Courtney [00:00:01] It’s a twofold process for me right now, since I am losing a clinician’s income from one location and moving her to the second where I’m going to increase my expenses, really just looking more so at how that can happen. Perhaps if she needed to do telehealth before signing the lease, just to have that time to create the equilibrium between two offices.
Linzy [00:00:28] Welcome to the Money Skills For Therapists podcast, where we answer this question: How can therapists and health practitioners go from money shame and confusion, to feeling calm and confident about their finances and get money really working for them in both their private practice and their lives? I’m your host Linzy Bonham, therapist turned money coach and creator of the course, Money Skills For Therapists. Hello and welcome back to the Money Skills For Therapists podcast. So today’s podcast episode is a coaching episode, which always makes me so happy. I love recording these coaching episodes. And my guest is Courtney Fields. So Courtney is a therapist in private practice. She started a small group practice a few years ago, specializing in high conflict and divorce, which quickly grew into a large group practice specializing in high conflict, divorce, and child custody support services. And our conversation today is around this decision that she is in the process of making around expanding into a third location. So we dig into, in the ideal scenario, how to make decisions around expansion and taking on a third location. Or this really applies to making any kind of big investment in your business where there’s kind of an outlay in advance. And you need to think about: would it be worth it? But we also, of course, because it’s this podcast, get into the mindset and emotional pieces of also the seasons of a business and being grounded in your decisions of when to expand or when to kind of gather together, is the language that we used. So if you have a group practice or if you have a practice where you’re thinking about branching out, making a big investment, maybe taking a bit of a risk upfront to grow your business, this episode is for you. Enjoy. All right, Courtney, welcome to the podcast.
Courtney [00:02:27] Thanks for having me. Linzy, it’s good to see you again.
Linzy [00:02:29] It’s so good to see you. So, Courtney, you took Money Skills For Therapists.
Courtney [00:02:35] During the pandemic.
Linzy [00:02:35] I was like, where are we in time? Two years ago.
Courtney [00:02:36] About the beginning of the pandemic.
Linzy [00:02:39] Yes, very beginning. So 2020. So it’s been a couple of years since we worked together. So this is exciting for me because I also get to hear, you know, where you’ve landed since then. So tell me, what would you like to have more clarity on by the end of our conversation today?
Courtney [00:02:52] Well, when I first took your class, I was in the middle of building a group practice, and it had grown really fast before I really knew how to even assess financial health of it. So I was really winging it. I was putting the cart before the horse. I was trying to pretend I knew business, had a business mindset. I never even heard of profit first before I took your class. And so it was something I had not thought about at all. I had put the mission and the services and the idea out there. It was successful. It grew really fast, but with great power comes great responsibility. And I was the only person. I was doing all the admin, seeing the clients, to supervising and marketing and doing all those things. And so I tended to avoid the things that I did not enjoy, which were the numbers.
Linzy [00:03:47] Yes.
Courtney [00:03:49] You’re in at all the numbers. So what’s happened since then is that COVID did not slow us down. I think I got like a two week break to chill because the whole world was in shock.
Linzy [00:04:00] Yes.
Courtney [00:04:01] Yes. The shock wore off and business was booming because I do specialize in divorce and many of the courts shut down during that time. So we really had to help people navigate very long limbo transitions. And so I started hiring and I went from just myself and two other people to a year later I was up to six therapists, went up to eight plus interns. I would stress every time payroll came around, I wasn’t paying myself. I didn’t know what I could pay. So on the surface, I really had to make my team feel really comfortable with what they were doing. But on the inside I was very anxious and uncertain.
Linzy [00:04:44] Kind of like parenting that way, isn’t it? You have to be like, Yeah, that’s fine.
Courtney [00:04:48] Right now everything is fine. Dumpster fire behind you. Exactly. Exactly. That was my my mode. So once I got some – and I’ll just I’ll just chalk it all up to your brilliance with spreadsheets. Spreadsheets. I feel like really just it was like a way to organize my brain. And so I was able to answer business, like open ended business questions, with a spreadsheet. What can I afford here? If I want to pay myself, how can I do that? So really started diving into the numbers and was able to – wasn’t planning the timing of my second location, but I went through a personal change and had to relocate myself to a different city from where my practice, my group practice had been. So I’m like, Well, now we have a second location because I’m in a different place.
Linzy [00:05:41] Here I am.
Courtney [00:05:42] Here I am, and put a lot of forethought into it. It just had to happen. And that’s when I really realized how much more these type of services, that I did, was needed. There’s a great response to the second location and now I’m in- it’s kind of a similar situation. I have a wonderful therapist that’s been with me since she was an intern and she has gotten licensed since then. She’s been with me from the beginning. She’s very invested and she’s relocating. And so now it’s like third location that’s been thrust upon me by her life change.
Linzy [00:06:21] Yes. Gotcha.
Courtney [00:06:21] So each time I’ve done this, I’ve had to, like I said, put the cart before the horse and just hope and pray it works out. Some of the numbers in advance- You know, when you go to a different community, we work a lot with the court system and there’s a lot of subjectivity to different jurisdictions, and so you don’t know where you’re starting. I’ve learned since I’ve opened a second location. So I really haven’t had a chance to figure out a way to make a strategic decision to grow. And so here I am again, in the same- in a similar situation, and I just wanted to kind of get some feedback on, if I had had the choice to time it and choose the right location and all that, what could I do? What kind of information would say yay or nay, right?
Linzy [00:07:07] Yes. Yes. Because at this point, is this location happening no matter what? It sounds like it.
Courtney [00:07:11] If I want to keep this amazing therapist.
Linzy [00:07:14] Yeah. Okay. So there would be a high cost potentially to not having this third location, which would be losing this therapist. Okay. Right. So, yes. This is about strategic decision making. Is what it is. It’s like, when do you make a move like expanding? This is an expansion move. And what information do you take into account to know if it’s the right move or how to make it a good move?
Courtney [00:07:37] Yes, absolutely.
Linzy [00:07:39] The first thing with this, Courtney, is your solution, you may be happy to hear, is spreadsheets.
Courtney [00:07:46] Great!
Linzy [00:07:47] And it’s running the numbers to understand, you know, two things. First of all, what does it cost you to open a location and to run a location? This is going to be an in-person like a physical office that she’s going to have.
Courtney [00:07:59] Going to build a team. So part of her task is going to be not just clinical anymore. She’s basically be expected to do outreach and…
Linzy [00:08:08] So you’re not like- this third location is not going to be just her. This is going to be another hub of therapists. Okay. So the first thing to think about is looking at how much baseline, how much is it just going to cost you to get started? Right, because there’s always startup costs. It’s very different now with online therapy where like the startup cost is like opening your laptop up, there’s your startup costs, but having an actual physical location.You know, there’s any deposits that you need to make, there’s like furnishing the space, there’s decorating, there’s all this front end money that goes into opening a space. Do you have a sense from your previous locations of how much it costs you to furnish like a single therapy office, let’s say?
Courtney [00:08:45] Well, I am very thrifty. They also do play therapy, and I’ve found it’s been a wise investment to have a storage unit as I stumble upon great old fashioned wooden toy kitchens and other good kind of vintage things and just take advantage of sales when they happen. Knowing this concept of growing this particular office that we have found, it gives you the option of furnished versus unfurnished, and so I do- I have found a way to lower the cost of furnishing by collecting over time.
Linzy [00:09:21] Great. Okay. So in some ways that’s money you’ve already spent.
Courtney [00:09:24] Yes.
Linzy [00:09:25] Okay. So that would be the first thing that I’d want to figure out, because that’s kind of your lump sum upfront, is I do hear that you have collected a bunch of stuff, which is great. That thrifting, I don’t have that bone in my body. I wish I did. It seems very handy to have the thrift thing.
Courtney [00:09:38] Yeah, it has to feel like fun. It didn’t always feel like fun when my mother dragged me around as a child.
Linzy [00:09:44] Yes, but as an adult, you get it?
Courtney [00:09:46] Seeds were planted.
Linzy [00:09:47] Yes, yes, for sure. What I’m hearing is that is going to reduce your startup costs because you already have some of those the furniture or the toys. You might already have some of those things that you need. So the one number that I would want to know is what is the rest of it going to cost? Right. And it’s going to be an estimate because it’s kind of like construction, like we’re we’re building a cottage in our backyard right now. And it’s just laughable when you throw a number at the wall because who knows where it’s going to land. You’re going to have a much smaller range with an office, but you’re going to think about, okay, how much does it cost to paint a space? If I know I have to paint these spaces. If I have to buy a couple chairs, what does it cost? You know, putting a certain dollar amount to give yourself at least an estimate of that initial outflow of cash. Because at the beginning, when you’re starting a location, money goes out. Long before money comes back. Right, like there’s that initial push, setting it all up, and then you’re set up for folks to come in and actually do sessions.
Courtney [00:10:37] That makes me think of the question of it sounds like there needs to be a cushion. You need to have some money set aside as part of this timing decision.
Linzy [00:10:47] Yes. Yes. And so, yeah, in that optimal scenario, you would be setting aside that money specifically bookmarked for like, new location, right? So you would say, okay, I’ve run the numbers and to open a suite that has four offices, it’s going to cost me about $6,000 to get carpets and furniture and paint it. So I’m going to start my third location startup fund in my budget. And in addition to having a couple of months operating expenses set aside just for, you know, if life happens, I’m going to have the specific goal that every month I’m putting aside $500 and you know, until I hit that goal. Or I’m setting aside $800 a month. So that would be the optimal. Right, is like you’re really planning it from this really grounded place of like, okay, in November we’re going to set up this third location and in order to make that happen and have it be no skin off our back, we are funding that goal well in advance. Right. That would be like the really kind of grounded long term view, not quite exactly where you are, but that would be, you know, thinking about your fourth location and your fifth location, a way to do it so that you’re not putting yourself in kind of financial stress or risk right off the bat.
Courtney [00:11:51] Yes. Yes.
Linzy [00:11:51] Right. So that would be the first thing to look up is that startup amount. But then you also have, you know, rent to pay as you go, and it’s just taking a look at the data that you already have, Courtney. So that kind of planning is what you could do for like your fourth location and your fifth location, right? Of like really settling and being like, okay, by the end of this year, we’re going to open our next location in this place. And you’ve thought through why that location makes sense either because there’s quite a demand there or you know that there’s a need, that would be kind of the long view. Right. But with it is as it is now, you’re going to not necessarily have the full runway to save all that money, but it’s starting to understand how much it’s going to cost you to start and then how much you’re going to be able to start bringing in and kind of mapping that out and figuring out how you’re going to fund the startup. So there’s two sets of numbers. The one that we just talked through was the expenses, right? What’s that initial start up? What’s the monthly rent? How much does it add to your subscriptions, your dues and subscriptions, like your software to have that location? And then you get to do the fun part, which is start to project forward income, right? Client sessions. So the way that I’m picturing this, Courtney, and this is how I would do it- and in the next little program after Money Skills For Therapists, Money Boss, I teach this skill because it’s a really important skill, right? It’s financial projection. The next thing is projecting forward reasonably how much money you’re going to be making a month one, month two, month three, month four. Right. Starting to map out what that road can look like. And again, it is projection. We don’t know the future, but it’s starting to understand even like what would need to happen for you to start to become profitable at that location because you might look at it and realize like, Oh, I actually need three clinicians working pretty fast in order to start to cover everybody’s wages and the expenses and have any money left over to pay me for running this group practice. And you should have profit as well. Right? So it’s running forward those numbers. Can you visualize kind of what I’m describing when I’m talking about what that would look like on a spreadsheet?
Courtney [00:13:46] I can. I actually consulted I think around the same time I was working with you, I consulted with the Small Business Administration locally in Athens. It was through University of Georgia. And they gave me some financial projections spreadsheet.
Linzy [00:14:01] Yes, exactly.
Courtney [00:14:02] You know, one of the issues I’ve had with this, though, is that, you know, I’m basing it on, okay, so this person works full time. And then in this business, it’s so hard to predict what- how long it’s going to take to do that full time. You know, there’s so many other variables that can happen. And so I can get the numbers and they look great when everybody’s full. And I’m fully you know, I’m fully staffed. But really, there’s then still a lingering effect from the pandemic to get fully staffed. I really saw that happen in the second year and that difficulty hiring, it’s just now started getting better. Yeah. And then this person is leaving. The first location’s her place.
Linzy [00:14:41] So that’s a loss. Yes. Yes. Okay. And with that, I mean, the way to offset that is to have conservative numbers. And you could start to pull those conservative numbers based on – in worst case scenarios before – when somebody’s taking a while to fill up. How long has that taken? Right. And it might be that you don’t project on them being full in three months. Maybe you project on them being full in five or six months to understand for yourself, even in that kind of like baseline scenario, what needs to happen to make this profitable. So I’m not losing money on this third location and really understanding like what is the minimum that needs to be happening, how many sessions need to be happening, whether it’s between two clinicians, three clinicians, four – what needs to be happening. For me to be paying everybody’s wages and paying for this location and not losing money, which I think is an experience you’re familiar with, right, is like we can go the other way without realizing it when the numbers don’t work.
Courtney [00:15:34] Yes. We’re just not just doing it and not knowing. I’ve definitely had- I appreciate now having this abundance mindset because knowing how to run the numbers helps you have more of that mindset. But I have erred too far on that leap of faith.
Linzy [00:15:51] Yes, yeah.
Courtney [00:15:53] Not enough.
Linzy [00:15:54] Yeah. And I mean-
Courtney [00:15:56] Run the numbers, then take the leap of faith, not the other way around.
Linzy [00:15:59] And sometimes the way that people think through these scenarios is like good, better, best, you know, like what is your good? What is like, what has to happen for it to run? Because then you can also understand it allows you to make informed decisions quickly. Like if you realize looking at your numbers after you map this out thoughtfully that you need to be seeing 50 sessions a month happening out of this location to – because you’re paying your therapist for those sessions. So in order to have enough to pay the expenses and have enough money to make it worth your time and some profit in the business, and you have a clinician who’s like just really not not getting clients and there’s a lot of resources going to them. And for some reason it’s just not working. Like as hard as that can be, it does let you really understand the minimum that needs to be happening in order for this to not be like a drain on your business and potentially put financial stress on other parts of your business that are working because it’s kind of like you make this ecosystem and if one part starts not working, it’s going to be pulling the other parts, right? So having that clarity can help you make informed decisions faster rather than waiting to figure something’s really not working and you’re not sure what it is.
Courtney [00:17:03] I love that you use the word ecosystem because that’s a perfect analogy for what I’ve seen happen already. With the office in the second. And even right now, I have people that I’ve brought on with the expectation to reach a certain caseload number and it hasn’t happened for various reasons and so it is like, well, now I need to strengthen and take a closer look at the types of contracts that I use. You know, so strength in that area as well as the projections as well. So it really is an ecosystem. I love that description. That really helps comprehend.
Linzy [00:17:39] And it allows you to understand as a boss, like what are – the kind of corporate language for this would be metrics – what are the metrics that you need to see from your clinicians to know that they’re actually doing their job and contributing to the business and allowing the business to run and be well? And if they’re not, you know, what are your steps? How do you support them? How do you address it? What language you use to talk about it? Like how do you lead, to either support and empower them to work on the things that aren’t working and get full and retain clients or, you know, convert consultations like whatever, wherever the issue you’ve identified. Or if it’s just not a fit, what is your process for saying goodbye to someone and setting them on a path that will be a better path for them?
Courtney [00:18:19] It all works together, and it all has to to be able to have those accurate numbers.
Linzy [00:18:22] Yes. Yes, absolutely. So coming towards the end of our conversation today, what are you taking away? What would be your next steps coming out of this discussion?
Courtney [00:18:30] Okay, this is where I have to settle my brain down because I get excited about having strategies and knowing what to do and then figuring out how to prioritize them. You know, I really think that it’s a twofold process for me right now, since I am losing a clinician’s income from one location and moving her to the second where I’m going to increase my expenses, really just looking more so at how that can happen simultaneously. The timing would be- it would need to be simultaneously. So even perhaps if she needed to do telehealth before signing the lease. Just to have that time to create the equilibrium between two offices. That’s something I hadn’t thought of before as strategy.
Linzy [00:19:16] Yeah. Because I think sometimes, you know, our businesses can feel like forces that are pulling us along. It’s like, oh no, no, I have to open a third location because I love her and I can’t lose her. And, and we end up making moves that actually are not strategic, because the other part of it, Courtney, is thinking about your energy and your focus. Are you in a place where you’re ready to, like, grow and support a clinician in recruiting other clinicians, training them, expanding your brand in that direction? Does that make sense for you right now? Does that make sense for the business? Or I mean, this path that you’re describing, this kind of transitional path of maybe she moves there and for a while she is on telehealth until X, Y, Z falls into place, the money falls into place, the time and energy falls into place. You’ve replaced your income at the old location. And so you’re not kind of taking a loss over here while you’re trying to grow over there, asking yourself, like, what needs to be in place so that I have the stability to branch out and grow again? Because with business too, there’s this concept of expansion and contraction or gathering. I like gathering more, you know, as a more neutral. And so there’s times when it makes sense to grow and you’ve positioned yourself to grow and you’re like, Yes, let’s do this. I’m going to like- because grow times are tiring, takes a lot., You know, you’re putting yourself out there, you’re trying things. Maybe it works, maybe it doesn’t. You get you interview a new clinician, they seem great. They don’t take the job. Like there’s rollercoasters that come with that. Right. So when is a natural expansion time for you? When are you really ready to lean in to expansion and take risks and do what it takes to make a location work? And when is it more of a gathering? Time to kind of get your ducks in a row, think it through, set a plan, and then move into expansion when the time is right.
Courtney [00:20:48] That’s it. Because I definitely see that with all these- even just asking you about these questions, I’m obviously in a gathering time.
Linzy [00:20:55] Yes.
Courtney [00:20:56] That I need to really focus my mind on that type of activities before picking out furniture.
Linzy [00:21:06] Totally. But yeah, furniture is fun. Yeah. Yeah. But we want to make sure you’re furnishing a location that’s set up to succeed and thrive and make your business better. Not become a stressor. Or a liability.
Courtney [00:21:18] Don’t we all need less stress?
Linzy [00:21:20] Yes, absolutely. And the image that comes to mind for me for that is just like getting your feet firmly on the ground, you know, like being planted before you reach. I don’t know. Is there another image that is more resonant for you? Like, what do you think of this gathering space?
Courtney [00:21:37] Oh, well, when you said grounding my mind immediately, but immediately went to just like grounding techniques that we help clients from. Yeah. You know, it’s even like settling the anxiety, like getting your- my own anxiety about this decision to a more manageable level. And so working on both the emotional gathering and the informational gathering at the same time. Yeah.
Linzy [00:22:02] Wonderful. Thank you so much, Courtney.
Courtney [00:22:03] Thank you, Linzy.
Linzy [00:22:19] So in this coaching episode with Courtney, that metaphor that we ended up spending some time on – of the time to expand and time to gather – was really powerful kind of shift, right? I think in our businesses it’s so easy, so often that it feels like business is happening to us, life is happening to us and we’re reacting, right? We’re just responding to what’s happening rather than us sitting down, gathering together, looking at the information and deciding when we want to grow, how we want to grow, if we want to grow. Having that grounded center as we’re intentionally growing our businesses, whether it’s a group practice or whether it’s a practice where you’re expanding into courses or workshops or or making maybe that first hire, you know, these are things that sometimes an opportunity comes along and it feels like we have to jump on it. You know, our anxiety ramps up, we get kind of activated and we feel like this is now, it’s now or never. And so rarely is it actually now or never. And as Courtney came to in our discussion, there was actually this other kind of middle path that she hadn’t even thought about yet around, you know, having her clinician who’s moving to another city work online for a while, which means she doesn’t have to make a big move at this very second and can be more intentional and thoughtful about expanding into another location in a new city. So really helpful image around that expanding and gathering. I’ve always liked that one and I’m glad that it landed here. I’m excited to hear what Courtney ends up doing. If you are enjoying the podcast, you can get more free content from me on Instagram, you can follow me at @moneynutsandbolts. We put out practical and emotional Instagram content on there all the time. About private practice finances. I’ve also started to do stories. I’m not really a social media person, but you might sometimes catch me in stories hanging out on my hammock or talking about something. So if you’d like more from me @moneynutsandbolts on Instagram and if you’re enjoying the podcast, please take a minute to jump over to Apple Podcasts and leave us a review. It is the best way for other therapists who would benefit from these conversations about money and private practice and emotions and money stories and capitalism and all of it to find me. Thanks for listening.