We recently interviewed Brent Campbell, COO/CFO at Squeeze (a financial technology app), on the 3 Steps to Financial Success in Private Practice. Brent has an M.B.A. in Finance from Nova Southeastern University and B.S. in Finance from Florida State University. After eight years in corporate finance at Hard Rock Casinos & Hotel, he became the COO of Enterprise Beverage Company. From there, he found his passion in leadership, and became a part of Operation Life Hope, as well of being on the board of directors for Hope of South Florida Golf Tournament.
Brent Campbell not only plays a key role at Squeeze; he is a huge influence on the business know-how and success of The Private Practice Startup and K2 Visionaries. Why you ask? He is the husband of our very own Dr. Kate Campbell! He works behind the scenes supporting our companies when it comes to technology needs, ideas, etc.
After working in finance, he realized something: he was put in a box. Brent expressed how the world of finance defines you. He entered the enterprise beverage group and witnessed all of the various talents and different hats that a startup company engages in and was hooked.
Being “addicted to making things happen”, it's no surprise that when Brent was offered the position of Chief Operating Officer over a cup of coffee for a brand new startup app company, he jumped at the opportunity. This app not only juggles finance, but budgeting, recurring monthly bills, and so much more. With an extensive amount of experience in the finance world under his belt, he had experience to equip this company to go far, and that it has.
We started out by asking, “What is the best advice you’ve ever received that relates to building a business, or becoming an entrepreneur?”
Fail fast and fail forward. Just do it and even if you fail, keep on going. Do not fear failure.
Since most clinicians don’t go to school for a financial degree, it would be feasible that we would have lots of difficulty in the financial realm of therapy and private practice. In the beginning, it seems as if most of us are clueless on setting fees, managing finances, or doing the accounting aspects of our business. Brent gave us three solid tips to help therapists in private practice succeed financially.
1. Don’t be afraid of accounting!
Accounting is the language of business. Learn the basics of debits and credits, profit and loss statements, or cash accounting. Utilize resources to help you learn and understand these concepts, because this is the bread and butter of owning a business
Cheat sheet of accounting: -Profits and Loss Statement: Sales, expenses, net income. This is what you are taking home at the end of the day. -Balance Sheet: Snapshot of where you are – how much you made in any point and time. -Accounts Receivable: This is cash coming to you. Therapists who are fee for service don't have A/R, but, if you take insurance, then you will have it since it takes some time to get reimbursed for services rendered.
Terms: This is when you have a vendor and they say, “you have thirty days to pay”. This would be an A/P or an A/R.
Keep in mind: If you could have a cash business where you are getting paid right then and there, that is the best kind of business to have.
Cash Flow Statement: Cash going in and going out – this is close to a profit and loss statement. This is just your services that you are selling, and is very clean with private practice.
Remember, it’s very valuable to have a relationship with your accountant – don’t be scared to call up and ask “silly” questions! If you can’t do that then look into getting a new accountant. A good accountant is one of the keys to having a good business.
2. Get organized!
Here are a few tips to getting organized with your accounting systems in private practice.
Set up a bank account in your business name. You can even get points by using your credit card for necessary business expenses!
Merchant Services. This will allow you to take credit or debit card payments for services rendered. Make sure to do your research to find out who has the best rates. Paying with credit card allows clients to see you for therapy and get credit card points while doing so.
Track everything. It’s vital to track your receipts, especially when it comes to taxes so you can do the appropriate write offs.
Save everything. To your cloud, Dropbox, or a folder. Print out your profit and loss statements, bank account statement, and credit card statement every month. Put all your receipts in a folder and print it out to keep in your binder. At the end of the year, send all of these documents to your accountant, which will save you time and money.
Four things you can write off and claim:
Home Office: If you work at home a majority of the time, perhaps you do online therapy. You can write a portion of your home off.
Meals & Entertainment: If you are having a business meeting over lunch or dinner you get to write 50% of that off.
Travel Expenses: If you’re on a cruise to Hawaii, but you have a conference to go to, you can expense a portion of that on your taxes.
Milage: Track your mileage to and from business related events.
3. Focus on your top line!
Here are a few tips for how to make sure your business is profitable. Make sure to start with your revenue. This is the lifeblood of your business. Build as much value and growth as possible. Also, it's essential to have multiple streams of revenue. For example, offer supervision, provide workshops, sell relevant products, or even write a book!
Another important area is to understand how much you want to make annually. Let's walk through an example:
Let's suppose you want to make $100,000 per year. Divide that by 52 (weeks in a year). This will let you know you need 19 clients per week.
Next, you want to think about how to market yourself so you're getting at least 19 clients per week. Do the research on your own practice to know what's working and what's not with your marketing efforts. Put your time and money into marketing efforts that work such as: word of mouth referrals, doctors' offices, online therapist directories (Psychology Today), etc... Wherever the majority of clients are coming from, focus your energy there.
Get out there and make things happen! Work really hard and learn. Knowledge is only as good as your ability to execute.
CLICK HERE to listen to Brent’s podcast, and be sure to check out his 100-page Accounting Made Simple book recommendation! Assure you subscribe so you can stay in the loop of ALL the podcasts we release. The Private Practice Startup would also be super grateful if you could rate and review our podcasts. We are trying to be the next "New & Noteworthy" - thanks again for allowing us to Inspire YOU from Startup to Mastery!
-Dr. Kate, Katie & The Private Practice Startup Team