E663 | Be Careful With This Key Business Relationship

In this podcast episode, Doc Danny discusses the topic of managing relationships when subleasing office space as a new physical therapist entrepreneur. He highlights that many physical therapists begin their careers by being mobile or subleasing space in a gym or clinic. While being mobile has its advantages in terms of low overhead costs, it can prove to be challenging to scale the business and time-consuming when it comes to traveling between patients. Subleasing, on the other hand, is a more popular option that allows therapists access to gym equipment at a relatively low monthly cost, typically ranging from $1,500 to $2,000.

However, Danny addresses a concern raised by a client regarding their sublease relationship. The client subleases from a gym owner who has issues with the owner of another nearby gym. The sublease gym owner has given the client an ultimatum - they must refrain from working with or having any involvement with the other gym, or their sublease relationship will be terminated.

Doc Danny views this as a significant red flag and advises against subleasing from someone with a "scarcity mindset." He believes that the gym owner's behavior is unreasonable, as it is not appropriate for one independent business to dictate the actions of another, as long as they are acting professionally and not directly competing. Doc Danny draws from his own experience, where he subleased from a gym owner who was unprofessional, demanded free treatments, and frequently closed the office. This owner had a reputation for being difficult within the community, and Danny regrets not properly vetting their character before entering into the sublease agreement.

In conclusion, Doc Danny emphasizes that when subleasing as a new physical therapist, the owner's character and mindset are more important than the location or price. Entrepreneurs should seek someone with integrity, a growth mindset, and a positive reputation through references. It is crucial to avoid individuals who attempt to limit business opportunities or may become unstable and threaten the business relationship in the future. Finding the right landlord partner is key to long-term success in the subleasing venture.

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Podcast Transcript

The gym owner where he currently has his office basically says, if you do that, then I don't want anything to do with you. So here's the ultimatum. You go to anything with them. You and I have nothing. Like we have no relationship. You stay here, then we're good. 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 today my company physical therapy business helped over a thousand clinicians start growing scale their own cash practices.

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

Hey, what's going on? Dr. Danny here with the PT entrepreneur podcast. And today we're talking about. One of the most important relationships that you need to really manage and and find a really healthy one when you are just getting started. This is for people that are subleasing space whenever they're starting their practice, which is probably the most common way people are going.

There's a couple of paths that we see one is mobile. Mobile obviously has less, less overhead. It's a little hard to market for. And then it's a huge time suck. Like it just sucks. You get stuck in your car, get stuck in traffic. You're in between patients. Anybody that's tried to scale a mobile practice knows that it's really hard to do.

It's really challenging because you just can't, unless you're in a very population dense area, it's hard to really have enough. Patient client density on your schedule in order to really scale that up I definitely see them working in downtown areas of major cities, but not everybody's there So a lot of times they start mobile because there's very limited overhead and then they typically will move to A sublease space a sublease space also might be where a lot of people just start, right?

So they start in the sublease space, meaning they, they find an office in a gym or they find an office in another practitioner's space or a wellness center or something like that. And they rent this space out because, it's cheap and they get access to gym equipment that they might want to use, which is great, right?

And it's still relatively affordable for people to do this. It's anywhere between free all the way up to maybe. 1, 500 to 2, 000 a month in a really, expensive area for a subleased office. So the question that I got from one of our clients recently about about his, the relationship he has with his gym owner where he has a subleased office is something that I think would be worth.

Bringing up and highlighting in terms of this really important relationship early on that you need to look for. So in the backstory is basically this, right? So this client of ours, he has an office space in one gym and there's another gym in the area that he has a good relationship with, but the gym owner does not have a good relationship with, doesn't like them and doesn't want this.

Clinician having anything to do with them either. So they have an opportunity to have an office in both of these both these spaces, which is probably a good move for their business. But the gym owner where he currently has his office basically says, if you do that, then I don't want anything to do with you.

So here's the ultimatum. You go to anything with them. You and I have nothing. Like we have no relationship. You stay here, then we're good. So he's basically trapping him, and saying Hey, I don't want anything to do with them whatever his reasons are. And this person could be rational and say, Hey man, I'm not in the business of, Poaching people's gym members.

Like I, like they have people we can help over there. You have people we can help here. We like, we like both these gyms. We like what you guys are doing. It's differences to it. But if you have an unreasonable person that has a very closed mindset, if they're like very scarcity driven so there's like an abundance mindset and a scarcity mindset or a fixed mindset.

That is the kind of person that you really do not want to be involved with in any sort of business sense. And I can bring this back to the very first gym that we were at. I don't know, I didn't know anybody here. I didn't know what part of city was the right place for me to be in. I didn't know what I should look for.

I literally looked for what, what has an office with a door. That I can go into that is cheap, like that's what I was looking for. And, I got connected with a couple gym owners. I met a few of them. I met one lady, she showed up like, dude, she showed up 45 minutes late. And it was like, there's no way I was going to rent a space from her.

It was the most unprofessional meeting I've ever had. It was so irritated. And then I met. Two other people that were relatively similar areas, different area than where I was looking initially. And both seemed fine at the time. So I went with the one that was cheaper, basically cheaper.

And the gym was a little nicer. Over the course of the year and a half that I was there the office got shut down. Multiple times because of things like him, not actually paying taxes not having a certificate of occupancy. He'd like randomly come in whenever I'd be working with a patient.

He basically expected that I would just treat him for free whenever he needed it. It was a, not the best relationship. And he was very similar to what this guy's describing in terms of kind of scarcity minded. He didn't want, he felt like people were poaching his people all the time.

Just very fixed, fixed mind versus an abundance mindset. As I look back, I think to myself, man, this is just the exact person that you want to avoid. You want to avoid people that are trying to a stop you from doing things like that's just. If you think of it this way, right?

This person is basically telling another independent business owner not to do something that would be most likely beneficial for their business and not cause any issue to the current business that this other person is in. It gets. It's silly. Like, why would somebody say that, and it's because they have a very fixed or scarcity approach to the world.

Maybe some things have happened to them where they've gotten burnt. Maybe they weren't always like this. But whatever it is, you definitely don't want to build your business on the foundation Of somebody that's going to act this way. It's unprofessional and it's not okay to tell another business owner That hey, here's your ultimatum you do this and we have you know, we have no relationship That's somebody that I would want to avoid at all costs.

So as you are going out into the world if you're newer to starting and you're looking for something like a Subway space. I think the most important thing It's not location, it's not how much it costs. It is the owner of that business, whether it's another clinic, whether it's a gym, oftentimes that's what it is.

You are looking for a business owner that is a rational, kind human being that wants everyone to win. It feels like the pie can get bigger. It feels like there's opportunity for everyone. And you only have one reputation. You really have to, you have to manage that. Just so much. You always have to think about longterm, play the longterm game and you want to look for other people that are doing the same thing because it's fun to, interact with people and play the game with the right people.

And it sucks to play the game with people like this, that, that are holding you back, that are trying to stop you from doing things. And maybe for them. Maybe they're trying to stop you from doing things because you know they're not having the success that they want. Maybe they feel threatened in some way, right?

It's just so hard to tell all I know is it's not the person that you want to spend a lot of time with It's not the person that you want to be able to kick you out of your office whenever because that very well can happen. So look for somebody that you sit down with them you want to see that they are a just A person of integrity, a person of there's a growth mindset, a person that has a good reputation, ask other people are about them.

And that's the thing I didn't do. Like whenever people would find out where my office was, I'd be like, how's that going? It's, and like, why do you ask, why do you say that? Because, the guy that owned the gym that I had, like he had a bit of reputation in the community of he's a challenging person to deal with and was tried a bunch of different things and was all over the place.

And I totally saw that. I didn't know anything about that. You know what I'm saying? Like I had no idea. So ask other people who, this person is like, what's this person like to other folks and you're looking for somebody that's going to fit a similar mold to what hopefully you are, right?

And not look for just the cheapest rent you can find, or the best location you could find with a a bit of a toxic relationship that you may end up having with the person who is your subleasing from, so make sure you're looking for that. It's not just about where it's at.

It's about the space or how much it costs. Like you really want to bank on the. Person, the person can make all the difference. And I have met some amazing people that within the community, whenever I started that are just like, lifelong friends, people that I still, get a chance to connect with that, came out of that space that I was in and I'm very thankful for that.

But if I could do it all over again, I would absolutely I would have found a different space. I would have done it differently. And I probably would have jumped into a standalone space faster, honestly. In retrospect, but it's a scary move to make. So if you're going to sublease, it's a great way to dip your toe in the water, not feel like you're tied to a building that's going to cost you, 5, 000 bucks a month and ran or something like that.

It's a direction a lot of people go, and I think it's a great way to start, but just make sure that relationship is key. You got to vet those people and make sure if somebody feels like they're trying to hold you back, dude, this is your life. This is your business. I, you cannot let other people tell you what to do.

You can't let other people tell you what you can and can't do with your business. As long as you are doing the right thing for yourself and your clients, that's all that matters.

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