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Study Hall: HOW TO START A HEALTHCARE STAFFING AGENCY · Earn Your Leisure

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Speaker 2: So can you talk about that As far as your
1:00
Speaker 2: backstory into coming into the health field and what made
1:04
Speaker 2: you transition your family's trajectory from being a healthcare worker
1:08
Speaker 2: to being a healthcare.
1:12
Speaker 3: The trajectory was started with my mom.
1:16
Speaker 4: Wait, she was the first one to make the pivot
1:18
Speaker 4: into doing something entrepreneurial in healthcare. She started a nurse
1:23
Speaker 4: staffing firm or what they call nursing agencies, so I
1:27
Speaker 4: was helping her out with that, and that's what got me.
1:31
Speaker 4: Like that early exposure to, you know, being entrepreneurial in healthcare,
1:36
Speaker 4: my mind was still on, Okay, I got to get
1:39
Speaker 4: go into a healthcare profession. They were thinking that all
1:42
Speaker 4: of our kids were going to become doctors. My brother
1:44
Speaker 4: is a physician, and another one of my brothers as
1:47
Speaker 4: an MRI technologist as well. So a lot of us
1:51
Speaker 4: went straight into healthcare because that's what was drilled into
1:54
Speaker 4: our heads. But as I was going through school, I
1:58
Speaker 4: started to focus more and more on the business side
2:01
Speaker 4: of things, eventually opening up an expansion of the healthcare
2:06
Speaker 4: company in Long Island. And I was using school and
2:10
Speaker 4: using that experience to kind of build and improve the business.
2:14
Speaker 4: She was working at a nursing home and they were
2:18
Speaker 4: using what they'd call agency nurses, and she was like, well,
2:21
Speaker 4: why don't I just start when I want to start
2:23
Speaker 4: an agency and get my friends from other hospitals to
2:26
Speaker 4: work for me and be one of your providers.
2:29
Speaker 3: And that's where that company started.
2:33
Speaker 4: But my mom has like zero computer skills, So when
2:36
Speaker 4: it was time to create the documents, it was me
2:38
Speaker 4: making the documents.
2:39
Speaker 3: When it was time to.
2:40
Speaker 4: Create spreadsheets, to do the invoicing, to manage quick books,
2:44
Speaker 4: anything that was on a computer was me, right because
2:47
Speaker 4: I was the kind of computer geek of my household.
2:51
Speaker 4: So I was like, Oh, Carl, I need this, Can
2:53
Speaker 4: you know how to make this? Could you get get
2:55
Speaker 4: it out of the computer. So it was always me
2:58
Speaker 4: and my mom working on that side of the business.
3:01
Speaker 4: So when I went to college, I ended up expanding
3:06
Speaker 4: the business into Long Island, and every lesson that I
3:12
Speaker 4: took that I could kind of like learn from to
3:15
Speaker 4: bring that knowledge back to the business, I did, and
3:18
Speaker 4: I ended up studying health technology and management with the
3:21
Speaker 4: concentration in radiology radiological studies, and that was to become
3:28
Speaker 4: an X ray tech and a cat scan technologist and
3:31
Speaker 4: an MRI technologist. And I chose that path because I
3:35
Speaker 4: wanted to have flexibility in when I worked, right, because
3:40
Speaker 4: there's certain positions in healthcare that are twenty four seven
3:43
Speaker 4: and there's some of them that are only like nine
3:45
Speaker 4: to five, and I didn't want to choose a career
3:48
Speaker 4: path within healthcare that would narrow me down to work
3:51
Speaker 4: in nine to five, because I knew I needed to
3:53
Speaker 4: have the nine to five the business hours free to
3:57
Speaker 4: expand on my business. So that was kind of the
4:00
Speaker 4: reason why it chose x Ray because it's you know,
4:02
Speaker 4: their x ray techs are working all shifts, they're doing
4:06
Speaker 4: cascaing at night, or they could flex into MRI. So
4:10
Speaker 4: I thought that that was going to be the best
4:12
Speaker 4: fit for me. And plus I knew that I would
4:14
Speaker 4: have work as well. And I never you know, and
4:17
Speaker 4: this is a message to anybody who's thinking about going
4:20
Speaker 4: the entrepreneurial I never like to not have.
4:24
Speaker 3: A guaranteed income from somewhere.
4:27
Speaker 4: And I felt like, if I'm if I can work
4:30
Speaker 4: nights and I could work weekends and use all of
4:33
Speaker 4: my free time during the day to folks in the business,
4:36
Speaker 4: then I'm going to do that. But I'm never going
4:38
Speaker 4: to sacrifice the potential to earn. And that's one of
4:41
Speaker 4: the things that is pretty special about about healthcare is
4:45
Speaker 4: because you know, a nurse could work, you know, three
4:49
Speaker 4: three days a week, three thirteen hour shifts or three
4:51
Speaker 4: twelve hour shifts, be full time, and then have four
4:55
Speaker 4: days a week you know, on a nurse'ssalia at that
4:58
Speaker 4: four days a week to focus on whatever else.
5:01
Speaker 2: It is that focused on whatever else they want to
5:03
Speaker 2: do in life. So it's like you can be a
5:05
Speaker 2: real estate entrepreneur, you can work another job if you want.
5:08
Speaker 2: It's like, you know, it's pretty flexible out and so
5:10
Speaker 2: let me ask you this. As far as the healthcare
5:12
Speaker 2: industry is something that pretty much is recession proof, there's
5:16
Speaker 2: a shortage just like the only especially nurses, there's the
5:18
Speaker 2: only profession I think that is extremely on demand right
5:23
Speaker 2: now where everybody else is firing people and it's like
5:27
Speaker 2: they can't find enough nurses, especially where we're at in
5:29
Speaker 2: New York. So as far as that is concerned, right
5:34
Speaker 2: for an entrepreneur, because we don't get in the business
5:36
Speaker 2: model of it, how did you like, what was the
5:39
Speaker 2: steps for you to start your home is it? I
5:44
Speaker 2: don't a misquote. It's a home nursing service home long
5:46
Speaker 2: term nursing service.
5:48
Speaker 4: See licensed home care service agency and then New York
5:52
Speaker 4: they call them.
5:52
Speaker 3: Link says and chops. It's two types actually, But.
5:55
Speaker 4: It started first as a staffing firm, which is very simple.
6:00
Speaker 4: Our staffing firm just need to incorporate yourself. You need
6:03
Speaker 4: to have a contract that says that you're going to
6:05
Speaker 4: be providing you know, contracted services, a rate sheet that
6:11
Speaker 4: says how much you're charging, and you're in business literally
6:15
Speaker 4: for less than a thousand dollars. You could start out
6:17
Speaker 4: a nursing agency, right because and it's it's actually mislabeled
6:22
Speaker 4: as a nursing agency because you're not you're not taking
6:25
Speaker 4: a percentage of the wages of that employee. So like
6:29
Speaker 4: in New York City, you could get a license to
6:31
Speaker 4: be an agency through consumer Affairs, so and that's a
6:37
Speaker 4: very easy process, but that's because you're charging a fee
6:40
Speaker 4: to the person that you that you're getting the job for.
6:44
Speaker 3: Right.
6:44
Speaker 4: A staffing firm is different because those people work for
6:48
Speaker 4: your company and you're assigning them to work in a hospital,
6:52
Speaker 4: in a nursing home or something like that, and you're
6:54
Speaker 4: charging the hospital a fee, taking your cut, and then
6:57
Speaker 4: paying your employee. So it's not by definition an agency,
7:02
Speaker 4: but they just refer to them as agency nurses because
7:05
Speaker 4: that's what the terminology is.
7:07
Speaker 5: Where did the idea for the staffing agency come? Right,
7:10
Speaker 5: So you're doing X rays, you deviated from the plan
7:12
Speaker 5: of being a doctor. Was it from the influx of
7:15
Speaker 5: people coming into the hospital and seeing that there was
7:17
Speaker 5: a shortage.
7:18
Speaker 6: Where did the influence come from?
7:19
Speaker 3: It came from my mom.
7:21
Speaker 4: She just saw an opportunity for a money grab and
7:24
Speaker 4: she was like, well, if I know several nurses myself,
7:27
Speaker 4: and I'm a nurse, so if I could start this,
7:30
Speaker 4: then I could just pull my friends together and we
7:33
Speaker 4: could provide services to these you know, understaffed hospitals and
7:37
Speaker 4: nursing homes. So that's where the idea came from. I
7:40
Speaker 4: got to give her that. But being exposed to that
7:43
Speaker 4: at fourteen years old made and seeing what the numbers
7:47
Speaker 4: were made it like, okay, this is a no brainer
7:49
Speaker 4: for me to kind of expand on that. But while
7:53
Speaker 4: we were in the staff infirm business, she also was like, well,
7:57
Speaker 4: since we're doing well here, there's an another side to
8:00
Speaker 4: this business, which is home healthcare. And I see those
8:04
Speaker 4: companies and she worked. She would work, and that's my
8:06
Speaker 4: mom is I guess pretty genius. She would have worked
8:09
Speaker 4: for them to kind of learn how they maneuver and
8:13
Speaker 4: get exposed to like where they get their contracts from,
8:16
Speaker 4: how what's the money flow. And then she was like,
8:19
Speaker 4: all right, let's look into getting a license. So while
8:21
Speaker 4: we're in high school, we were working with a license.
8:23
Speaker 4: A license didn't hit until two thousand and one. But
8:26
Speaker 4: the staffing firm business was going well. I had expanded
8:29
Speaker 4: to Long Island. We didn't do anything with the nursing agency,
8:33
Speaker 4: I mean with the home healthcare agency. It was just
8:35
Speaker 4: sitting there dormant. But something cool happened, which is New
8:38
Speaker 4: York State stopped issuing the licenses, right, They capped out
8:42
Speaker 4: the licenses.
8:43
Speaker 3: So we start getting phone calls to buy our license.
8:45
Speaker 4: And the phone call first was fifty thousand dollars, then
8:48
Speaker 4: it was one hundred thousand dollars, then it was two
8:49
Speaker 4: hundred and fifty thousand, there was four hundred thousand, and.
8:52
Speaker 3: We thought about selling it just to fuel the staffing firm.
8:56
Speaker 4: But it was like, wait, if we're getting offered four
8:59
Speaker 4: hundred care for this license.
9:01
Speaker 3: To operate, there's money here.
9:04
Speaker 6: So what was What was the reason that New York
9:05
Speaker 6: State decided to stop issuing.
9:07
Speaker 4: Ze same reason why they're trying to scale back the
9:09
Speaker 4: agencies now. It's just too much oversight. Right, So there's
9:13
Speaker 4: more than two thousand agencies in New York, right, every
9:17
Speaker 4: three years, we get surveyed by the state and they
9:20
Speaker 4: have to send three nurses to your agency to review
9:23
Speaker 4: your medical records. So to do that to two thousand agencies,
9:27
Speaker 4: you need a lot of you know, personnel, So it
9:31
Speaker 4: gets out of control every now and then where it's
9:32
Speaker 4: just too many people to monitor. So they're actually trying
9:36
Speaker 4: to force a consolidation within the industry, shrinking the number
9:40
Speaker 4: of licenses that are out there.
9:41
Speaker 3: So it's easier for them to maintain oversight.
9:45
Speaker 2: So all right, so in a sense you have the
9:49
Speaker 2: company where it's like a middleman. In a sense, staffing
9:52
Speaker 2: is actually really big. We haven't even to talk about
9:54
Speaker 2: staffing on this podcast before. But so you recruit, you
9:57
Speaker 2: recruit people for job pretty much, and staffing you could
10:01
Speaker 2: do any you could do staffing in any type of it, staffing,
10:04
Speaker 2: naf staff and stuff like that. And then you you
10:07
Speaker 2: charged the hospital and they pay you and then you
10:10
Speaker 2: paid a difference. How lucretive can that make?
10:12
Speaker 4: Is there?
10:12
Speaker 3: What's the profit margins on that?
10:13
Speaker 4: It could be as much as fifty percent because it
10:18
Speaker 4: depends on what the hospital is willing to pay. In
10:21
Speaker 4: home care, the profit margins about eleven to thirteen percent
10:25
Speaker 4: because it's getting Medicaid dollars and the margins are small there,
10:29
Speaker 4: just like the margin for a hospital is only eight percent, right,
10:33
Speaker 4: hospitals are a functioning on eight percent margin. Or with
10:36
Speaker 4: staffing itself, it could be as high as fifty because
10:38
Speaker 4: it's it's how desperate are they for.
10:40
Speaker 3: Staff and what are they willing to pay?
10:42
Speaker 4: But usually you're charging like a thirty percent markup over
10:45
Speaker 4: what you're paying your staff.
10:46
Speaker 2: That's kind of so fifty percent the best case scenario.
10:50
Speaker 2: If they give you two hundred, you give the employee
10:52
Speaker 2: one hundred.
10:53
Speaker 6: And you say, and you're taking one hundred.
10:55
Speaker 7: Yeah clean, it's like if if if that's what they negotiated, right,
11:02
Speaker 7: So with the nursing comp it's usually about thirty percent
11:04
Speaker 7: over because the hospital and the nursing facilities thinking well,
11:09
Speaker 7: what do we pay our nurses?
11:11
Speaker 3: What about matching their payroll taxes?
11:14
Speaker 4: Right, that's another expense their workers comp and their healthcare
11:17
Speaker 4: expenses plus PTL. So when you're trying to you want
11:21
Speaker 4: to come in as close to their price or their
11:23
Speaker 4: overtime price as possible because they're either going to mandate
11:27
Speaker 4: their staff to work overtime or they're going to use
11:30
Speaker 4: an agency, and if you come in for like a
11:32
Speaker 4: dollar or two less than what that figure is, it's
11:35
Speaker 4: now a saving to that facility and they'll be interested.
11:39
Speaker 4: So you could charge like thirty to fifty percent above
11:43
Speaker 4: because if it's at fifty percent, you know you're hitting
11:45
Speaker 4: the time and a half money, right, and they're still
11:48
Speaker 4: going to they still may be short, so they still
11:50
Speaker 4: may go with you, even though it's equal to their
11:52
Speaker 4: time in a half number, and that doesn't include the
11:55
Speaker 4: workers comp and taxes that they're going to have to
11:57
Speaker 4: pay as the employer.
11:59
Speaker 6: So undred thousand offer for the license, did you guys
12:02
Speaker 6: decide to sell? You decide, you know what, we got
12:03
Speaker 6: something great here, let's hold on to.
12:05
Speaker 3: It, hold on to it. And at the same time
12:08
Speaker 3: the market crashed.
12:10
Speaker 4: So in the staffing business, right you have a contract
12:13
Speaker 4: that says, all right, you're gonna pay me forty five
12:16
Speaker 4: dollars an hour for an LPN nurse, and I'm going
12:20
Speaker 4: to pay them and we're going to provide the service.
12:23
Speaker 4: But what ends up happening is that you have the
12:28
Speaker 4: terms that maybe every thirty days, every sixty, every ninety,
12:32
Speaker 4: so you're front running the payroll until you get reimbursed
12:36
Speaker 4: on your invoice, right, you're not getting paid weekly from
12:39
Speaker 4: the nursing facility.
12:40
Speaker 3: They don't pay out weekly.
12:42
Speaker 4: So right before the market crashed, we were growing pretty
12:46
Speaker 4: aggressively and we had line of credits to float that money.
12:50
Speaker 4: So just like what's happening right now in this crash,
12:53
Speaker 4: the banks pull back on those line of credits, so
12:57
Speaker 4: we couldn't even provide as much services anymore. So it's like, well,
13:00
Speaker 4: what are we going to do because now we can only.
13:02
Speaker 3: Provide like thirty percent of our services.
13:04
Speaker 4: And that's why we're even flirting with the idea of selling,
13:06
Speaker 4: because it's like, if we've sold this for four hundred K,
13:09
Speaker 4: that helps us, you know, have more buffer money.
13:12
Speaker 3: But then we thought like, well, the.
13:15
Speaker 4: Home healthy's get paid less than nurses, so let's just
13:18
Speaker 4: start spooling up that side of the business, making you know,
13:22
Speaker 4: smaller spread, but we can grow this beyond and people
13:27
Speaker 4: are thinking about paying you almost half a million dollars
13:30
Speaker 4: for the license.
13:30
Speaker 3: There's got to be some money here, and that's where
13:32
Speaker 3: that paper took place.
13:34
Speaker 4: Is that true just for New York State or was
13:35
Speaker 4: that something that was happening throughout the country where licenses
13:38
Speaker 4: were being ceased.
13:40
Speaker 3: Oh no, no, no, that's that's New York state.
13:42
Speaker 4: Like right now in Florida, where I am and expanding
13:45
Speaker 4: on my new venture, there isn't a moratorial licenses. I'm
13:49
Speaker 4: applying for a license right now. Some states, I think
13:51
Speaker 4: Michigan doesn't even have a license to operate. You could
13:54
Speaker 4: just start a home care agency without any oversight, which
13:58
Speaker 4: is kind of nuts to me because New York is
14:00
Speaker 4: heavily regulated. California, of course heavily regulated. So you know,
14:05
Speaker 4: short answer is that it depends on your state.
14:09
Speaker 2: So a friend of mine in Ohio, he has a
14:13
Speaker 2: health clinic and he was kind of explaining it to me,
14:16
Speaker 2: and it was it was crazy because he was saying,
14:18
Speaker 2: like with the healthcare industry, the common mistake that people
14:21
Speaker 2: make is that they think that they actually have to
14:23
Speaker 2: be in the field to actually be, you know, an
14:27
Speaker 2: entrepreneur and like open a type of business. But you
14:30
Speaker 2: don't have to be a doctor. You don't have to
14:32
Speaker 2: be a licensed doctor to have these type of business right,
14:36
Speaker 2: like that you have like you're not a licensed doctor, right.
14:38
Speaker 3: I'm not a licensed doctor.
14:39
Speaker 4: But in most states you have to have a licensed
14:43
Speaker 4: person like either a nurse, or a physician on your
14:46
Speaker 4: founding team if you're gonna if you're gonna do a
14:49
Speaker 4: license home care agency, but as a staff and firm,
14:52
Speaker 4: you could turn around and start one tomorrow.
14:54
Speaker 6: So your mom would Your mom filled that role, right,
14:56
Speaker 6: she was the nurse.
14:58
Speaker 3: So that's that's how it worked.
15:00
Speaker 4: So you know, if you're thinking about getting into this business,
15:03
Speaker 4: like I get increase.
15:04
Speaker 3: All the time on my channel where it's like how
15:07
Speaker 3: do I start? How do I start?
15:08
Speaker 4: So I started showing them step by step this is
15:10
Speaker 4: how you do it. So step one, if you're going
15:13
Speaker 4: to go and become a home care agency, you've got
15:16
Speaker 4: to just research your Department of Health website and find
15:19
Speaker 4: out are the issuing licenses, what is the application process,
15:24
Speaker 4: and what are the rules and regulations right, because those
15:27
Speaker 4: regulations are going to dictate what your policies are and
15:30
Speaker 4: how your policies need to be drafted, and you're going
15:33
Speaker 4: to need to develop your policies when you're applying.
15:35
Speaker 3: It's actually pretty a pretty.
15:38
Speaker 4: Grueling process because you're doing like man like four hundred
15:43
Speaker 4: pages of policies, your forms that you're going to be
15:45
Speaker 4: using to do your assessments. It's pretty intense, but you
15:48
Speaker 4: could also hire a consultant to help you with that.
15:50
Speaker 4: Like right now in Florida, since I'm in a much
15:54
Speaker 4: better financial position than when we started the home caurgency before,
15:59
Speaker 4: I'm just paying a consultant to handle the entire application
16:02
Speaker 4: process and working on building my team while while they're
16:07
Speaker 4: doing that piece, rather than physically typing. But from the
16:10
Speaker 4: staffing firm perspective, you just need a you can get
16:13
Speaker 4: like a boiler plate generic staffing firm contract. Pull that
16:18
Speaker 4: up on Google, determine what area you're going to focus on,
16:22
Speaker 4: if it's going to be healthcare or nursing, and then
16:25
Speaker 4: decide what your.
16:25
Speaker 3: Rates are going to be.
16:26
Speaker 4: Make sure you're you're cushioning in at least thirty percent
16:29
Speaker 4: spread because your payroll taxes are going to cost you
16:35
Speaker 4: close to like ten percent, and then your worker's comp
16:38
Speaker 4: is going to be around six to seven percent, so
16:41
Speaker 4: then you're only going to be left in like twenty
16:43
Speaker 4: So at least you charge your thirty percent markup if
16:46
Speaker 4: you're going to do that. But the process, you know,
16:48
Speaker 4: once you get licensed is all about what relationships you
16:52
Speaker 4: build and executing on your marketing strategy so that you're finding.
16:56
Speaker 3: Those those patients.
16:58
Speaker 4: But on the staffing firm side, the process is call
17:02
Speaker 4: the nursing home, called the hospital, speak with either the
17:05
Speaker 4: administrator or the director of nursing and say, I am
17:09
Speaker 4: a staff infirm.
17:10
Speaker 3: I'm looking to gride services. Do you need coverage? Best time? Summertime? Why?
17:17
Speaker 4: Because people are going on vacation. They're going to be short, right,
17:21
Speaker 4: So that's when people are going to be desperate. They'll say, hey,
17:24
Speaker 4: you know what, sure, you know, send us over your
17:27
Speaker 4: send us over your contract and we'll have a reviewed.
17:29
Speaker 4: The first contract that I got when I expanded in
17:31
Speaker 4: Long Island took me about maybe two weeks of phone calls.
17:36
Speaker 3: I just literally downloaded National County.
17:39
Speaker 4: Nursing Homes and I just picked up the phone two
17:43
Speaker 4: years old alone.
17:45
Speaker 3: Call it cold calling.
17:47
Speaker 5: You created the contrast yourself, or you sat down with
17:50
Speaker 5: a lawyer. How did that process work?
17:52
Speaker 3: Oh?
17:53
Speaker 4: She took my mom took a copy of the contract
17:57
Speaker 4: that her nursing home is using, and I just retyped
18:01
Speaker 4: it all right.
18:02
Speaker 2: Well, in the next segment, we want to talk more
18:04
Speaker 2: about the business and also about the acquisition that you guys.
18:07
Speaker 2: I know you were saying off camera that somebody had
18:09
Speaker 2: offered you some money and you looked at that, And
18:11
Speaker 2: because we'd like to talk about stories like that on
18:13
Speaker 2: EUYL because these are things that the general public does
18:15
Speaker 2: not know and isn't privy to. So yeah, we're going
18:19
Speaker 2: to talk some more in depth about the healthcare fail
18:20
Speaker 2: in the next segment. All right, So in this in
18:23
Speaker 2: this segment, we're gonna we're gonna talk some more about
18:25
Speaker 2: some actionable items. This is what everybody loves EYO for.
18:29
Speaker 2: So you have two different businesses with the staffing firm
18:31
Speaker 2: and the nursing But first I want to talk about
18:33
Speaker 2: staffing so for people, because you said that's that's probably
18:36
Speaker 2: like the more practical thing that really anybody can can
18:40
Speaker 2: do as a staffing firm. And like I said, staffing
18:43
Speaker 2: firms are big on a variety of different levels, not
18:46
Speaker 2: just the medical. All over, staffing firms extremely big and
18:48
Speaker 2: pretty much is just bridging the gap where somebody needs
18:52
Speaker 2: work and their employees that are skilled to work but
18:56
Speaker 2: they don't. They got to come together. So the staffing
19:00
Speaker 2: firm job is to find the qualified employees and match
19:03
Speaker 2: them with good employers. So what are some steps if
19:06
Speaker 2: somebody wants to start their own staffing firm?
19:08
Speaker 4: I'm going to try to break it down as simple
19:10
Speaker 4: as possible. If you're going to be starting a staffing firm,
19:13
Speaker 4: the first thing that you're going to need to do
19:15
Speaker 4: is get your hands on just a basic staffing contract.
19:19
Speaker 3: Okay, get a contract.
19:22
Speaker 4: Review that contract, and part of that contract is going
19:25
Speaker 4: to have a feed schedule, right, This is what you're
19:28
Speaker 4: charging for the positions. Right, So if you're starting with nursing,
19:32
Speaker 4: start with a feed schedule for urns, a feed schedule
19:36
Speaker 4: for LPNs, which are licensed practical nurses, and then for
19:39
Speaker 4: nurse aids, because those are the most utilized workers in
19:43
Speaker 4: a nursing home or in a hospital.
19:45
Speaker 3: Right. So that's one thing that you want to have.
19:49
Speaker 3: But you're going to do your market.
19:50
Speaker 4: Research next to know what is a nurse commanding as
19:54
Speaker 4: far as salary, what is an LPN commanding as far
19:57
Speaker 4: as salary?
19:58
Speaker 3: And the nurse aid right, so that you know what
20:01
Speaker 3: you're supposed to be paying.
20:02
Speaker 5: Out specific to each state that you're in, specific to
20:05
Speaker 5: specific to the state that you're in.
20:07
Speaker 3: Specific to your region.
20:08
Speaker 4: Even in New York, New York City is going to
20:12
Speaker 4: charge higher rates than Buffalo, right, So you have to
20:15
Speaker 4: just research your local market just to know what does it?
20:19
Speaker 4: You know how much are you going to be paying,
20:20
Speaker 4: because that's going to dictate how much are you going
20:22
Speaker 4: to charge because.
20:24
Speaker 3: You obviously need to cover that.
20:25
Speaker 4: You're going to need to cover payroll, you need to
20:28
Speaker 4: cover a worker's coup and then you're going to need
20:30
Speaker 4: your profit marginal right, So I advise that whatever the
20:34
Speaker 4: local rates are, charge a minimum of thirty percent more
20:38
Speaker 4: or you know, as much as double, because it depends
20:41
Speaker 4: on what's again the need of that position. So once
20:45
Speaker 4: you have your contract set, the next thing that you
20:48
Speaker 4: should do is obviously incorporate yourself, right, either go to
20:52
Speaker 4: the LLC route or the corporation route, just so that
20:56
Speaker 4: you have an entity and some sort of barrier between
21:00
Speaker 4: you and liability. Right, that's the purpose and also the
21:03
Speaker 4: tax benefit. So make sure you go out there and
21:05
Speaker 4: incorporate yourself. You could do that on legal Zoom. I
21:08
Speaker 4: use a service called Blumberg Excelsior. I'll send you guys
21:11
Speaker 4: a link. You know, I like working with them. They're
21:13
Speaker 4: quick and they'll set up your corporation within a day
21:17
Speaker 4: or two. They'll even apply for your tax ID number,
21:19
Speaker 4: all the things that you need to be recognized as
21:22
Speaker 4: a business right, and that cost in New York is
21:25
Speaker 4: going to be anywhere from like three hundred if you're
21:28
Speaker 4: doing a corporation to like almost two thousand if you're
21:31
Speaker 4: doing an LLC because of the publication fee that's associated
21:35
Speaker 4: with that, because LLCs have to publish that they're coming
21:39
Speaker 4: into existence. So once you have your contract and you
21:42
Speaker 4: have your entity set up, and you have you know,
21:45
Speaker 4: open up a bank account and the entity's name, the
21:48
Speaker 4: next thing that you should do is probably hire a
21:52
Speaker 4: few people right to get your application. You can pull
21:55
Speaker 4: up any generic application online, but you're going to need
21:58
Speaker 4: to get an application so you can actually on board
22:01
Speaker 4: and have a pool of providers, nurses, nurse aids, LPNs,
22:05
Speaker 4: whatever you're going to be hiring.
22:07
Speaker 3: And you know, once you do get a hit, you're
22:10
Speaker 3: going to be able to staff.
22:11
Speaker 4: You don't want you don't want to get into contract
22:15
Speaker 4: to provide staff.
22:15
Speaker 3: And you got the staff right.
22:17
Speaker 4: So I think if you're a healthcare professional, it might
22:21
Speaker 4: make the most sense of staff yourself be one of
22:23
Speaker 4: the people that gets dispatched, so at least you know
22:26
Speaker 4: that you could fill in certain gaps if you get
22:28
Speaker 4: that immediate call that you can work that shift yourself.
22:31
Speaker 5: How many people? How many people are you putting on
22:33
Speaker 5: the team to start? We're doing like two or three
22:35
Speaker 5: including yourself, So you've got a four person.
22:36
Speaker 4: Team in if you're starting a staff infirm, Yeah, I
22:42
Speaker 4: would at least three in each position that that you're marketing.
22:45
Speaker 4: So at least you have, you know, some depth to your.
22:47
Speaker 3: To your staff.
22:49
Speaker 6: So we have r N LPN and then health Day
22:51
Speaker 6: so that would be nine people.
22:53
Speaker 3: Yeah, gotcha.
22:55
Speaker 2: So how do you because like there's a shortage of
22:59
Speaker 2: nurses right now New York and there's like they're like
23:03
Speaker 2: begging nurses to come from all over the country. Right,
23:05
Speaker 2: So this is like a perfect if somebody had a
23:07
Speaker 2: staffing agency for nurses right now, it'd be perfect, But like,
23:11
Speaker 2: how do you find the candidates?
23:14
Speaker 4: Like, I'm track talent, Okay, So first you've got to
23:19
Speaker 4: just public. You're going to post on whatever you can indeed,
23:22
Speaker 4: LinkedIn Facebook, jobs wherever, threads list, just post that you're hiring.
23:29
Speaker 4: And the thing is, people are nurses.
23:31
Speaker 3: I know. Most nurses I know are working two jobs. Right.
23:35
Speaker 4: They're usually the top earner in their households, especially in
23:38
Speaker 4: our community.
23:39
Speaker 3: They're working two jobs, sometimes three jobs.
23:41
Speaker 4: So they're always looking for jobs, right, because one, their
23:44
Speaker 4: jobs exist and they're always looking. But if you dangle
23:47
Speaker 4: a carrot, like higher rates than what they're normally getting paid,
23:52
Speaker 4: then that also attracts them. So let's just say the
23:54
Speaker 4: average thirty but you're paying thirty three. Then nurses who
24:00
Speaker 4: are working for some other agency or they'll give up
24:03
Speaker 4: their part time job and work with you for a
24:05
Speaker 4: little more money. So you make it a smaller spread,
24:08
Speaker 4: but you're attracting the talent that way.
24:10
Speaker 5: But what what is what makes a candidate qualify? What
24:14
Speaker 5: are the things they need? I'm assuming experience or maybe
24:17
Speaker 5: not in this type of crisis.
24:18
Speaker 3: Even experience.
24:19
Speaker 6: Uh.
24:20
Speaker 4: Licensed, they need to have most most people in healthcare
24:24
Speaker 4: need to be licensed, right, So our answer license LPNs
24:28
Speaker 4: are licensed. Nurse aids have a certificate. Home health aids
24:31
Speaker 4: have a certificate, so they obviously need to be meet
24:33
Speaker 4: whatever the guidelines are for the state. They also need
24:36
Speaker 4: to have an up to date physical which shows that
24:39
Speaker 4: they're immune to beesels, monks, Rubella rubiola, chickenpox for oursella,
24:46
Speaker 4: that they also are TV negative so they can't have
24:49
Speaker 4: active tuberculosis, and that they're what's called you know, safe
24:54
Speaker 4: and fit to work okay, so that physical needs it's
24:57
Speaker 4: done annually. All healthcare workers working in direct contact with
25:01
Speaker 4: patients have to have an annual physical, so their physical
25:03
Speaker 4: needs to be up to date. But every nurse and
25:06
Speaker 4: everybody in the field knows that. So either they're getting
25:09
Speaker 4: the physicals done at the job and they could get
25:12
Speaker 4: their physicals from their job, or they just get their
25:14
Speaker 4: physical from their doctor. But once they have that, they
25:17
Speaker 4: have the application, they filled out their W two forms
25:21
Speaker 4: or the ten ninety nine forms if they're or W
25:24
Speaker 4: nine's if they're going to be ten ninety nine, and
25:27
Speaker 4: they have their medical clearance and you have a copy
25:30
Speaker 4: of their license, that's what you would consider a profile.
25:33
Speaker 3: For that for that nurse.
25:36
Speaker 4: Of course, their resume helps, but most of the time
25:39
Speaker 4: they're not even asking for the resumes.
25:41
Speaker 3: Because they're so behind.
25:42
Speaker 4: It's just like, does this person have at least one
25:44
Speaker 4: year's experience typically is what they're looking for, so you
25:47
Speaker 4: would also look for that.
25:49
Speaker 3: But sometimes you might have a new nurse who has maybe.
25:53
Speaker 4: Eight years experience as a nurse aid that understands how
25:57
Speaker 4: things move in a nursing facility that they'll be willing
26:01
Speaker 4: to take as well.
26:02
Speaker 3: Sometimes they orient them at the facility.
26:05
Speaker 4: It really it's really a case by case, but at
26:07
Speaker 4: minimum physical license or certificate and.
26:13
Speaker 3: Identification and you know eligibility work in the United.
26:16
Speaker 5: States, are there terms after you you find a candidate
26:20
Speaker 5: that they have to stay with the company for six
26:22
Speaker 5: to twelve months or does that exist in this in
26:25
Speaker 5: the staffing aguencry you if.
26:26
Speaker 4: You have that agreement with the worker, and usually within
26:29
Speaker 4: the contract you have like a provision that they can
26:34
Speaker 4: hire that person after one year if they pay you x.
26:38
Speaker 3: Percentage of that person's salary. If not, they can't hire
26:41
Speaker 3: that person.
26:42
Speaker 4: So it's also a way for them to kind of
26:44
Speaker 4: vet and recruit talent to a certain extent.
26:47
Speaker 5: So that in that sense, right, let's say that they
26:50
Speaker 5: made one hundred thousand, if they want to hire them
26:52
Speaker 5: after the year, you take a percentage of that, so
26:54
Speaker 5: you like, maybe I get five percent, so that's fifteen
26:58
Speaker 5: fifteen thousand if we make it one hundred earners.
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29:50
Speaker 6: Yep, okay, gotcha, Okay.
29:52
Speaker 2: So to staffing, how lucrative is staffing?
29:55
Speaker 3: We pivoted to home care.
29:58
Speaker 4: We're doing about a million year year in revenue and
30:02
Speaker 4: like the net margin is about twenty percent, so you're
30:06
Speaker 4: seeing two hundred grand profits.
30:08
Speaker 3: It see enough to earn.
30:10
Speaker 4: On It wasn't it wasn't what it's what it was
30:12
Speaker 4: for for like how it is for home care. But
30:16
Speaker 4: we never got to the point like as far as
30:19
Speaker 4: size that we did with the home care agency.
30:22
Speaker 2: So pivoting to pivoting towards home care, So home care
30:26
Speaker 2: is more is way more lucrative in your opinion, No.
30:29
Speaker 3: They're they're I think I think they're equally lucrative.
30:33
Speaker 4: It's just that the the funnel is different and there's
30:38
Speaker 4: a larger barrier to entry. So you know there's with that,
30:43
Speaker 4: of course, there's money, right, there's fewer view there's fewer providers,
30:47
Speaker 4: and there's still a need. So we were able to
30:49
Speaker 4: scale that aggressively because you know, a home health aid
30:54
Speaker 4: only needs to train for eighty hours right to get
30:56
Speaker 4: a certificate, and that means that there's there's a lot
31:00
Speaker 4: of them out there, so we're able to scale up
31:03
Speaker 4: the number of people that we have faster than a
31:06
Speaker 4: bunch of a bunch of nurses. To get three hundred,
31:09
Speaker 4: four hundred nurses, it's a lot harder to do than
31:12
Speaker 4: to get three hundred or four hundred home healthy.
31:16
Speaker 2: So to be a home health aid, to be a
31:18
Speaker 2: home health aid, what do you have to do to become.
31:22
Speaker 4: It's an eighty hour course, so it's you know, body mechanics,
31:26
Speaker 4: how do you care for a patient? You know, making
31:30
Speaker 4: sure that the water isn't too hot so you're not
31:31
Speaker 4: burning a patient when you're giving them bath safe technique
31:35
Speaker 4: at home safe technique.
31:36
Speaker 3: Anybody can do that as long as they link up
31:39
Speaker 3: to work in the United States yep.
31:41
Speaker 2: So that's actually when we're talking about the business side.
31:43
Speaker 2: But that's actually a job opportunity I guess as well
31:47
Speaker 2: for people that might need work right yep.
31:51
Speaker 4: And in New York they're making anywhere between fifteen and
31:55
Speaker 4: twenty dollars an hour.
31:58
Speaker 6: And the qualifications are like training program, that's it.
32:04
Speaker 4: To training program and then also physically background check, background check.
32:08
Speaker 2: Yeah, so all right, so you guys scaled that up
32:12
Speaker 2: pretty pretty aggressively, and then you were saying that you
32:14
Speaker 2: got to offer to sell the company.
32:17
Speaker 4: So right now we're doing like for twenty nineteen, you
32:21
Speaker 4: did about just under twelve million dollars in annual rev
32:26
Speaker 4: and I got a mailer right from somebody who was like.
32:30
Speaker 3: Are you looking to sell?
32:31
Speaker 4: So I was like, let me, let me, let me
32:33
Speaker 4: entertain this and see what numbers are throwing around.
32:36
Speaker 3: Right.
32:36
Speaker 4: So it was actually an agent who who a burgers
32:42
Speaker 4: and acquisitions agent who broke his businesses. So he sat
32:46
Speaker 4: with me and he was like, we could get you
32:48
Speaker 4: fifty percent of your annual revenue and I was like,
32:51
Speaker 4: all right, so talking about you know, between five and
32:56
Speaker 4: six million dollars sale based on where we were at
32:57
Speaker 4: that year, I was like, all right, cool.
33:00
Speaker 3: So they brought in I'm not sure if I got to.
33:04
Speaker 4: See the terms and conditions of the contract, so I'm
33:06
Speaker 4: not going to say their name, but they brought in
33:08
Speaker 4: a publicly traded home care agency that was acquiring agencies
33:14
Speaker 4: like mine, right, and they reviewed our case mix and.
33:17
Speaker 3: How much money were we making, and they made an offer.
33:20
Speaker 4: That was consistent with that so it's like, okay, I
33:25
Speaker 4: was my trader background. I started looking up the financials
33:29
Speaker 4: of that company and looking at how they were organized,
33:32
Speaker 4: and I saw that they were trading at.
33:36
Speaker 3: At sixty times.
33:38
Speaker 4: Earnings, right, they had a sixty pe And I then
33:43
Speaker 4: looked at how many cases they have, and they have
33:45
Speaker 4: like thirty thousand lives.
33:47
Speaker 3: In the management in the country. And I was like,
33:49
Speaker 3: all right, well, we have.
33:51
Speaker 4: Three hundred patients, so we would just need to get
33:56
Speaker 4: you know, one hundred times larger, right, And what would
33:59
Speaker 4: that take?
34:00
Speaker 3: How can we do that?
34:01
Speaker 4: And I was like, well, they're trying to buy us
34:04
Speaker 4: at like five times earnings, but they're trading at sixty.
34:09
Speaker 4: This is a this is a dope brainer. They brought
34:11
Speaker 4: in another company as well, not not not not the
34:14
Speaker 4: public trade company, another another suitor, and they're like yeah.
34:18
Speaker 4: I was like, what is your strategy here, which's the
34:20
Speaker 4: what's the game plan?
34:21
Speaker 3: The guy was like, we've.
34:22
Speaker 4: Already taken another Uh, we've already taken another company public.
34:27
Speaker 4: All we do is aggregate companies and go public. That's
34:31
Speaker 4: that's our model, right. It's like we've done it in
34:33
Speaker 4: fashion and now we're doing it in healthcare. So they
34:38
Speaker 4: were trying to offer me four times earnings, and I
34:40
Speaker 4: know that the publicly traded company is trading at sixty.
34:45
Speaker 4: So it's just a matter of getting financing and going
34:49
Speaker 4: out there and gobbling up smaller and mid sized agencies
34:53
Speaker 4: so that you get the numbers to go public and
34:57
Speaker 4: then you're gonna you're gonna make twelve x return on
35:00
Speaker 4: what you just bought, because all you're doing is buying
35:03
Speaker 4: functional agencies, putting them under one umbrella, stripping back duplicated jobs,
35:07
Speaker 4: like you don't need a bunch of CFOs, you have
35:10
Speaker 4: one CFO in your company, right, so they just aggregate
35:15
Speaker 4: and go public. And I was like, you know what,
35:19
Speaker 4: maybe we shouldn't sell, right, Maybe this is not the
35:23
Speaker 4: direction to go in.
35:23
Speaker 3: Maybe the direction to go in is emulate.
35:26
Speaker 4: That model and start thinking about, you know, expanding the
35:30
Speaker 4: business into different markets and expanding the business in a
35:35
Speaker 4: way that you know, we're on a trajectory to go public.
35:39
Speaker 4: And that's what I'm doing now with eight book.
35:40
Speaker 6: So you turned down six million and to scale your
35:43
Speaker 6: own business.
35:45
Speaker 2: Yeah so so so all right, so eight book? What
35:49
Speaker 2: is what does that include? As far as you're new
35:52
Speaker 2: So you said that once you got that idea.
35:54
Speaker 4: Yeah, our mission at a book is really to just
36:00
Speaker 4: streamline the discharge planning process because hospitals. Hospitals are under
36:06
Speaker 4: pressure to discharge patients quickly and make sure those patients
36:11
Speaker 4: are readmitted. But what happens when somebody has pneumonia, goes home,
36:15
Speaker 4: doesn't pick up their medication, they don't know how to
36:18
Speaker 4: take their medication, they're not following a good diet, They regress,
36:22
Speaker 4: they relapse, styand up back in nursing facility. When that happens,
36:27
Speaker 4: the hospital gets penalized. So our mission is to streamline
36:32
Speaker 4: that process so that hospitals are discharging using our software
36:36
Speaker 4: solutions right discharging to home care so that immediately we're
36:42
Speaker 4: picking up that patient, servicing them, making sure that someone
36:45
Speaker 4: is there to pick up the medication, take care of them,
36:47
Speaker 4: making sure they're not falling at home, making sure they're
36:49
Speaker 4: not regressing so they don't trigger back into the hospital
36:53
Speaker 4: and trigger that penalty, and by doing that, refunneling ourselves
36:57
Speaker 4: with a lot of new referrals so the hospital solving
37:00
Speaker 4: that hospital's problem.
37:01
Speaker 5: The hospital gets penalized is like a fee or a
37:03
Speaker 5: fine that the hospital gets.
37:05
Speaker 4: That's not a fee or a fine they will subtract
37:09
Speaker 4: up to three percent of their top line revenue.
37:13
Speaker 3: For penalties on the following year.
37:15
Speaker 4: So let's just say the hospital is making one hundred million, right,
37:18
Speaker 4: the hospital margin eight percent, right, so they only make
37:21
Speaker 4: an eight million dollars profit.
37:24
Speaker 3: Medicare will penalize them three percent on.
37:28
Speaker 4: Revenue and reimbursement, right, but their operation costs are still
37:32
Speaker 4: going to cost them that ninety two million. So from
37:37
Speaker 4: going from one hundred million to ninety seven and having
37:41
Speaker 4: an underlying ninety two million dollar, you know, cost to
37:45
Speaker 4: provide services, they're only making five million. That's that's almost
37:49
Speaker 4: forty percent loss in their bottom line if they get penalized.
37:55
Speaker 5: How many patients would it would it take for like
37:57
Speaker 5: a hospital get penalized for something like that kicking.
38:01
Speaker 4: It's it's like ratios, So it depends on how many
38:04
Speaker 4: bets they have, how many what disease processes, because they're
38:08
Speaker 4: targeting six disease processes, pneumonia, heart failure, cabbage which is
38:15
Speaker 4: bypass surgery, complete joint replacement surgeries. So those are the
38:19
Speaker 4: ones that are like the high risk because they're expensive
38:23
Speaker 4: to take care of, and it's you know the mentality
38:27
Speaker 4: of the government is we're paying you to fix them,
38:30
Speaker 4: fix them, you get what I'm saying, Like, fix them,
38:34
Speaker 4: make sure that they're healthy. But at the same time,
38:36
Speaker 4: we're only paying you for four days for this hospital
38:38
Speaker 4: state because that's the national average. So what is the
38:41
Speaker 4: what is the hospital doing They need to get them
38:43
Speaker 4: out or is they losing money and they need to
38:45
Speaker 4: ensure that they don't come back. So our company is
38:48
Speaker 4: focusing on that transitional care and converting into long term
38:52
Speaker 4: care for.
38:53
Speaker 6: Those who Yeah, you're helping making sure they don't come back,
38:56
Speaker 6: we help.
38:57
Speaker 3: Them to make sure they don't come back and saving
38:59
Speaker 3: their reps.
39:00
Speaker 6: Gotcha?
39:01
Speaker 2: And so what's the business modecle? You said, like eventually
39:05
Speaker 2: you want to take this public? Right, So how is
39:08
Speaker 2: this different from Avalanche?
39:10
Speaker 3: And like what do you see?
39:12
Speaker 2: How did you replicate what you saw the larger company
39:15
Speaker 2: do to you and how are you going to implement that?
39:18
Speaker 2: And like really scaling aid Book is it to acquire
39:20
Speaker 2: other small sized companies and bring them under the umbrella
39:23
Speaker 2: of aid Brook or Okay?
39:25
Speaker 4: So for me, what I because I've been trying to
39:29
Speaker 4: push my partners in the home care company an Avalanche,
39:34
Speaker 4: to think about things on a larger level. Always That's
39:38
Speaker 4: always been the case, right. I always wanted to push
39:40
Speaker 4: the business further. And what I realized is that they
39:45
Speaker 4: were going into business for the freedom that you know,
39:49
Speaker 4: owning your own business allows, right, you can take vacation
39:52
Speaker 4: when you want, do what you want. And they were
39:55
Speaker 4: comfortable with what we're making there, right, So they weren't
39:59
Speaker 4: looking to push. They do want growth, they do want
40:01
Speaker 4: to make more money, but they're not willing to adjust
40:04
Speaker 4: their habits and mindset to run multiple locations to expand
40:10
Speaker 4: into different states. They're not They're not there. So the
40:13
Speaker 4: first thing that I'm doing with aid Book is assembling
40:15
Speaker 4: a team that has industry knowledge and working in public companies.
40:21
Speaker 4: So what I'm doing at aid Book is focusing on
40:25
Speaker 4: talent that has worked in publicly traded companies and just
40:30
Speaker 4: building our infrastructure with that mindset. So not only are
40:33
Speaker 4: we going to be using technology as and solving that
40:36
Speaker 4: problem for the hospital to be a driver of growth
40:39
Speaker 4: in our business, but we will entertain, you know, acquisitions
40:42
Speaker 4: as well, because as we get close it makes more
40:45
Speaker 4: sense to so let me let me put it this way.
40:50
Speaker 4: I believe that our software and aligning ourselves with the
40:53
Speaker 4: hospitals will allow us to grow by you know, one
40:57
Speaker 4: hundred patients per month.
40:58
Speaker 3: Right.
41:00
Speaker 4: If I'm growing by my one hundred patients per month
41:03
Speaker 4: in one city, then I need to set up in
41:06
Speaker 4: another city and grow an agency by one hundred patients
41:09
Speaker 4: a month by employing the same software, the same marketing
41:12
Speaker 4: team to do that.
41:12
Speaker 3: Right.
41:13
Speaker 4: So, if I'm going into a new state, rather than
41:16
Speaker 4: go through this lengthy, you know, licensing process, which for
41:21
Speaker 4: Florida is going to take me four months to have
41:24
Speaker 4: the license and then another six months to get Medicare approval,
41:28
Speaker 4: what I could do when I'm going into a new
41:30
Speaker 4: state and better capitalized.
41:33
Speaker 3: I could just start buying.
41:35
Speaker 4: Smaller mid sized companies at five times earnings and just
41:39
Speaker 4: point our marketing engine to them and scale them up
41:42
Speaker 4: to two thousand, three thousand patients per per an agency
41:46
Speaker 4: per state. Once I get to like twelve fifteen thousand
41:50
Speaker 4: lives in the management, I have something that I can
41:53
Speaker 4: take to the public market, or once again, step to
41:56
Speaker 4: a larger conglomerate and say, look, we're growing at a
42:01
Speaker 4: thousand patients per month.
42:03
Speaker 3: We don't see an end in our funnel.
42:07
Speaker 4: You're growing by acquiring companies right at five times earnings.
42:12
Speaker 4: If you just buy our system that's already functional and
42:17
Speaker 4: fully aligned with the hospitals, then you're going to grow
42:22
Speaker 4: at this rate in perpetuity, right, So why wouldn't you
42:29
Speaker 4: want to buy this? And at the same time, I'll
42:31
Speaker 4: still be on the track to take the company public.
42:33
Speaker 4: So for me, the most important thing is an initial
42:36
Speaker 4: team that has that experience. So I've already coached some
42:41
Speaker 4: talent from Toperware, and now I coached one person from
42:47
Speaker 4: h Emory the hospital system in Atlanta, And these are
42:50
Speaker 4: people who are interested in being involved in a startup
42:53
Speaker 4: with this with this trajectory in mind that within five
42:58
Speaker 4: to seven years we're going to exit and to exit big,
43:01
Speaker 4: and we need to function this way and just replicating
43:04
Speaker 4: systems with that that you would come to find in
43:09
Speaker 4: a public traded company. So you'll see that most publicly
43:13
Speaker 4: traded companies are you know, will have one of the
43:16
Speaker 4: major accounting firms doing doing their accounting or at least
43:19
Speaker 4: doing their audits, like PwC for instance. So from from
43:23
Speaker 4: day one, our accounting structure has to be on point, right,
43:28
Speaker 4: because that happens if you if you notice, like when
43:30
Speaker 4: you're looking at like startups that are trying to go public,
43:33
Speaker 4: they some of them get jammed up because of accounting,
43:36
Speaker 4: you know issues is because they didn't have their structure
43:40
Speaker 4: right and now they got to get they got to
43:41
Speaker 4: spend two or three years getting their financial straight to
43:45
Speaker 4: then take the company public. So by building from from
43:48
Speaker 4: the very beginning with the mindset of this is this
43:52
Speaker 4: is how accounting is done in pubularly traded companies. This
43:55
Speaker 4: is how much money is allocated to marketing spend versus revenue.
44:00
Speaker 4: Having all those details and people who are familiar with
44:03
Speaker 4: those details being on your team from the beginning is
44:06
Speaker 4: what you need. And also you're going to need money
44:08
Speaker 4: to support that. A lot of one of the mistakes
44:10
Speaker 4: that we make, as you know as a community is
44:13
Speaker 4: we'll start our business with too little money with our friends,
44:18
Speaker 4: with our family, and they're not skilled to take it
44:21
Speaker 4: to a certain point.
44:22
Speaker 3: And then you don't even have the discussion of what
44:24
Speaker 3: is the vision.
44:24
Speaker 4: For the company, Where are we trying to go, what
44:27
Speaker 4: are we trying to do, how are we trying to
44:29
Speaker 4: get there? Are our visions aligned, are values aligned? And
44:35
Speaker 4: those things you need to send you need to set
44:37
Speaker 4: them from the beginning. If you don't. You're going to
44:40
Speaker 4: be building a company on a shaky foundation, or you're
44:43
Speaker 4: going to build a company that you know at a
44:45
Speaker 4: certain point it can't grow anymore because your your foundation
44:49
Speaker 4: is in set.
44:50
Speaker 2: Yeah, that's big. Well, obviously I've heard vast sets under management.
44:54
Speaker 2: I never heard of lives under management before, but makes
44:57
Speaker 2: sense if you're in a medical field. So yeah, I
45:01
Speaker 2: mean that. Like you said, I mean you just outline
45:03
Speaker 2: your vision. And I think that that's important for entrepreneurs,
45:06
Speaker 2: whether it's big, small, middle whatever. You have to have
45:09
Speaker 2: a vision. And it's like you already kind of have
45:12
Speaker 2: an idea in your mind. Nothing ever goes according to plan,
45:14
Speaker 2: but at least you have a roadmap of where you
45:16
Speaker 2: want your company to go. And that's more than half
45:19
Speaker 2: the battle right there. I think a lot of entrepreneurs
45:21
Speaker 2: are just winging it, winking up and just trying to
45:23
Speaker 2: figure it out day to day, like they're literally living
45:26
Speaker 2: day to day, and times like this it just really
45:30
Speaker 2: exposes that. And now you're in a financial crisis because
45:33
Speaker 2: you never really had a business plan. You just had
45:37
Speaker 2: you know, figure it out mentality as you go, and
45:40
Speaker 2: that can only take you so far.
45:42
Speaker 3: Correct, It's it's a and the thing, I'm lucky.
45:45
Speaker 4: Really, I'm lucky, like just like like like.
45:50
Speaker 3: Like the VC dude that was just from Black Star Fire, Yeah, Kwame.
45:59
Speaker 4: When I was watching, I was like, this is like
46:01
Speaker 4: my story, right because his father's a physician.
46:05
Speaker 3: He's helping out at the office, he's learning and he's
46:08
Speaker 3: watching and like.
46:09
Speaker 4: Having that that information coming into your mind from that
46:12
Speaker 4: young you start to just like you say, I think
46:15
Speaker 4: you say something. If you start looking at a yellow car,
46:17
Speaker 4: you start to notice more yellow cars.
46:19
Speaker 3: Right. So if I am ready I'm looking at okay,
46:22
Speaker 3: my mom's staffing business, and I'm now I'm in the
46:25
Speaker 3: staffing business myself. You start and I'm working in hospitals,
46:29
Speaker 3: you start having your eyes open to where's the money moving,
46:32
Speaker 3: how's it moving? So certain things that will go over
46:35
Speaker 3: your head don't go over your head anymore immediately. Right.
46:38
Speaker 3: So it's the same thing.
46:39
Speaker 4: But what I see with a lot of people is
46:42
Speaker 4: that they either they don't have much, you know, entrepreneurial experience.
46:46
Speaker 4: They get it later in life and they start just
46:50
Speaker 4: winging it. The best thing that you could do is
46:53
Speaker 4: you know, here what one do like a business, a
46:57
Speaker 4: business template or a business model, right just look just
47:00
Speaker 4: google business model and youtubeer a business model video. It
47:06
Speaker 4: walks you through how you should be thinking about your business.
47:08
Speaker 4: The very first thing is what is your value proposition?
47:12
Speaker 3: What are you offering?
47:13
Speaker 4: What problem are you fixing or what need are you addressing?
47:18
Speaker 4: What what is that in your company?
47:20
Speaker 3: Right? So at eight book, what is our value proposition?
47:25
Speaker 4: We're dealing with this problem that hospitals have of patients
47:30
Speaker 4: being readmitted, and that's the problem that we're trying to solve.
47:34
Speaker 4: And we're going to monetize that by solving that problem
47:37
Speaker 4: and by being the service provider to those patients.
47:40
Speaker 6: How many how many states are you operating in right now?
47:42
Speaker 3: Right now? Well, New York and then what's eight book
47:45
Speaker 3: is going to be Florida?
47:45
Speaker 6: Florida.
47:46
Speaker 5: And when I'm thinking Florida, and I'm thinking, like when
47:48
Speaker 5: you said you want to grow your your clients by
47:52
Speaker 5: one hundred per or thousand per year, you're in a
47:55
Speaker 5: state with the largest population, well the oldest population.
47:59
Speaker 6: In the kind of was that done intentionally?
48:03
Speaker 4: Actually not really, because Florida, like in New York, we're
48:09
Speaker 4: dealing mostly with Medicaid managed long term care right as
48:13
Speaker 4: the payer Florida has a cap on how many waivers
48:17
Speaker 4: they put out. Right, it's a red state mostly, so
48:21
Speaker 4: they put out you know, they do less spending, so
48:24
Speaker 4: a lot of the people here are self paid. But
48:27
Speaker 4: I liked Florida because you know, I'm going to be
48:30
Speaker 4: living part time in Colombia. So it's a good midpoint
48:34
Speaker 4: between Columbia and New York. So, and it has the
48:37
Speaker 4: international airports. The weather it's good, So that's why I chose.
48:41
Speaker 4: I chose Florida. But I'm going to be expanding into
48:44
Speaker 4: every state that has, you know, a thriving home care
48:49
Speaker 4: community like come care infrastructure, so Florida, North Carolina, Texas, Atlanta,
48:56
Speaker 4: or Georgia, Pennsylvania, California. So those are states that I
49:03
Speaker 4: would be willing to enter because I know that the
49:07
Speaker 4: home care infrastructure is good there.
49:09
Speaker 2: You haven't, ladies and gentlemen. So on the last segment,
49:11
Speaker 2: we're going to talk about your software system. That's actually
49:14
Speaker 2: something you're a lot going on. We're going to a
49:16
Speaker 2: time on time your software system, and then we're going
49:18
Speaker 2: to bring home with everything yet you got going on now,
49:20
Speaker 2: So yeah, all right, so we're going to talk about
49:23
Speaker 2: your software system. But before one quick question about your company, So,
49:27
Speaker 2: how do you raise money? Because I you know, it's
49:30
Speaker 2: probably a lot as far as the expenses to run
49:34
Speaker 2: these type of organizations. You say you have to pay
49:36
Speaker 2: up front, then you get reimbursed on the back end.
49:38
Speaker 2: So finance finances is always the biggest hurdle for any
49:42
Speaker 2: business for the most part. So how do you how
49:45
Speaker 2: do you raise money? How do you have money coming
49:47
Speaker 2: in on a consistent basis to float your operations?
49:51
Speaker 3: So in.
49:54
Speaker 4: Looking at the staff and business, that started with five
49:58
Speaker 4: thousand dollars five K and obviously that's under capitalized, right,
50:04
Speaker 4: That's what ended up happening, is that all right, we're
50:08
Speaker 4: limited to how much services we can provide. Some people
50:11
Speaker 4: waiting a month to get paid because we were getting
50:14
Speaker 4: paid on a monthly basis. So first was like the
50:19
Speaker 4: most traditional people, you go to a bank, you apply
50:21
Speaker 4: for a line of credit, right, but that's only going
50:24
Speaker 4: to be if you have business history, right and that
50:27
Speaker 4: they feel that you're credit worthy. But with time, those
50:30
Speaker 4: lines of credit it was tapping. For one case, it
50:33
Speaker 4: was tapping friends and family and that's usually where most
50:37
Speaker 4: people start with either basic credit cards or getting money
50:42
Speaker 4: from the bank, right, but they're not lended much and
50:45
Speaker 4: it's not enough to really turbo charge your company. It
50:48
Speaker 4: wasn't until I was trading stocks and building, you know,
50:53
Speaker 4: a tech company that I started to understand that starting
50:59
Speaker 4: with some family money is schools fight's you know, it
51:02
Speaker 4: could get you started. Starting with little credit cards and
51:05
Speaker 4: make money is enough to get you started. But if
51:07
Speaker 4: you're really gonna try to expand your business, you're going
51:11
Speaker 4: to have to raise money from institutional investors, right, from
51:16
Speaker 4: VC firms, from angel investors, and their entire business model
51:22
Speaker 4: is to identify solid companies, pump money in with the
51:28
Speaker 4: intention solely to scale them.
51:31
Speaker 3: Right.
51:31
Speaker 4: That's a little different than starting from scratch, right because
51:36
Speaker 4: if sometimes all right, so in the world, in the
51:39
Speaker 4: in the startup world, right, and it's not just tech startups,
51:42
Speaker 4: because any obviously, any industry could be a startup. But
51:45
Speaker 4: in the startup world, your first objective is to develop
51:51
Speaker 4: an MVP, right, your minimally viable products, and that's the
51:56
Speaker 4: first thing that you need to finance. Right, Prove that
51:59
Speaker 4: you have a product or service that the market is
52:02
Speaker 4: in demand for, Prove that you can monetize it.
52:04
Speaker 3: That's the first thing that you should raise money for.
52:06
Speaker 4: And if you're gonna do it with your credit cards
52:08
Speaker 4: and with friends and family money, that's the time because
52:11
Speaker 4: you don't you don't necessarily have to go out there
52:13
Speaker 4: and form a business. You just have to prove that
52:16
Speaker 4: you have a product or service that people are willing
52:19
Speaker 4: to pay for. Once you can prove that with this
52:22
Speaker 4: product or service, it costs, you know, ten thousand dollars
52:25
Speaker 4: a month to operate, but it generates fifty thousand dollars
52:29
Speaker 4: of money like annual profits. Once you could prove that relationship,
52:36
Speaker 4: that money in doing this thing produces money out at
52:40
Speaker 4: a multiple larger than money in. You can take that
52:45
Speaker 4: that that little company to market and start raising money
52:49
Speaker 4: from angel investors and venture capitalists.
52:52
Speaker 3: And there's gonna be different.
52:54
Speaker 4: There's gonna be different levels of them, right, there's gonna
52:56
Speaker 4: be there's gonna be like Brooklyn, what is it Brooklyn
52:59
Speaker 4: brids Right, Charlie Charlie O'Donnell is the guy who hits
53:03
Speaker 4: that fund. He likes to deal with companies that are
53:08
Speaker 4: at that seed level, that first investment usually five hundred
53:12
Speaker 4: thousand million in capital. Then there's like the series A,
53:17
Speaker 4: Series B and so on and some so there's some
53:20
Speaker 4: VC firms that only get in at that pre like
53:24
Speaker 4: like two hundred million dollar minimum. Like, we don't look
53:28
Speaker 4: at any company that doesn't require two hundred million dollars
53:31
Speaker 4: or more. Right, So it's all about what where we're
53:34
Speaker 4: trying to go. But the first, the first that seed
53:37
Speaker 4: funding of that that anywhere from half a million dollars
53:40
Speaker 4: to like one one point five. There's there's VC firms
53:44
Speaker 4: that specialize just that. Then there's VC firms that specialize
53:48
Speaker 4: in and then different sectors. Some are healthcare focused, some
53:51
Speaker 4: are technology focused, some are industry agnostic. It really depends,
53:56
Speaker 4: but you need to have some sort of traction, some
54:00
Speaker 4: of proof that your business is growing.
54:02
Speaker 3: And I learned that by doing.
54:04
Speaker 4: My tech start up because I was like, all right,
54:05
Speaker 4: I know, I'm gonna need money to fuel this thing.
54:08
Speaker 4: And in going to like tech startup meetups, listening to
54:12
Speaker 4: the conversations, going to pitching events where you're actually you know,
54:17
Speaker 4: competing to raise money or you are even just practicing
54:20
Speaker 4: you're you're pitching, you hear what they what the VC
54:24
Speaker 4: firms are interested in.
54:26
Speaker 3: What's the cost to acquire a user? What is that
54:30
Speaker 3: user worth? How much?
54:32
Speaker 4: How much does it cost to acquire a user, and
54:33
Speaker 4: what's the lifetime of a user? What's the value proposition here?
54:38
Speaker 4: That they're going to ask you those questions and sometimes
54:41
Speaker 4: you need to be asked that question, so you can
54:43
Speaker 4: go back to your computer Google what the hell they're
54:46
Speaker 4: asking right, and then you end up start you end
54:49
Speaker 4: up creating what they're asking for. We need you to
54:53
Speaker 4: look like this. They you know, in the startup world
54:55
Speaker 4: that we talked about the hockey stick, they want your
54:58
Speaker 4: growth to be the hockey right, gradual growth or if
55:02
Speaker 4: you just look at the that's viral right, look at
55:06
Speaker 4: COVID nineteen right, that's truly the definition of going viral.
55:10
Speaker 3: You look at the curves. What were the numbers, and
55:13
Speaker 3: then it's.
55:14
Speaker 4: Exponential that they're they're looking to see that you're on
55:18
Speaker 4: that trajectory, that there's going to be that level of absorption.
55:22
Speaker 4: So once you start looking at vcs to answer that
55:26
Speaker 4: question is how do you raise money? How do you
55:27
Speaker 4: get the money? Once you start looking at them, it
55:30
Speaker 4: forces you to become, you know, a builder of a
55:34
Speaker 4: business because they want they want your business to succeed,
55:37
Speaker 4: but they can identify that you're on shaky grounds, so
55:41
Speaker 4: they want your foundation to be tight. They want your
55:43
Speaker 4: team to be tight. They want there to be traction,
55:45
Speaker 4: they want the market size to be large enough. And
55:48
Speaker 4: those are the things that they're interested in.
55:51
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