In this podcast, I interview the Entrepreneurial MD, Dr. Phillipa Kennealy.
With so many physicians punching the clock every day, today, as employees, I really sense a shift coming. There are so many doctors that are unhappy now. I think a big change is upon us and that physicians want to reclaim their time & their freedom. I believe that physician entrepreneurs are going to come back. Who better to speak to this than a physician who has done it herself?
That’s why I thought I would bring as a guest, my friend, Dr, Philippa Kennealy.
Philippa is President of The Entrepreneurial MD. She works with physicians who are struggling to become entrepreneurs and build their own successful businesses.
In this podcast, Philippa reveals:
– Learn about the wide array of businesses which physicians have started that Dr. Kennealy helped to coach
– Discover the top books that Dr. Kennealy recommends to other entrepreneurial MDs
– Learn the critical pitfalls that physicians make when starting a business
TRANSCRIPT
(Note: I outsource transcription efforts, please forgive in advance any grammatical errors. I just simply don’t have time to review it all)
Dave: my name is Dave Denniston. Welcome back to the latest episode of the freedom formula for physicians podcast. well in my book; “the freedom formula for physicians” I mentioned repeatedly time after time, how being a business owner is not only an awesome way to make some income but is also chalk full of having lots and lots of business deductions and then decrease your taxes.
Well, with so many physicians they are punching the clock every day and today as employees and I really sense a shift coming. I was just reading a [?] report on compensation and it talk about how there are so many doctors that are unhappy now. And I think a big change is coming on us when physicians want to reclaim their time to reclaim their freedom.
And I believe that physician entrepreneurs are going to be coming back. Well who better speak to this than a physician who was down it herself? And that`s why I thought I would bring a guest; my friend Dr. Philippa Kennelly. Philippa is the president of the Entrepreneurial MD. She was one of the physician who was struggling to become entrepreneurs and building their own successful businesses. she is actually a board certified family physician.
She left her own private practice in 1996 and then much later launched her first speaking and coaching business; OYA Consulting. And you know she is so passionate about professional development for physicians. Having being one herself, she wants to see physicians re-innovate, reinvigorate their careers to overcome burnout from a simple line medicine and as has been reported to her repeatedly, physicians are longing for more control over their lives.
She told me she believes entrepreneurship is one way to reintroducing doctors to their own creativity and resourcefulness. She has been a coach, she has this belief in helping physicians make their own way and to start with their own inventive ideas. So welcome Philippa.
Philippa: well thank you so much for having me here Dave.
Dave: we are looking forward to gathering your thoughts working with as many physicians as you do but first tell us a bit about you. I mentioned in the introduction that you were into medicine and you shifted your focus. Tell us more about your journey and how you`ve gone to where you are now.
Philippa: well I even want to take us long as it probably does take a time to tell you about my journey so I will give you the [?] version. I have been quite a bit of career change in my life. I have also changed countries having this accent obviously tells you that am from somewhere else. I was actually born and raised in South Africa and did my medical school there. And I had the opportunity to work in the rural bush in Zimbabwe just as that country was emerging into independence. Which was a really funny experience but obviously something very different from what one would expected as a physician here in this country. And then for personal reasons I moved to the United States a long time ago.
A little over 30 years ago. Had to redo my training and then went in to practice the family physician. Deduct the number of years and then realize that I was probably, I would have known to call it that but I was probably burning out and I desperately needed a change. So having got my Masters in public health I actually then found myself in the position of being a Hospital Administrator, Medical Director and then went down to become the CEO of a hospital.
And took a complete 180 degree turn at some point and went on to work in an internet startup, which was a really really fun experience until of course the doc cambas came. And then I had to reevaluate my life at that point and one of the things I encountered along the way was this thing called coaching. And I had always thought that it was a really intriguing idea because it seemed to me like it was one of those helping professions and with that I would maybe consider this is a retirement career until I was sort of faced looking at a big empty future not sure what I wanted to do.
Pretty sure that I did not want to go back into practical medicine. And so I decided to become a coach back in 2002. Did my training certification and I have been doing this work ever since 2002 and have really chosen to focus in on working with physicians primarily because that’s my natural fit, that’s the group of people I understand best. And that is where I think a fair amount of help can be offered. Sot that is in a nutshell.
Dave: what an amazing journey. So you started in South Africa and you got your medical degree there and then probably in the bush. Laughs. An amazing experience. And then you came to the US. Having been over the US or mostly are you in Southern California I understand.
Philippa: no I have been exclusively living in Southern California. I have had the pleasure of travelling much in the company in the country but that`s almost always for pleasure although fairly recently I have been doing a fair amount of travel for work as well.
Dave: very cool. Well you are a business owner yourself, you’ve owned your own practice, and you’ve been a CEO. Let`s chat about positions of business owners. What are you seeing out there today?
Philippa: well am seeing that there is a as you said in your introduction a sort of big push for positions to either consolidate or join organizations and enterprises and really give up that independence of their treasured and really thrived under until they were no longer thriving financially.
And so there has been a lot of pressure on them to make major changes and there has been a split in the way they have chosen. A small percentage, a relatively small percentage should I say have chosen to hang in there but revamp their business model so becoming sort of more [?] or hybrid [?] and obviously then a small number have been able to stay in the kinds of practices they have always been the [?] people in smaller communities where they still have I would say the market share of patients.
But to the largest extent I would say physicians are now kind of throwing the towel in and saying well am just going to go join a Kaiser or join some big organization or have some big daddy corporation take care of me and my practice. Or I am going to join an academic medical center, my practice will become an academic medical center’s practice.
My husband will want for example his practice was acquired by medical center, an academic medical center and it`s very positive experience for him but he was at a much later stage in his career so it’s a very shifting landscape is the bottom line as far as I can tell.
Dave: yes it seems like for the most part of the business owner entrepreneurial physician has been a dying breed but I really sense a lot of angst out there and people may be shifting the other direction. Do you sense that yourself or no?
Philippa: well I don’t know that I could say the majority are shifting into a more entrepreneurial mode. I think the majority are shifting into a sort of more depressed; should we say repressed mode.
But I think that there is a fairly substantial number of physicians who are sort of saying well I refuse to go down that path so let me look at the alternative, including leaving the practice of medicine but using the skill that I have acquired over time to build some other not necessarily traditional clinical practice.
Dave: well you are appearing for the interview and I have run into those kind of people, those browsing to your side then. Kind of that you have your own podcast, the conversations were trail blazers, and I went through a couple of episodes and I thought there were some really cool stories that we could share with other physicians of how some incredibly successful doctors have transitioned to become business owners. So tell us about that tell us one or two of your favorites.
Philippa: I can tell you about it in general. I wouldn’t have a very hard time picking on one or two of my favorites because there have been such a fascinating array of highly motivated and skillful people to interview so let me spick to the array of, kind of folks that I have spoken to. I have interviewed inventors.
Folks have come up with new nontraditional practice models which are quite different from your everyday traditional practice model. Folks who have become consultants, physicians who have been writers, they have written books. More than one of them in many cases. Anything from novels to non-fiction, how to help people. Physicians who have gone into or developed new services including technological services.
Physicians who have developed much more sort of holistic health programs; much more focused on health and wellness as opposed to taking care of disease. Physicians who have formed nonprofits. A lot of those emerging out of their own personal experiences. You know physician who had breast cancer and developed [?] services as a result of that. A physician I recall whose child was desperately ill and who developed a service as a result of that. Physicians who have become professional speakers. So it`s been just a great array of physicians doing all kinds of different things.
Dave: and how does this usually happen? Can you kind of take me through the process; is it something they are still practicing medicine for a long time as the transition of being an entrepreneur, does it happen suddenly? How does that occur?
Philippa: once again I think is a diversity is so big that really I think is any and all of that. There have been some physicians whose life circumstances have cropped up where they have had to make a fairly drastic change and totally rethink how they approach being a professional, showing up as a professional, there have been many physicians I have interviewed who are currently in some degree of clinical practice but are very actively involved in a business as a sideline.
And there are some who gradually transition out of medicine having had aside a business and then having recognized that they really couldn’t keep that up and their clinical practices and have opted once they felt that their business had a viable business model and they had something that was generating reasonable income but they have made the decision to opt out of that kind of practice altogether. And then of course there was some physicians whose actual practices have become highly entrepreneurial. So they have left practice at all.
Dave: alright alright. Well first let`s keep it pretty basic. What are the first few things that physicians should consider when they are starting their own business? Take us through those steps.
Philippa: well some of this work that I do upfront was my client when we`re talking about launching a business is; it`s very important to recognize the difference between being very gun hole about something and having strong believes about something and feeling like this is something that you’ve seen before in your practice that you think would be a good idea.
And discerning whether there is a real viable market for the offering. whether it is a product or a service. So having the discipline to do a little bit of upfront due diligence should determine whether there really was a market field services. Is very important and I will just give you my own personal story when I decided to transition out of oil consulting but chose my sort of my more generalist coaching business into the entrepreneurial MD;
I did that in 2006, before I decided to have this much more focused area particularly from a marketing stand point I quickly discovered that you can`t, you know I could coach anybody theoretically but I can`t market to everybody. It`s just not targeted and focused enough. So I had to pick a niche particularly for the purposes of marketing and I loved coaching physician entrepreneurs but I wasn’t sure that there were a lot of physicians who would be interested in those coaching services.
So I had the opportunity to do a survey and survey of group of physicians through a relationship that I had. Somebody who had a lot of physicians on the list. And I came back with 85 people really really interested expressing very strong interest out of a 100 surveys that I sent out.
And I felt that was probably a relatively strong indicator that there was going to be enough in the market so I didn’t have to hire a marketing focus group person or anything else, actually with this day and age with accesses to things like survey monkey or LinkedIn or good networking opportunities I think is perfectly ok to be able to ascertain a market but is not just about you and your idea. It`s about if there is a market place of people who are interested who have the need or desire and the ability to pay. That’s critical to determine.
Secondly I think it`s really important to recognize that whatever you are going to do is going to take time. And it always takes two or three times as much time as you estimate is going to take. You make a big mistake about time management and how are you going to fit this into your life if you have to do multiple shifting emergency.
If you have to show up every single day in your practice or if you have to do surgery three or four times a week. You know, you do need to know that this is going to take time and is going to take a certain which I think is the ability to sort of really organize your thinking. You can`t just sit around the place and just go from here to there and hope that out of this some kind of business will emerge.
I think that that`s inefficient and is going to take incredibly long time and this also going to lead most people to give up because they really haven’t developed a systemized approach to things. So organizing your thinking and then doing some realistic planning.
When I say realistic it`s hard to be realistic about something that doesn`t exist yet. But sitting down and doing some planning; a best case scenario, a medium case scenario and a worst case scenario. Is it still enough share for me to move forward? I think that’s really important as a way to begin thinking about going into business yourself as an entrepreneur.
Dave: well and I find across divisions they are so busy, finding time can be difficult and I know for myself, finding time to write or do podcast what I have to do is block out time. You have to dedicate it.
Philippa: yes absolutely.
Dave: so you have to dedicate that time and be committed to doing what you are doing so that might mean maybe saying on every Friday from 1pm to 3pm am going to work on my business whatever that may be.
Philippa: exactly and you used a really interesting phrase here “am working on my business”. Most people get caught up working in the business; you are delivering the service or making the product and is critical to curve out that time to work on the business. To strategize or to come up with your marketing plan that you are going to adhere to on a regular basis are all establishing the critically relationship. Whether they are going to help you move your business forward.
Dave: and I have heard from myself being a business owner I think I have the attitude and I think many people make this mistake of “I am not going to fail”, you know “I am not going to give up” if I mess up on something is going to happen but am not going to give up. I am going to keep going and keep trying and keep pushing until I make it succeed.
Philippa: correct. You are saying that that’s helpful.
Dave: yes and I think that…
Philippa: absolutely. That persistence and tenacity is critically important. I will say that that’s a really common scene amongst all the physicians that I have interviewed for my podcast series. This idea that having the tenacity to keep pushing through the down times and the disappointments has been very important to their success.
Dave: absolutely. Now I can`t agree more. You have to keep on and going on at what you`re passionate and you love doing what you do. And what about just financially, this is one of the tough things of being a business owner and I think there are some pitfalls. What do you see in terms of how physicians can get trapped when they start a business? What are some financial advice that you will give to folks when they start a business?
Philippa: I see it as sort of one or two extremes in a way. I see that either physicians are underestimating what is going to cost to get a business up and running and not really recognizing that there are capital requirements. You know what is going to take to get the business started. And then there are operational cost that might be needed whether on a monthly or quarterly or on annual basis and plugging all that into some kind of a pro-format.
Understand what this business is going to cost them. And not recognizing also that there is an opportunity cost that when you choose to do something, focus on one particular activity, you lose the ability to do another activity. So we recollect the opportunity costs and understanding that there are very often opportunity cost and you want to evaluate whether that opportunity cost is worth it or not. So underestimating what is going to cost.
I think the other thing that I see often as an opposite extreme stream and this is more in the coaching that I do rather than the folks who have actually made it in the podcast series. Is that they sort of overestimate what is going to cost and this has a sort of negative impact on their ability to move forward.
They become paralyzed thinking well I can`t really do this because I can`t afford to and it leads to a lot of fear. Again going back to the conversation the [?] basis series. The ones who have made it have been able to get over that period and take on some risk and recognize that there is no guaranteed future or no ironically in healthcare now.
There is no guaranteed future even if the [?] position and commission. So I feel there is sort of two different extremes in a way overestimating what it might cost and then holding back for fear that is going to cost too much or underestimating what it cost, is going to cost. The cost not being realistic and then finding yourself in a bigger hole than you anticipated. I don’t know if that is similar to what you’ve heard.
Dave: well you know, I think that I find overestimating on cost by itself as you mentioned isn’t necessarily a bad thing but I think there is this whole emotion that you mentioned of fear over all. Its fear of failure, its fear of the unknown, it`s fear of what am I going to do, what is life going to be like, when you have in most cases a very steady, a very nice paying job and I think that in general if I was to pull out one word do it would be fear from what I see of people starting their own business and people that are entrepreneurs.
You look at these people on short change. when they see something that they love they hop on to it. They don’t have fear about it you know they are going to do whatever they can to make it work. So I think that’s what really separates successful business owner from one that doesn’t make it. What is the statistic; 80%? 85? Of businesses close I can`t remember.
Philippa: well it depends on the length of time that you are looking at but apparently high number closed within a short period of time. And then obviously significantly higher number closed within five years so be able to plan ahead and doing it for the long whole I think is important.
Dave: absolutely absolutely. And I think is kind of interesting where today one of the big financial pitfalls that is really tough to deal with as a young physician if you have just transitioned out of residency you have 200,000 or 300,000 dollars in medical school debt. And that can be a real petty. Have you been seeing any young physician entrepreneurs feel about that that have been making it and paying off their student debts and successfully stunning?
Philippa: well am working with a young woman right now who is very very disciplined and she has had a fair amount of debt but she and her husband have been very disciplined about having a budget, sticking to it and then being rigorous about paying off her debt so she needs to pay off some more still. But she’s been very very careful with how she is managing her debt so yes am working with somebody right now. It`s not the common one, I tend to work with physicians who have been burning out of medical practice a little bit later in the process forty enough. But she isn’t a perfect example of a physician who is only been doing this for a couple of years and is already seen that this is absolutely not the lifestyle that she thought she signed up for.
Dave: well there is so many pool of things that being a business owner in terms of choosing your corporate structure, having a bit more tax efficiency, setting up your own retirement plan that are fantastic ways to be saving tens of thousands of dollars in taxes so there is something that is so important to me that I think more physicians should do.
And I think as we are kind of rapping up here and we are heading towards the time one thing I love doing is empowering people, empowering physicians with the resources and whether is a book for a resident or a fellow or a practicing physician or some videos or some courses. It seems like that financial 101 course gets missed out in the mist of all the schooling. So Philippa what would you suggest in terms of resources that you would suggest to a physician that is looking to start their own practice or become a business owner? What some good stuff you term unto?
Philippa: there is one thing that is really really critical to my thinking and it was a big eye opener for me as I … yes because I jumped inside of the coaching business. I didn’t really know what I was doing and then as I was coming up with the entrepreneurial MD I wanted to get it right.
Is not that I was doing it wrong or incorrectly for the first two years but I didn’t really know what I was doing so I was learning about business massively on the fly for the first two or three years. But a book really turned my thinking around is called the E-MIS REVINSTON by Michael Gerber. I think that’s a really really critical book for people to read. E-MIS; E standing for entrepreneur. There is one for medical practices I didn’t find that a very good book. He wrote that one as well but just the EMIS revisited. He originally wrote the first book I think in the 80s and then he revisited the book and wrote it in I think later 90s. And he also has a E-MIS mastery book where he goes into great depth about how to actually apply what he says the E-MIS.
But just that book alone I think is fantastic. Depending on which line you are going into there is another book that actually a lot of my clients have found helpful; “What Business Should I Start”? By Rander Abram. She just take people through the step of thinking in a much more businesslike fashion and is very helpful for the physician who feeling entrepreneurial, thinking about getting out of practice or thinking about doing something in addition to the practice because they are frustrated or they are bored and looking for new stimulation, and don’t know exactly which direction to turn.
So it`s a great process for helping think through what business might be good for them. I would offer my own website as a resource for physicians because I have been blogging for, well since 2006, so what`s that; 9 years. There is 9 years of content on all kinds of topics relation to professional development and in particular professional development as an entrepreneur and a business owner.
Dave: and what is that website just so people know.
Philippa: that`s entrepreneurialmd.com. the quick way to get there is T for tommy, E for Edward, M for Mary, D for David, HOME; that’s a one word, temdhome.com. Otherwise if you can spell it is entrepreneuralmd.com. And I have just redone my website so is not fully mobile responsive. And then another book that I thought was really really helpful; if you are wanting to understand how to use the internet as part of your resources by a guy called Perry Coleman, there is a book called E-booth Camp. It was written back in 2009 but he really did get under the skin of what the internet is all about and how to think about a business that has got an online component to it. He has also written a couple of update books on social media and on speaking presentations. But I just, you know a few bit basics like that and in fact I actually have a list of book resources on my website as well.
Dave: well they have to check it out and they can find out.
Philippa: exactly yes.
Dave: well this was great Philippa, I think there is a lot of great things people can walk away with. Well if people have more questions how can they get in contact with you?
Philippa: well I do have a contact form on my website which is probably the easiest way to get hold of me because I am very responsive to email and so if they just go to the contact page on my web form. Am assuming that somewhere on your blog or you have a link associated with this podcast and you can just put in the entrepreneurial MD with a link, my contact form will be there. Probably it would be the easiest way to get hold of me.
Dave: ok great. Any other closing talks?
Philippa: no I think you are doing a great service for physicians, helping them get their finances in order and helping them look at different ways and how they can optimize their own professional experiences. And so I think everything that you are doing you are bringing in these kinds of conversations and is going to be invaluable for them as they think their way towards professional fulfilment.
Dave: well thank you. This is fun and I appreciate having you on. I just want to say to folks out there. If you are a physician and you want to share your story, you have something you want to share, probably some of these tough issues of starting your business. You want to get on the show box for a few minutes and you would want to share it too, that is freedom formula for physicians podcast. And you can contact me at daviddenniston.com or on my website; doctorfreedompodcast.com. Make sure you subscribe for the freedom formula for physicians podcast this is Dave Denniston. Thank you so much for joining us and make sure you check in again soon. Have a good one.
