallon and there was this big old water tank deal and they didn't need it anymore.
They went to pumps or whatever and it was just on an old water tank.
Bought that, put an elevator to the top, cut out the deal, and made it a bar and restaurant and of course it has the best view because where do you put the water tank? Highest elevation because gravity's doing the plumbing and it was a bankrupt Watertown. What do you call it? The Water Tower. And where did you want to go after work to have is a couple of drinks and see the whole damn town and the storms rolling in? That water tower can be hit by a tornado, I mean it's built to hold eight pounds a gallon on this big tank, it's not moving. What was the other one I saw? But anyway, there have just been some really cool restaurants.
Most people would think if you were born and raised in a town of ten thousand, that when you go to big old city slicker Columbus with eight hundred sixty thousand people, you would never leave. So why are you leaving?
Bob: I liked Columbus, Columbus is nice. You know --
Howard: How far a drive is it from your house?
Bob: Two hours.
Howard: Two hours?
Bob: Two hours from Columbus back home. You know, when I was growing up as a kid, it was a huge treat to drive to Lima, Ohio, thirty minutes away and get Chipotle you know, it's like, “Oh man, we're going to go get Chipotle it’s going to be awesome.”
Howard: You know we just got our first Chipotle. Didn’t we just get it? How long?
Speaker: Maybe like two months ago, tops.
Howard: Two months ago, I didn’t even see it.
Bob: Now that is what I am saying, now there is a Chipotle on every corner in Columbus it seems like. There are things like that, but at the end of the day I want to know my neighbours. I want to do business with people that I know I'm going to see often or like I'll do business with a guy who's a lawyer and then when I need help with my will he will help me with that, I'll do business with somebody that works at the Performing Arts center and then when I think that there is something interesting that can be done there, they can do that.
You know, I just liked the whole idea that my home community actually feels like a community. You know, here in Phoenix, you always talks about how Ahwatukee is its own kind of town, you could say Glendale is so huge, but maybe there are areas of it and neighbourhoods. I liked that my whole town just feels that way and you know, growing up, my mom is from rural northwest Iowa and then my dad was born and raised in Van Wert and so they were both rural people.
So when my mom moved back there, she had no problem moving there. And as I was growing up -- and the biggest thing, my dad, his dad, my grandpa was a hunter. He liked to hunt, he liked to camp. He was an outdoorsman.
They didn't travel a lot; they didn't do much more than outdoorsmen stuff. My dad hated it, he was like, the thing that I'm going to do with my kids, they are going to see the world. So by the time I was 18, I had been like to like five of the seven continents, I had been all over the world. When I was 10 years old my Dad took me to Egypt and we climbed the pyramids and stuff. The coolest thing about that Egypt trip is that the US declared war on Iraq, I think March 23rd and our flight took off March 24th, 2003.
So we were there right after that war started and we were supposed to be this big tour group of like twenty people, me and my dad are the only ones that showed up and it was great because I had a tour guide all to myself. We had this bus all to ourselves, coolest thing I ever did in my life. So my dad has taken me all over the world and I've done all these cool things. He just last year was the President of the Ohio Dental Association --
Howard: Damn! For the whole state?
Bob: Yeah for the whole state.
Howard: Your dad was?
Bob: Yeah and that's how I figured out that you're going to be at our ODA convention, I think it's like next year or something.
Howard: I am?
Bob: Yeah. So I'm excited to –
Howard: Is that in Columbus?
Bob: Yes in Columbus?
Howard: Well will you take me to The Refractory?
Bob: Yeah, let's go to The Refractory. That would be so great, I haven't been there in a long time because I only go when Dads --
Howard: Well when I come in it will be with Ryan the three of us can go to The Refractory. That sounds great.
Bob: Let’s go that sounds great. But yeah, so you know, I just like the hometown feel of working in a community and the people that I'm working with. You see, the other thing is the business is super attractive because the patients that I'm treating, most of them have been coming to us for 80 years. Their grandparents, their great grandparents, and their kids that is exciting to me. I don't think there's anything else more meaningful to me. So like even when I get to assist and people are looking at me like, “You are going to be my dentist in the future” you know, that feels so good, that's so exciting. It is so exciting to go and run a family business and hopefully make a lot of changes to it for the better and make it grow even more and serve even more of the community.
Howard: Well, you know, that's the heritage of humanities and culture is family. It’s like if you were born in Asia and your father was a goat farmer, a quarter of the people would be goat farmers. Even the last names like Smith, you are a blacksmith. I mean Farran means a baker so when I lecture, me and Ryan have lectured in, how many is it five? You have been to six?
Speaker: [inaudible 00:27:39]
Howard: I mean any dental school you go to and say “Raise your hand if someone else in your family is a dentist?” Almost a quarter to a third of the hands go up. And we have been in homes where they have the nuclear family, where the whole tribe lives together. We were at one house in San Paulo, thirty five dentists in the family and I think we were in India, the record there was twenty seven dentists in a family and they all lived in one big communal home.
I mean it's not like the American zone is where it's at home with defined deals. It would d be like this stairway and that door.
Bob: My hometown has a sister city in Japan and I've got to go there twice and like stay in homes with families there. And that's been really cool to stay in like traditional. This is in like rural Japan, not in the city, so to see how the grandparents and maybe even uncles and aunts all lived together in the same home and how that works is really, really cool.
One point I wanted to go back to is you made a point about how, like if you are Navajo you're going to go work on the Indian reservation and things like that. Something that's been really exciting about my college, The Ohio State College of Dentistry is that, I don't know if this was our Dean or if it was a whole group, but next year's class and for all the classes that come after it, they are adding ten spots in the class that are solely for people who are from underserved counties in Ohio. So those are the only people that are going to get into those ten spots because they've done all this research that those are the people that are going to go back.
Howard: They just need to do it for all the dental schools for ten years.
Bob: Yes, that's what really needs to happen.
Howard: And with MD’s too, registered nurses, even engineers. Your Dad liked to travel around the world, my Dad like amusement parks and places that made stuff. So every family vacation we would go to St Louis, we would go to like ‘Six Flags’ over in St Louis then go to the Budweiser factory, I saw Coors beer made. We went to Detroit and actually the station wagon we bought, Dad only bought it because they set up a golf cart tour, so he could pull his seven kids down the assembly line while they are making our station wagon where we saw it come off. It was damn cool and I saw cheese and just, I mean, he just loved to see stuff made.
So for my kids, how many places did I drag you to where they made stuff?
Speaker: Oh tonnes.
Howard: Tonnes. On one vacation we took an RV and we drove from Phoenix to San Diego, then drove up all the way up the coast to Canada. So our vacation was the west, the Pacific Ocean, from Mexico to Canada. And we'd stop at like L.A at 1-800 dentist and Glidewell and Jim Glidewell was so adorable, here he is giving my four little baby munchkin boys a tour as if they were a dentist.
We went to see Kevin Austin's where they made Adec dental chairs where at one end it was just raw wood and pellets and plastic beads. And at the other end came out A- deck chairs. But in every one of those small towns, I asked him, what is, what is your biggest problem for growth thinking is it competition,
Is it overseas, is it price? It was always attracting engineers, talent, programmers and again, all the schools you're applying to engineering school, what are they looking at? Your grades in calculus and physics and geometry, when here are these towns of ten thousand making A- deck chairs.
We don't have any engineers and if you'd accept that kid for an engineer from our town that maybe only had a two point eight, grade point average but he could come back and we grow our business. But the number one limiting rate of growth in every single dental company I'd ever visited in a town of under twenty five thousand was HR. Because the universities are obsessed with having the highest scores of acceptance so that on US news and World Report, our university ranks number one.
They ought to shut down that magazine and shut down that list and put the rural community who pays half the taxes, they needed to make it a priority and it's just sad that they couldn't do that.
Howard: So how many operatories does your dad have?
Bob: Six, on no, five. Three operative and two hygiene.
Howard: Three op and two hygiene and does he own his own land and building?
Bob: Yes owns his own land and building. It was an old Wells Fargo bank, Wells Fargo wanted to move so he took the Wells Fargo bank. Kept the ATM on it, so there's a Wells Fargo ATM so we can go right over, put his money in and also they pay him rent to use it.
Howard: My gosh in 2008, it was so cool. So many of those banks went under and they had too many locations and I know dentists who got an old bank, the banks that come in, in Phoenix and buy that hot intersection corner for $400,000 to $600,000, put a $4,000 to $5,000 building on that and then they would pick it up in distressed properties. They would pick up the whole thing for five hundred thousand but then signed the bank a ten year lease to keep the drive through, so they have the ATM and then the smartest ones and I noticed they were always Indians. American Indians, because that's the engineering mafia of America, most of your engineers.
So the Indians through a friend of a friend of a friend knew someone in the cell phone tower business who then put a cell phone tower on that bank building for Verizon or what have you. And I know a couple of dentists who bought the building and after they signed a 10 year lease for the ATM machine and the 10 year lease for the cell phone tower, were already like $5,000 month cash flow property. I mean it's like if they didn't build a dental office they were already making 60 grand a year. I mean how cool. So the only thing you're missing now is a cell phone you got to get a cellphone tower.
Bob: Thing is in my hometown, there are tons of windmills for like generating electricity. The giant windmills because it's very flatland. So I want to get some of that because the big investment that my dad made was in farmland. So we have about 200 acres of farmland now. And I really want to get some windmills on the farm land.
Howard: What are they growing on the farm?
Bob: It alters year by year for the soil. So we grow soybeans and then we'll grow corn and then sometimes we'll grow wheat but not wheat not very often.
Howard: So soybean, corn, and what?
Howard: What's the most profitable?
Bob: Soya bean
Howard: Soya bean is the most profitable? But you know what? I think those big windmills, I always wonder, are they doing that for physics and electricity? Or are they doing that to maintain that electricity made on a grid. Because when I grew up in Kansas, all the windmills were smaller than this table, to pump water out of the ground for cattle and horses. So I think the real money would be, why doesn't that make electricity?
Because then you could have one on every house, but I think maybe I'm jaded, but I think they want to build all these monster ones so that you still have to use your utility company, APS and SRP and all these big deals. But to me it seems like, I'm a dentist I don't know this space, but I don't know if it's because they are trying to maintain their, need as a utility.
I always thought, “My god, man, why don't I ...” I mean Kansas there are windmills everywhere, I love windmills. My mom is addicted to lighthouses, she travels on vacations just to see a lighthouse and get the miniature lighthouse memento and her home is cluttered with lighthouse trinkets.
I love windmills, but I always wonder why doesn't every little house have a windmill? I love what Tesla is doing where, instead of putting
those ugly solar panels on the roof, they're making them in to tiles. So now there are homes that have roof tiles where the average person driving down the street doesn't know, that's all solar.
So the aesthetics is ideal, but there is no sun at night. So if it seems like if you had solar during the day going into a Tesla car battery in your garage and a windmill on the top of your house --
Bob: That is the real system.
Howard: -- with wind blowing. Have you looked into the windmill deals?
Bob: Oh yeah.
Howard: There are probably a lot of tax credits on it.
Bob: There are a ton of tax credits, they pay you a yearly amount to have it, it would be a great thing to get into.
Howard: So are you and your Dad going to do that?
Bob: I don't know. We tried when it first happened, so now when they want to do another instalment.
Howard: It's the next big thing. I think the next big thing is going to be driverless cars. I think the next big thing is going to be getting off the grid for electricity. I think individual houses are going to have their own grid and then if everybody would open up, their wifi finds instead of having a password, you wouldn't even need Verizon.
Howard: I mean, I don't know why they just don't -- because if you have a password because you're trying to protect yourself from a hacker, ask a friend of yours that hacks, how long it takes them to get into your wifi, what do you think he will say?
Bob: He will say about ten minutes.
Howard: So everybody has to use Verizon because everybody doesn't take out their password for the wifi and the hackers.
So what questions did you have for me?
Bob: Okay so I took a lot of notes over the ‘Thirty day’. So essentially what I'm going to do is just go through them and see, because the whole question, that original email I sent you was have you done an updated lecture on this MBA?
I get an email back from Ryan first that, “Oh, I think this would be a good subject,
let’s do a podcast on it”.
Howard: really Ryan?
Bob: Then ten minutes later I get email from you saying “I don't think much has changed, business is business.”
I was like, “Okay, that's funny. So I guess the thing is --
Howard: But it’s true, what has changed in geometry, trig and algebra?
Bob: Not much. So when I was sitting here actually trying to think of some questions, it was hard because I'm like, a lot of these principles still kind of count, you know. If you had to say, what do you think? Do you think there have been any major changes in global healthcare, macroeconomics or dental macroeconomics since the time you recorded?
Bob: What would you say they are?
Howard: Okay so --
Bob: The big thing you talked about, it's like the single high priced market stratification.
Howard: Yeah, I think, I think ... gosh I am never supposed to talk about religion, sex, politics or violence.
Bob: This is ‘Dentistry Uncensored’.
Howard: This is going to get pretty political, but you know, communism and socialism is really a failed ideology, but a lot of people on earth don't believe that. Let's take housing, we look at housing and there are people living in trailers, apartments one, two or three bedroom, condos, one bedroom house, two bedroom, the most liquid house in Phoenix is a three bedroom, two bath, you sell that in a week.
By the time you get to five bedroom, five thousand square foot or greater right now for like a year two, you having an illiquid asset. These NBA and these NFL players, one of the single biggest mistakes they do is, now they are making $10,000,000 a year and in their trophy wife decides to build this thirteen bedroom purple house with a nine car garage with these weird pools. What they don't realize is people with that much money want to build their own stuff; they don't want your stuff so they are all illiquid assets. But the market segment is so broad.
Bob: Even more so today than when you were --
Howard: For housing and cars it’s the same. I mean, look at cars, you have a driverless car, you have a two seater, you have a three seater, SUV, a truck, all the way to a Lamborghini. There are like fifteen, twenty different price points for a house or a car.
And then government idiots think that health care, there's just going to be one thing. So when you, when Jimmy Carter built the Department of Education, let's just say he built that for the Department of Fast Food Hamburgers. Just pick your friends and say it was McDonald's. That means there will be no Burger King or Wendy's, no Carls Jr, no In and Out burger, no, White Castle burger.
So it just kills all innovation and every time the government gets involved they kill all innovation. Innovation stops, service stops. I think what people can't grasp on healthcare is that one of the reasons dentistry has been so good is because let's say someone's going to lose all their teeth and the only way to save them is all on four, two arches, 25 grand an arch.
He would say I just don't have $50,000 for an all on four. Well then let's get an all on none and do a full mountain. What does a full set of dentures cost in your town?
Bob: I think it is twenty five hundred bucks.
Howard: So we have the $50,000 Mercedes Benz car just like you can buy a $50,000 Mercedes Benz, but we have a $2,500 used car, we have a $2,500 denture and there needs to be that type of deal.
Howard: You have government insurance where, what's the co-payment when grandma goes with her Medicare to the hospital?
Bob: I don't know.
Howard: None, so she has no skin the game. So she's in Columbus and a new set of a new set of knees is going to cost 50 grand, but if she had to pay 5% co-payment, her co-pay would be $2,500. $2,500 is lots of ground, so she might be calling Van Wert, Ohio and find out that the guy in Van Wert charges $35,000 for a set of knees and now 5% of thirty five thousand is seventeen fifty.
So she's like, well my gosh, twenty five hundred minus seventeen fifty, I'll save $750, driving two hours to Van Wert and then they'll have a deal with the little bed and breakfast next door and a hotel deal. So it's going to be different breaks once because you might value two brand new knees, more than me. I might say I don't want you to screw with my knees I'll just eat Advil and Ibuprofen.
But in Healthcare, in government they still don't understand that every person has to have skin in the game. Like you go to every free dental clinic in America and you'd go in there --
Bob: How many missed appointments that are there?
Howard: 50% no show. Well, if you had to take $5 to make an appointment and if you cancel, you don't get $5 back and the next appointment you make it will be ten and the next one will be fifteen and twenty until you price them out and make an appointment. Then all the liberal socials are like “Well, you can’t charge them $10 because he's poor”. It's not right or wrong, you don't manage humans that way, you don't manage animals at the Yellowstone National Park by giving them free food and a dog house to live in because now that wolf doesn't even know how to hunt. American manages their national park animals better than their own human animals.
Bob: In day two of the Dental MBA, when you're talking about dental macroeconomics, you were talking about this, about how the single high priced market strategy, market segmentation is kind of making it hard for people to get taken care of in all aspects and that's when government gets involved and that's when it gets inefficient and that's what would hurt us. And you said that as a dental profession, we need free enterprise to get involved.
And you talked about managed care and HMOs. So from 2000 to today, what is the progress on free enterprise getting involved on increasing access to care? What are your thoughts on the dental macroeconomics and you know about the --
Howard: The number one problem in Healthcare, macroeconomics, dental, medical, pharmaceutical, is that when free enterprise doesn't serve a large group of people, it's a market failure. So then those people ask the government step in. So when you don't take care of business, you ask for the governments help. Same thing with policing, police departments are notorious for not knowing. [inaudible 00:44:11], my two older sisters are Catholic nuns. All the priests knew 1% were bad apples, but they didn't say anything. So then law enforcement had to come in. Penn state, same phenomena everybody at Penn State knew what was going on, but they didn't do anything. What's the latest, Harvey Weinstein, everyone in Hollywood knew what was going on.
So tribes don't turn on themselves and then dentists get mad when some dentists looks at just some horrific dentistry and says you need to go to the board. They're like, “Dude, but he's another dentist”. Well, do you want to police your own dentist? Or do you want a third party, the government, the board to get involved so you have to be strong.
So the biggest problem with dentists is they don't treat the poor because when they treat the poor, they want to go in and make a Cadillac and they are getting reimbursed for a used car, Medicaid. And so 1% of dentists don't do amalgam? They go, “Oh you know, I'm morally, ethically, I can't do an amalgam.” What would Jesus do? Jesus would not do an amalgam. An amalgam lasts thirty eight years, it's antibacterial and it costs a buck.
But now you're going to do a composite and got to numb that place, rub it down pack cord, it takes a freaking half an hour and then Medicaid only gives you a little bit amount of money, so you lose the money, so now you don't do Medicaid. Well ask all those poor people if they would have rather had a poor amalgam. And the other thing, I'm a dentist; I've been talking to you for fifty minutes. I still haven't seen a bicuspid or a molar, I just see six teeth. So who gives a shit if number one and two are black. When dentists tell me, “Well, you know what, I don't Zirconia in the molars is not translucent enough. I like emax.” It's like, why don't you just say you have a head injury.
Howard: Do you think anybody's ever seen a man's molar that emax or not? Now if you are a skinny girl, low fat body, big smile that showed gums and you were a model and you're making a happy face on Instagram maybe. But for every man on earth, no, I mean they're just irrational. So, back to market segmentation, when you say you can't take Medicaid or Medicare it is not Medicaid's problem. It is that you are trying to sell a gosh darn Cadillac for the price of a Chevy.
Hygienists if you say you are your hygienist, you know, Southwest Airlines takes its total costs Planes, labor, pilots, gas, buying the plane and they reduce it to flying a seat through the sky for a mile and they say this is how much our chair costs for a mile.
We have been doing that for our dental chairs for thirty years this is how much our room costs for an hour. No dentists knows the cost to fly that plane through an hour. So if this room costs $80 an hour and this insurance is only going to give say $40 for a cleaning, then the problem isn't that they don't pay enough, but the problem is that you don't tell your hygienist, this is a thirty minute cleaning.
And she says, “Well, we don't do thirty minute cleanings.” We only sell a Mercedes Benz cleaning.
Howard: Well that is not the poor people's fault. That's not the insurance company's fault, that's the hygienists fault. Well, why don't you do this? The dentist doesn't set up the room, seat the patient take the x-rays. Why don't we take the hygienists and get her a $10 an hour helper and the $10 helper can set up the room, go get the patient and go seat the patient and then you come in when you prepared, she will chart you do the scaling and then when you're done you leave.
She will go over there and she will polish. She'll get the fluoride treatment, write up the chart, she will dismiss them and she will clean up there. Can you change out your Lamborghini, Mercedes, Cadillac for the price? And they said, “No, can't do it I am extremist, that's not dentistry that Jesus would do and not going do it.”
Okay, so now you have a market failure so now when you get ten, twenty, thirty forty million people without health insurance or dental insurance. Then Bernie Sanders starts walking around saying, “We will give it to you for free” even though there's no sense of history.
And I'm like, “Hey Bernie, what does that mean? Does that mean you're going to arrest all the dentists and hygienists and take them to dental prisons and lock them up and we have to work there for free?” Then they say “Oh no, no, no, we'll still pay you”. So where is the money come from? Pluto, Krypton?
So what I suggest for industries is not give the government a reason to get involved because it all comes out at the end of the day as checks and balance. Because if you had no checks and balance on the dentists and they owned all the insurance companies, they would want to come in every Monday and do one crown for $25,000 and then go home for the rest of the week. They don't even realize that.
They will say, “Well why do the dental schools keep increasing classes?” Well, if you raise your tuition $10,000 a year and then still sold out your next year's class and then the next year raised it $10,000 and sold out your class. I mean what if the dentist, every time they doubled their crown fee, they had no impact, there was no price elasticity, the dentists would keep raising their crown fees, but they are mad at the dental school Deans for doing it.
Bob: So, one of the big things that you highlight throughout a lot of the of the ‘Thirty Day MBA’ is you talk about your wage related profit sharing that you use, can you review that for those out there that haven't listened to the program that would benefit from learning about that?
Howard: Basically, if you go to school four years to be an engineer or a registered nurse or a hygienist and your sister went and got a job as a clerk at Starbucks. They have different amounts of drive and ambition for money. So the number one thing on bonuses is that the lowest paid people aren't driven by money. They are driven by love, words, you work through lunch, here’s movie passes, Starbucks pass or here is 20 bucks.
They like their environment, but as you make more and more money, like for instance, in a dental office, your associate dentists is the most motivated by money. They will jump through fire hoops to get a bonus. So what I tend to do is 20 years ago, I used to have an even bonus system and then it took me a long time to realize it just didn't matter. So what I did for the lower waged people is a cash bonus.
Bob: You had your three profit goals, right?
Howard: Who is the guy that had at one time, nine out of ten heavyweight champion boxers of the world working for him, he had the white hair, straight up?
Bob: Oh my gosh, I know who you are talking about, but I don't remember his name.
Howard: Who is that guy? He had Mike Tyson, everybody ...
Ryan: Don King.
Howard: Don King! Don King taught me, I mean, I learned this from Don King. I learned it from his movie and that is, there would be all these rich sports people saying to these poor kids who weren't financially literate, who didn't go to college and grew up in a boxing gym, the wrong side of town. They would say, “Well, if you do this, you know, you're going to fight. I'm going to get you all this money.” And then thirty, sixty, a hundred days from now or the fights not for six months, you are going to get this big pay cheque.
Don King would say, “Well, you sign with me” and they would say, “Why should I sign with you?” and then he would hand them a sack. In the sack would have $50,000 in twenties. They would go, “Holy shit,” and they’d sign.” So what I would do with the assistants is, I went every month and I would say, “Okay, here is what we have got to do to pay your bills.”
You get a salary, do this amount, we collect this amount I will give you one Benjamin, this amount two Benjamin, this amount three Benjamin. 80% of the team they would crush it and then when I gave them three Benjamins, see if I gave them a pay cheque and then took out taxes and then I gave them a deal. Well they are married they go home and it goes into the joint checking, it’s not fun and sexy.
They would make bonus every time probably eleven out of the twelve months, they make the bonus number, they get three Benjamin's. Those three Benjamin's made them more excited just like a heavy weight championship guy getting a sack of cash and then all the professionals in suits and ties are like, “Why would they go with Don King? Why? He's screwing him on the deal?” Well maybe in your mind, but maybe this guy today, what he wanted more than anything was to go home to his lover with a sack of cash.
Bob: Because just like you said, billionaires focus not on trigonometry and calculus and all this, they focus on people and knowing what people want. And that's very much a, “Who are these employees?”, “What do they want?”, “What kind of people they are, this is what they want.”
Howard: But I have got fifty people, right? And my management team, I got seven department managers and that's where all the big bonus money goes. Because those people like today is Saturday, I'm working, I know all of them are working. I mean these are people that are sending me emails on Sunday night. So once you get to six figures, those people are totally, and a lot of people look at them and say workaholics.
A lot of people say, “You spend so much time on Dentaltown, how do you do it?”
Well, I don't watch TV, so when I look at the data on America and Americans are spending about four hours a day on TV. Why? You know, I didn't watch an episode of ‘Friends’. I didn't watch ‘Frasier’ or --
Bob: ‘Game of Thrones’,
Howard: I don't know what ‘Game of Thrones” is. Like when I emailed you back and made a relationship with you, that's more fun for me than watching ‘Game of Thrones’. I just don't get it like I have had three dentists this week ask me if I wanted to go see The Star Wars movie with them and I'm just like, “okay, I'm sure that's fun and that's cool, but I'd rather talk to you for an hour and a half than watch…”
Bob: You are in dental mania. That's what you tell us you tell us that we need to get into dental --
Howard: I just think it’s more fun. I don't think it's workaholics, I mean I have friends that are full blown addicted to Netflix and they will come in to a series and it will be like seven or eight seasons. I don't know how many shows are in the season, but they will sit there and say, “Oh my god, I started watching this and it was so amazing and it was like four hours a night after work and then eight hours a day on Saturday and Sunday and it took me like two weeks to kill it” and I'll say, “So now what are you doing?”, “Oh I found another one”. And I think that's cool.
I mean I only have that relationship with the NFL, I mean, I can never make fun of anybody watching Miami Housewives because at least with Miami Housewives, you know why Charlene is mad at Jamal, I have no idea why I want the Cardinals to kill the Raiders, but I want them to. So it's my silliest, stupidest vice, but I love it and I wish I actually had that but what other questions?
Bob: Okay, so Day Six is all about group practice. How great group practice is and you talk about AFTCO. Is AFTCO still the powerhouse, is that the company that I should still be trying to make our relationship for the future, when I want to sell or transition or something like that. Who is the powerhouse in acquisitions and things like that in that company?
Howard: AFTCO stands for Alan F. Thornberg and he wanted to have a little boy named Alan Jr, but it was a girl, so her name is Alana, love her to death. I would say that those questions are so, politics.
Howard: It's all local.
Howard: So what I would do is I would, the reason I built Dentaltown, I would get on Dentaltown and I would be transparent. That's the problem that most monkeys don't have, most monkeys don’t like checks and balances and they don't want transparency. They want everything private so they're going around whispering to their little friends. For 20 years I've seen dentists come out of school and sit there and say, “I'm going to buy a practice in Missouri, who is the best broker? And some guy might come on and say” AFTCO”.
And then the next guy says “No, no, no, no. AFTCO believes in dual representation. So they just want to get the deal done.” So they are representing the buyer and the seller, that is no one is representing you, you want someone to represent you. Now Alan F. Thornberg would tell me I'm an idiot, and he has sold over a billion dollars in offices and nobody's sold more dental offices than Alan.
But what is cool about Dentaltown is you are not taking my word for it. You are not taking Alan’s word for it; you are taking a community's consensus on it. And then what happens is you flush out a lot of talent, like some dental consultant in Ohio that you never even heard of gets on and says, “You know what? Here's what I think I think you should use, Mr Cranston, he was born and raised in Columbus. He sold all these offices.”
I'll tell you another thing; I have watched some of the greatest dental legends. A lot of the legends today grew up on Dentaltown. Sameer Puri, the CEREC master as Spear center, Tarun Agarwal. So many of these guys, and the only reason they made their own luck is because while almost everyone else just reads on Dentaltown like a newspaper. They had the foresight to say, “Why do I care what anybody thinks of me? I'm going to go on and ask a question.” “Hey, my name is Sameer Puri, I'm thinking about doing this or that.” He was a young kid out of school and the whole fraternity of Dentaltown is trying to guide this kid. Now he went from a baby to the top of his game, inside of 10 years, same thing with Tarun Agarwal.
And then as everybody is watching these kids and falling in love with them, everybody is helping them, everybody is opening doors for them, so they just rise up. We call them, on Dentaltown, super users and it is not just on Dentaltown, it is research super users. So if you go into a programming community, electrical engineering community, any community. Even Facebook say you have five hundred friends, five of them are the ones posting all day long and most of them are lurking except for baby on their birthday or their anniversary dinner.
Bob: So the biggest thing that has probably changed since when you recorded this is there are things like Dentaltown now, there is Facebook, there are all these ways to now communicate within the entire community.
Howard: Here is a guy who's not sure if he's a lurker or a super-user he is like, “How much do you think I should buy a dental practice, would you say it is one year sales or six times EBITDA, how would you value it?”
Here is the smart guy “Hey, my name is Bob Laing. I'm going back to Van Wert, Ohio. There are two practices for sale this one, here is the address, here is the broker, it collected this much money and it is selling for this much and the other one is at this address and it is asking ...” totally specific.
So now people out of the woodwork are saying, “Dude, look, I practice in the next county, you buy Adam's office, you're going to be doing warranty work for 10 years. Make sure in your contract you say, if this work is failed and I redo it, you'll put a price and why don't you put this much in escrow?” Or the other guy might say no. But it is the people who are the most specific and transparent, basically, here is the way I rationalize my brain.
A lot of people say that they don't post because they are afraid someone is going to say something and it's going to hurt their feelings. So humans are two million years old, a hundred billion already died. There's seven and a half billion alive today, so 6.5% of every human that has ever lived is alive today and the other 93% are dead.
You are never going to make eye contact with 99.99 % of all the humans live. So you are going to spend your whole life worrying about what everyone thinks when 96% of everyone is already dead and you will never meet 99% of the living ones. But you are afraid to ask a question because some guy might say something and make you run into the other room and cry.
It's not that I'm thick skinned it’s I don't give a shit. I don't put it in perspective. I don't spend my whole life wondering what Charlie Rose thinks, I don't care. It's not that I don't care and I don't have feelings. I'm so damn busy I don't have time to think about what Mr Cranston thinks of what I said on podcasts 250. If you think that I'm dumb enough to think that you agree with everything I say, I mean, the only thing that I want you to agree with is that there's only one thing I can tell you that is true. That is, I'm the only normal dentist on earth so just remember that.
So if you disagree with me, you are abnormal, you’re Doctor Abby Normal. So my advice to graduates is, the most successful dentists who reached all their goals and dreams the fastest, easiest, highest quality, lowest price. Were on the message board transfer, but you know, where they will post, they will post on Facebook. Like how many friends you have on your Facebook?
Bob: I don't know, I'd say two thousand maybe.
Howard: Okay so Dentaltown has two hundred and fifty thousand dentists. So in scales of economy is that one special dental consultant in Ohio more likely to be on Dentaltown or in your Facebook group? It is that person who knows that if you buy that practice, that guy has been to drug rehab three times. He has got three ex- wives and he has been using [inaudible 01:02:30] root canals, and they are all short, you know what I mean? I mean there are scales of economy. Then here is the other thing on Facebook if you are a cosmetic dentist, you believe that amalgam is evil and only Satan uses it and then you go on the group and say, “Well, you should have done an amalgam.”
I mean, come on it's a class five, she has Alzheimer's, she is not aware of her existence, she doesn't know her children’s own teeth and an amalgam class five root service will probably last five years and your stupid inert plastic cosmetic, translucent bullshit fellowship in the academy of cosmetic dentistry is full of shit.
Well they will just delete you, so they delete everyone until they are in their Fox News bubble. Or their CNN bubble or their cosmetic dentistry bubble? Whereas in Dentaltown, you come in here in your little bubble and you are like, “Well, I don't believe in amalgam” and then the next guy's like, “That's because you are an idiot”, and then blah, blah, blah, blah, blah, and then it's like, “Oh my god, I'm butt hurt. I'll never post again. Someone said something mean”.
Doctors and physicians and lawyers they have big egos. So Dentaltown is a brutal, brutal force for someone who, all their employees call him Doctor, they go home, they are the bread winner, everybody caters to the King. Then you get on Dentaltown and some other dentist goes, “I'll call you o your own shit dude, an amalgam class five on a dementia lady who has rheumatoid arthritis and can't brush her teeth in a nursing home. Your composite will last six months, my amalgam last five years. So I am ten times a better dentist than you and then drops the mic.
Bob: Okay, two more subject areas. I think one of the biggest ones that I think could use an update from 2000 to today is you have one where you talk about creating a management information system. So now with all these different software with Dentrix, Eaglesoft, and then you have mentioned, did you transition to Open dental?
Howard: Yes I did.
Bob: So can you talk about it, to educate me, you know I grew up helping in a dental office yet I really didn't know anything about what kind of reports I should run. I'm the kind of person that doesn't know how all these different systems work. How do you use your Open dental? What are the most important reports? How would you update the creating a management information system segment?
Howard: So programming is either closed, like Apple. In dentistry, like [inaudible 01:05:01] their CEREC machine, its --
Bob: Every part of it, there is no editing.
Howard: And it does not work with any other system even when they say it is open, it's not, then you have open systems like Google. Now there are pros and cons to everything, with an open system when I update the Dentaltown app and the Orthotown app on the Google android store it’s approved in a minute. When I send in the update, to the Apple app, it takes a long time and they are nitpicking and they are doing this. So there's closed and open, there are pros and cons. It's not right or wrong but just pros and cons.
Dentrix is a closed system, so is Eaglesoft so the dentist has all their accounting over here. We use Peachtree, there is Great Plains accounting that Microsoft bought. There are all kinds of accounting software; programming has gotten faster, easier, cheaper. So like say you were a programmer you worked for me and I tell you to write this source code.
First thing programmers do is they go to these programming websites and communities and searches “ Does anybody have a source code for a shopping cart, Checkout, like an Amazon type feature?” They are going to cut and paste. So if you google Dentrix or Eaglesoft, the only people that love it are the ones that have no business acumen. They don't know their overhead, their return equity; they don't know any of their costs. They don’t know anything about business. If someone really is concerned about businesses and say they love Dentrix or Eaglesoft
that's just crazy.
So the movement, the fastest growing movement is Open Dental and I can prove that because I own a media company, Dentrix and Eaglesoft, they are always buying ads in magazines and websites, they are always advertising.
Open Dental doesn't advertise because it's growing too fast. I mean, it took me a year to get the CEO, Nathan Sparks to come on the show because I don't want to draw a bunch of attention to it. I mean, every time we turn around there just is more business.
So now what's going to be moving? You still don't have a system the only people that have the systems are DSO’s like Steven Thorn when he got out of school, when he started Pacific, he bought a software, a license from an existing practice manager software and then hired a bunch of programmers and for 20 years as he has gone from zero to five hundred offices, he has built all those internal systems.
Bob: So they have their own internal systems they don’t use [inaudible 01:07:32]
Howard: And so does Heartland and on all these, you don't have their scales of economy. Now that Open Dental is the mainstream, all the people that are
business savvy, sophisticated are moving to Open Dental and they don't advertise and I don't get any money for that or anything.
But now for the first time bunches of people are looking at that code and then looking at their accounting, whether it be Quickbooks, Quickbooks Pro. I have been on Peachtree accounting, I got an MBA. I mean you can't run the Fortune 500 on Quicken or Quickbooks Pro, they all use SAP but SAP is too expensive for a dental office.
So I would say in answer to your question, it's still not available now. What I recommend now is I recommend that you go to Open Dental and you go to at least Quickbooks Pro and you hire your front desk people instead of saying, oh, well she has 10 years experience in the dental office across the street, 10 years experience office she never knows your costs, your profitability, taking nine different insurance, losing money on a third of their patients and don't even know it.
To get bookkeepers because in my past I can take a bookkeeper and train them what an insurance code is for a filling root canal and crown in a minute. But I can't take the girl who was at your front desk for 10 years; she has been on Dentrix she comes to me, I say, “Well, how many reports does Dentrix have?” Five, ten, twenty, thirty. How many reports does it have?
Bob: She says “I don't know”
Howard: “I don't know.” And I'm thinking it's the mindset, so if you are a human, you were on this software for a decade and your monkey paw never moves the mouse to just go click ‘reports’ and look at them one time. Then go ask Doc, “Doc, we have fifty reports, do you want any of these read?”
That's a mindset some people have a mindset for sports or music.
Like Ryan told me he wanted to play piano, so I bought him a piano when he was little. Took him to one lesson, he hated it, and then he came home by sound and he, he plays like Beethoven and when he's playing the whole piano shakes and I'm sitting here, I can't, you know, and it just sounds it is the most amazing thing in the world.
Bob: My girlfriend is the same way. She had a teacher and she hated the teacher, but she loved the piano and then finally they found like an older lady who had never really taught piano before. So she would just show up at her house. She would say, “Oh, let's play whatever you want” and she still kills it on the piano. She picks it up, she looks at the music for a day, never needs it again could just play it. That’s amazing.
Howard: So you either have that knack for numbers or you don't and when you hire receptionists, some of the best ones in thirty years I stole from the Chase Bank next door to me. You are making deposits every day and you see that they are just good with numbers. All bookkeepers love numbers and when I go to a dental office and they have hired three assistants, one of them used to be a bookkeeper. I can teach you how to make it temporary and then your supplies every month are 4.5% and you have a system.
But if you hire this assistant because she has 10 years experience and she's an artist she loves working with her hands, she loves cosmetics, she loves all that. But your supplies 4% this month, 8% next month, 6%, 7% there is no organisation. So if you want a business fill up your team with people who come from business.
Bob: So you are telling me when we go and we start a new practice or if I go home and start my practice, I should be going around all the business places and trying to find somebody to --
Howard: I would go a step further, all my friends that I know that are millionaires are millionaires, a hundred millionaires, multi-millionaires ... your two uncles that one year they did a billion didn’t they, when they built the, contract for the Wichita airport, I think that year they booked a billion three hundred and fifty employees out. But every multi- millionaire I know by the time they got to their first five employees, one of them was a full time bookkeeper; by the time they got to ten, twelve, thirteen employees they had two full time bookkeepers.
So let's say you are in construction and this was a freestanding building. This was a remodel, this is a fire damage house, this is an eight apartment duplex. I need to know the costs, activity based costing, activity based management, and only bookkeepers could tell you. If you say to them, I'm in construction then I want an 8% net income. Well you got to know all your costs.
If you walked into any dental office and hired a bookkeeper and said when I get done doing a filling, I want you to tell me that I make $9 and twelve cents after taxes or did I lose 15 bucks. When you don't have that, you are Stevie Wonder and your whole life; you are just living in a mystery.
Bob: What makes a bookkeeper is that a degree? How do you find a bookkeeper?
Howard: Every CPA has bookkeepers. You just put an ad on Craigslist for a bookkeeper. I put an ad in for a bookkeeper and I hired this little girl 20 years ago in the parking lot. I was running late and she had come in and sat for the interview and I was running late and finally she walked out on me. Finally I got up front and said, “Where is ...” and they go, “Oh, she left” and I ran out the front door. I saw her in the parking lot getting the car. I ran out there “I’m so sorry, I’m so sorry”. She was pissed off, no she wasn’t taking that. I finally convince her to work for me. Twenty years later she is, the President of the company, makes more money than most dentists.
Howard: I'll give you another story. There are lots of these stories, but I'll give you another one, in a whole different arena. You think of religion as non-profit. Billy King just passed away, what was his name? Billy Graham, Billy Graham just died at 91. So there are nineteen thousand towns every town --
How many churches are in your town, your town of ten thousand? How many?
Bob: How many? I would say more than 15.
Howard: Okay so there are six dentists and fifteen churches. So he's on Larry King’s show and he is like, “Hey 19,000 towns every one of them has a dozen churches, they are all reading the same book. Why are you, Billy Graham, the man? Why are you the most famous? Why does everybody know your name and not hundreds of thousands of preachers and pastors in every small town America?
And he said, “I'll tell you why”. He says, “because I was the Reverend, I was reading the Bible, I was preparing the sermon, but I got me an inside man and I hired an inside man and when we started working he says, “Billy, Reverend Graham, when we build this church, did you want it to seat a hundred or two hundred? He said, “Whoa dude, I'm reading the bible, I'm preparing my sermon. That's your job and if you don't know the answer then I mean, what are we collecting them on?
“What does this church costs? What's the electrical, land, building, rent, mortgage.” He says, “That is not my job and if you are asking me, I got the wrong guy and you need to leave and I need to find another guy.” The guy said, “No, no, no, no, no, cool, cool”. They shook hands and he said, “You never write my sermons and I'm never going to do your numbers.”
So they had a full time guy doing the business of religion, which if you said to any preacher, my sister that's a nun, “the business of religion”, they would think it's heresy and slap you.
Bob: But there is a business
Howard: But there is a business there. I mean, you don't pay your money in incense, frankincense and myrrh; you need to use the coin. So, when you get an office manager, hire someone who was a bank teller, a bookkeeper, she is going to know, your house will be in order. Then when she reports to you, you just tell her a break-even point, what do we have to do today to pay all of our bills?
She says, “Dude, you got to do two thousand” and then you say the best dental offices run a 50% overhead, so that means we are going to do two thousand before anybody goes to lunch and they are going to come back and do another two thousand and we are going to do 50%. Then when we get to Friday we close at noon, but to be at 50% overhead we are four thousand short. Then we are going to open up Friday afternoon because maybe we will get two tooth aches and two people need a root canal, bill them a crown, four thousand we are back on target.
Then when you tell your staff like that and you think, well as I started to get to the fourth week and we are not going to make goal, then we are going to open up Saturday. When you start telling your staff that you are not going to get off noon on Friday or not take a three day weekend. You are going to open up Friday, Saturday they start squeezing. They start scheduling faster, easier, tighter they would rather work through a lunch then come in on their day off.
And when you are all transparent and you are all trustworthy and everybody feels safe to talk, someone in your staff will say, “Well Bob, I disagree”
Howard: I don't agree with you.
Bob: That is a big thing you pushed out.
Howard: If you want to surround yourself with ‘yes’ men, you're going to walk off a cliff and your staff is all going to be standing on the cliff as you fall all the way down. They are going to say, well, “He never listened.”
So you don't want ‘yes’ people but they're not going to tell you the truth, unless you make them feel safe.
Bob: Right then okay. Here is another big thing that you talk about in Dentistry Uncensored and then you talk about in the Thirty Day MBA, is that continuing education is a huge thing too. I just read your book, ‘Uncomplicate Business’ and the big thing you talked about is there are three things that you can invest in. You said the number one most important thing you can invest in is your wetware. Your brain, your knowledge, what you can learn.
So you have always been this big advocate of pursuing your FAGD pursuing your MAGD. Would you still say today, 18 years later from when you recorded this, that when I get out of dental school, one of the best things, one of the best investments I can make initially is pursuing these areas of continuing education?
Howard: So your dad is the President of --
Bob: Past President of the ODA, yes.
Howard: -- of the ODA. When you join the FAGD you go to get your fellowship and you go onto get your Mastership. What is cool is how many dentists are in Ohio?
Bob: I don't know the number.
Howard: What would you guess?
Bob: What would I guess?
Howard: It has got to be twelve thousand.
Bob: Yes I would say fifteen thousand.
Howard: Are you googling it? How many dentists are in Ohio? I wonder if Google would even know that. So about fifteen thousand there are thirty thousand members of the AGD and I think only like twelve thousand got their FAGD and only like two thousand got their MAGD or something like that. So when you go to these courses, it's the people you meet and it's not so much that you went to the course, but now you are always going to be a summary of the five people you spent the most time with.
So in your family, that's your girlfriend, your dad, your mom, your family, your kids someday, but in your professional life, if you hang out with five dentists from school and they all think dentistry sucks, they are burned out and they are fried and they hate it, you will feel the same.
But when you start running with AGD people or when I go back and look at spending five weeks at the Pankey Institute, or I think it went to Dawson three times, Kois several times, Spear, Misch, Ross Nash, it was great information. Meeting great friends and then you would be sitting at lunch and they are telling you the course might be on the endo and they are talking about bone grafting.
They are just always excited and they are going forward and that energy, birds of a feather flock together. So surrounding yourself with five people who just love dentistry, going for it. You know, the scout's honour, it’s just they are thirsty, clean, brave. They are just dental superstars and it just rubs off on you and you have that karma.
This podcast actually came from my AGD; I mean I did five hundred hours to get my FAD another six hundred, that's eleven hundred hours.
And I thought to myself, you know, I felt guilty because I was in Phoenix, there are three point eight million in the metro, there are like thirty eight hundred dentists in the valley. There's something going on every night in dentistry.
But you know what, when you're in Parsons, Kansas, there might not be shit going on and you might be an hour away from the city that has a study club and they have one meeting once a month, only nine months out of the year and half the time that's your local orthodontist or state farm agent. And I thought to myself, you know, the only thing I can bring to the table on a podcast is I can get amazing guests on, from all variety from people that are in dental school. I have already got three podcasts where they passed away, three legends Carl Misch, Bob Gibson of Denmat, Margolis, the laser paediatric dentist in Chicago.
Howard: So what I think is cool is that you need a hundred hours. The dentists who took a hundred hours a year of CE crushed it. Well I put out 365 hours a year while you are commuting to work, so I feel really good that I'm putting a lot of really great information and not just in America, but Africa, Asia, and Latin America. I mean I get emails from all over the world and them just saying that the ones that are so special, they say, “You know, I would have to work three months just to buy a plane ticket from Africa to L.A to hear this person speak and I just listened to them for an hour for free on my Samsung.” And I just think “Yes!”
So this technology, this wave I'm riding, when I got out of high school, this was a mainframe computer made by IBM this strength and then I got out of college, they came out with a micro computer and Bill Gates started making software for micro computers called Microsoft micro computer software and then that was the big revolution.
Now the computers even stronger, in 2007 it's in your pocket. I went from only the fortune 500 biggest companies had a mainframe now two and a half or three billion earthlings have an IBM mainframe computer in their pocket. So now we can transfer knowledge for almost zero cost, zero variable cost. You already bought the fixed cost of your phone, right? And you're already paying the variable cost of the phone plan. And so the marginal cost of listening to my podcast on your smartphone on Youtube or Dentaltown, I mean it's just a cool thing.
Bob: I can ask you questions all day but I guess the biggest thing that I want to maybe learn and that other people who are listening to this MBA program. What do you think are the biggest changes in dental business? Not that essentially,
what do you think -- I’m going to be selfish, to ask a question just for me and people like me. What is the biggest piece of MBA business advice that kids like me who are graduating dental school need to know today?
Howard: Okay so when I was your age, how old are your 24?
Bob: 24 yes.
Howard: Oh my god, I’ve got kids that are -- Ryan how old are you? 24. I got two kids older than you. People are always thinking that everything's changing, changing, changing. So you know, like the monkey went from talking to you, to long distance making smoke signals to blowing horns, beating drums all the way to the telegraph, the same wires used for the telegraph are used for the telephone, the same wires and telephone or use the internet.
Howard: The internet is really the telephone 2.0. So what doesn't change is the human, okay? And while all these people are going to always try to marginalize dentists and physicians for their own benefit, it's never going to happen with dentistry because number one, when I go to every human on earth and , I just ended up with a clarity test.
Let's just say -- and thank you so much for bringing me these buckeyes, peanut butter and milk trial. You have to explain it first. What is this?
Bob: It is called a buckeye because it looks like a buckeye nut that comes off the buckeye tree. And essentially what it is is its powdered sugar and peanut butter and some other stuff mixed together and then it's got melted chocolate around it and it's the most amazing, delicious thing.
Howard: So if I walked up to any human on earth and I said, “Bob, here's your only choice, you are going to die tonight or you going to buy the peanut butter chocolate buckeye from me and you will die one year from tonight. Those are your only options.” You want to die tonight? Or do you want to buy this pill and die a year from tonight?
Bob: I would buy the pill.
Howard: Okay, what would, what is the cost of it meant you would have to give me everything you've got.
Bob: I would give you everything I got.
Howard: Okay, so everybody who doesn't have skin in the game. You know when I spend my own money, it's efficient. When I'm buying stuff for me it's the most efficient. So when I'm buying me a cell phone, I buy me an Apple. You said you wanted a smartphone for your Christmas present, I bought you a Samsung, but then the government takes other people's money and buys stuff for other people. No skin in the game, least efficient. So nobody in the government says we spent too much on housing because you buy your own house. No one says if you spend too much on cars, you buy your own car. No one says we spend too much on smartphones because you buy your own smartphone.
But since I buy your healthcare, we spend too much money on healthcare. Yet every person I go to would give me their house, their car and their cell phone. So when all the people say go left and all the government says go, right, that's when you just got to call bullshit.
Howard: Especially when it goes to babies, babies is the most irrational. If mama's one year old baby was dying of cancer, she'd sell everything and move to Norway to save it. Which is totally irrational but I mean this kid didn't know its name. It, it has no productivity, has no value. It doesn't have an occupation. That's what's real. What's real is I would give both kidneys to any my grandchild. If the doctor said, well, your granddaughter needs a kidney and she actually needs both and your liver and when we're done with you, you will just die. What's the chance I would do it?
Bob: Pretty high.
Howard: Oh absolutely, I mean I'm already done and Taylor's brand spanking new. She's five or six, is she five or six? She's five so that's how the cookie crumbles. Now in healthcare we already see around the world that when the doctor gives you a prescription and a lot of them are loaded on their smart card, and they go to an ATM machine and the bottle comes out, the pills come out of the deal, the label comes on and where's it made? Scottsdale, Arizona.
But it's against the law in America for a job protection plan. So we already have data around the world that a pharmacist, when automated by artificial intelligence and an ATM machine robot, they actually liked it more because I can get my prescription filled 24 hours a day, seven days a week. I don't get to Walgreens or CVS and say “Oh, they're closed.” Physicians, we see telemedicine taking off that you are facetiming your doctor.
The dentistry is all surgery, you work in the operatory. I have to touch you, I have to lean your head back open wide. They are so particular about who touches them and gets in their mouth and do surgery and they say they want the cheapest, cheapest price. But look at the data, no dentists have customers for life.
So you would think if a dentist gets twenty new patients a month. So if a hygienist works forty hours a week, fifty weeks a year, she works two thousand hours. Well no hygienist works forty hours a week, they all work three or four days a week. But if she worked five days a week, 50 weeks a year, she could only see a thousand people twice a year, so if you had 25 new patients a month every two and a half years, every three years had another hygienist. But every 65 year old dentist that has been practicing in a town of five thousand for 40 years still needs new patients because every time he puts a new patient on, someone comes off.
Why? Because it's very complex, it's surgery. I'm touching you, did I hurt you? Did it not look right? The patients always mostly never come back 80% of the time because they had a toxic experience with a condescending staff member that dentist talked down to him, the assistant rolled her eyes. The hygienist said, which end of the two points are you flossing with the receptionist, someone is always being short.
If you always have first rate employees being nice and not talking down and not being condescending, that is what keeps customers for life. They don't know if you use Ivoclar or [inaudible 01:29:27]; they know if you hurt them but you didn't hurt them during the root canal. They don't know it's five millimetres short and won’t last very long, they didn't know that you bought your implant on eBay and it's probably made from melted down bumper cars.
They just know if they like you, if you made them feel good and this created dopamine, oxytocin and serotonin.
But the fact that nobody can keep a customer for life ,the fact that almost every dental office has plateaued, which means every time they get a new patient, they stay the same size. I mean look at the numbers, if you find a dentist collecting $40,000 a month, he's been collecting $40,000 a month for 20 years. This one's doing eighty well, he's still plateaued he has been collecting eighty a month for 20 years. They are all plateaued, they are all losing. Every time you get a new customer, one comes off.
They have weird language like, “Well, this is what we do for new patients”. Well, why don't you do that for all your patients? I mean, if every new patient gets a tour or why doesn't everybody get a tour? I mean, you know, so it's a very weird culture, but here's the final straw.
Your girlfriend, if I walked up to her and I said, “How much money do I have to give you to pull your front tooth and you'll never replace it the rest of your life?”
Bob: She wouldn't do it.
Howard: I mean she would for a million dollars.
Bob: Maybe yes. I don’t think she would.
Howard: What if I said, I'll give you a billion dollars and I’ll pull out all your teeth and laser remove all your hair. You will be bald like Howie with no teeth, but you will be a billionaire.
Bob: Would I do it, yes,
Howard: Would she do it?
Bob: Probably not