**Transcript was automatically generated by artificial intelligence.**

Paul Martin

Good afternoon and welcome to another episode of Paul Martin's Crucial Conversations. Today, I am really excited to have with us a former client, a friend of our firm, John Dean. John is the CEO of Mid-Michigan Physical Therapy. Welcome John.

John Dean

Thank you, Paul.

Paul Martin

So mid-Michigan partnered merged with Doctors of Physical Therapy back in April of 2021 when Mid-Michigan made that merger with DPT. They were a three clinic business and they have expanded. And I've added a fourth clinic that John is overseeing as well. So congratulations on your growth, John.

John Dean

Thank you very much. It's going very well.

Paul Martin

Awesome. Awesome. So this is something that I've been actually very anxious to talk to you about and what I'd love to know is when did it first hit you and your wife, Linda? When did it hit you guys that it was time to merge your company with a larger company?

John Dean

Well, you know, my my wife, as you know, is a physical therapist also. And we've worked together for about more than 25 years and in Michigan was going up and going for about 15 years. And we always believe that at some point the time would be right to sell our practice and move on. And, you know, over the years, we've looked at different potential models of how that could work. And and so we weren't really sure when that time was going to be. And then we ended up having our first grandchild. And then my wife made it very clear to me that, you know, we needed to create a path whereby she could retire within one or two years and obviously spend more time with our now three of our grandkids and so forth. So so, of course, I ignored her as long as I could. And then and so ultimately did need to sit down with her and figure out, you know, what would be a path forward for us. And, Linda, you know, she fulfilled a lot of roles for us within our practice. Very much on the administrative side, something that really I had had really no desire to step into. And she retired as I was always more on the operations side of things and what have you. And so it became quickly apparent that the very best option for us to was to look for a larger company that we could merge with and essentially unload her role onto the new company. And then hopefully that be in a situation where that new company would also have a role for me, because I you know, I've got a few more years to go, hopefully.

Paul Martin

Absolutely. That's a great story. And so it really was very personal. A personal family decision that Glenda was going to step down, you were going to stay in, but you needed that support that Glenda was providing and you needed to find where you would get that support. Perfect time to find a larger company. And you guys made that personal decision and powered right through it. I commend you for that.

John Dean

Thanks. Yeah.

Paul Martin

So after you made that decision, but before you were really in the thick of the process, did you ever have any moments of doubt at all?

John Dean

Well, sure. We actually started the process kind of prior to the COVID 19 pandemic. And and so, you know, we we recognized that, you know, as therapists, we do have this we have this tendency to think that we can do everything better than everyone else. And but but in this instance, you know, we kind of recognize, you know, this is a huge decision for us. You know, we've developed our practice over a 15 year period, and we kind of need to get this right. And we don't want to goof this up. And we felt that, you know, we really need to get an expert on board to kind of guide us through that process. So that was that was kind of sort of where we mash Glenda was always a little low on the trust scale there and so forth. So she took a bit of convincing. And that's really, of course, as you know, we reached out to Mark Martin health care to kind of sort of guide us through those steps with the hope that we wouldn't take any missteps along in the whole process.

Paul Martin

Yeah. Yeah. Now, and I can remember that first meeting, I believe it was at a diner up there.

John Dean

Yeah. Yeah.

Paul Martin

Yeah. Absolutely. So John, what advice would you have for owners who right now, just like you guys or we're really struggling with making this decision, and they may be still on the fence. What advice do you have?

John Dean

Well, the first thing I think that people think about when this starts coming up is, you know, obviously they want to know what their motives are of why they want to go to that next stage. You know, why is the time right for them? And then if they feel that, okay, you know, I want to retire or I want to merge our beer company or whatever their circumstance is, they've kind of got they can kind of go down two paths. They can decide that they want to try to go it all alone or they can kind of recruit really someone who specializes in that area. And I suppose, you know, I kind of think about it as a person who, you know, if you lived in a really nice home and in a nice neighborhood, and you wanted to put it up for sale, you know, would you put a sign in your yard and put an ad in the Sunday paper? Or would you recruit the best realtor in the area? To help you with that process? And really, for me, it's not any different. So it seemed really natural to us to, as I said, reach out to yourselves. And I think that's a really great first step because, you know, one of the things that people want to know is, you know, what is my that what is my my practice worth? What's my baby worth? You know, and often times a person may think, well, my practice is worth seven X or I should say ten X, and and it's actually worth seven X or maybe it's worth 12 X. And so by getting somebody else involved, it really helps bring some objectivity to the table. So I think that's really important. So you have that first step of establishing, you know, what the value of the practices. And then I think it's really important then to work with someone like yourself who really knows kind of some of the landscape of like mergers and acquisitions or have you. And of course, someone like yourself and also has those connections to reach out to some of those bigger companies. That might be a good suitor for that practice.

Paul Martin

Yeah. You know, and John, I remember back to some of the early conversations with you guys and the way in which you were kind of walking and moving through this made so much sense. And that first step of, okay, really, what's our value in today's market? That brings out objectivity versus going out to some of the acquirers out there and figuring out your value from them just doesn't make sense. And I think you guys, you know, had the forethought of let's figure out where our value is objectively look at this. Then we take it to the bigger companies. And I can let you go for that.

John Dean

Mm hmm.

Paul Martin

So one of the big concerns of every company out there that's looking to potentially merge, sell, partner with a bigger company is how are their staff going to react? How did you guys tell your staff and prior to breaking the news to them, did you fear what their reaction might be?

John Dean

Yeah. You know, first of all, I would say that we felt that it was important to keep everything quite confidential and tell and we really had all the I's dotted and the T's crossed, and we knew everything was definitely a go. And so once we knew that, that was kind of sort of all in place, then our next priority really was to go out with our team and share our decision and what have you. And we we had it. And so we decided what we wanted to do was put together and bring them all together for a meeting, put together kind of a PowerPoint presentation. And, you know, this is something we've done routinely on an annual basis anyway in terms of, you know, the where our company was going, where and how we had over the years, you know, we had, you know, addressed different challenges talked about the growth of our practice and what have you. And we really presented it kind of sort of in the light that this is really the next logical step forward for us to merge in a larger company within our community where, you know, competition was heating up and so forth. And really emphasizing in this kind of health care arena that this is a step that we felt would really, you know, ensure their job stability for many years going forward. And and so, you know, we really kind of shared with them this vision and obviously promoted really all the good things that would go with that. And we really felt really, really positive about our decision to merge with doctors of P.T. because we felt that it was a really great culture fit. And, you know, we felt that, you know, for our clinicians, you know, their their daily lives would be changing very much and things would essentially as far as patient care was concerned. What continue along the same track that we're already on. And really, really a lot of the essential changes would be really more occurring on the back side of things. So you know, obviously, we did fear what reactions people would have because it's natural for people when they got that big news to saying, well, you know, how is that going to impact me? How is it going to affect my job and so forth. And so when we had into that presentation, you know, we try to somewhat anticipate the questions that people may have and then kind of sort of addressed those pretty comprehensively and, you know, honestly provide lots of opportunity for discussion and what have you. And so that people really felt good about our decision. I think also the fact that they knew that, you know, I wasn't bolting for the door or whatever else I was, so they knew that, you know, I was going to be part of the new operation. I think that was also a key part. And that if I you know, you know, trust, of course, has been built up overnight and I feel that our team has learned to trust London Eye over the years. And so when we when we announced this decision, you know, I think we have that kind of kind of a history of trust to lean on and in turn did go very well, in fact. Here we are a year later and every therapist that was with us when we first merged it after the beauty is still with us today. So I think that's really good.

Paul Martin

That's terrific. And, you know, it's sounded like I mean, you had been through and we're not totally through it yet, but you had been through the major formal discussions on on getting through COVID.

John Dean

And yes.

Paul Martin

Of course, I had to keep this confidential. You know, this was something that was there all the way through COVID with you guys. And so it was natural and it made so much sense the way you guys did that, which was a presentation on. Now, here's the next step we're taking. And I think that boded really well for how your staff responded and the fact that you've really lost, you know, none of your professionals going through this. Right.

John Dean

Right.

Paul Martin

So what what did you how did you decide that you wanted to use a professional advisor, Martin? Health care advisors. And how did you evaluate the candidates and what was your criteria for making that decision?

John Dean

Well, you know, as I as I kind of explained earlier, I felt you know, reaching out to Martin Healthcare was kind of a no brainer for us, first of all, because we recognized that we really did want, you know, expert guidance in this whole process. And as you know, you lined up with one of your one of your very capable team to really guide us through that process. Answer all the questions. Dave, you know, he obviously screened the potential suitors for our practice and so forth. And really, we were we were able to kind of sort of rule out many of those pretty quickly. We quickly recognized for our practice and the way we practice that a lot of the kind of sort of big players out there and on the national scale really weren't a good match for us, in fact. And as you know, we were kind of sort of almost giving up hope that there was a match out there for us for for a practice like ours that had, you know, such a strict criteria of what we wanted because, you know, we we, you know, we wanted to find a company that really did resemble us in terms of culture and how we treated patients and so forth. And, you know, we're we're establishing our community. We know all the different physicians that come to trust us over the years. And what have you. And so we wanted to make sure that that we picked a company where none of those relationships would suffer. So, you know, as you know, we we matched with Aaron Cray, the CEO of Dances of Beauty, and really took an instant liking to Erin. I know that you know him he's very personable for our high energy, and we just loved everything he had to say in regards to to ourselves. You know, we felt if we won one of the bigger players, we would just be like another dot on the map. And you could see with Aaron that he was going to really value our practice And, you know, one of the things he said to us early on is that, hey, you guys have run your practice real successfully for the last 15 years. And, you know, why would I step in the way of that? You know, I just want to partner up with you and make things better, not fix something that's not broken. So that was kind of music to our ears. And, you know, Dr. Pete it's just been really wonderful to work with for us.

Paul Martin

That's awesome. And I'm glad you brought out for us some of those key attributes that you know, doctors of physical therapy had. That was the match was the match for you and the criteria that you had built. And I think that it's not uncommon for companies to have a very specific criteria on what they're looking for, for their future. And you guys did a great job, really, laying that out, because without that, how do you really know what you're looking for? So you guys did a great job with that.

John Dean

Thank you.

Paul Martin

So everybody dreads or anybody going into this process that they dread integration. And so having now been through a large part of your integration. Tell us a little bit about how that has gone and any advice you would have for companies out there who are looking to do this potentially this year or next, how and how they could best prepare for that integration process?

John Dean

Well, I think one of the things to start off with is you really got to be very proactive. It's not a process that happens overnight. So so first of all, you know, if this is selling or merging, your practice is kind of sort of on the horizon. And it's something that you think that you're going to move toward in the next year. But the time to take action is actually now versus later, because it is a process. It's a huge decision. And really being proactive in all of that and getting that expert input even months in advance, I think has great value. So I think that that's a really good starting point. The next thing is that, of course, many of us have worked very hard over the years. We tend to be very focused on, well, what's our practice worth? What's the value of our practice? And so while the financial part of it is important, I think, and you had you had mentioned this to us in our in the early phase of our process is to get that culture matches as so important, especially if, you know, one owner or more is going to stay with the new company. It's so, so important to work with a company that you know, you're going to do well with in the long run. So I think that's that's so important to consider. I think the other thing and I've spoken, as I mentioned, a couple of other owners that have considered, you know, selling their practice in the next year. And they they kind of come to me with questions about well, what'd you need to change? And they've kind of sort of expressed their reluctance to change. And I think it's important for any prospective PTO owners out there that they're looking to sell their practice is that you've got to look and see how you can offer value. And you've also got to you've got to have a very flexible mindset. It's it's really helpful if you can kind of sort of step in the shoes of that potential partner and see what they're looking for, too, because if you're going to kind of dig in your heels and you're not going to change, it's just not going to go well. You've really got to go about it. From a carve out. Okay. I'm more of a Win-Win scenario, and I think if you do that heading into this and seeing how you know your practice can complement that future partner, that that's a really kind of sort of healthy mindset to go into this.

Paul Martin

Yeah, absolutely. And what I'm hearing is that you and Glenda looked at change as How can we make this positive change? How can we prepare? So this is positive change versus, you know, change in what historically we've all thought, which is these changes were just going to be bad no matter what. They're going to be bad. You you really lifted, you know, from kind of down in the weeds to no, let let's look at this as positive change. Yeah.

John Dean

I mean, we've been very fortunate in terms of like I am to to partner with doctors, AAPT. We've really been blessed. I mean, they've got a wonderful leadership team with Aaron that the CEO, a great executive team around him. And then for us, you know, we've had a great culture match and our team has been, you know, very excited. I mean, they've they've done wonderfully over the past year. And then from vacation patient care standpoint, nothing has suffered along the process. So it's been like for us, it's been like a win win win. So it's been pretty awesome.

Paul Martin

Yeah. So happy to hear that. It's great to talk to folks that have been through this and to have such a great outcome as you guys have. John, I cannot tell you how much I appreciate you coming on with us today and sharing for our listeners, your experience going through this process. I think you gave them a lot of value today, and I really appreciate your time.

John Dean

Okay. Well, you're more than welcome Thanks, Paul.

Paul Martin

So for all of you out there, if you have any questions on any of the topics or any of our discussion points today, just click below and let's talk. Thanks and have a great day.