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0:00So, my name's Zach Levine. We sell pain management services to New Yorkers. Okay. Um integrated pain, so chiropractic, PT. Um Like old people, young people, women, men? It We have a bunch of avatars right now, which is potentially a problem. >> Brick and mortar? Brick and mortar. We're out of network insurance, which is a dying which we'll get to reason. We do 4.2 in revenue. Okay. But you're mostly insurance? Are you mostly cash? Mostly insurance. Oh, mostly insurance out of network. Got it. I understand.

0:26>> Yeah. Yeah, 4.2 want to get to 20. >> Okay. Got it. We have three offices. Okay. Don't know exactly how to transition out of the dying business model. Obviously, our industry is growing. Yeah. So, what business model are you thinking about switching to? Cash. Mhm. I have a bunch of friends who are in network and murdering it. In network, yeah. Dude, why don't you get in network? We've just heard it's a grind you know, it's commoditized down to >> commoditized. It's a race to the bottom, yeah.

0:52Why do you feel like the way that you have right now is dying from out of network? Uh because reimbursements from payers are declining each year, whereas inflation and because the amount of people who have out of network benefits is dwindling as well. It's mostly just corporate. Uh-huh. Um and that's even declining. Uh Yeah, they're just getting smarter and they want to push everyone in network, so we're getting squeezed. >> Administrative burdens through the roof.

1:17Mhm. Prior auths, all this crazy [ __ ] >> So, this is a therapy provider who bills insurance. He's dealing with an issue that a lot of out of network are dealing with, which is that reimbursements, aka what insurance companies pay providers, is going down, but inflation and costs are going up, and so that's squeezing their margins. And for this individual, he was making zero profit. And so, he felt like he needed to change his model quickly. And so, basically you have two options. You can either go in network, which is you have guaranteed customers, but you're getting in a lot of ways like lower quality customers that, you know, the government and things like that are paying for, mass market insurance is paying for, or you can go cash cash pay.

1:54Right? Like you can people can just pay privately for whatever you want. And so, he felt more aligned with cash payment. And so, either way though, I think understanding what strategy is required to win within each of those paths was kind of the real decision, which is like, what problem do you want to solve? Do you want to solve the problem of learning how to market and sell customers? Because that's what it's like when you are in kind of the cash business. Right? And if you've never done that before, then that's a real that's a real beast to get over. On the other hand, if you want to be in network, then it's going to be a business all about operational efficiency. It's about returns on capital, and basically how efficiently you can staff up, and how low you can keep costs across the business because you have no pricing power. Right? So, it has to all be off of efficiency. And so, those are basically the two paths that he had. And so, I wanted to walk him through the the kind of the questions to figure out which of those he felt more aligned with. And it sounded like he definitely wanted to go more the premium cash pay version. And so, that was kind of the direction that I led him in. So, you basically see it as like I could either go in network and then make your entire business model around operational efficiency.

2:54>> Yeah. Um which is a which is I mean, I've got somebody who'd murder it doing that. So, I don't think there's anything wrong with that. Um or alternatively, you just go premium, be the best, and be be private, right? Be cash pay. So, the question is how do you transition it? Yeah. Yeah, I think we've decided as a team collectively, we just don't want to be in network Sure. because of the lifestyle and you know, whatever. So, >> And who you deal with. Yeah. Yeah, a pain. Um literally for you. Uh or really, I guess for them. Uh So, fundamentally, I think you just have to think about this as a basically starting a business over, but with resources already. You don't really have to think about the service. You probably don't have to think about the packaging itself. So, like what's the what's the grand slam offer for this?

3:33Yeah. Um and you'll you'll have a number of like you're you're just going to become a normal business. Which is just like you will run advertisements, and you will make offers to people, and then they will come in, and then they will take their credit card out, and they will buy [ __ ] stuff from you. Um and so, it's probably more that it conceptually feels complex more than it actually is. And so, it's probably a ripping the band-aid off thing. Uh which is that I would just out like so, one is what channel of acquisition you're going to use? I'm guessing right now is it mostly word of mouth? Yeah, it's referrals. It's been a business for a long time.

4:06>> so um one is you can start sell upselling existing customers. So, like obviously they have what's covered in from insurance, but then um you know, upselling other packages that'll get your team a little bit used to being like it's okay to pay us. That's from like a really tactical level. Uh but from an acquisition perspective, you've got content, you've got outreach, and then you've got you've got paid ads, right? And alternatively, you could have affiliates. So, we have to pick. So, of those four things, which ones do you feel like you are better suited? So, from affiliates, it's like uh go to shoot injury attorneys or like you want to find the the person that they're going to see prior to hitting you up.

4:39>> a bunch of that, and the issue there is that they want to send to a network, or if you're injury attorneys, to workers' comp cases, which don't pay very well. So, >> So, you don't want to go from that perspective. So, you don't want to do affiliates. Content probably in my opinion probably isn't the the the best way. Um so, then you have outreach, and you've got paid ads. I'm going to bet paid ads is going to be your better bet since it's local. It's pretty straightforward. Um operationally, it's not complex. Like running paid ads in a local area is like pretty easy. Um you drop a pin. You do a radius.

5:07>> we need more like so, obviously we have a bunch of different types of avatars. So, like really nail like what how would you say going about >> You're probably going to end up finding that you have one to three offers that actually convert, and then the remainder of your business will be upselling and cross-selling when they walk in the door. So, instead of thinking about your business as having like you know, we have 15 services, we advertise all 15. You're going to have one to three that convert really profitably on the front end, and then the remainder of your business is cross-selling and upselling. So, it's like you're going to have the most efficient door into your business, and then you'll end up just cross-selling and upselling people and retaining people from from from there. And so, like in terms of next steps, it's you need to record an actual ad for an offer, and then put it on Meta, and then drop a pin on the map, and do a 10-mi radius. Hopefully it all three are close together. And you'll run the ad. That'll then go to either a CRM, or if you're low-tech, you can just go to a Google Sheets, and then you can have your front desk call them within 60 seconds. And then if they don't pick up, call them again, and get them booked. Because your time is valuable, you'll probably want to consider running some sort of highly discounted assessment on the front end.

6:11So, that'd be like a $200 >> offer, yeah. Yeah, X-ray or something like that that they can get for 19 or 20. You don't care about that. You just want a credit card on file so that when they walk in the door, you have two things. One is that when they walk in the door, uh well, one, you you want them to walk in the door cuz they paid. Two, you can charge a no-show fee if you want to. Um but typically, if you're getting even a low ticket amount, you'll be in the 70 to 80% show rate, so you won't waste uh practitioner time. >> actually pulling out their credit card, yeah. Yeah. Okay. And just for the for the discount offer, now when they come in the door, you'll do the assessment, and then after the assessment, you don't treat them. You'll do the sale appointment then. You sell at point of greatest need, not point of greatest satisfaction. So, at that point is when you'll make the offer.

6:51Um and then you'll be like, "Hey, awesome. Do you want to use the card we have on file?" cuz you already have it on file cuz you got it earlier. It makes a much smoother sale. So, the issue he's dealing with is that he's at he's at optimized stage. He's 20 to 49 in terms of his head count. And the issue number one that he has is that he can't hire higher level talent because they expect full compensation, and he basically has very little cash to bring in the talent that he needs. All right, so that's number one issue that he's dealing with.

7:18Um he's spending money to grow, but he's not growing. Money's missing. And so, that's an issue that he's dealing with in finance. Because he has so many kind of products and services, the improvement between these things has gone down, and ads aren't convert Basically, he doesn't have any real ads or real way of getting customers in, and so costs are going up, right? And so, these are the issues he's dealing with, which is really common at this stage. Now, let's look at what he has to probably do in order to improve it. And so, he has to create customer segmentation by cohort and activation process, and then install sales training uh for his team so that he can start segmenting people and upselling them down a customer journey path. Instead of marketing all of these different products, he basically needs to make one or two or three entrance points in the business, then cross-sell and upsell all of these additional services that might not convert as well on the front end, but work very well for continuity, or for upsells and downsells, or even high ticket upsells on the back end. And so, he had basically has to shift his perspective from somebody who bills insurance that's just like whatever they take off the menu, you know, cuz insurance encourages people to be like, "Here's all the different services, and this is what we pay you for them." And so, people just try and offer lots of stuff. Once you have a cash business, it's all about efficiency of acquisition. You're trying to acquire customers as profitably as possible, and then ascend them to the highest LTV. And so, this is basically what he has to build is the sales system, the the ad assembly process to increase the volume of people coming in, segment the customers, and then learn to headhunt higher level roles once he increases the cash flow. Got it. Does that help? Yeah, definitely.

8:46>> Okay. That's what you have to do. Like you you have to learn how to acquire customers that are cash based. And so, that means that you have to run ads, and you have to sell [ __ ] What would you do like if you were saying from a strategy standpoint? Like we have the current business that's doing 4.2 million in revenue. >> You're going to keep that business, but you're all of your discretionary resources are going to go towards this if you want to build a build a bridge to tomorrow. Yeah. Should we do any of them more on the things that are still working within out of network? Like it's really just a you know, we have limited resources. How much should we spend on each?

9:16What's profit? We're at basically at zero. Oh, [ __ ] >> Yeah. It's part of the problem. Yeah. [snorts] We waited Yeah, we waited longer than yeah. >> Yeah, yeah, I understand. Like cuz you can't control how you're reimbursed. No, but we can remove the lowest reimbursement re- reimbursing patients, which is like remove Medicare, then we can lower our cost structure. We can go that route. >> think that would probably be the first thing that I would do. And then you can >> to free up cash flow, right? So, yeah, you'll you use these resources in terms of time and money to build the bridge.

9:46Make sense? Yeah, thanks a lot, Alex. Yeah, you bet. So, if you've hit a revenue ceiling, or your entire business relies on you to grow, then I'd love to invite you out to our headquarters here in Vegas to learn how we scale. It's a my team spends two days with you to identify the thing that's holding your business back. And so if that sounds interesting, click book a call and if you're a fit, we'd love to potentially see you out here in Vegas.