Veterinary Blueprints
The Veterinary Blueprint Podcast is all about taking the blueprint of industry experts and breaking it down in short, digestible episodes you can use to take your practice to the next level. Join host Bill Butler as he interviews experts on client and practice management, financial strategies, human resources, and more. Gain valuable insights and stay ahead in the veterinary field by tuning in to tips from successful experts inside and outside the veterinary industry.
Veterinary Blueprints
#25 - Banking on Your Dream Practice With Joe Persichetti
We explore the world of veterinary practice financing with Joe Persichetti, Senior Vice President and Head of Healthcare Business Banking at US Bank, who shares insights on how veterinarians can secure funding and navigate the path to practice ownership. Joe brings nearly 25 years of experience helping healthcare professionals achieve their dreams of practice ownership, expansion, and growth.
• Student debt is not a barrier to practice ownership - focus on payment management rather than total debt
• Building the right team of financial advisors, CPAs, attorneys, and healthcare-focused bankers is crucial for work-life balance
• Veterinary practices remain financially strong and "recession-resistant" businesses, making them attractive to lenders
• The industry is seeing a resurgence in both startups and independent practice acquisitions
• Engage with lenders early in the process for guidance, not just after finding a practice to purchase
• When choosing a lender, ask if they specialize in healthcare, what terms they offer, and what happens after the loan closes
• Local banking relationships with dedicated representatives are more valuable than call centers for busy practitioners
• Practice ownership offers greater income potential and autonomy compared to associate positions
Reach out to US Bank's Healthcare Business Banking team to learn how they can help you achieve your practice ownership goals. Find your team early - the right financial partners can make all the difference in your success.
Host Information
Bill Butler – Contact Information
Direct – 952-208-7220
https://butlervetinsurance.com/
https://www.linkedin.com/in/billbutler-cic/
Schedule a Strategy Session with Bill – Strategy Session
Podcast Sponsored By:
Butler Vet Insurance: We wrote the Book on Veterinary Insurance
Running a successful veterinary practice comes with its challenges. At Butler Vet Insurance, we specialize in simplifying insurance for professionals like you.
"Protecting Your Veterinary Practice": Your Guide to Stress-Free Insurance
Insurance-related stress: Order Your Copy Now
Why Choose Butler Vet Insurance?
We specialize in risk management tailored for veterinarians, addressing unique challenges!
Butler Vet Insurance – Your Trusted Insurance Partner for Veterinary Practices.
Welcome to the Veterinary Blueprint Podcast brought to you by Butler Vet Insurance. Hosted by Bill Butler, the Veterinary Blueprint Podcast is for veterinarians and practice managers who are looking to learn about working on their practice instead of in their practice. Each episode we will bring you successful, proven blueprints from others, both inside and outside the veterinary industry.
Bill Butler:Welcome to today's episode and outside the veterinary industry. Welcome to today's episode. Welcome back to the Veterinary Blueprints podcast, where we bring business and entrepreneurship to the veterinary practice owners and managers across North America. I am your host, bill Butler, and today we have an incredible guest joining us, someone who knows the ins and outs of practice financing for veterinarians. Joining me today is Joe Persichetti, the Senior Vice President and Head of Healthcare Business Banking at US Bank. With nearly two decades of experience in practice finance, joe has worked with thousands of healthcare professionals to help them secure funding, expand their practice and navigate the complex world of banking. From startups to acquisitions and everything in between. He's been at the forefront of helping practices grow. Joe, welcome to the Veterinary Blueprints Podcast. I am thrilled to have you with us today.
Joe Persichetti:Likewise Thanks for having us Bill Happy.
Bill Butler:Friday, happy Friday. Well, why don't you give our listeners a little background on yourself? I know you have an extensive background in finance and banking overall practice finance and banking and you're now at US Bank. So how did you get into this overall and how?
Joe Persichetti:do you wind up at us bank? Sure, so I mean I've been fortunate enough in my my entire career is really surrounded around financing and banking and for the last 24 years it's been healthcare specific and helping doctors, dentists and veterinarians across the country. Really, you know, live their dreams and acquire start practices, grow them, expand, et cetera. And that really started to resonate early on in my career of how important that was right. Because if you're in a community and I used to have a small Italian restaurant in a small town in Columbus Ohio as well and realizing when you're part of a community how important healthcare is, right Both in medical and veterinarian, and having access to care for both your pets and yourself are extremely important, and so it just kind of stuck with me that the best thing that I could do would be to continue to give back in that world. So two years ago, roughly two years ago, I came over to US Bank because I was fortunate enough for them to give me a call world. So two years ago, roughly two years ago, I came over to US Bank because I was fortunate enough for them to give me a call and really they've been in healthcare financing in some form or fashion for the last 100 years. But they had reached out and asked me you know, what could they do differently, that I would be interested in helping a new initiative to expand and grow even further in healthcare at US Bank. And really, when I thought about that, it was an interesting comment right of like what's not being done or what could be done a little bit differently.
Joe Persichetti:And I really looked at who we were serving and going back to that community base of what clients need in the healthcare profession. And it's really access to local bankers, not just on the front end, not just when they're getting their lending. And you've got a business development officer that helps you with your loan. But what about the servicing of that loan? What about all the other products that you decide to bank with? Because, let's be honest, if I'm a healthcare provider, I'm a veterinarian, whoever it might be, I don't have enough time in my day. I'm serving clients, I'm serving my patients. I don't have enough time to contact four or five different bankers, right?
Joe Persichetti:So if I have access to a local person, that I have their phone number and I can reach out and say, hey, I'm having an issue with my checking account or this deposit's not working. The quicker that we can get them back working on their patients, the better.
Joe Persichetti:And that's kind of what I went back to US Bank with is I was like let's expand and make sure that we have the right products, but let's also make sure that we're servicing them, both on new requests lending's very important but also on the back end, Because a lot of people they move their service to call centers or 1-800 numbers and the problem with that is our healthcare providers get one or two classes in school that are around running a business not nearly enough, absolutely and then as they get better at it and they expand and they have multiple practices, then their, their needs and their issues become bigger as well.
Joe Persichetti:So having that quicker access where you know your bankers down the street, down the street, we thought was very important, especially on the servicing aspect of it. So that's what we did. We just hired our 101st person in the last 12 months to be focused on healthcare-specific. So we have bankers all across the country not just looking for new lending from a development standpoint, but also relationship managers so that our clients know who to work with after the loan is done.
Bill Butler:So I know that's a relatively new initiative for US Bank specifically and growing. You know, I know that you've been on a hiring spree, I've seen it here in Minnesota with our local US Bank rep and so you know, from an initiative perspective I think, what are the one or two things besides that, that personal touch that that you're trying to bring to the veterinary or health care space with this build?
Joe Persichetti:I think you have to start with expertise, right. So, going back to what are what our clients, what our health care providers need, which is quick access to advice, we need our bankers to be experts. So that's the first thing that we looked at because, again, like I, can put them local, but if they only work with a doctor, dentist or veterinarian once a quarter, or if they only work with dentists or they only work with doctors and they don't understand a veterinarian's needs, they're all different. The terminology is different, the degree of need in all of the products, merchant payments, wealth, etc. So that was the second thing that was important to us is to find people that had a health care background wherever it was, whether it was internal at US Bank or external people that we brought on, and so that was the second piece that we kind of focused on.
Bill Butler:Yeah, I know the credit merchant piece here in Minnesota has been big for a long time and now you're building out some of these other components. Well you know, as we talk about veterinarians and the thought of owning a practice, I'm seeing a lot of startups happening a lot of perpetuation in the one and two-by-doc practices just in the industry.
Bill Butler:A lot of perpetuation in the one and two-by-doc practices just in the industry. You know from your experience and background in animal health and you know you've been at this a lot longer than I have. What do you see, you know, do you get asked often about work-life balance, and can you have work-life balance if you're a practice owner?
Joe Persichetti:I do. It's probably one of the top two questions that we get and I think that you know I don't probably lead by example. I think I could be better personally at work-life balance.
Joe Persichetti:I have four kids at home and probably, you know, get thrown into different places, but I get that question a lot, especially with people that are just coming out of school, or one or two years out of school, where they're like, I've looked at the different options. I think the one thing that that veterinarians have today that maybe 10 years ago was there but not as prevalent is access to information, and I think they ask more questions, which is a good thing. They can research stuff, they're listening to your podcast, they go to some of these shows and they're getting more information, which is great, and they're also asking a lot more questions. So they're asking I know what's available, I could go the corporate route, I could start my own practice, I could buy my own practice. I think I want to be an independent owner, but is that even possible and can I still enjoy my kids and things like that? And I think the first thing that we tell them is build a team around you.
Joe Persichetti:Right, like if you try to do it and that's the one that I struggle with Right, it's like if you try to do everything yourself, it's harder to get stuff done. So the most important thing that you can do is, before you make that decision of starting or acquiring a practice, is sit and ask questions of who do I need around me? You need a banker that can understand healthcare, so that you're not trying to educate your own banker, your own local banker, on what you need and why you need working capital if you're starting up a practice and how why, if you're starting a practice from scratch. You need an interest only payment period, but you also need a you know a health, you know a veterinarian specific advisor and CPA, an attorney that understands how these acquisitions work. So the more you build a team around you, the better off you can be from a from a work life balance standpoint.
Bill Butler:Well, and having just been down at WVC in Vegas, genius Vets had a symposium on startups there's no shortage, as you mentioned, there's no shortage of information out there and if you're a veterinarian and you're interested in this and you haven't been to one of these big national shows VMX, wvc, aha, avma you know the big players WVC, aha, avma you know the big players that you know not that there aren't good resources at your local MVMA. You know we have a lot of those locally but also nationally, and you know. So there's tons of resources out there and you know generally what's interesting is. You know the bankers generally, know all the players. You know, as you mentioned, the CPAs. You know the bankers generally know all the all the all the players. You know, as you mentioned, the CPAs, the attorneys, the insurance, because it all falls into that acquisition or that startup. And so working with a banker who's got experience in the marketplace can be an advantage versus you trying to go out and find and vet people from the get go.
Joe Persichetti:Yeah and not. I mean, not only does it help from a work life balance standpoint, but it also can save you money, right? If you don't, if you don't rush into a decision and you just ask the right questions, the first thing that you should do is start at home and write what is important to you, you know, is it the hours that you work in a day? Is there a certain income that you need for you and your spouse If you have one to to live off of? What are your priorities? And once you have that priority list, you kind of build your perfect dream practice whether it's a startup, acquisition or whatever around that. And asking questions up front before signing on a lease space or negotiating on a deal, so that you're not trying to backtrack or adding additional expenses later, is a great way to start it.
Bill Butler:Yeah, what trends you know. Sitting in your chair it was a lot different than my chair you see quite a bit more. You've got a. You know, as you said, you just hired 101 people across the United States. You know what trends are you seeing in veterinary lending and animal health, specifically with startups? You know we touched on a little bit, but what are you seeing in the industry? I mean?
Joe Persichetti:we are seeing, probably in the last five years, a resurgence of startups, of people that are, whether they're confident or they just they want to build. They go to WVC or they go to some of these events and they see their dream office and decide let's, you know, let's start it, you know, instead of something else. So we are seeing more startups. Certainly a ton of independent acquisitions still happening as well.
Joe Persichetti:I think the bigger questions that we get is that one how are the performance? So the performance is still extremely strong, which is, from a bank standpoint, what we look at first right In these. You know a new business or a business transitioning hands how is that performing? And these are still, you know I new business or a business transitioning hands how is that performing? And these are still, you know I don't want to say recession proof, but recession resistant businesses that do really really strong. Especially, you look at you know animal health and what happened during COVID and everybody went out to get a, you know a new pet or to expand, and that demand out there on your the healthcare needs of your animals is strong which means that you know we need more offices, especially in growing areas.
Joe Persichetti:You look at where I'm at today in Columbus, Ohio. We have a lot of tech companies coming in, like Intel and Facebook and things like that. That means more jobs. It means more communities. It means you need more health care, both for yourself and your pet care both for yourself and your pet. Same thing in parts of Texas, as businesses have moved corporate offices into Texas. More construction going on.
Joe Persichetti:So I think the first thing that we get asked is are these still viable from a bank standpoint or from a numbers? And the answer is yes, that they're performing very, very well. We've seen what we call revenue curves, which is the anticipated revenue of a veterinarian office in year one, two and three, as they're starting up continuing to grow, meaning that the revenue is expanding, which is great. And then the last thing that we get asked is I'm coming out of school with significant debt. Is that going to prevent me from getting financing? And really you should talk to advisors early. It doesn't mean that it has to be a bank. It could be your CPA, it could be a consultant, whatever it might be. But you should ask those questions because really it's expected that you're gonna have that level of debt. You're furthering your career in a healthcare field. What you should be more concerned about instead of the debt itself is less about the three or four or 500,000 of debt that you got and more about what is my payment. And there's a lot of different payment options out there now. Between all the federal based, there's some independently based programs that extended out. So cashflow is what you should look at first.
Joe Persichetti:And going back to that comment I made about your first step should be sitting down as a family and be like what do we want to do? What are our goals? How much do I need to make? And if you know that question on the student loan piece it becomes, can I get the payment of my student loans to be a reasonable payment so it allows me to do all these other things? So really, that's the most advice that a lot of my bankers give you know, veterinarians that are asking the questions across across the country is Look at your payment and make sure that it that it's not like because there's still that there's some debt you want to pay down quickly, right, like cars, credit cards, pay them off each month. You know all that stuff. But from a student loan or from a home mortgage do you have the right payment? Because if you're under the mindset of I only want to pay down debt quickly, but you get yourself underwater, then that can be a bigger challenge.
Joe Persichetti:So it's easier to be flexible and make sure that you have a payment that you can work with and then back into it from there. Sure.
Bill Butler:And I think what I took away from that, joe, is the short answer is student debt is not a barrier to practice ownership. That's right and I think it just goes, having been at WVC, not only was US Bank there, but every bank under the sun. The veterinary space is a safe bet from a business perspective, which is why the banks are there, because they know it's a safe bet. Safe bet from a business perspective, which is why the banks are there, because they know it's a safe bet. And, as you said, there's, you know there's a little bit of risk I don't want to say recession, but coming back down to earth, post COVID for the, for the animal health industry, but it's still very, you know, stronger than a lot of other industries out there, and so it's very attractive for lenders.
Bill Butler:So it's about finding the right lender. Well, you know part of that process in thinking about talking to a lender, you know how long does the loan process take, or what should I come prepared if I'm going to. You know if I'm going to talk to a US bank rep in my local state or at. You know if I come up to your booth at AVMA, you know what should I have ready or what should I be prepared with?
Joe Persichetti:I mean, that's a great question. I think the first thing that I would say is the length of time depends on how far along in the process you're in. If you bring your lender in after you have found a practice that you've identified that you want to purchase and you have a close date and you've got all the financials of that business that you're looking to acquire, that should take a week to two weeks for somebody to look at and decide if that's a deal that cash flows and meets the things to approve. As far as when you should engage your lender, I would do it as early as possible because they might one they'll make sure that you're introduced to it to the team that Bill and I are talking about. They might one they'll make sure that you're introduced to it to the team that bill and I are talking about. But two it they also it might change your mind on. You know, did you write the? Did you ask the right questions? So if you're looking to start up a practice, you might not. You might be like I can't even go to a bank because I don't even know where to go. I don't even know where I want to and I don't know how much it's going to cost.
Joe Persichetti:Yeah, and I think that's the, that's the, the home mortgage mentality, right, like, find it in business lending. It's almost like bring them in early as a consultant so that we can at least say well, what are you looking to do? This is what you know. Historically, the average practice looks at Um, what areas are you looking at? Are you looking at your community or a community next to you? Why are you asking, or why are you looking in that community? Um, so, and then if you bring us in early, where it's more of a pre-approval, it could be a longer process because you haven't even found the location and stuff like that yet. But I would still suggest or encourage bringing a lender in early, just so that they can ask the right questions for you.
Bill Butler:And you know, as far as bringing items to the table, you know, obviously, having your personal finances in decent shape, right? You know, obviously, having your personal finances in decent shape, right. Like you know, you don't want to have fifteen thousand dollars in credit card debt and you just bought two cars and you've got an eight percent mortgage and all these things you go. They want to buy a practice like having some of those things in order. As you said, making sure that you're paying down your credit card but I heard this from another lender is uh, as you said, paying down down debt is not necessarily always the best thing to do, and so if you've got $50,000 or $60,000 cash in the bank, don't think I should throw that at my student loans to get my student loan debt down. You're better off potentially leaving that money in the bank.
Joe Persichetti:Yeah, I think you know the banks in this space, especially the ones that are healthcare specific or have healthcare divisions, and there's a lot of great banks out there. Look at the entire picture right, and what I mean by that is a veterinarian out of school for two years that is just starting to make money, still has student loan. Debt is going to look different and that's okay than somebody that's been out 10 years and making a ton of money over that 10-year period, and so that becomes the character piece of underwriting, which is how much have you made over the last couple of years, what should you have and where is it? So it's kind of spending that piece.
Joe Persichetti:The other piece that you're mentioning is get advice early on, whether it's a CPA, a lender, a consultant, somebody in the industry that you trust around. You know that people will call it liquidity, but it's really cash, and the reason that it's important is in an event of a rainy day, which can happen in any you know personally, not even just in any field do you have some money in case something happens, whether it's to you or your family, or you need to pause your business. So, going back to your point, bill, you know taking all of your cash and, being like, my banker's going to want to see that I have zero debt. So I just made $100,000. I'm going to pay it all off.
Bill Butler:I'm going to pay off all my cars.
Joe Persichetti:And that becomes a challenge because again, all I care about on that car payment is your actual payment. Can you afford that payment in your income? So they're making sure that you're talking to people is key because again, you don't want to liquidate yourself because you have to have some money set aside for a rainy day.
Bill Butler:Yeah, you know, when I go to meet with a lender whether it's a you know us bank or any of the other banks out there what are some questions that you think are key to ask that lender to make sure they're working with the right one. You know the first chapter of my book I asked. You know nine questions you should ask your insurance agent if you're going to work with them. You know what are one or two questions that a veterinarian who's going to you know acquire or start a practice, whether it's about, you know, build a building or leasehold improvement or acquire something what are a couple of questions they should ask that you know you think are critical for them.
Joe Persichetti:I think number one is are you healthcare specific? And I think where that's important goes back to our comment earlier, where you could save yourself time, most importantly, money and just overall experience by having somebody that's looked at your situation a few different times before. The second piece of that is what are the terms that you guys offer? Because you know, going back to cash flow, if it's a local bank and they only go to seven year terms and you have all this student loan debt and you really need a 10 year or 15 year term, that seven year term might put you in the wrong space. What are your? What is the flexibility of your, of your prepayment?
Joe Persichetti:Again, events happen you want to acquire another office and that bank doesn't want you to acquire another office and you have to move your, move your banking relationship. You know is it going to cost you additional money. So what are your terms? What is your? What is your overall structure? Do you offer a hundred percent financing to acquire a, including working capital, so money to pay the first couple months of deals as you're starting to get? You know the account you got to pay for that insurance up front.
Bill Butler:You know I'm going to ask for 25% down, unfortunately, to get the insurance started. It'll put you on a payment plan. But you know getting equipment and you know, even if it's an existing practice, there's going to be some you're going to need some working capital in the bank to pay some bills as you get things going and then I think, lastly.
Joe Persichetti:So, if the first three are do you work with a lot of healthcare lenders or a lot of healthcare clients? What are your terms and what is the flexibility of offering 100% financing and working capital? And then, the last piece, which is not asked enough, is what happens after my loan. If I have a question on my loan, or the payment doesn't go through, or the deposit that you're requiring me to have I'm not able to get checks in, who do I call? Because, again, you have a few healthcare.
Joe Persichetti:Veterinarians are such a unique business, right, because not only are you, you know, helping with the office and the even if you have an office manager, you're, you're part of that but most importantly, you're working with your patients, which is why most veterinarians got into this in the first place, because of their love and care for animals. So when you have a 10 hour day, but you've got patients all day and you still have to eat, so you don't pass out like you have a 20 minute window to fix your banking problem, whether it's your credit card machines not working or your deposit and that's the question that most people don't ask is okay, I do my loan with you.
Joe Persichetti:What happens next? Do I call a 1-800 number? Do I call you? If I don't call you, who is it Knowing that? Again, it goes back to time and efficiency. The quicker you can get ahold of somebody so that you can go back to generating revenue and helping patients is better for everybody.
Bill Butler:There's nothing worse as a business owner, speaking from my own chair, than having a problem with banking at 445 on a Friday trying to get a payment in and you're're like, well, I've got to run payroll on Monday and this needs to be in the bank, and all of those problems and just having that relationship with somebody who knows how to fix it, Especially if there's an issue and you have to take time out of your day, which means that you have to tell a patient to hold on of your day, which means that you have to tell a patient to hold on and you know if that animal's sick or you know it backs up, you have to cancel that.
Joe Persichetti:That's again revenue that you're losing, so it all adds up.
Bill Butler:Well, as we start to wrap up here, joe, I think the question that I would ask is if I was a veterinarian listening to this podcast or out there in the world and I wanted to start a practice, can I do it? Is it viable for me to do in today's market with the current environment? You know, you hear about corporates, you see a lot of things happening in the space. You know we were down at WVC and they were talking about the mid-level practitioners and so there's a lot of disruption in the marketplace. But if I'm a veterinarian, I want to start a practice. Can I Do? You think it's possible?
Joe Persichetti:Yeah, I think the short answer is yes. I think the more important longer answer is everybody has their own unique wants, right Of you know, what I value in my life is probably different than yours, and vice versa. So sitting down and creating that, that key, and making sure that you know exactly what you want, both personally and professionally, I think is the starting place. But from a numbers standpoint, we are seeing a ton of demand. These are great, viable businesses I mentioned. The revenue is continuing to grow year after year. So when you talk about some of the other things, expenses are also growing, yes, but so is the revenue right. So you're still're still able to make. You know the income that you expect, or you wanted to when you were getting out of school. So the short answer is yes, and the longer answer is make sure that you understand the bigger picture of exactly what you're looking for and then build it from there.
Bill Butler:Well, I think that's great advice, joe. One thing that I've done with my business over the years is create that vision and then, you know, make decisions based on that vision. So you know, you brought that up a number of times, sitting down at home and spending some quiet time thinking about what do I want my practice to look like? How much money do I want to make? You know, what color are the walls in my practice? I mean things like that matter, because then when you're making those decisions, it helps guide you along the way and can put you where you want to be From a revenue or from an ownership perspective I don't know if it's talked about a lot or enough what's the difference between associate pay and owner pay? I mean, you see the numbers and what owners are making out there.
Joe Persichetti:If you're a veterinarian who wants to make some money, where do you maximize that, and so that's the beauty of it, right, is that if you're an owner, you determine for the most part right, there could be some regional things how much square footage, how many animals can you see in a day, things like that but you determine your own schedule, the revenue is more in your control and you can make more money significantly because of the fact that you don't have to rely on an owner telling you as an associate. These are the cases that you'll see today and kind of be capped. And there's other things that you can do. Again, going back to creating your own team, working with the right insurance partner, working with the right attorney and CPA. There's ways to maximize your expenses so that you can make more money in your office by doing certain things.
Bill Butler:Yeah Well, that's great advice, joe. We really appreciate the time. We'll have some information about how to reach out to you and the US Bank in the show notes. If there was one tip for veterinarians out there that you would leave them with, what would it be? It would be find your team early. Find your team early. That's like from the podcast perspective. That's like two thirds of everyone's top tip is find a team early, and you know there's no shortage, as you mentioned, of resources out there for people to find their team, whether it's insurance, cpas, builders, architects, practice consultants, brokers they're all out there and they're just itching to help veterinarians achieve their dreams, and they can do it with US Bank and Practice Finance Division headed by Joe Persichetti. Well, thanks so much, joe, for your time today.
Joe Persichetti:Really appreciate your insights. Yeah, thank you.
Bill Butler:All right, as always, everyone remember to like, share and review the podcast. It helps us get our message out to all the veterinarians out there and practice managers looking to grow their business and practice with entrepreneurship and business insights. Thanks so much for joining us in today's episode.
