E745 | Are You Sure You Want To Scale Your Business?

In this episode, Doc Danny dives deep into the concept of "lifestyle businesses," exploring their unique characteristics, benefits, and challenges. A lifestyle business is generally defined as a small, cash-based or hybrid practice generating less than $500,000 annually. These businesses often see owners deeply involved in daily operations, focusing more on personal satisfaction and work-life balance rather than scaling or establishing enterprise value.

Danny discusses the advantages of a lifestyle business, highlighting the perks of having flexible hours and the ability to work with clients or employees you genuinely enjoy. For many, this model provides a comfortable income and a fulfilling lifestyle.

However, as the episode unpacks, there's often a disconnect between the romanticized notion of a lifestyle business and the reality of what it entails. Many entrepreneurs find themselves torn between the desire for a manageable and enjoyable business and the ambition to grow a scalable enterprise that offers passive income and the potential for generational wealth.

Tune in as Danny shares personal anecdotes about the sacrifices he made in relationships, health, and lifestyle while striving to grow his own business. Balancing personal life and a scaling venture can be challenging; it requires a mindset of obsession, focus, and an acceptance of significant trade-offs. For those seeking to achieve a blend of personal fulfillment and business growth, the journey can be intricate and demanding.

Whether you're currently running a lifestyle business or contemplating your next entrepreneurial steps, this episode invites you to critically evaluate your goals. Understanding the trade-offs involved in both paths—lifestyle and scalable business—will help you chart a course that aligns with your vision for success. Join us for an enlightening discussion that could reshape your perspective on entrepreneurship and work-life balance!

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Podcast Transcript

Danny:  If you think that you want to grow a business past yourself, you have to be okay. The sacrifices you're going to make with your lifestyle with your trade offs, you're going to have to make because they do exist. They are a real thing. And it is actually what a lot of people, it deters them from actually growing a business and scaling a business past themselves because they're unwilling to make these trade offs.

Hey, are you a physical therapist looking to leverage your skillset in a way that helps you create time and financial freedom for yourself and your family? If so, you're in the right spot. My name is Danny Matei and over the last 15 years, I've done pretty much everything you can in the profession. I've been a staff PT, I've been an active duty military officer, physical therapist, I've started my own cash practice, I've sold that cash practice, and to date, my company, Physical Therapy Biz, has helped over a thousand clinicians start, grow, and scale their own cash practices.

So if this sounds like something you want to do, listen up, cause I'm here to help you.

here with the P. T. entrepreneur podcast. And today we're talking about lifestyle businesses and the pros and cons of that and whether this is something that you know, you may or may not want to do. A lifestyle business for me is a business that it's really a cash based practice, hybrid practice, whatever.

But they're going to be fairly small. Let's call it under a half a million dollars in gross revenue on an annual basis. It can be smaller than that. It can literally be just you. It can be you and maybe, some contractors. But you're heavily involved in the business and it's something that is really not You're not trying to scale it.

You are not trying to develop any sort of enterprise value in the business. This isn't something you're really going to be able to sell, but it can be something that can generate income for you. And it's something that can can really provide a good lifestyle for you. That's why they call it a lifestyle business, right?

You are working in the business, no different than working in another job, maybe you're working more. Maybe it's less you have more risk, obviously than working for somebody else. There's no guarantees. You're definitely eating what you're killing kind of model. But you could you could definitely transition from a job to a, being self employed in a lifestyle business, increase your income increase your, you say over what you do on a day to day basis and and work with people that you really enjoy working with.

Not a bad transition. We see a lot of people go this direction. Here's the mistake that I see though, sometimes is when people. Want a lifestyle business. They want a business that supports their lifestyle, but they think that what they want to do is grow a true business there's misalignment between what they really want and what they think they want.

And this can be a really challenging thing to understand because sometimes you don't know what you want until you realize what you don't want. And that might be Like trying to grow a business past yourself, which is a very hard thing to do any, in any business and a service business and whatever it could be anything, but it's a challenging thing to do.

And there are a lot of unique advantages associated with that. And for instance, passive income, which is a very hard thing to actually develop, but passive or non active income happens whenever you're able to grow a business past yourself and income is generated, whether you're the person seeing that patient or not.

That's a very rare thing that puts people in a place where they develop True. Value in the business something they can sell one day and that could create generational, Family change that could create wealth for the rest of your life And this is the one of the big reasons why people want to go that direction is they want to actually have the financial rewards of a business that has been scaled up But deep down if you want a lifestyle business You are going to struggle to scale a business past yourself If you just want to replace your income if you like the things you like to do outside of the business if you are a very healthy person as far as like the balance in your life and your hobbies and your friends and you know all the things that are actually like really important from a quality of life standpoint, you can't really have that and grow a business past yourself.

At least for a period of time, you're going to have to make sacrifices. You're going to have to say no to a lot of stuff, fun stuff that maybe you want to do friends, family. You may have to say no to some health things that you would like to do, but you don't have the time because you have to focus on the work.

You have to focus on the business. And this is where we see so many. Entrepreneurs struggle with their health and their relationships and all that. And being able to maintain those things or have some semblance of balance is important, but you are not going to have this amazing balance life where you can be on three softball teams and play fantasy football and go to all these, all these concerts and go on all these vacations and all these things that you might want to do that are just like totally disconnect.

And, you're super into these hobbies that you have and be able to grow a business. A successfully at a rapid clip past yourself. I just don't think it's possible. And I could be totally wrong as far as my assumptions here. My own experience is you're either in or you're out.

You can't be half pregnant. You're either in it to grow a business all the way, or you're not like, it doesn't work that way where you're like one foot in one foot out, you'd have to be fully committed to it or you're not committed to it. And it's okay. If you don't want to be, that's fine. That's totally fair.

It. A lifestyle business is nothing to be ashamed of. In fact, it's amazing for the right people. It's the right vehicle. It's the perfect fit. But if you think that you want to grow a business past yourself, you have to be okay with the sacrifices you're going to make with your lifestyle with your trade offs you're going to have to make because they do exist.

They are a real thing. And it is actually what a lot of people, it deters them from actually growing a business and scaling a business past themselves because they're unwilling to make these trade offs. For whatever, reason and not saying it's bad or it's wrong. It just depends on what your goals are.

For me, I traded many things. I traded, friends, I traded health. I traded my relationships for a period of time. And luckily for me. Because this doesn't always happen. I was able to bounce back from all those things and be in a really healthy place, like in my life, which I am very thankful for because I've now seen many entrepreneurs go down this path and not bounce back.

And they have poor relationships with their spouse, their kids, their health is terrible. They have really nothing around them except for a successful business. And that's actually an ultimate failure as well. So I would say I was a bit of the extreme. I was obsessed with what I was doing and I've been able to really dial that in a bit more.

But there's some amount of obsession that you're going to have to take to this because it's really hard. It's super hard. If you want to play a professional sport, if you want to play a sport at a really high level, you can't be like into it. You can't just practice every once in a while.

Like you got to put in. A ton of work, unless you're just an absolute physical freak, but even then that's going to, that's going to only get you so far. You're gonna have to put in so much work, so much effort over such a long period of time to then achieve that goal that you're going to have to make all these trade offs and sacrifices along the way.

If that's just the way it works, having that balance is so hard to maintain. And the trade offs don't have to be to where you say, like you don't ever see your family or anything like that, but you might not be able to coach your kids. Teams for a while because you don't have the time to do that. Like I didn't do that for a long time and was only able to do that in the last year or two.

For me, okay, yeah, it's a trade off. Do I regret it? I don't know. Maybe. But I am where I am today because of the things that we decided to do. And that's what I wanted. To do that was my goals. My goal was never a lifestyle business. It was to grow a business, see what I could do. I want to challenge myself within the business world.

And I still do to this day. It's something that I'm fascinated with. I love the game, but I also have now, I'm now at a point where I have built a business past myself, where we have other people, where I can have more A a quality lifestyle and still have a business that's growing and scaling, but there's a certain period of time where you're going to have to give up a lot of things.

And if you're not okay with that's fair. A lifestyle business can be a great fit. And here's the big difference between what you have to think about in a lifestyle business And a business that you're growing past yourself a lifestyle business You that business is not going to be worth anything.

You can't look at it as an investment You have to look at it as an income stream to look at it like a self employed income stream And you have to invest the money that you get from that income stream into things outside the business Just like anybody that has a job like if somebody works at google they don't sell their job one day whenever they retire.

It doesn't work that way they can't write, but a business you can sell and have a huge windfall of money that comes your way from that exit of the business. If you have a successful business that you build, it can sell, then that can happen for sure. But if that's not going to be in the cards for you, and that's not what you want, Then you have to take the income stream and you have to invest in things outside of it, just like somebody at Google does in their 401k or whatever they're investing in outside of their job.

So you have to look at it that way. Don't make the mistake of thinking you're building this thing. It has all this enterprise value. You're going to sell one day, but it revolves almost entirely around you and it has almost no value. No one's going to buy that. They're only going to buy things that are essentially producing income without you being involved.

And that's a really hard thing. To do and if that's what you want to do great amazing challenge wouldn't I wouldn't do it any other way But if that doesn't sound like you then that's all right build yourself an income stream Help people get amazing results like be amazing at what you do as far as the clinician is concerned People need us, you know Take the income you generate from that and invest in things outside of your business because you're playing if you're not you're playing the wrong game Like you're looking at it the wrong way and you're going to end up one day looking back and be like, Oh shit, I thought I was building this thing that I could sell at enterprise value, but really you built a lifestyle business.

So you got to know what you're building, make sure you're building the right thing. And not necessarily think you're building one thing versus the other, because one day you might look back and realize it was a big mistake in terms of how you managed, your finances or reinvest in your business or whatever it might be.

So anyway, if you're interested in starting a practice, obviously think it's a great idea. Realize there's a big difference between a lifestyle business and a business. You scale past yourself and you've got to understand which thing you're trying to build, why it's important to you. And really think about that for some time, put some thought into it before you go and make decisions about what you want to do, because you don't want to make these trade offs in your life if it's unnecessary, and it may not be necessary to you.

It may not be what you want. It may not be what you want your life to look like. Not everybody's like me. And in fact, many, most people are not I wouldn't, I'm not saying that in a good way. I'm saying that as many things that I've done in, in, in my life, as far as like the trade offs that I made leading up to it.

Most people would view that as I would never do that. I've, I basically had zero friends. For a period of probably five or six years because I didn't have time for him. I didn't have time for him. Just focus on my business. That's a trade off that I made. That's not a trade off that everybody wants to make that's reality.

That's the truth. That sounds lonely. It's fucking lonely Yeah, it is but you know what where I am today and my ability to actually like Build these things back up. I'm so thankful to have the opportunity to do that. And I missed a lot of these sort of variables that create a well rounded life, but I wouldn't know what I was able to accomplish if I hadn't tried.

And that was for me was a huge driver and still is. And if that sounds like you, then you probably got to go for it as well. Just make sure that you don't burn everything else down in the process and make sure that you have some amount of relationships that are important to you, that you keep, you maintain, you prioritize those, especially if you have a partner or spouse, family, kids, those are the things that they don't change. Like friends, Hey, you may feel differently about yours, like friends are one of those things that I feel like bounce back and have bounced back for me. If that's an area, you're going to make a sacrifice and your health is tough too.

You may not be in the greatest shape of your life. I definitely wasn't, you can be in decent shape and make that trade off and have the time and the bandwidth to do these other things. And that's just it. You gotta be understand if it's worth it for you to make trade offs or not.

And if it's not. Stay small, stay in the lifestyle business and be just as happy there. If that's you,

Hey, peach entrepreneurs, we have big, exciting news. A new program that we just came out with it is our PT biz part time to full time five day challenge over the course of five days, we get you crystal clear on exactly how much money. You need to replace by getting you ultra clear on how much you're actually spending.

We get you crystal clear on the number of people you're getting to see and the average visit rate you're going to need to have in order to replace your income to be able to go full time. We go through three different strategies you can take to go from part time to full time and you can pick the one that's the best for you based on your current situation.

Then we share with you the sales and marketing systems. That we use within our mastermind that you need to have as well. If you want to go full time in your own practice. And then finally, we help you create a one page business plan. That's right. Not these 15 day business plans. You want to take the small business association, a one day business plan.

It's going to help you get very clear on exactly what you need to do. And when you're going to do it to take action. If you're interested in signing up for this challenge, it's totally free. Head to physicaltherapybiz. com forward slash challenge, get signed up there. Please enjoy. We put a lot of energy into this.

It's totally free. It's something I think is going to help you. Tremendously, as long as you're willing to do the work, if you're doing the work, you're getting information put down and getting yourself ready to take action in a very organized way. You will have success, which is what we want. So head to physicaltherapybiz.

com forward slash challenge and get signed up today.