Are you paying more than 2.2% for your payment processing fees? If the answer is yes, you may be losing a lot of money.

In this episode of Beyond Bitewings, Ash welcomes Jeremy Lessari, founder of Payment Brokers. Jeremy shares his entrepreneurial journey and how he negotiated his payment processing fees down after discovering companies kept raising rates.

After selling his last company, he decided to utilize AI technology and created Payment Brokers, a service that monitors payment processors' fees for small businesses. The company will notify businesses of increases, and also help to negotiate the lowest rates.

Jeremy and Ash also talk about why he became an entrepreneur and how so much changed once he found ways to make a difference vs. making money.

To connect with Jeremy, visit: PaymentBrokers.com

If you have specific questions about embezzlement or if you'd like to have another question answered on a future podcast, please reach out to the Edwards & Associates team.

Welcome to Beyond by Wings, the business side of dentistry, brought to you by Edwards and Associates, PC. Join us as we discuss how to build your dental practice, optimize your income, and plan for your future. This podcast is distributed with the understanding that Edwards and Associates PC is not rendering legal, accounting, or professional advice. Listeners should consult with their business advisers before acting on any of the information that is shared. At Edwards and Associates, PC, our business is the business of dentistry. For help or more information, visit our website at enassociates.com. Hello and welcome to another episode of Beyond Bitewings. In today's episode, we will be talking to a very special guest.

His name is Jeremy Lessaris, who's the founder and CEO of Payment Brokers, A Fintech company focused on AI enabled cost reductions within the payment processing industry. Jeremy is also a seasoned entrepreneur who has built and successfully exited 8 companies in Tech, SaaS, payments and healthcare as of 2021. Aside from talking about how to navigate the challenges within the payment processing industry, Jeremy will also share stories from his entrepreneurial journey and hopefully shed some light on scalability of a business on a macro level with us today. So without further ado, hello, Jeremy Lessaris. How are you today?

Good. Good. How are you?

I'm good. I'm good. Thank you.

And where are we speaking from today?

In a fake white room. You probably hear a lot of echo. I'm in, Miami Beach. Oh,

that's nice. I bet this time around.

So just just past this wall is a is an ocean somewhere.

Oh, that's beautiful.

Alright. So Jeremy, tell us a

little bit about your company, Payment Brokers, and what led you to it, and maybe share a little bit of your, background on entrepreneurship.

Sure. So I'm a serial entrepreneur. I've built and exited 8 companies. So lots in tech, lots in Fintech, tons in payments. And I came from the payments industry working in just traditional credit card processing.

Mhmm.

And when I was in that business, I recognized early on that there were some really serious challenges in the way that companies were built. There's really no set way to bill a company. That's right. Yeah. The pricing is just arbitrary, and it's usually set by some sales reps somewhere along the path.

Mhmm.

And so I was helping my own businesses after I had built and sold a company in that space. I knew how to negotiate my own rates and fees, and I knew what interchange costs. So it's I I knew where the profitability margins were for processors.

I see.

So I helped a friend of mine. I I said, hey. Why don't I just call your processor and I'll help? Can you send me a copy of your statements and I'll look at it and I'll do the breakdown and find out what how much profit that processor is making. So that was kind of the first foray into this business. And so Payment Brokers was born right after that because I recognize that $50,000,000,000 a year is being put as burden on small to medium sized companies. That's right. I used to be one of them. So I was on the other side of the fence that actually almost took out one of my early companies.

One of the first companies I founded, it was an online furniture retailer store.

Uh-huh.

And I was paying credit card processing fees, which were back then upward to 3 4% Wow. On a standard basis, especially for e commerce because e commerce didn't really exist yet. I mean, it was really early stage e commerce. And at that point, as I had charge backs from companies who are customers who had received product from me, I had to deal with these huge, very complicated systems where, you know, and you had to fax things back and forth. And it was really cumbersome and really hurt the companies. It took a significant chunk out of our margins and and almost bankrupted the company. Wow. So as I grew up in the space and started learning how it worked, I recognized how and I'll I'll say this nicely without mentioning names, how predatory the pricing is.

Yeah.

So I started looking at how much of a burden is out there. There's a very well known reporting agency in the space. So I said, here's a profit margin. Here are the known costs. We know exactly how much credit card processing transactions are being run every year. That's very well reported on how much is above the profit line and where does that profit fall. So we found about $50,000,000,000 a year is being charged above profitability. So that that means everybody's making money.

We're not taking money out of Visa or Mastercard's pocket. We're not taking money for your cash back rewards. No one wants to part with that stuff. Where the profit margin line was, I I recognize that these processors were taking huge, huge margins, some sometimes 2 3% above cost, above their margin, above their profit margin. And all of that fell on small to medium sized companies. Big companies, they pay costs and plus very small, small margins. And I've seen it. So I, you know, the huge companies that are doing 1,000,000 and 1,000,000 of dollars a month, Mhmm.

They're not paying really high rates. The the people who are the ones that are small and medium guy. So we we took a machine learning application that we built in house to take that data from the statement, analyze it, find out exactly where the profitability is and help those companies negotiate with their existing credit card processing provider. Don't switch anything. Don't change your processing. Don't get a new terminal and, you know, disconnect from your EHR system. Right? Your whatever software you're using.

Mhmm.

Stay with who you're with, just have data. And then the hard part after you get great pricing is monitoring it because they change pricing at will. And in many cases with very minimal and even no notice, like they're not telling you exactly what changed And it's basis points. Right? Two basis points here, 3¢ there, $2 a month there. Mhmm. So we have a monitoring tool that monitors the pricing, what the cost is, and what your contracted rate was because they don't have to hold to the contracted rate. I understand why they don't have to. Obviously, new credit cards come out every day.

They need to be able to change pricing at will so that they can incorporate those cards. But, also, it's just predatory. Like, they just raise pricing whenever they feel like it without even notifying. And I think, in general, it's made huge impacts where I've seen small practices save 1,000 a month doing nothing. Not changing anything, not changing equipment, not retraining employees on POS systems, purely just taking data back to their processor and using that to negotiate. I see.

So

that that was how we founded the company, and it's been ultra successful. We've targeted some of the bigger processors to go after, and And we've been, you know, 90% of the time we're successful in finding significant savings for the company. And we work on a, you know, a performance basis. If we save money, we split it with our customers. So no upfront costs. No you know, that's that was really the premise is, like, how can I help? And where can we make impact? And does it actually hit the bottom line? Right. And, that's how payment brokers was born. But that's a like, a lot of how a lot of my companies started.

I I found a problem. I targeted a solution. Yeah. I started to build tech to solve the problem, whether it was an efficiency thing or, an an analysis thing and turned it into revenue. And and the companies did well.

Wow. That's great. So let let me try

to understand this a little bit. So payment brokers isn't necessarily a merchant service provider.

It's We Yeah. We don't have We don't sell credit card processing at all.

I see. So it basically provides like, a SaaS based app that will help the business owner monitor and regulate those merchant fees.

Yeah. And a service on top of it. So we we actually do the negotiation on behalf of the customer. Ah, okay. So we call it tech enabled negotiation. I mean, we have to have the tech

right

to do an analysis. If I were to hand you a credit card processing statement, I mean, we've handed it to forensic accountants and they look at us sideways. Like, I don't know. I wouldn't even know where to begin. Right. There are thousands of different rates and fees associated with every card. So whether it's a debit card or a rewards card, and then on top of the type of card, then there's a security. Did you swipe it? Is it chip, chip and PIN? Mhmm.

Is it, you know, TAP? Did you use biometrics?

Mhmm.

The more secure, the less the cost. And so the more challenging it is to read the statement. It's so complex.

Right.

Now now companies have simplified it. So you hear Stripe and QuickBooks and PayPal, and they've created a single rate, which is great. People like, oh, I get one statement. It has one number. It's, you know, 2.79% 30¢ a transaction. That's great, but a debit card cost 0.25%. So if you take a debit card, you're already paying 2 and a half percent more than you should have. So there's a, there's a balance here of like simple payments are expensive.

They're you're paying for the simplicity of the billing being a flat rate. And it could be significant, like, between 1 2% difference in what you should be paying on a cost plus basis. So it's just a really complicated thing.

I see.

So so we become the tech side. We we do the analysis. Mhmm. And that machine learning tool takes a statement and breaks it down. If we had to do it manually, it would be it wouldn't be worth the effort. I mean, it's still worth it. I mean, we've we've found tens of 1,000 of dollars a month for certain clients.

I see.

So it's it it could be worth it, but a machine learning tool really helps accelerate Right. The part of analysis so that we can help. And then our team, we have a sophisticated supply chain team, just no different than any other vendor relations group or advisory company. Okay. Good. We take that data. We call the processor. We have all the insight on how the processing works, and we can help them get the pricing down.

And it doesn't matter the size of the company. Like, processing has a cost. We know what that cost is. We know how profitable it is to the the processor. And I'm not gonna say that it's commoditized, but it is. Like, there's a 1,000,000 processors. They all do the same thing. Yes.

They have tools and tech that integrate, but and they have value. I don't wanna take away from that. Like, security and I love being able to just tap my phone. It's it's great.

Right.

But not at 5 6%.

Right. Right.

So that that's really the background on how payment brokers got started.

I see. But you guys do the negotiation?

We do.

Okay. So that's amazing. Okay. Good. Good.

Good. People don't have I mean, business owners that are trying to wear 50 hats already. Exactly. That don't that don't already have a sophisticated supply chain team who's dealing with vendor negotiation every day. Mhmm. I'm not targeting the big, you know, the fortune fifties. I they have those teams in place. I wanna work with the small and medium companies that need help.

They don't have people to do this for them. They don't have the data. They don't have the time. So we we really take it off their plate and we do it pro bono. Right? We we we'll go do the work. And if we find savings and we can continuously prove that we've saved them money Mhmm. And provide an ongoing monitoring and continuous negotiation because this is not a one time thing. They're gonna raise the pricing back up.

I see.

It's a no it's a known thing. Right. So we get right back on the phone, so we go right back to work to help them put money on them, you know, right back to their bottom line.

Right. Okay. That's good. So you guys actually become like an invested partner, right? It's like, look Correct. We're not gonna charge you anything till we see that there's an opportunity for savings. If there is, then we're we'll work together. It'll be beneficial for both parties.

Exactly. It's a win win and it it's actually a win win win. Even the processor wins. They don't lose the business. Like, I think what ends up happening is at some point, another credit card processing company is gonna come in Mhmm. And get enough of an audience to say, I could save you $1,000 a month, but you'd have to switch to me. Right. And so that happens so much.

But the devil, you know, is better than the devil. You don't. They all do it. They're I mean, whether they're publicly traded or not. Like, I I thought maybe having some regulatory body over it would have helped, but it doesn't. Right. They have to be able to change pricing. I I fully understand why they have that power.

They just abuse it.

I see.

So our job is to just keep them honest.

Okay. Well, that's good. That's good, man.

You know, that's that's the one thing that's lacking these days, I feel like, especially with vendors and with so much competition. Now, I I can also imagine because you guys are using AI, combined with machine learning, you guys can make it pretty cost effective for your clients.

We can. I mean, and and I think that's the then result is a net positive. Right? We we split the savings. So it's it's very easy for the customer to see it. They see it hit their bank account. They know exactly what they would have paid had they had their old rates and fees. Mhmm. So it's it's very easy on us to say, hey, we saved you a $100 or we saved you a $1,000 And so it it's really simple.

Right. Right. And just to add on to your point, just so our, dental and medical clients can understand this. I know for a fact that all the medical and dental professionals, they're analyzing, either on a monthly or quarterly basis, how their practice is doing by looking at what we call collections. Right? So collections, a lot of times, whether using QuickBooks or whichever software, it picks up the deposits that were made into the bank account. And that's how they evaluate, okay, this is how much we have collected, versus the management software that they're using, which is showing them their production numbers. And oftentimes, they look at the difference and compare it against their AR report to see where they're at. Now the key component here sometimes that they forget to include in the calculation would be those merchant fees.

And there's a direct correlation there. So if these fees go up, hidden fees, right? And if the rates change, that will be reflected in your collection numbers. So whenever you're doing your management analysis, like how is my practice doing, those numbers can easily get skewed. And also, depending on, you know, how often you're doing your analysis. I know, especially for smaller clients, they don't have the time to do it every month or

They do it quarterly. Yeah.

Even quarterly. Sometimes they do it once a year. So a lot can change. So, you know, having a 3rd party company that can help you monitor it, and as Jeremy mentioned, you know, when I say smaller clients, you know, a practice that's doing less than $10,000,000 a year, they are doing a lot, right? And having more people by your side to help you streamline some of the processes, oversee, the business systems that you've set in place will make your practice more effective and efficient.

The other thing I see, this is kinda trend right now. Processors realize, like, people are gonna negotiate. So how about we just pass it on to your customer? Just take the 3% and pass it on to your customer. That doesn't help. And actually, I mean, look, it brought the problem into light. I think now you're starting to see, you know, a lot of legislation Yeah. Potential to stop what they call junk fees. And this is, you know, credit card processing fees being passed on to the consumer is also going to be it already has been considered a junk fee in California.

So there's going to be state legislation on on being able to to surcharge customers. Like, hey. I'll just charge them 3% and then I'll make more money. It's actually exacerbating the problem. Right? Because you're charging 3% more, and then you're paying 3% on top of the 3% you just charged. So you're not even getting a 3% That's right. So it's it's making it worse and it's hyper inflating the economy. Right? We we our our inflation is, like, averaging 29 or something like that over the last 15 years.

Right? I mean, it goes back and forth. But to then just throw 3% on everything Mhmm. Isn't going to solve the problem. The problem is no one should be paying 3%. I think everybody just chalks up that number to that's the cost of doing business and it's the cost of moving money. It's not. So I I feel like, you know, that's 50 to 75 basis points higher than it really should be Mhmm. Depending on the card types you take.

And, you know, American Express has programs. There are DIY things that we often recommend our clients do. Mhmm. Simple things that they can do. Like, if I see a statement in it and there's a ton of debit and they don't have a pin pad and they're not forcing people to put their pin in, that's a problem. Because you're going to pay 1.29 or 1.79 percent for that debit card when all you have to do is ask them for their PIN number. And it now becomes a 0.25% card. That's a DIY thing.

We don't split the savings on that because we taught them how to route cards properly. There's other things that companies can do, like, you know, don't get a paper statement. You don't need 1. Get the PDF. It's usually between $10.20 a month. There's just little things like that. Right. They should just do, but no one knows to do it 12.

They just don't take the time to make the call and do it. So those are tiny things. But the first thing that every company should do is take their total of fees and divide it into their revenue and find out what their net effective rate is. Like, what is the bottom line that they're paying?

Mhmm.

Because processors are tricky about, hey, you're actually paying well, your rate's, like, you know, 30 basis points over interchange. Like, that doesn't mean anything. You need to look at the bottom line. What is the actual effective rate I'm paying? So if they do that really simple exercise and they're paying more than 2.2%, you should really look into it. I mean, it's worth it's worth taking the time for between 50 basis points and a 100 basis points, you know, half a percent and 1 percent of your total revenue. Mhmm. And doing these things like cash discounting or pushing the 3% to the the consumer side, it it hurts you as a company. There are definitely a community of people who will leave even if the service provider is great because they just don't feel I mean, we see that with tipping in Miami.

It's auto gratuity everywhere. It's not a happy feeling to get a 22% auto gratuity on a bill. So it it hurts them from a reputation perspective, and then it just makes the problem worse. Right? You just make the processor makes more money.

Right.

That that's who wins in that. What they should do is reduce their expenses, get it down under 2, and then charge a 3%. Right. Put some money in your pocket.

Right. Oh, absolutely. Absolutely.

Cash discounting is another bad habit. And people think if you pay me cash, which no one's carrying cash. So don't stop at the a t I mean, again, bad user experience for their customers. Cash is actually more expensive. If you took all cash, you'd have a serious problem. People don't know that the cost of cash and now, you know, these banks, there's no one there's no one in the branch anymore. So when you go deposit cash, they charge you. And on top of that, like, if you take a lot of cash, now you have Brink's trucks, you have security, your insurance policies are gonna go up.

There's a lot more to it. Right. So saying, hey. Pay me cash, and I'll give you a discount, that that's not helping either. I think that it's and long term, that would hurt the company too. So it's really just cost down as best you can. There's simple things you can do. Just gotta take the time to do it.

And if you need help, that's that's where that's really why we started the whole company.

Right. Okay. That's good. That's good. No. I like that.

And I'm just thinking, I'm like, okay. I can see your vision. I can see how you can help the community, how you can help the small business owners, the midsize business owners. But talk to me a little bit about the journey of those 8 companies that you built that you later successfully exited out of.

That's an interesting one. You know, I I think it's a little bit more glamorous. You know, when you some of the exits are out of necessity. Some of them are, you know, fun and you you've kind of had your fill with it. I've also learned that when I had a full time career and I was building companies simultaneously

Mhmm.

I just couldn't operate 247, 365. So some of those exits were purely there are better operators than me. Yeah.

To all

of it. I have no more minutes left in the day, so somebody has a multiple valuation Mhmm. On what I've built. I'm gonna take that. Right. So some of them not happy. Some of them were just, you know, I'm not in a position of continue to manage a company. Company needs real management, people, money, funding.

Uh-huh.

I bootstrap started a lot of those companies.

I see.

But it was a journey, I think, from entrepreneurial ideas that revolved around being making a lot of money.

Mhmm.

And I think in my early years of building companies, it was more about survival. Right. I grew up in a very mediocre environment that was really difficult, and all I cared about was survival. So when you build companies based on money mentality Mhmm. It's not healthy. So I built a lot of companies really just about profitability Mhmm. And money and growth. As I started to grow up and understand what I wanted to build, they they had more meaning and mission and value, and I think it was less scarcity mentality and more how could I impact things and make a difference? And as I made those, they became more successful.

There were bigger exits. They were a lot more fun. I enjoyed them more. I think, in general, that was kind of the path. It's a little bit of a rocky road in the beginning to build those things, but also of amazing learning experience about

Oh, I'm sure.

Valuation of a company. Mhmm. Something that when people start a business, they don't really sit down and think about. And I think in the industry you guys are in and that's not something that comes to mind day 1

Oh, no.

Is what's the end what's the end goal here? So thinking from the end early on really helps in terms of building something that has larger value or bigger valuations when it comes time to exit. So I do spend more time thinking about that. And I'm sure as, you know, some people in the practices that are looking at exit, maybe that's something they are looking at now. Like, how do I get a bigger multiple? And I know there's a lot of roll ups in the space. Mhmm. A lot of PE firms that are buying in that.

That's right.

And, you know, I'm seeing 2x and 3x. 7x and 3 days. Yeah. I mean, but then also I see some who found recurring revenue opportunities and subscriptions and, you know, other outside things that they could bring in that added the tech, connectivity, communication tech, even simple things that could add 2 x, 3x, 4x, and Mhmm. Made huge impacts to their exit. Right. So that's one that I I think now when I build things, I look at that. Mhmm.

It's not the reason why I build it, but I definitely keep it in mind because I know, you know, ultimately, that is my exit. Right. So that that's definitely the journey that I've had.

Yeah.

But also now more, like I said, more mission driven. And now I'm kinda going back to my roots. Right? I think early on, I said I had a major problem that almost bankrupted my company. That's right. So it's actually been fun for me to take it back.

Oh, wow. Okay. Amazing.

So helping companies I'm not saying that we're Robinhood. We're not, you know, but we are. We're helping small companies fight processors and big banks. They just don't have the knowledge base to do it. And if they do, they they don't have the time. Yeah. So it it this one is more mission driven for me on that end.

I see. And I can tell just by speaking to you.

Oh. You know what's fun? Uh-huh. Somebody who you know, when you have one of somebody running a practice that may not be making a ton of money.

Mhmm. I

actually have one in Miami. Mhmm. My one of my really closest friends, his brother.

Uh-huh.

So he had heard me talking about this. We were on vacation together, and he just kind of I was taking a call during vacation, what you do when you own a company. And That's right. And he just overheard and he's like, hey, could you help my brother? I was like, sure. So he sent us statements. I did the analysis. He has a dental practice in Miami. Mhmm.

There's a case study on my website. It's him.

Oh, no way. Real.

Doesn't do a ton. Yeah. Doesn't do a ton of volume.

Uh-huh.

We saved him 6,001 location, $6,000 a month.

Wow. That's

that's how predatory I mean, you know, that's how predatory it is that industry is.

Wow. That's crazy.

So to be able to I mean and I don't know what he makes, but he's not making 20% of the revenue of the company as the owner and and and bookkeeper and everything else.

Oh my goodness.

So when you can make that big of an impact for a company, it's a big deal. Oh, absolutely. I feel it it was a good case study. It was part of what kicked off, hey, I think I can do this for the masses. Originally, I was just working with partnerships like accounting firms and all sorts of advisory groups.

Mhmm.

PE firms was a big target for me because that just puts 1% to the bottom line of their portfolio company. Mhmm. That's a massive impact.

Oh, yeah.

I didn't think about working directly with the company because it's a lot of one off projects. But we built software to be able to effectively manage that. Now we can. And it's it's great to actually see. Like, obviously, we're buddies now. So it's it's a lot of fun to be able to make that kind of impact for a small business owner who wasn't even making $5,000 a month for me to save him 6,000 straight to the bottom one.

Right. Right.

So that that's a lot of fun.

Yeah. And for those listeners that are considering an exit strategy right now, especially if you're planning on selling to a DSO, most of the DSOs right now are offering about 5 times EBITDA. Right? And what Jeremy's talking about is if you can reduce your expenses by, you know, let's take this case study for instance, $6,000 a month, that's $72,000 annually, 5 times EBITDA. He just helped you make an additional $360,000 in your sale. So that small amount, right? When you multiply, when you look at the bigger picture, that's a big difference, huge impact. So that was part of the reason why I wanted to talk more about this because I feel like business owners, not just dental practice owners, business owners, they like to always look at the bigger picture. And while that is good, but from an operation standpoint, it's these little things that add up at the end of the day, right? So this is just one component that he's talking about and I'm glad that Jeremy's actually sharing a lot of his old stories. In fact, I was going to ask him like maybe he could share a mistake he made that he regretted back then, but now, looking back to it, he's like, I'm glad I made that because I learned a lot from it, and I'm gonna share this story so you guys can learn from it.

Oh boy, Which one? Advisory. Okay. This is I actually talked I I just talked about this on on another show I was on recently.

I see.

I wish I would have had advisory earlier. Mhmm. I thought I could just do everything.

Mhmm.

And good people made a huge difference in the companies later on.

Mhmm.

And I just thought, I can do it all. I got it. I'll just handle it. I'll figure it out. You know? And I think as business owners, you just do that. You're just, like, ready to jump in and learn it.

Mhmm.

Really good solid advisory in different aspects of your business, like finance or accounting or is probably the most single most important thing you can do. Two heads are definitely better than 1, but not like, hey, my buddy knows a little bit about this, so I'm just gonna ask him for advice. It it really needs to be someone in the space that's a trusted adviser that can really help you through those issues. Mhmm. It cost me immensely not doing that upfront. I wish I would have done it sooner. And I thought, well, that's expensive. It ended up being way more expensive not having it.

And in early companies that I built that I exited, I wish I would have had m and a advisory or exited. Like, I wish somebody was there to kinda guide me through the first exit that I just got crushed on. Maybe even tax strategy would have been great to know when Sure.

When I

did exit and I didn't have all the planning in place. And then it was like, hey. We closed December 1st. I'm like, great. Get all this money. It's like, hey. By the way, all of that tax money is due now. Like, wait.

What do you mean? I just got this money. So

Right. Right.

So it's something that I think small businesses don't immediately gravitate towards because, like, it's just gonna be expensive. Right. Not gonna get anything out of it.

Right. I do appreciate you mentioning that. I I do appreciate you mentioning that Because you're absolutely right for a small business, you know, they're starting business for the first time, hiring people, overheads higher than what they're bringing in. They're actually in that mindset, you know, And this is what I call the employee mindset, where you know, when you're thinking about, okay, how do I have more disposable income? Okay, I need to reduce my expenses, right? I need to eat less outside, I need to go to less fancier restaurants, I need to save on gas or buy a more fuel efficient vehicle. You're thinking of ways of cutting expenses.

Right. Yeah.

But as an employer, not all your expenses are like that. Some of your expenses will actually help you capitalize, right? Help you make more. Advisory, especially if it's from that industry, it can help you tremendously.

Yeah. Growth. Like Yeah. A 100%. Like, spend money on growth and definitely organization. I mean, efficiency is key. Right?

I feel like there's a lot of

waste and you you said it. I I I'm gonna write something about this. Everything is a subscription now. Yeah. And it's, you know, it's like 5 here, 15 there, and QuickBooks is 50, and then this is 70. And by the time you're done, you're like, I got $10,000 in recurring expenses. So,

like Mhmm.

Troubling. Mhmm. Why do I have all this stuff? And then there's software for software. Well, QuickBooks doesn't connect to that. So, yeah, there's a 12.99. You can connect it to this and they're like Right. Okay. Right.

Yeah.

So it it there is a cost versus value at some point, some real hard decisions that have to be made. Do I really need that? And often that messaging should be, do I need that for growth? Mhmm. And when you can get past, like, hey. I can be efficient to a degree. I think that's something that early on people should focus on.

Right.

Focus on growth. I mean, sales cures a lot of things.

Mhmm.

Being efficient will help when you don't have them. So you gotta have both. Right. So it's it's it's tough because you gotta how do you do all this as and I'm sure in in a lot of these practices, they're they're already wearing 50 hats and, you know, day to day are walking around seeing patients. Right?

Right.

So how I don't know how they do it. It's a lot of work.

It is. I mean, it's part of the reason why we're thinking about doing an episode on burnout for our listeners. It's a real thing these days.

More so.

It's even more challenging. I don't know much about the the roll ups in that space, but I feel like they just they get acquired, and then they're back into you have a job again. Yeah. And I I worry. Is that, like, really? I mean, maybe maybe it is. I don't really know the space well enough to say that it's been positive. It seems like it could be, but I just worry, like, they roll them up and what do they what's their exit strategy? So I'm sure that I'm sure it's a lot helpful more helpful for them to have cash flow. And maybe there's a lot of efficiencies that I don't see where they streamline a bunch of things for them and they make them more profitable.

Yeah.

So if it's real advisory that comes in and helps because they have all the experience in the business acumen and the software packaging and Mhmm. Everything's really dialed in

Mhmm.

That it is a it's a, you know, a good outlet for them. Yeah. I just worry, is that real is is that their exit then?

Yeah. And and you actually talked a little bit about that. It's having foresight. So don't just wait till the last minute because somebody reached out to you and gave you a favorable, you know, multiple and you're like, oh, you know what? I'm gonna sell next year. Plan it out. Think about the tax implication. Think about what you're going to do after you sell it. Think about what you're

going to do. Yeah. That's the that's the real question. You just spent all that time, effort, energy schooling. Can they even do it anymore?

Yep. That's the thing. I mean, they can. They can always open up a new practice, but would it be more profitable? Don't you have to put in more work to get it back up to break even point? Wouldn't it have been better if you just used that time on your existing practice

They they can open another practice after?

Yeah. Yeah. You can

So it's not a noncompete

industry? Well, again, it depends on the buyer. Right?

Yeah, of course.

So if it's PE folks, again, they have different models depending on what kind of model you go with. Are you partnering with them? Are you selling to them? It will vary, the non compete. But assuming we're just talking about, let's say, you know, full on sale, cash upfront, no rollover equity, none of that, no obligation for you to stay and work, even though that's unheard of. But let's say for this example, say, and you decide, okay, I have all this money. This is after taxes. What do I do with it? What do you do with it? Right? So think about that.

Advising. You know what?

You know what? I have been talking to a few clients that when I asked them, I'm like, look, after you sell your practice, what do you wanna do? Continue doing dentistry? Are you gonna work as an associate somewhere? They're like, oh no, man. I'm gonna do something else. I'm like, what are you gonna do? They're like, I'm gonna speak at seminars. I'm like, oh, can you

live in

a moment?

Yeah. It's just gonna say how many monetize it?

Well, that's the thing. They're like, oh, no, we're not gonna, you know, we're not gonna make enough money to sustain ourselves, but that's because we already have the funds we need. And these are folks that are closer to retirement age. Right? So they have plenty in their 401 ks and, you know, that's That makes sense.

A big bonus.

So for them, I'm like, oh, okay. That's interesting. But I'm

gonna steal your math, though. I I actually hadn't really thought through the, the valuation increase. Yeah. 11 to 2% of your revenue times 5 x. That's Uh-huh. Yeah. It adds up.

It's huge. It it does add up. Now, again, now this is something that my clients are aware of, but the issue is they look at expenses that are needed for their current operation. So areas like oh, I'm going to let go of an employee. Well, is that employee vital for your collection to be where it's at? Or you know, oh, I'm going to not use this company anymore. Instead, I'm going to, you know, do it myself in house. Well, the amount of time you'll have to pull out to do it yourself, is it worth it? Is it actually going to help your business? Or do the opposite? So certain areas, leave it as they are. But other areas like this, right? Focusing on merchant fees, focusing on, you know, that little portion of your revenue that's getting secretly taken away.

Focus on something like that. Yeah.

I'm sure there's a ton of line items to go after. Right? I mean,

so how much money are you actually taking home? Right?

It's a challenge.

Jeremy, it was a pleasure having you on our episode today. And thank you so much for sharing your knowledge with our listeners. I'm sure a lot of them will really appreciate it. Now if for somewhat of a reason 1 or 2 people may want to reach out to you, how would they do that?

You can go straight to the website, payment brokers.com. I'm also on LinkedIn. I'm pretty active in in the space, so happy to answer any questions along the way. But like I said, I I think the first thing would be before you do that, just take a quick glance at your last credit card processing statement. Take the total fees, divide it into the total in credit card sales, and you'll get you'll you'll see the percentage. And I think that'll give you a really quick simple math. If it's above 2.2, reach out. We're happy to help.

No cost to do it, so feel free to reach out to me directly.

Alright. Thank you so much, Jeremy. Thanks for listening today. Be sure to subscribe to Beyond by Wings on your favorite podcast platform. For more information, you can follow us on Facebook, Twitter, and LinkedIn, or reach out to us on our website. You can also shoot us an email at info at eandassociates.com.