Very Clinical: Don't Get Tired of Dancing with Dr. Frank Clayton

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[00:00:26] For July 2024, you can get free shipping on every order using the coupon VeryShip. All one word, VeryShip. Either way, Crazy Dental has you covered. Go check them out at CrazyDental.com. Hello faithful listeners. This is Dr. Alan Mead just chiming in to head off any confusion.

[00:00:46] So the fellas were recording with Dr. Frank Clayton, a real favorite on the podcast, and he recorded three episodes with them about what he's changed his mind about as well. I hope you are enjoying these. These are a blast. I think they're fantastic.

[00:01:00] They had technical difficulties throughout the process, and Frank's mind changes about clinical stuff did not make it. I fear that it did not make it. The other two did. So you're going to start with what he's changed his mind about business, which is fantastic,

[00:01:18] and hopefully they can record his clinical one again at some point. They're going to talk about multiple times about him having been on three times in a row, and he will only have actually been on two times in a row, just so you understand

[00:01:30] and so I don't confuse anyone. So I think you guys are going to love this episode. I appreciate you listening and thanks very much. This is a production of the Very Dental Podcast Network. Welcome to the Very Clinical Podcast.

[00:01:56] In about the time it takes to do an MO on three, we will entertain and amaze you with tips and tricks on regular daily dentistry. Here's Kevin and Zach. What is up Very Clinical listeners? Welcome back to yet another episode of the podcast.

[00:02:10] This is Zach Miners coming to you from Kansas City, Missouri with me as always my trusty co-host Dr. Kevin Herefriar. Kevin, what's up man? Just living the summer dream. I just had a dreamsicle and a push-up pop and a bomb pop.

[00:02:30] The dreamsicle is the best of the bomb pops, the worst of those three things. You think so? Yeah, bomb pop overrated. Overrated big time. The dreamsicle has the stuff in the middle, right? Yes. I like stuff in the middle. Yeah, I think most people do.

[00:02:49] The voice you hear in the background is returning guest Dr. Frank Clayton from Atlanta, Georgia. Frank, what is up man? What's going on guys? Great to be back. How was your week? Frank, we failed to mention last podcast that the last time you were on our podcast was

[00:03:02] four years ago. What happened? Leap year. Okay, yeah. It's the only thing that I know of. Other than that, I don't get out much anymore. Man, I can't believe we didn't have you on at Voices of Dentistry though a couple years ago. Were you not there?

[00:03:20] I thought I was. Yeah, I was there. I think you were. You definitely were. Yeah, it has been four years. Yeah, so that's an untruth. No, yeah. That was on this setup, but I was there. Yeah, we did a podcast at VOD. Awesome. Yeah.

[00:03:39] If you caught Frank last week, you listened to him talk about a couple of things that he's changed his mind on in clinical dentistry. This week we are going to do the business of dentistry, but before that, are you guys ready for some Atlanta trivia?

[00:03:55] Yes, I've been building up on my Atlanta trivia. All right. Yeah. All right. Now, Frank, you got to hold back here, okay? Okay. Kevin. Yes. Atlanta is known as the city of? Peaches. No. Do you know, Frank? The city of... Is it railroads? No, it is not.

[00:04:24] It is the city of the forest. That's a lie. That is a... Who made that up? That is a lie. Okay. Wait. Or sorry, I should have said city of... I think it's city of trees, not... Okay, city of trees. City of trees. Yeah, governor of Lauderdale.

[00:04:40] Sorry, I don't know why I said forest. I messed that up. I misread my own note. Point of interest, Cleveland's nickname is the Forest City. Oh. Oh, okay. Look that up. I did not know that. Yes. Did not know that. We live in a forest.

[00:04:56] They just cut off the trees to make our buildings. Well, it says Atlanta is known as the city in the forest or the city of trees because 50% of the city is covered by trees. Now, that's true. You fly in, there are a lot of trees here. Also peaches.

[00:05:11] Peaches and trees and peach trees and the road called Peach Tree. I think there's 13 of them, I think. And red clay, dirt, whatever. Do you have many trees in your yard at home, Frank? Lots. Probably 50. 50? Yeah, lots of trees. Smoke. I think I have a tree.

[00:05:31] Lots of leaves. That is a lot of leaves. Lot of leaves, yeah. And all different kinds of trees. So yeah, we live backed up to a creek, but yeah, there's a lot of trees here. Peach trees? It's true. No peach trees. Oh, you don't really live in Atlanta.

[00:05:45] That is true. I need to plant one just to say that I feel at home, but you know, you never see peach trees around here. Actually South Carolina leads in peaches, I do believe. They overtook Georgia and peach production.

[00:05:59] There should be some sort of border dispute over that. Oh yeah, there's arm wrestling going on in the sticks for that. Excellent. You know it. Question two. All right. So John Pemberton invented Coca-Cola in Atlanta in the late 1800s. Do you know what his trade was?

[00:06:20] As you know, he had like a- A trade? Professional trade. Yes. I'm going to say cocaine smuggler. Close. You're really close. Kevin, do you know what John Pemberton did while he was inventing Coca-Cola? That's for Frank. I guess- Oh, sorry. For Frank. I guess cocaine smuggler. Yeah.

[00:06:47] I believe he was a pharmacist. That is correct. I said you were close. Dean, you're exactly- He was a legal cocaine smuggler because it was legal at the time. So I think the judges should give him credit. Partial credit. Yeah, partial credit. Yeah, absolutely. Credit for that.

[00:07:04] I think I knew that. Smuggler. I was going for the joke, but I think I- No, you covered it. Well, anyway, thank you for producing all that coke down in Georgia to creating the cocaine crisis that we solve on a day-to-day basis. Yeah, appreciate that.

[00:07:19] As Chick-fil-A would say, my pleasure. Yes. Excellent. All right, Frank, have you changed your mind on anything in the business of dentistry in the last 20 something years? I actually have. Swear that I'd never sell my practice to a DSO. This is a good one. Spicy.

[00:07:40] All right, lay it on us, Frank. Sold my practice to a DSO. Oh, you did? Done deal? Breaking news. Breaking news, yeah. When did that happen? A year ago. Okay. And what changed your mind? A lot.

[00:07:57] A lot to go on, but I swore I never would, and for the reasons I had in my head, to boil this down, I talked to this local small niche DSO and said, if you put this in writing, I'll do it.

[00:08:14] And it was all about taking care of my employees, transfer to another doctor, not messing with anything. And they actually put it in writing, which I never thought they would do. And I talked to a few DSOs before that and they said, you got to be crazy.

[00:08:30] Nobody's ever going to do that. This company did and has left me alone for a year. And I have a two-year commitment with them. I can go further if I choose, but it's actually been really good. So I swore that I never ever would. And here you are.

[00:08:52] And never swear that you would, because there's always someone or something or some business out there that can make things happen. Just like a spouse, you never know until you meet them. It clicked and it's actually good. So that was...

[00:09:14] What were your reasons prior to not even considering it or quote, never doing it? Never doing it because I saw how many just shit. I looked out for my employees.

[00:09:28] The first thing was I looked out for the employees and I saw what many of them did and I didn't like it. Then I saw what they did to patients. They either had to start upselling stuff or change things or do things, which I wasn't

[00:09:45] going to do in this stage of my career. And this company said, no, we really don't care anything about that. We just care about you making what you've done over the past few years. We're going to pay you X.

[00:09:57] And if you keep doing that, we really don't care what you do. I was shocked because I always looked for the gotcha and had attorneys look it over, talk to two or three other docs that have signed with them.

[00:10:12] And they said, no, they actually will leave you alone. And they don't have the infrastructure to take over. They have suggestions on things, IT, merchant services, any of that. As far as taking care of my employees and my patients, I haven't actually told my patients anything.

[00:10:34] So your employees know, though, they know prep them two years ago, then changes were going to happen, whether it's an individual sale or a DSO. So my advice to anybody listening, prep your staff far in advance just so they're not blindsided.

[00:10:55] Whether you sell it to an individual, partial, whichever the transaction, just be very transparent as much as you can with your employees. So this is obviously an exit strategy for you, Frank. Do you, I mean, you don't have to answer if it's too personal.

[00:11:11] Do you think it's going to be another year or five years or what's in your heart? It's going to be at least a year. July of 25, my commitment is up. I'm sure they would like for me to sign longer.

[00:11:29] If I do sign longer, it won't be on a full-time basis. I would love to have a transition with someone who wants my type of practice, who's willing to do that. And who knows?

[00:11:47] I've been taking other classes and doing some coursework and other things that I want to explore. So I'd love to do a mix of it. I just don't see myself doing full-time at the rate that I'm going. So you're going to be a yoga teacher?

[00:12:06] The cat's out of the bag. Yes. Yes. Is there a webcam in here? Have a few more guys. I can just imagine you in yoga pants and I got a little tingly inside. Well, I thought that pic was blurry, I think, but evidently you saw everything.

[00:12:24] Zach, what are your thoughts about selling to a DSL? I'm not there. I haven't thought about it yet. But do they ever approach you? I've gotten one offer from one of the big ones that I know that I wouldn't want any thing

[00:12:46] to do with, at least at this time. But whatever Frank's signed with and that's his personal information. The fact that they haven't done anything that has ruffled his feathers that he's willing to say is shocking to me. Yeah, it really is great. Frank, we're good for you.

[00:13:12] Yeah, when the dance starts, they tell you anything. And I call bullshit on everything. And when they actually did this, I couldn't believe it. I thought, just like we said last week, I was at a different stage when I didn't use the CEREC.

[00:13:33] Three years ago, I wouldn't have entertained this. This is not. At this point in my career, at this time, when somebody comes along and says, yeah, we'll agree to just let you do your thing. Like really, as long as I'm here, this contract is enforced.

[00:13:49] I can do this. They said, sure. Talking to other docs, they said, this is too good to be true. Talked to my attorney. She goes, I've done about 20 deals with them. And this is actually what they do. I said, wow. Okay.

[00:14:03] Frank, did they offer you a similar amount to buy your practice as ones that were, that are a little bit more invasive? I mean, did you take a lesser deal to get something that was someone who wasn't going to mess with you?

[00:14:18] Well, to put this in a baseball analogy, I wanted singles and doubles. I've always done singles and doubles dentistry. Singles and doubles can win a majority of games. So I went to them and after the first few different DSOs, it was the usual.

[00:14:37] We'll give you 60% and then we'll hold on to 20. And when we recap in a few years, you get the home run with runners on. Okay. I purposely found someone who said, look, there are no home runs here, which I was fine with. They're like, this is guaranteed.

[00:14:58] This is going to be put in escrow. This is what we're going to pay you. And I said, that's what I want because I don't want to hedge. I don't want to hedge 40% of my practice equity on anything, whether it's a pool of like-minded

[00:15:15] or unlike-minded dentists, whether it's a decaying interest rate atmosphere, which is happening. I didn't want to be at the mercy of them having to make a hundred deals to make my eight acts or 10 acts come true.

[00:15:32] So their proposition and mine met, and I said, I would really like this multiple and I don't want to play any games in two years. I just want the same multiple, just guarantee that you're going to give it. And I got that guarantee.

[00:15:48] So there's no hopeful that they have to sign a hundred doctors, that they have to get more PE backing. I love that because I'm not tied to anybody but me, and that's the way I wanted it.

[00:16:04] For that to happen, I couldn't believe it because I had heard and read so much about this and how there's a gotcha on almost every corner. So this, I mean, I'm a year in and I'm like, I'm waiting for the guy. There is no gotcha.

[00:16:21] This is the way that it is as long as I'm there. Now we just see how long I can tolerate people, employees, patients, the usual stuff that we talk about. So that's where it is. I love it.

[00:16:38] Kevin, you asked me if I would entertain this and I told you I wasn't quite in spot to even really give a serious thought, but you're a little closer to retirement than I am. What about you? What's your answer to this question?

[00:16:52] First of all, I'd like to say I don't think it's the dirty word that it used to be. So I completely changed- It depends. I think- I changed my mind on that. It does depend. Yeah. Yeah.

[00:17:04] So I guess what I'm saying is if this was five or seven years ago and Frank would have said that, I would have had a gut reaction like, oh, but now I'm like, oh, good for you. That's great. I don't see it that way.

[00:17:18] And I think it's probably because I'm closer to the end and Frank's closer to the end. I don't want to get into too many details, but I did go fairly far with one DSO and I

[00:17:32] felt ultimately that there was some voodoo math happening and that I didn't think they could actually deliver what they were going to, what they proposed they would. So- Yeah. I didn't pursue it any further and I could be completely wrong on that, but-

[00:17:53] It didn't pass your smell test. It didn't pass your personal smell test. It didn't pass mine nor my accountant's. Got it. And some other trusted people that I know. So I just- But it was probably true. Yeah. That was probably true.

[00:18:09] So I didn't pursue, that's the furthest I've gone down that road ever. Yep. That was about three years ago. It exposes you and then you start to see, you see the patterns, you see then the way the market works because it's, I mean, it's just like any idea.

[00:18:28] So is just like anything. It's just like food, just like sex. There's good food and bad food, good sex, bad sex, good cops, bad cops, Dennis, whatever. There are good ones there, but if you kiss enough of the bad ones, then you go, holy, that's a bad taste.

[00:18:48] Yeah. Like that was saying. It's going to linger. Yeah, it lingers, which is good because that's a protective mechanism for you to go, okay, my guard's up here. If you're talking to one like I'm associated with, my guard was up. Sure.

[00:19:02] I danced with a few on like, all right, you're really going to have to be impressive, which is great because the other side is they wear your ass down so much with figures and the check that you go, fuck it. Let's just do this.

[00:19:16] I'm so tired of dancing. Don't get tired of dancing. Just dance for the long haul. Worst case says you still have your practice at a hundred percent that you own. You don't have to do a deal with anybody.

[00:19:29] Well, I think that's the most important thing that you said. I still have my practice at a hundred percent and the deal that was going to be made, it just didn't smell right to me. And there's so many out there.

[00:19:43] I've discovered there's so many little micro ESOs that you don't have to go with a name brand. You can, and it all depends on what you want. If you want management and you want CE leverage and equipment leverage, by God, they're out there. I don't.

[00:20:01] I want you to leave me alone. All right here. And they, they don't even call or write me anymore. I feel left out. I got a couple more questions on this here. Yeah. Did you own your real estate? I do. Is that part of the deal?

[00:20:17] Uh, don't know yet. Yeah. In that they, they leased from me now, which was another part of the deal and that I talked to a real estate attorney and I got that locked up, whether they have a practice there or not. So that's part of it.

[00:20:34] So now, you know, I own my building and they lease from me. That's a nice little bonus. Whether I stay or go, that's part, you know, I read something on, you know, dental investment group of is your practice part of your retirement goals?

[00:20:49] I'm like, how the hell can it not be? It may not be the whole pie, but the fact that I'm going to just get rents, it's like, you know, it's like I went and bought an apartment house and I'm renting it.

[00:21:03] It doesn't get to me any better than, than that. So at the end it shits the bed. I have an office condo. It's a great dental office condo. If not, we make it into something else. But that was also part of the deal.

[00:21:21] And the other thing of Frank is, dad, you tried to sell it to an individual and just never got any traction or had you decided that this was the route for you relatively recently? That is a long story.

[00:21:36] I'd love to talk with you guys about because a listener and I met five years ago through Alan's podcast. He actually came out and we danced for about two years and I almost sold it to him.

[00:21:53] It was the hardest thing I ever had to do when it came down between him and a private sale and this DSO. And if he's listening, I still feel horrible as a business decision.

[00:22:06] I was very transparent with him, but Zach, it was a very, it's much more emotional selling it to a doctor and doing that dance. I can tell you that the numbers weren't even close.

[00:22:21] That's why I called BS on the DSO because they said, you can't do this and meet my needs. And they did. That individual knew this and I kept telling him, I have one more meeting and if this goes through, I'm going to sell it to the DSO.

[00:22:41] That came down to the final day for he and I and the DSO and I. That's a whole thing. It got very emotional. That's a story in itself that I can talk a while about for people that you talk about

[00:22:58] running a marathon and until you cross the finish line, it is not done. Any business transaction, it is not done. But with an individual, you get wrapped up more emotionally than you do or than I did with a DSO. And that's how that turned out.

[00:23:17] But to answer your question, yes, I had preferred and this is why DSO was a dirty word five years ago. I made my mind up to say, I am selling to an individual because I'm not dealing with that. I don't want to partake in it.

[00:23:31] I don't want to quote bring dentistry down. I don't want to water it down. All the things that you read. And the topic is what have you changed your mind about? And in my life, that is the biggest thing I've ever changed my mind on.

[00:23:46] And it wasn't overnight. It was over years. It's the climate of dentistry. It was my personal and my wife's situation. It was where things are headed with 18 and 20 year long employees retiring anyway. All these things came together to go, you know what? It's right for me.

[00:24:11] And I changed my mind. So I have zero regrets about it. And a nice tattoo. Yes, it's got a little trademark at the bottom with their DSO thing on it. That was part of the deal. But anyway, it was a mind change of ultimate.

[00:24:30] You know, my wife couldn't believe it. My friends, I talked to Brent about these things and they're like, I can't believe. But then after what I'm telling you in more detail, wow, they really came through with that. And I said, they sure did.

[00:24:47] And I couldn't pass it up because I don't like looking back and would have shoulda. I like making the decision and moving forward and accepting that I either made a good or a poor decision and learning.

[00:25:00] And after year one, we can talk again next year and see if it's still good. But I'm just amazed they haven't come in and just overhauled things or just said, uh-huh, you know, and rip the contract up. There's been none of that. So wow. Very good, man.

[00:25:20] Good for you. Sounds like you made a home run on that one. I love it. With the baseball theme. Well, to me, Zach, that's exactly, you know, it's not a physical home run in that I wasn't

[00:25:30] swinging for the 8X, 10X or, you know, that outlier of a hit. I barreled up, but it didn't go 485, but it cleared the left field wall. A home run. You know, and I rounded the bases and I'm on second or third right now and we're good. Awesome. Awesome.

[00:25:52] Thanks, Frank. Why don't we just wrap it up with that? Yeah, that was good enough. One topic was good on that one. That was like, like Frank said, that was going to be a meaty one. Yeah, I love it. All right.

[00:26:05] Any final thoughts on DSOs or City of Trees? I don't think it's the dirty word that it used to be. Awesome. Thanks, Frank. And next week we decide whether Frank has changed his mind on anything in life. Three weeks in a row. All right.

[00:26:24] I'll be back next week. All right. Thank you guys. We'll see you next Tuesday. Thanks guys. See ya.