Episode 249 14 Aug, 2024

ARE WOMEN GROUP PRACTICE OWNERS FACING AN UNEQUAL PLAYING FIELD? WITH RACHEAL COOK

Racheal Cook 3

ARE WOMEN GROUP PRACTICE OWNERS FACING AN UNEQUAL PLAYING FIELD? WITH RACHEAL COOK

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  • Episode 249 | ARE WOMEN GROUP PRACTICE OWNERS FACING AN UNEQUAL PLAYING FIELD? WITH RACHEAL COOK 00:00

Ever wondered why so many women pour their hearts and souls into their group practices but still find themselves struggling to hit those higher revenue marks? Unfortunately, this is an all too common occurrence.

We all know that running a business as a woman comes with its own unique set of challenges, but the real question is: what can we do about it?

In this episode, I sit down with Racheal Cook to pull back the curtain on the stark realities that women face in the business world—like the fact that although we own nearly half of all small businesses, we’re only generating a tiny slice of the revenue pie.

But don’t worry, we’re not just here to point out the problems. Racheal dishes out actionable strategies you can start using today to close that gap and take your group practice to the next level.

Here’s a glimpse of what we cover in this episode:

  • We get real about the numbers—why women own 44% of small businesses but generate only 4% of total revenue.
  • The often-overlooked barriers women face when trying to secure funding and how to navigate around them.
  • We discuss why understanding your financial metrics isn’t just important—it’s essential for your practice’s growth.
  • Why building a strong, supportive network is a game-changer for your success and how to start cultivating one today.

It’s time to bridge the gap—because we all deserve to see our hard work translate into the financial success we’ve earned.

Thanks for listening! Like what you heard? Give us 5 stars on whatever platform you’re listening from. Need extra support? Join The Exchange, a membership community just for group practice owners on our website www.thegrouppracticeexchange.com/exchange. Talk to you next time!

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SPONSORS:

TherapyNotes: An EHR software that helps behavioral health professionals manage their practice with confidence and efficiency. Go to therapynotes.com/r/thegrouppracticeexchange for two free months!

GreenOak Accounting: An accounting firm that specializes in working with group practices. Mention TGPE to get $100 off your first month!

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Transcript: Racheal Cook

Racheal Cook 00:00:00 There is a huge divide between men and women in business, and I discovered 44% of small businesses are owned and operated by women, but we only make up 4% of total small business revenue. And that stat was shocking to me.

Maureen Werrbach 00:00:18 Welcome to The Group Practice Exchange Podcast, where we talk about all things related to group practice ownership. I’m your host, Maureen Werrbach.

This episode is sponsored by Therapy Notes. Therapy notes is my favorite EHR, and it’s one that I’ve been using in my own group practice since 2014. They’ve got everything you need to be successful in your group practice, and they’re constantly making updates and have live support. If you want two free months of therapy notes, go to Therapynotes.com/r/thegrouppracticeexchange.com.

Struggling with your practice’s finances? Let me tell you about Green Oak Accounting. Green Oak is the industry leader in mental health accounting, and they know exactly what it takes to help your practice thrive, especially when you’re scaling up. Green Oak is set apart from the rest by their deep industry knowledge and top notch advisory and CFO services.

Maureen Werrbach 00:01:15 Plus, they offer traditional accounting services like bookkeeping, tax prep, valuations and so much more. Here’s what’s in it for you. Peace of mind, financial clarity, and the potential to significantly grow your practice and profits. In fact, Green Oak has the most impact with practices looking for financial guidance when leveling up thanks to their CFO services. And they’re not just about crunching numbers. They also offer a mix of resources like the Therapy for Your Money podcast, the Profit First for therapist book, and self-guided courses to keep you informed and empowered and growing your practice. Ready to transform your practices financial health? Visit GreenOakAccounting.com to explore all that they have to offer. Green Oak accounting, your partner in financial prosperity.

Hey everyone, welcome back to another episode of the Group Practice Exchange podcast. Today I have Racheal Cook. She’s an award winning business strategist, the host of the Promote Yourself to CEO podcast, and the founder of the CEO collective. And her mission is to end entrepreneurial poverty for women. And that’s actually what we’re going to be talking about today.

Maureen Werrbach 00:02:34 Hi, Racheal.

Racheal Cook 00:02:35 Hi. I’m so glad to be here.

Maureen Werrbach 00:02:36 I’m really excited because this is a topic that I haven’t had on my podcast before. And I, of course, know that a ton of women listen to it. So I’m excited to chat.

Racheal Cook 00:02:46 Yes, this is something I have been on a mission to talk about because I learned years ago when I was kind of getting my business consulting practice up and running, that there’s a huge divide between men and women in business, and I discovered 44% of small businesses are owned and operated by women, but we only make up 4% of total small business revenue. And that stat was shocking to me, because I know so many women who are starting businesses and, you know, exclusively work with women who are starting businesses. And as I started digging into the numbers, because I am a research nerd, once I get my mind around something, I want to know everything I can find about it. What I discovered was 88% of women in business for themselves are not making more than $100,000 a year.

Racheal Cook 00:03:35 That means only 12% are crossing that six figure mark. And while six figures is a great take home salary for a lot of people and many places across the country, it’s not much when you are a business owner because it does not take into account all of the expenses of running a business, the taxes and running a business. If you’re a small business owner, you’re lucky to take home 50% of what you’re bringing in. Yeah. So that kind of led me down, this whole research rabbit hole that I have been in for the past 15 years to figure out why is it that women are under earning and actually limiting the impact that their work can make in the world?

Maureen Werrbach 00:04:17 So what are you finding out? I feel like I can just sit here now and listen to.

Racheal Cook 00:04:22 A lot of things. So one is women are traditionally very undercapitalized when we start small businesses. And what I mean by that is most women are more likely to start small businesses with little to no startup capital. We usually are self-funding.

Racheal Cook 00:04:38 We are pulling from our savings. We’re pulling from our retirement. We’re funding it with credit cards. We are a whole lot less likely to go to a bank and get a loan. We’re even more or less likely to go out and get, you know, raise capital. Now, most of the people I’m working with, their businesses are not a business where they would need to go raise like venture capital but it’s also very common in that world. Only 2 to 3% of venture capital goes to women founders. They’re much more likely to get venture capital if there is a male co-founder along with them. And in fact, a lot of my friends in the startup space, this is one of their biggest complaints. They’re saying, I can’t get anybody to fund my idea. But for a lot of small businesses that aren’t trying to go that route, they just want a business that actually pays them a great income. This becomes a big hindrance because we are more likely to need to depend on that business to pay us as quickly as possible.

Racheal Cook 00:05:37 A lot of women who are starting businesses, they need it to be making a take home income very, very quickly, which also means we don’t have years and years where we can pour back into the business and, you know, reinvest all of our profits back into growth. For a lot of us, that money has to be taken out to pay for our lives, and that means our growth is going to be impacted. It’s going to be much slower. We’re going to be less likely to go out and hire team and hire employees. In fact, most women owned businesses, it’s just the owner. There is no team or employees. We are more likely to be a one woman show than to have any sort of real team. And the lack of capital, the lack of access to additional funding. Those are some of the reasons why, like we are literally bootstrapping our businesses. But the bootstrapping, while it sounds great in theory, is actually really, really challenging for us to do in a profitable way.

Maureen Werrbach 00:06:35 That is a lot I feel like to unpack. Unpack. That’s. Yeah. So I’m hearing you with the women tending to lack the like, startup funding support, needing to more often than not start a business that can bring them in income more quickly. How can women define growth goals that will actually help them improve their lifestyle, especially if they’re in that. So obviously, the people who are listening in my industry are group practice owners, so they are hiring employees. They are, you know, maybe of that smaller percentage that is bringing other people in, how can they create these growth goals that can improve overall their life and their lifestyle?

Racheal Cook 00:07:21 Yes. One of the biggest things is just knowing your numbers. And I know this is something that not everybody loves to hear, because it can be uncomfortable and bring up lots of feelings. Looking at numbers but honestly not understanding your numbers is one of the biggest things that’s going to cause challenges in any small business. So as a group practice owner, especially as you start bringing on people into your team, one of the biggest things I start hearing from a lot of people is that they start to feel like they’re paying everybody else, and now they’re somehow a glorified assistant.

Racheal Cook 00:07:54 They thought by hiring other practitioners they were going to free up time and energy. But often what ends up happening is they’re just trying to keep the day to day going. They’re trying to keep the operations going, the administrative work going, all of the billing, all of that is now falling back on the business owner, and that is not much fun for the business owner. They start to feel like they’ve taken a pay cut here in order to grow their business. So that’s one massive thing, is you’ve got to understand your numbers and make sure that for each new person who is going to be coming into your business, that not only are you able to comfortably pay them, but that there’s profit margin to now go into hiring some support staff. This is one of the major areas that I see small business owners across any sector fall into, is they start hiring people on their business to go off and work with their clients, but then they don’t think about, oh, I need support staff to support those practitioners.

Racheal Cook 00:08:51 And that means, you know, again, the work’s going to fall back on you and then you’re not focused on growth. If you’re not able to stay focused on the activities they’re going to bring even more clients, or in this case, even more patients through the door. Then you’re going to find that your business starts to level out, or could even start to backslide a little bit, simply because all of your attention as the owner is focused on day to day basics instead of the big picture of growing your business.

Maureen Werrbach 00:09:18 Yeah, I see that a lot in my industry, especially in hiring like the first ten or so employees, is that they want to keep as much of the profit as possible so they don’t hire out support, but then they’re doing work that like if you were to pay it out, you can pay an administrative rate out that is lower than what you would want to pay yourself in this role. But they’re seeing things only from a very short frame of mind of like, I don’t I don’t want to invest this money into support staff because I need to pay myself.

Maureen Werrbach 00:09:52 But then what they’re doing is just creating a whole bunch more work for themselves, because now they have to do the billing, the answering, the phones the payroll and all those other things.

Racheal Cook 00:10:02 Well, and you end up cannibalizing your growth because as the business owner, you are the only person who cares whether or not your business grows. And that is the honest truth. Like, you will probably not find another person to hire on your team who will care about your business’s success as much as you do. So you have to know that you are the highest paid person on your team. With the highest paid person on your team really need to be listening to voicemails and updating invoices. Probably not. So it is a short term sacrifice to get administrative support in place, but long term you might pay that person 20 or $30 an hour to get going, but you’re able to shift your attention and your focus to those growth activities. I call these the thousand dollar an hour activities, where now you’re really growing your practice because you’re establishing a brand for yourself, you’re building a reputation.

Racheal Cook 00:10:55 You’re making sure that whoever is looking for you is actually finding your practice. And those are the things that are going to move the needle for you more than you trying to, you know, take care of everything just to save a little bit here and there.

Maureen Werrbach 00:11:09 Yeah.

Maureen Werrbach 00:11:10 What other strategies do you have for women who are wanting to grow their business but still be able to pay themselves, especially in those beginning stages?

Racheal Cook 00:11:19 I think one of the most important things for everybody is to know that you need to have a marketing system, a sales system and a delivery system. We call this your client growth engine. Now, the way I’ve designed the client growth engine framework is based on consumer psychology, based on how many of us go out to make a buying decision. But I find that a lot of people aren’t thinking in terms of this is a process. This is a journey people are going through when they’re trying to find someone like you. So especially in the world of health and wellness, I tend to find most of those people who are running those types of businesses are really good at the client delivery.

Racheal Cook 00:11:55 They’re really good at what they do right. But where they tend to get hung up is where do I get my clients from? How do I get out in front of enough people? And then how do I take that potential client and convert them into a paying client? And not just a paying client, but a paying client who returns, right? Because we all know, like any health and wellness space, coming to see you once is not really going to solve anything for most people. Might make them feel better in the moment, but long term is really where most health and wellness needs to be. So when it comes to doing the marketing, the sales and the delivery for this and your client growth engine, the biggest gap I see is people not understanding where people are coming from and how their potential client is thinking about finding a therapist or finding a provider. So I know a lot of people tend to default into, well, I need to jump on social media, but I would actually challenge you before you start getting into the grind of creating a ton of content and go through your client base and ask yourself, where did my last 10 or 20 clients come from?

Maureen Werrbach 00:13:02 You should be.

Racheal Cook 00:13:02 Able to track. And if you’re not tracking, by the way, go put this in all of your intake paperwork. How did you hear about us? Really simple question. Hugely important data. Because if you go back, those last ten, 20 people and 70% found them because of Google and they found you when they were typing in therapist for teens with ADHD, that is going to be where you want to put a ton of time and energy into making sure your SEO is working, versus cranking out a ton of social media content in front of a lot of people who may or may not be an ideal fit for what you’re trying to accomplish. So that’s one huge piece of it, is making sure you’re not just defaulting to what you might be hearing out on the internet streets about what works for marketing, because the reality is, there’s so many things that work for marketing. And if you are especially a local based business, I know most therapists are, you know, regulated and certified by their states.

Racheal Cook 00:13:59 Yep. You have such a leg up like any local business, because SEO is one of the most untapped resources out there. And if you don’t have a Google business profile, you’re very much missing out on a ton of free traffic people actively searching for your services.

Maureen Werrbach 00:14:16 Yep, I love that. I want to jump sort of in a very different direction, but I wanted to talk a little bit about why support systems are so important for women entrepreneurs. And I’ve heard this just from friends of mine who have felt like they didn’t have support as they were growing their business. I was lucky enough to have support. So I think I’ve had my business for 13 years now, and I probably have taken for granted the fact that I had support and didn’t realize how important it was at the time, especially when I was starting it. But in hearing so many of my friends who have started a business in the past few years who feel like they didn’t have a support system, how much it impacted them, I want to hear a little bit from you on that.

Racheal Cook 00:15:00 I think this is one of the most important things we can think about. And I’m going to share a quick story and then I’ll share some practical things. So both of my parents are small business owners. I grew up behind the scenes of two different small businesses, but in 1987, my mom was in a really terrible car accident that put her in a coma for three months and in the hospital for the next two years as she recovered from a traumatic brain injury. At the time, my dad was a brand new insurance agent. He was just a year or two in. If it wasn’t for the support system we had with other agents in the state of Virginia, they literally rotated around his agent number for two years. And when every week, somebody else was getting my parents their commissions so that he could focus on taking care of my mom. When I share this story, people are like, are you kidding me? This would never happen today. And I’d actually say you’d be surprised. If you intentionally build community, then you will have that kind of support show up.

Racheal Cook 00:15:59 And I see it all the time because working with women business owners, I see all sorts of things that happen to us, all sorts of personal tragedies that happen, all sorts of business challenges that show up. But when you have people that you can turn to and say, hey, here’s what’s going on, I need your help. They will show up for you. So this is something I’ve kind of been cultivating my whole life because it’s been part of my DNA. Part of how I just move through the world. And I think one of the things that makes us so unusual is a lot of small business owners don’t necessarily come from the type of background I have, where they have business owner parents, a lot of times they’re the only person they know who’s a small business owner. They don’t have any family, they don’t have any friends. If their family and friends don’t really understand what the stress of small business ownership looks like, in reality, it can be really easy to feel like they’re criticizing you or, you know, being negative nancys when really they just don’t know anything about what you’re going through.

Racheal Cook 00:17:01 So one of the most important things I always tell people is business grows at the speed of relationships. You have to be prioritizing meeting other people all the time, and you don’t just meet them once. This is where networking gets a bad rap.

Maureen Werrbach 00:17:15 Yep.

Maureen Werrbach 00:17:16 Quantity over quality. Yeah, yeah.

Racheal Cook 00:17:18 They’re like, you just go to these events and pick up business cards and then what do I do? And I’m like, first of all, I never do that. I go to the event, I host a happy hour, I talk to a bunch of people, the people who I enjoy talking to. At the next event, I’m going to make sure I see them. It’s making friends for grown ups in my mind. Like literally it’s not everybody’s going to be your new bestie, but if you go out there enough, you put yourself out there enough into the same types of groups, the same types of organizations. You’ll start to get a feel for, like, who is somebody who’s on the same wavelength as me, who’s goals are similar to mine, who’s perspective is similar to mine.

Racheal Cook 00:17:59 I find that the hardest part of it is just getting out there, though, so I highly recommend, especially if you’re a local business owner. Plug into existing groups. You don’t have to do this starting from scratch, but you can simply start by showing up to whatever local groups are happening, and there are probably some that you don’t even know about. You just need to, you know, get on the Google and look around. Yep. I’m here in Richmond, Virginia. We’re lucky we have so many business related organizations and nonprofits and groups, but there are national groups as well. If you’re not in a larger or I’m in a kind of small city, but if you’re in a small town, let’s say you’d be amazed how tight those small business communities are even in small towns. But it does mean putting yourself out there and going to patronize those businesses and going to connect and say, hey, I’m so-and-so and I run a practice here. I’d love to talk with you about, you know, how you work with your patients.

Racheal Cook 00:18:56 Maybe there’s a way we could collaborate, and it’s just going out there making those connections. And even though it is so incredibly awkward the first few times, you just continue doing that until you build yourself a community.

Maureen Werrbach 00:19:09 I really love that, and thank you so much for sharing your story, because it just really hits kind of home with how much having community support within the business realm, not even in terms of like, support at home, but from other business owners, can sort of make or break things. And I agree with you. I can imagine that a lot of people would say that that isn’t something that would be possible these days, but I think about like, just in the way that I engage with entrepreneur friends of mine who I’ve met that don’t live in my state, like I literally met them through online business stuff, who, whenever I see that they’re doing something new and cool, I’m like, tell me what I can do to help support you in just bringing that to life. And so real relationship building breeds that it does.

Racheal Cook 00:19:56 And it can be as simple as literally, how can I help? I find the challenge here when it comes to building those relationships is sometimes it’s like deer in headlights. What do we do? Yeah. And where a lot of people go wrong is they come out with a huge ask and there’s no relationship there. Right. Like you haven’t really gotten to know each other. I think the bigger thing spend time together, get to know each other, ask how you can help and what doors can you open for each other. Opening doors for other people is it’s like my best tip for anybody who wants to build an amazing support system, because I have so many small business owner friends who they’re like, Racheal, do you know a great CPA? I need to find a new person, Racheal. I need a new real estate agent. Racheal I need a new lawyer. Racheal I need a new chiropractor. And I’m like, okay, hold on. I’ve got someone here for you. And becoming that person.

Racheal Cook 00:20:48 That person who can facilitate those introductions. It also puts you know you in mind with everyone in your network, as this is somebody who’s a great connector. And if I make connections for her she’ll make connections for me too.

Maureen Werrbach 00:21:02 Yep, I love that.

Maureen Werrbach 00:21:03 So if people want to reach out to you, where can they find more about you and if they want to work with you?

Racheal Cook 00:21:10 Yeah. The best place to find me one is my podcast, Promote Yourself to CEO. We kind of hit on a fun grouping of topics here today, but my podcast goes deep dive into a lot of business strategy and how we put in place the strategy, systems and support you need as you’re scaling your business to multiple six and seven figures. You can also come over to the CEO collective. Com slash hello. And we’ve got a landing page there for anyone who’s finding me on podcast interviews just like this with some of our best free resources and training. So I’d recommend heading over there to.

Maureen Werrbach 00:21:43 I, really appreciate you coming on to share your knowledge, and this is just a fun topic.

Racheal Cook 00:21:48 Thanks so much for having me.

Maureen Werrbach 00:21:51 Thanks for listening. Give us five stars on whatever podcast streaming service you use, and I’ll see you next week.

Thanks For Listening

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 trainings ready for you to dive into. See you next week.

Resources

Here are the resources and guides we recommend based on this episode
GreenOak Accounting

GreenOak Accounting

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At GreenOak Accounting, we offer accounting services that cater specifically to solo and group therapy practices. Our services range from bookkeeping to budgeting & forecasting, Profit First support, profitability analysis, payroll, tax preparation, compensation analysis, and much more.

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For more information about our packages and the different ways to work with us, please visit our website at https://www.greenoakaccounting.com/ and schedule a complimentary consultation with one of our team members!

Therapy Notes

Therapy Notes

*Need a good EHR for your group practice? TherapyNotes is it. I’ve been using it for years in my own group practice, and it does really well when it comes to having the features group practice owners need. Try it out for FREE for 2 months by clicking here.

* I am an affiliate for some of the businesses I recommend. These are companies that I use in my own group practice, and make recommendations based off of my experience with them. When you use some of these companies through my links, I receive compensation, which helps me continue to offer great free information on my podcast, blog, Facebook group, and website.
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