Episode 201 | How to Sell Your Group Practice and What to Consider with Gabrielle Juliano Villani

This week I have a guest expert on them, her name is Gabrielle Juliano Valani, and she is someone who sold her group practice. And so she’s gonna talk to us about what that was like for her and give any feedback and suggestions for those of us who might be considering selling or positioning our group practices in a good way so that when we’re ready to sell, It is ready to sell.

How are you? I’m good. Thanks for having me. How are you doing? I’m not too bad. I had a busy morning. I took my ADHD meds really early, so I was like up on the go. I went to the gym already. I took my walk to Starbucks already. You’re my first order of business for the day, so I feel like I, My gosh. Well, hopefully, some of that productivity comes over here to me cuz I need it.

Oh my gosh. Well, I know a lot of people have been talking about selling their group practices. I also think because we’re in a season these past couple of years where these bigger companies are coming in and buying out practices. This is just a topic that people are asking about and then those that are proactive and might not yet be ready to sell are just thinking.

What they can do to better position themselves for that time when they’re ready to sell. So I’m really happy that you were willing to come on for listeners. I know you haven’t thought about selling or you don’t know what the process of selling is like there. Are, as you’ll probably say, Gabrielle, there’s a lot of questions that might not be able to be answered directly because once you sell, you usually sign paperwork NDAs and things like that that don’t allow you to talk about the nitty-gritty of it all.

So we’re gonna stay global and just know if anyone’s coming to you. I know in my Facebook group, a few people asked direct, direct questions and you’re like, Yeah, I can’t answer that. That is just the way it is. So start by telling all of us where your group practice was before you sold it, how long you had it and what your frame of mind was in getting to the process of selling.

Was it something that was on your mind? Was it something that just happened by happenstance or like a good opportunity? What was that all like? So I started in 2017, in December. Just in private practice. And I of course told myself, Oh, I’m just gonna have like this little private practice. I’m gonna have 15 clients a week, and that’s all I’m gonna do.

And my practice grew really quickly because of the population that we served. We were Medicare providers, and I also, in the beginning specifically only did home visits for my clients. I got really busy really quickly and I was seeing almost 30 clients a week driving all around Denver, Colorado, where I live, and seeing people in their homes.

And I also teach Zumba and a Zumba student of mine was like, I’m an out and we have a social worker on staff who wants to work with you. That’s exactly what she wants to do. You should hire. So that’s kind of where I started my expansion and she was my first hire and it just kind of grew organically from there.

And then of course with C, that changed things we weren’t doing in-home anymore, so we switched to completely virtual. And at our biggest, we were 15 clinicians. And when I sold. We were at 10 and I sold at 2021, and most of that growth happened between 2019 and 2021. So really only over like two or three years.

Yep. 20 we were in then, right? Yes. . I have no idea what it’s we’re. So what prompted the selling? So like a lot of people, I was very burnt out and I also had Covid in 2020 and it was very, Life changing for me. There were a lot of things that happened during the pandemic. They think that a lot of us were just like, The fuck are we doing with our lives?

That’s how I felt. Yeah. I was like, I have been on autopilot all this time and I can’t do this anymore. , and through my own therapy and the self-reflection, I just was like, This is not what speaks to. There are so many changes that are happening. There’s a lot of risk and liability and this is just not what I’m passionate about anymore I need more help was the other thing.

Cuz we had grown so much and I was on this plateau where I was like, I can’t afford to offer more, but I want to offer more and keep growing and I can’t do that without any help. So I. Talked to a friend of mine, she’s actually a mentor of mine and she works in a totally different industry. She’s also an entrepreneur and she’s like, You could think about selling.

And I was like, Yeah, well maybe. So we ran some numbers and of course, I was like, That’s not enough money. Cause it’s never enough money. . Yeah. And I just kind of put it on the back burner. But I had just put that thought out there and the universe delivered a message, And last summer I got a phone call out of the blue and they were like, We are a private equity firm that represents this outpatient clinic in a different state that’s looking to acquire your business.

And it was like, That’s like totally spam. I’m not gonna respond to that. But this friend of mine was like, No, you should call them. And. And that’s how I, that’s how I found my buyer. So you never know. What did the process feel like, the transition process from making the decision and that decision being finalized?

How emotionally and like just on your end, not maybe the logistical steps, but what did that actually feel like for you? There was a rollercoaster of emotions. It’s a lot of ups and downs. You can’t really talk about it because a lot of it is confidential, so I can’t put it on Facebook or whatever like, so I felt very isolated.

I felt shame like I had given up and I was a failure and I couldn’t do this anymore. Then the next minute I’m like, No, this is amazing. I’m like on the right path for what I want, and this is my calling. This is what I need to do. So it was a lot of ups and downs. So it was important for me to have a couple of support people that I could talk through with this.

And I also had a broker who really helped me, and one of the things he said that just changed my perspective a lot was, this is your life. Think about what the end goal of your career is, and what you want. This is just one stepping stone to getting there. That really helped me because I was so stuck on it. This is my identity.

Yeah. What am I gonna do if I’m not doing the claims and the billing every day and managing the referrals? Like, what is it? So that mindset shift was huge for me. I really like that. I think that’s probably a common thought process that people go through when selling, especially when they still feel tied to their business identity-wise.

how long was the process for you to talk to this company, to sell it? We started talking at the end of July 2021, and I officially closed on December 31st, 2021. About, That’s six months things I feel like. I wasn’t aware of and from a few friends who’ve sold their group practices, one very similar to you in the rollercoaster of emotion.

The process actually is shorter than I thought. I know a few people who are even in like the three-month range, and so I just assumed it was like gonna be this really long process and to hear from over the past couple of years, friends who have sold how fast-moving it actually. Yeah, it can be. And I think a lot of times it depends on a couple of things.

Like if you were selling to another therapist and they needed to get financial stuff in place, it will take a lot longer. But a lot of times they want it done in less than six months, which is nice to just get through it. Are you completely out, I know a lot of places require working in the business for like a year or two years after selling.

Was that something you had? Yes. So that’s another really common thing, and I think a really big misconception when I tell people that I sold my business, they think you just sell it and you’re done, and that’s it. But think about it, if you were buying someone’s therapy practice, you probably wouldn’t want the founder to just up and leave, right?

Yeah. There are so many things that still need to be in place to help with the transition. So it’s not good for your team, and it’s not good for the clients. To just leave. So that’s really common. So yes, I still work there and I have the same position I had before. I’m the clinical director. I still see a couple of clients.

I still manage my team. So yeah, that’s very common. They almost always ask for that, and I’ve seen them ask for up to five years. Yeah. Now I know that there’s a lot, especially with private equity firms, that would love to have the founders stay on board. And I think that’s something also. Practice owners don’t realize is an option for maybe those that wanna really let go of some of the liability and, you know, kind of wearing a million different hats is that there are options to sell while also not fully leaving the industry.

If you aren’t wanting to, if you’re maybe wanting to go back to really just doing the clinical work or supervision. . Yes. Which is perfect. You know, the company that acquired mine has bought some in other states too, and some of the other practices they bought, you know, that’s exactly what ended up happening.

The owner was like, I don’t wanna do the admin, the back end stuff. I just wanna see clients. Yeah. Indefinitely. And I’ll stay here as long as I can just do that and not have to worry about anything else. Yeah. That’s awesome. So you are in a leadership role there. Yes. Like the clinical director. Mm-hmm. , how does it feel being on that end without ownership status?

I’m trying to ask you, make sure to ask the questions. I envision as a person who’s a business owner, that you have all the decision-making control, right? Mm-hmm. . And when you let that go, was there a transition period where it felt like everything is out of your hands, but you’re still in it? And was there this?

Shift that you had to make yourself with your relationship to the business, I guess? Yes. That’s exactly what it felt like and looks like. Yes. So in the beginning, not too much has changed because it takes so much time to get into a new EHR and transition. So in the beginning, it’s really just kinda like business as usual.

And then slowly we kind of just started rolling things out and. Felt different. And sometimes I would be stressed about something and I’m like, That’s not my problem anymore, I don’t have to do that. But yeah, it does look different and can be, I think, a little bit blurry during the transition like what are the expectations and what aren’t?

And so that can be challenging, but it’s just part of. , what’s your suggestion? How do employees respond or feel about that change? Mm-hmm. , when a group practice owner’s still there because of the employees. Also, have to make a shift in their relationship to you and not see the business owner or the previous business owner as the person making these decisions.

I know from other friends of mine that lots of employees left during those transitions cuz there’s change. It’s a big change. It’s human nature. People fear change and there’s an assumption that it will be. For employees. That’s how employees feel generally because usually you look at the businesses and they’re making decisions just for themselves and not their employees.

So there’s a genuine fear that whatever this change is, it’s not gonna be in my best interest. And so a lot of people leave, but there’s also what I’ve seen is how the business owner might, or the past business owner might feel there to blame in a way because they initiated that selling. And so anything that happens after is still somehow felt.

On that founder. Does that make sense? Yes, it makes up. I’m wondering what is your feedback for those that might be in that space right now of having just sold and seeing so many changes. I know like you said, EHR changes are usually one of those leadership changes. What is your feedback for founders who are maybe in the thick of it and feeling like, uh, all their staff are just upset with them for making that decision?

I would suggest being as open and transparent and available and supportive to your staff as you can because it is a big change. Perhaps just giving some clarity as to why things are the way that they are. Like if you’re selling because you are burnt out, or if you’re selling because you’re retiring and this is the next step for you, or if you are just retiring from this field and you’re planning your exit, or maybe that was your plan from the beginning.

This has always been your exit strategy. So being transparent and supportive, and also including the new owners, the new CEO, hr, whoever, as much as possible so that they can start to build that rapport and relationship with those employees. That’s smart. One of the things that I personally have struggled with, obviously I’m a larger practice and so the pool of candidates who could potentially buy my practice whenever that might be, is limited, and I’ve done a lot of research on finding ways to turn it into a work or owned cooperative.

It is just almost impossible at my size to do, and it leaves. To private equity firms and these big corporations, and there’s this feeling that selling to companies like that isn’t in alignment with my vision, but also feels like it’s the only option. . I don’t know how you felt about that. It just is my own struggle in thinking about how could I ever sell it.

It just likely has to be in that sort of arena. For anyone else who might be struggling with that, what is your feedback? I know you mentioned like, you didn’t say solo, but that’s what I feel like. Mm-hmm. , I’m gonna be selling to the big, bad people. And if you think about it from the group practice owner’s perspective, it’s like those are the people eating everyone up.

And it’s like this very negative thing. I guess, what’s your feedback or thoughts on that? Yeah, that’s very common, and even I see in your group and a couple of other Facebook groups, people saying similar things and it’s a mindset shift, and I think just leaning into that and thinking about perspective, first of all, you’re still gonna work there, so you’re still gonna be a part of what the practice looks like.

Mm-hmm. , The other way that I think about it is, This is really better for the employees. They get things that I couldn’t offer before and you know, that might not be true for you since you’re a little bit bigger, but. There’s gonna be more support. All of my people get PTO, which we were just starting to roll out cause it wasn’t quite to that point yet.

They had a 401K with a match. They get better health insurance than they had before. So there’s more support there. And I also think of it as, This also still like it’s going to happen, right? It’s already happening, so why not be a part of it and be a part of that change and include yourself to be able to, you know, make what you feel are like the right decisions or you know, however you wanna think about that so that you can be more involved in these companies that are coming into our field and that you can actually have a say and a voice and what that looks like.

I think that’s actually the best feedback. For those practice owners who do decide to stay, especially maybe past the one year or whatever minimums is like as these bigger companies might not be therapists and might not even live in the state and be a part of the day-to-day decision making. Having those practice owners who sell be up is still a part of it.

They can. Some level of control and I think can also make that a part of negotiating in Yes, the sale. Mm-hmm. , if that’s a value for you to be able to be an advocate for the employees from a clinical perspective, maybe that’s that middle ground. Yeah, I like that. Yeah. That’s how I try and think about it.

And you know, at the end of the day, like. Part of my values and mission was like, we want to be able to serve clients and as many as we can, especially because we take Medicare and Medicaid. Mm-hmm. , and so this was like the next step in us being able to help even more people than we could help before. My last question for you as we get towards the end is for anyone who’s thinking about in the next one to three years about selling, what are your tips or feedback for getting yourself a better position?

Even if you never want to sell your business, you should act as if you do because that will make it run. So efficient and profitable from the very beginning. Cuz sometimes I do consult with people or they ask me and they’re like, I don’t wanna sell but I’m just interested. But you should act as if you were going to from the very beginning cuz that will always make things wrong as smoothly as they can.

Of course there’s always gonna be something that’s part of it. But some things to think about are really keeping an eye on your numbers and I know. A lot of us have money issues, and we’re scared of looking at the PNLs that really sit down with your accountant or your bookkeeper every quarter. Look at your revenue, look at your profit.

What can you cut out? What expenses do you absolutely not need? Make sure you’re not paying your employees too high from the beginning. I think that’s another really common thing that happens. We want to pay the best wage we can, of course, because we want our employees to make the money that they deserve.

But when you do that, it might not be sustainable for your business. And I would also say streamline your processes. So don’t have a million different apps for doing things like if you’re using Simple practice and Zoom and something else, like try and streamline everything to make it as easy as possible.

And document everything. If you change a system, why did you change it? Document that. Oh, I like that. Mm-hmm. , I really appreciate you coming on and sharing your experience and giving feedback to those who may or may not be considering selling. I know it’s such a hot topic these days, and I think the reason that you sold, and the reason is that most people right now are feeling like practice owners and clinicians.

I mean everyone, and I know I’ve been in that burnout. For a little over a year and feel like I’m just getting out of it. And so it makes a lot of sense that people are thinking about it on top of the fact that we’re just seeing a lot of information in news about, you know, practices absorbing each other and scaling in this very large sort of way.

So I think it’s at the forefront of everyone’s mind, and I really appreciate you sharing your slice of what that was like. Yeah. Thank you for having me. I hope that it helps some people out there who are maybe considering or just starting to think about it. So for those who might be interested in learning more about your support, for people who are looking to sell, where can they reach you?

You can find me on Facebook and LinkedIn. Gabrielle Giuliano vlan or Gabrielle giuliano vlan dot. Perfect. Thank you. I appreciate you coming on. Thanks for having me. Thanks for listening to the Group Practice Exchange Podcast. Like what you heard. Give us five stars on whatever platform you’re listening from.

Need extra support. Join the Exchange, a membership community just for group practice owners with monthly office hours, live webinars, and a library of training ready for you to dive into. Visit www.members.thegrouppracticeexchange.com/exchange. See you next week.