Dr. Joshua Klein, REI, Chief Clinical Officer, Medical Director, and Co-founder of Extend Fertility in NYC joins Griffin this week on Inside Reproductive Health to discuss the business of getting into business. Listen as they share perspectives on risk tolerance, people-management, financial backing, and the potential to lose -or gain- it all on the path to entrepreneurial leadership.
Tune in to hear:
Dr. Joshua Klein share how he successfully cornered an underdeveloped segment of the fertility market, and what steps he took to get there.
Griffin question Dr. Klein on how he knew when to time the change in his career path, and what others in the same position should consider before making a move.
Griffin question Dr. Klein when he says “people are the hardest part.”
How to not get way over your head in overhead before you even start.
Dr. Klein’s information:
LinkedIn https://www.linkedin.com/in/joshuakleinmd/
Website: www.extendfertility.com
Transcript
Griffin Jones 00:04
How many ways are there to start an REI practice? How many ways are there to start fertility business? Explore that today with my guest, Dr. Joshua Klein because a lot of younger REIs think about well, do I have to go partner with somebody? Do I get a salary right at an academic center? Do I go off on my own, and I risk everything, because I've got this stupid medical school debt. And I went to some very expensive undergraduate college and maybe my parents were wealthy enough to help me but maybe they weren't. And I've got that debt to some of you who are coming out with a lot of debt. And, and so starting a venture, your own entrepreneurial venture can seem pretty daunting. And so our guest today Dr. Klein talks about another possibility is finding other people with financial backing. And in starting your own endeavor, as a piece of that you won't necessarily be a majority owner and own everything. But that's one way to do it. So we talk about the massive learning curve that you're gonna go on, if you want to learn more about the business of fertility, whether you own it or not, that it's drinking from a firehose. So Dr. Klein talks about some of the things that he picked up and the challenges of managing people, a vision for an REI practice. To start the whole thing of looking at fertility preservation is something that was underserved in the market. And what Dr. Klein thinks is the right demographic, or the more appropriate demographics for fertility preservation, and why he saw that as a need in the marketplace, and other hard lessons learned, like cost per lead cost per new patient acquisition. And so we both we talked about those things, and Dr. Klein closes with thoughts of how younger dogs might approach making that choice. So I hope you enjoy today's episode, Dr. Klein originally was a he completed his fellowship at Columbia. And then he was an associate physician at RMA of New York. And now he is a partner at Extend Fertility. And I hope you enjoy this conversation with him. Josh, welcome to Inside reproductive health.
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Thank you so much for having me, Griffin. I am interested in the topic for today because we have had people to talk about egg freezing on in the past. And but I'm interesting because your group extend fertility was one of the first to make a brand around. Yes, you're a comprehensive IVF practice. But you did have a special focus in fertility preservation early on. And so I want to spend some time talking about that. Maybe we get to the business second, but you were where were you in your career, when you started to feel like, you know, fertility preservation was something that was clinically viable, because, you know, that wasn't the case. 20 years ago, maybe the people just getting on board now are late. So when was it for you? Yeah, that's a question that that I thought a lot about. When we first were putting this place together.
Dr. Joshua Klein 03:31
I came out of training in 2012. So I finished my fellowship at Columbia in 2012 and took my first job at RMA New York, which is as many listeners probably know, is affiliated with Mount Sinai. It's one of the big academically affiliated programs in New York City. And part of it is just history because ASRM? Well, I should say, the studies that demonstrated that egg freezing could be done through vitrification relatively reliably and reproducibly. And with relatively good success rates really came out in the late 2000s Going into the early 2010 2011. That sort of timeframe. And then actually was at the end of 2012, technically published, I believe, in January of 2013, when he ASRM sort of put their guideline out that said that egg freezing can be offered as a method of fertility preservation without the rubric of an IRB without an experimental protocol. There was a lot of buzz around that that didn't mean that ASRM was you know, endorsing egg freezing or something that everybody should be doing. But at the very least, it wasn't considered an experimental modality anymore. And so that that was 2012 2013 which was literally the first year I was out in practice and kind of getting my feet under me. And, you know, sitting in an office in New York City and Manhattan with that The culture around us, you know, certainly being the case that most women are not getting getting pregnant and building their families in their 20s People are, are sort of young if they're getting pregnant in their 30s. It felt like to me, egg freezing is something that might be super valuable to like, a lot of women, not just a select few, but to like, sort of in some way, the average educated professional 30 something year old Manhattanites, who isn't, you know, hasn't partnered up yet, or isn't ready to settle down yet is still building their career and not at that stage of their personal or professional life where they're ready to have kids. And so, you know, at that time, egg freezing was still very small, it was still new, most people didn't know about it, and this people weren't accessing it for one reason or another. And so even at a big program, like RMA, they were doing, I think, something like 120 Egg freezing cycles a year, which means, you know, maybe 10 a month and the entire practice. So I was seeing a small handful of patients of who are interested in egg freezing. And it just felt like it didn't match the demographics of what it should. So at some point, that kind of light bulb went off that there's a disconnect between the number of like single, professional educated women who might want to do this, and then people are actually doing it. And then of course, the question became like, what's the missing link here? How come? How come it's a mismatch. And so the things that I thought about and that kind of got parlayed into building extend fertility, where people don't know about it. So there was a lack of proactive education about fertility preservation, you know, IVF, clinics, are doing a really good job of keeping busy helping people build their families, people who are struggling to get pregnant with IVF. And so egg freezing was kind of not the center of their attention. So that's one was education and awareness. Two was sort of, I think, the environment, I think egg freezing was never really thought of as like an important piece of an IVF clinic. And so I always used to say that, like, you could pick out the egg freezers in the waiting room, because you know, they were the ones sitting by themselves younger, kind of looking awkward when most of the infertility IVF waiting room is couples who, you know, kind of sad and tortured a little bit in the egg freezers, or they don't have a problem, they just are wanting to be proactive about planning their, their their reproductive life. And then third is cost because egg freezing tends to be priced as sort of like the IVF pricing, but a tiny notch less, even though technically, it's a lot less work for the lab to do so. So it kind of was overpriced, I think at that time. And so those principles were the ones that we tried to harness when we created a Extend Fertility as a center that focused on egg freezing back in 2015 2016. To kind of build a brand and a culture around the idea of making egg freezing and fertility preservation more understandable, more accessible, making the experience a little bit less unpleasant, especially if it's a sort of a purpose built environment, and then bringing the price point down in a way that that could still allow us to have a viable business model. So that's kind of the threads that went into it.
Griffin Jones 08:11
So you saw the market. You saw the the the the flaw in the market when it came to pricing and availability. What about demographics? Because that is a point of maybe contention, but that I just I don't I don't hear a lot of consensus about is what is the ideal demographic, and there are both clinicians and egg freezers did say, the younger, the better. And it it should be something that, you know, 22 year olds parents gift to them for graduating college, I hear both clinicians and egg freezers say that I also hear clinicians and egg freezer say that no way, like it's a very narrow demographic, and it's for 3839 year olds, maybe who are right, right, just before the window of have a real DOI risk, I suppose. And so, where how do you? How do you come to what you think the proper demographic is? Yeah,
Dr. Joshua Klein 09:19
it's a that's a great question, because it is something that I think gets debated hotly, and we have patients every day that say, you know, can I wait a year? Can I wait two years and sometimes it gets a little silly, you know, how can I wait six months? It's like a negotiation. But I think what, what has to be recognized to sort of think through that intelligently is that it's in arguable that in general, if someone does egg freezing younger, they're going to get a more valuable end product meaning younger woman will get or any particular woman if she doesn't younger, will probably get more eggs and more healthy eggs and that same woman who in an alternative universe does it older So, by that rationale, it's, which is oversimplified, as I'll explain, everybody should do it, like you just said at 22. Like, it should be a universal thing, the younger, the better. And so there's not much to argue about. But the reality is that even even at a place like extendable, we tried to keep it on the more affordable side, it is a luxury good meaning between the cost of of the service and the cost of the medications, and then the cost of storage, it's a, it's a, it's a significant amount of money. It's not the easiest process, we try to make it as easy as possible. But it's not the easiest process, it does take a lot of wherewithal to kind of get through it. And so it's not, you know, if if it really was something that you can get come into the doctor's office, you know, get a procedure done for 10 minutes, and it costs $100, I probably wouldn't be singing that same song of everybody should just do it when they're 22. Because kind of why not. And it could, could really be an important thing in your life. But but it's a lot different than that. And so what I what I want to point out is that every year that passes that you don't do it is another year that you might not end up having to do it, right. Because if you're 25, and thinking about doing it, but you wait. And then by 28, you actually got married and then started your family naturally, then that you want that gamble, right? Because you didn't have to do it. And now you may never have to do it, because you're already getting getting your family started naturally. And so you kind of dodged that bullet and you save the money and you save the anxiety and the investment of time, energy and resources to do it. And so in a certain way waiting to do it longer makes sense. Because the younger you are, the more likely you're going to end up starting your family in an easier way than egg freezing, if you just give it some time. And that's why I don't think that the 22 year olds should be less, there's a special situation which I'll actually get to also in a moment. But for most average healthy women, 22 Doesn't make sense because you can afford to wait because if you do it when you're in your late 20s or early 30s, you'll still get a very good end product. And there's a large percentage of women who will in fact, the majority of women who are thinking about it 22 By the time they get to 30 they won't need it anymore. So I think we're overselling it if we're selling it to 20 year olds. So that's something I think isn't always articulated clearly. But that's a reason not to do it too early, even though it's true. If you do it at 22, we'll do it at 30, you'll get more out of it 20 at 22. But you might not need to do it at 30. And so a lot of times it makes sense to wait to sort of let your life unfold. And then but then you gotta be careful not to let that slippery slope slip. Right. So if you do it at 39, I certainly would think that that's a mistake, because that's already you're sort of reacting when egg freezing works best as a proactive maneuver, right? If you're freezing eggs that are mostly not healthy already, which is when you're getting close to 40. That's the reality, it might work. But it's certainly not a great situation. The other thing Oh, the other thing I wanted to emphasize is the fact that age is only half the story, which is to say age is the best marker of egg quality. But there's another issue which is quantity, right how many eggs a woman has and we've learned over the last 1020 years, especially through how Hmh testing has become very common. And actually a symbol of a test. That is , it's been a very important development, I think, in the last 1020 years of fertility, management and treatment. Because if you're a 28 year old with a very low Hmh, which there are a lot of healthy 20 year olds that are going to have a low AMI, it's something that's very highly individual variable, it will probably make a lot more sense than thinking about freezing eggs at that point. If you're 28 year old with a very great Hi imH. You could say okay, I've waited a year. And that's not such a terrible decision. So I think that's another thing that's often overlooked is it's not only about age, it's another dimension when it comes to egg freezing, which is your egg supplier ovarian reserve and Hmh testing is so easy to get it's almost a shame that, you know, I believe that that OB GYN should just be doing it routinely, they do a lot of other health maintenance stuff that may or may not be helpful. And this is something that could be really useful. And I think slowly they are doing it more and more. But I think that's another dimension of calculus that needs to be recognized. And that can help a woman who's trying to strategize to make that kind of decision is really useful to have.
Griffin Jones 14:16
I don't think that this question is gonna go away because it doesn't seem that it doesn't seem that we have hit the plateau for the age of first birth in this country. So I think everybody remembers that headlines from earlier this year hit the first average birth. For women in the US the median age hit 30. And if my records are right from the CDC, it was even just in 2014 it was a little over 26 years old. Yeah. So it went, it went up one and a half years from just shy of 25 and 2000 to 2026 in less than 26 and a half in 2014. And then in 2022, it's 30. So I suck at math, but I think most of the people listening can see the exponential growth. So I don't think that this is going away. What do you see in the marketplace? Do you see peaks and valleys? You know, what I wondered is when you started in 2015, in New York is like, okay, are we going to see this in Charlotte in three years? And then in Cleveland, two years after that, and talk to us about what you're seeing?
Dr. Joshua Klein 15:46
Well, I think you're right, first of all, that this is still a moving target, and the market is still maturing. The, it's interesting, because there were some well publicized predictions that were made 2014, let's say I think about what the expected size of the egg freezing market would be. And there's one quote that's out in the media that said something like 85,000, or 100,000 cycles of egg freezing by 2020. The truth is, it hasn't grown that explosively. And you could think about lots of different reasons why that might be the case. But I think that egg freezing has clearly grown a lot. I do think it's going to continue to grow, I actually think that some of the kind of spin off growth that we're seeing, and that others probably are seeing as well, is more and more married couples, or not just married, but I guess more and more couples are coming in to proactively plan their families, even as couples when they're not ready to have their children yet. And also, and this gets a little hazy, where the line gets drawn between fertility treatment and fertility preservation. And sometimes it's an issue with insurance coverage, and so forth. But lots of patients who, you know, come in in their late 30s, for fertility treatment, they do IVF, and they get an embryo. And they say, Well, wait a minute, we always wanted two kids, and we struggled to even get one good embryo. So what we want to do is we want to do another stimulation cycle to at least get one more before we go ahead and use this one. And that happens all the time, these days that people are trying to bank at least, you know, not bank inventory of embryos, in some unreasonable way. But to put away one or two good embryos for the second baby if they're having their first baby in their late 30s, or 40, which is actually very logical. And so the I think the fertility preservation concept is kind of growing and branching out into other in other ways that in some way, are still evolving, by the way, another, I think, idea that will come to fruition, but I don't think it's happened yet, is I've had a handful of patients who have read about and are interested in doing proactive couples who are interested in making embryos for PGPT, which is the polygenic testing, you know, looking at, particularly if let's say, a couple comes in, the guy says, you know, my, my dad has terrible Parkinson's disease. And I know there's no gene for a consensus disease that I can screen for, but it just scares me to death that that's something that I might have a kid and it's going to be at high risk for. And so what I want to do is do these kinds of polygenic testing, you know, involving multiple genes to say which embryos have a higher or lower risk for developing, whether it's Parkinson's or Alzheimer's or diabetes or heart disease and things like that. So that's something that's not common yet. But I think that it's coming, as this sort of feeling devolves into a lot of this proactive planning your family type of and then genetics is obviously evolving and improving as well.
Griffin Jones 19:02
So you made a brand that I think is pretty well positioned for that. The brand Extend Fertility really works for both sides of fertility preservation and fertility treatment, it is because it's the extension is very intentional. And so you, you started this in 2015 is when the was when the business started, right. So you completed a fellowship at Columbia in 2012. You go work for RMA for three years. This is the point that a lot of the listeners are at they're either just leaving fellowship or their associate docks and they're thinking about the next step. You are at a place where you're at a great practice. You could pursue partnership there, or you could go off and do something risky. What was your decisions? When did it start? to appear in your mind of I could go off and do a venture like how did that originate?
Dr. Joshua Klein 20:07
That's a great question. So, yeah, I mean, without getting, I guess, too personal, I have a lot of gratitude towards my years at RMA, I learned a lot. And it's a good place. I think that for me, I think that it well, it was a hard decision, let me just say that much. The truth is that when I started speaking to one of my associates, my business partners who was interested in investing money, putting together investors to build out Extend Fertility, my original expectations that I would sort of be some kind of consultant on the project and not actually do it myself. But as we kind of continue those conversations, and I got more enthusiastic and excited about the idea, and he got more enthusiastic about me actually getting in it, it took some time, to warm to the idea, but I kind of got more excited about about doing it myself. But it's scary, you know, especially first job out of training. And I was fortunate to have, you know, good training and at large academic centers at Ivy Ivy League institutions. And so I hadn't kind of been really out in the business world before before then. But I think that my mindset essentially was that I felt like a small fish in a big pond at RMA, which isn't necessarily passing a judgement, it just the way it is, when you're working for a large institution like that. It's a big pond, it's a big pond, and to their credit, it's a big pond. And so I felt like I was young enough at that point where if I was going to ever take a risk, you know, I didn't, I probably couldn't have done it the day after I finished fellowship. Or I certainly think it's very hard to do it. The day after you finished fellowship, there are those who do it, and I give them credit, too. But I felt like having gotten my feet under me at for a couple of years. If I if I stayed for another few years, it probably would have been that much harder to leave. Probably my income, presumably would rise slowly. And so that, you know, the better you're doing the more than make it attractive to stay. And so, you know, when you're young, you're just getting started, it's a little easier, because you're not giving up so much. And so, I don't know, I guess my thought process was basically I felt like this was a good idea. And at the end of the day, I felt like, before I started my before I finished fellowship, before I started my professional career, I felt like I questioned, like everybody has self doubt, I knew I was a bright kid. But like, it's hard to see yourself doing what your what your teachers and mentors and superiors are doing, like, Can I really handle it when when stuff gets, you know, kind of difficult when there's an unhappy patient? And how do you? How do you deal with that, or when you have some issue with like an inspection and there's regulatory stuff, and hiring and firing and all that it's very intimidating as a young, you know, kind of medical trainee. But I think that what I started to realize was that the hard stuff is still hard when you get older, and everybody does their best to handle it. And so and everybody's just human, I think that's what I what I really kind of it became clear to me that everybody's doing this is doing their best and no one knows all the answers in advance and kind of everyday brings another challenge with it. But if you know if the other guy can handle it, probably so can you and you just have to kind of have that courage and have that confidence in yourself. And so that was what I think allowed me to take that leap is sort of getting out in the world seeing that nothing's perfect. Even behind the curtain, every practice, every lab has its own questions and issues and, you know, uncertainties and every practice has its own issues that come up and like that's life and you kind of do your best to keep people happy and to do to keep the patients happy and go home, you know, doing the right thing and hopefully sleeping well at night. And you know, so it kind of lost that in that side of the intimidation. And then I felt like you know what, I'm going to take the leap. And by the way, if you take the leap and you kind of just fall on the floor. So you still have your training and you're kind of embarrassed probably but you can get up and go get a job and so you know, I felt like it's it's not if you if you let that opportunity go when you're young doc it may not come back to you. But if you take it and you swing and miss Well, no one's gonna fault you for taking the swing I think and and your career isn't ruined just because you tried something it didn't work so
Griffin Jones 24:40
and if you fall flat on your face and you're humble and self aware enough, it will make you a better partner somewhere else absolutely Well, as long as you are and those are two big as. Those are two big conditions. Not everybody is onboard and self-aware. But but if you are falling flat on your face can give can can make you do that much more valuable as a as a partner somewhere else is if the gays and then you know, if you are successful, then that's then you have you've done it long before most other people have. So in your view, what's harder? owning a business or residency
Dr. Joshua Klein 25:21
apples and oranges I guess I mean, I think I think Well, the obvious answer residency is harder, because it's physically so demanding. And then you also have to kind of keep your mind sharp while you're literally exhausted. To be clear, and for the record, I don't, I'm a very small part owner of extent, but I wouldn't call myself the owner of extent, because there's a lot of investor money that went into building this place out, and that and by the way, too, for, for the, for the, for the record for the listenership here also. So I'm talking like a big shot, oh, yeah, I'm gonna, you know, go off my own and start something new. And I in some ways, that's true. But I wasn't in a position to put up tons of my own capital, because I didn't have it. And so I did start off with investor money. And I guess I had to earn their their respect and their confidence to get that investor money, but I didn't, I didn't find $5 million in my own pocket to put down and build out a lab and build out a program. So I didn't have that much courage, or I guess, wherewithal at that point. But having said that, there's no doubt that running a program is hard. And I think that the reason that that's true is because literally you feel stressed and responsible for like 1000 different things that can come up and everyday, something does come up. A lot of it's the people, the people is the hardest thing. You know, they say hiring and firing. And that's, that's the most blatant example. But, you know, people who are thinking of leaving, and people are unhappy for X, Y, or Z and people who don't get along with each other. And they're both important pieces of your, of your of your of your team, and you gotta help them get along somehow. And, you know, the day to day, team, building, Team preserving is is is is complicated, and there's no playbook and you just got to do your best to sort of read people's emotions and feelings and instincts. And that's obviously not easy. Also, the fact that you feel responsible for everything, and maybe I that's one of the things I have to continue to mature to learn, let go. But like a silly little example, there was a, someone who dropped off a gift bag for a patient letter retrieval. Was it yesterday morning or two days ago. And somehow that gift bag disappeared. And it never got to the patient in their post op, it was supposed to be like some snack. It was nothing. It was like some snacks. And some, I don't know what, maybe a heating pad or something. And the person who dropped it off was obviously not happy because the patient was was was heard about and they were expecting and and I don't even know what happened. Somehow it never, never, never made the way and so then I'm was approached by the person who dropped it off. Because of course, like, you know, I'm kind of considered responsible for everything and like, Where can we figure it out? And then I'm asking you at the security cameras and the security camera wasn't focused, it wasn't working. And then I'm asking the lab and it's just like, this is the last thing I want to be you know, working on is finding the snack bag. Like Who else am I gonna you know, I did get help and and still not figure it out. But the point is, like, from the littlest to the biggest things, you worry about it because you feel responsible for everything that happens under the under the four walls or under the roof. And so that's that's not an easy way to live. And my hair's a lot grayer than it was five years ago, that's for sure. But well good news,
Griffin Jones 28:36
Josh. That means you're not a sociopath. So you it's, it's like it to be a business owner is one I it's so hard and I'm not running a medical practice but just you know, even running a client services are it is so hard for the reasons that you describe balancing, delivery and sales and, and the people that the to do all of those things and and you have to be so you have to be receptive to people. You have to listen and then there are other times where you have to forge ahead and say okay, we're moving on and and so you have to be agreeable enough to listen to not be a sociopath AND and OR a narcissist and but also not so agreeable, that you're just Oh, okay. Yeah, I guess I guess that is too much work for you to do. Yeah, I guess. I guess the patient doesn't really need that. You know, it's you have to you have to walk a line that can be pretty heavy.
Dr. Joshua Klein 29:48
It's funny the way you frame that because I also think it sort of tangentially but it connects to, in my opinion, how to be a doctor with a good manner in terms of how you manage patients and patient make patient recommendations. In the sense that, especially with infertility, where most of our patients are, you know, relatively young, relatively educated, lots of them are doing lots of Google research. And they're on the message boards, and they're talking to their friends and their and their sisters and whoever else that that their doctor said, you have to do this or that doctor said that never should be doing them like that, or Google, you know, says X, Y, and Z. So I think it's a really hard balance to strike, you always want to be open to hearing your patients feedback, or thoughts or questions or suggestions. If you're perceived as as dismissive of their input, that's going to be the kiss of death, patients hate bad. But at the same time, and this is something that I've also learned and continue to learn is that it's not healthy to just say, Oh, you read about that, you want to try that, or your friend did this, I'm sure we'll do that. Like, I think you not only is it not good practice, but it also you lose respect. And it's not a healthy dynamic for the patient, if you're just willing to do whatever. And so, you know, you have to really strike that balance of being being open minded, willing to discuss but also firm when you know, sort of what's right and what's wrong, and make sure that you express your opinions, so that people know that you kind of have something that you kind of believe in and that you're willing to draw boundaries and give firm recommendation. So anyway, tangential to the managing a practice. But I think it's the same skill set in a certain way to be able to read people and allow them to see that you're willing to listen to them, but not kind of just they're
Griffin Jones 31:43
both examples of leadership. So the idea of partly being is that you're meant to lead me as the patient Yeah, you have to listen to me in order to be able to lead me effectively. But at the end, you you are not the pharmacist and I am not the physician, you are the physician, I am the patient. And you have to be able to lead me in the same as drew in a business and for not just fertility practice owners and other business owners in the fertility field who listen to this show. But all of us business owners across the market think the last year and a half, two years have gotten unbalanced advice from it's all been about the employee, just go on LinkedIn. And see I haven't seen one post on frickin LinkedIn sticking up for a business owner in two darn years. Everything is and we deserve this too. And we also should have that and we're finally making what we're worth. It's like, really, that's what your worth is, is right now in the most unprecedented inflated economy of all time, like, is that house really worth a million and a half dollars? Okay, but then does that mean that that's what you're worth when there's a recession or or the pendulum swings the other way. And for business owners, the advice has been do whatever you can to retain, show that you care show that. Listen, give them what what they're asking for. And in many cases, you do have to do that. It also has to be balanced with leadership and saying this is where we're going and holding people accountable. And many people, the last few years, many of us have been afraid to hold people accountable, have been afraid to, to really, you know, leverage leadership. Because it's like, well, if I lose that person, you know, we're already down three people. And, but, but it sure makes things worse. Because then it becomes a cancer in the organization. And and then nothing you do is good enough, when you are listening when you are if you don't have the other side to balance and say this is where the organization is going. And we're all accountable to it.
Dr. Joshua Klein 33:56
Right, right. Yep. And it's not easy. You know, it's and it's, I think it's probably as hard as it's ever been for the reasons that you're talking about it. We all do appreciate our employees and our colleagues and genuinely, and they do deserve what they deserve. But yes, it can get out of hand pretty quickly if you don't set sort of some framework for what's reasonable. And that's not an easy thing to do. So
Griffin Jones 34:25
other than like principles like that, about people just even like function? What are things about business that you knew nothing about when you started? Like, I think now, good advice for most people, unless they're 100 on this on the entrepreneurial spectrum, and by 100, I mean, Mark Zuckerberg, I mean, Elon Musk, I mean, that type of but you know, your average business owner might be like a 70 on that spectrum. And, and so I think for most people, unless they're the most extreme on the entrepreneurial spectrum are better off I'm going to work for someone first learning as much as they possibly can, and then starting their own business, if they still think that's a good idea. And I say that and I believe that at the same time, though, I know things like I wouldn't even Effingham County what to look for, in many cases. So what are some of those things where you're like, I didn't even know, to look for that. Before I was, before I managed to practice.
Dr. Joshua Klein 35:30
I think I mean, in a very fundamental way, I think one of the things that has become clear to me is that so much of business relies on assumptions that are necessarily loose. You know, one of the things we struggled with and as they struggled with, but but that we, that we learned along the way was, I mentioned earlier that when we started extended, we wanted to push down the price point and egg freezing to help make it more accessible. And this has been an ongoing debate that's still ongoing, you know, what's a reasonable price for for an egg freezing cycle? And even more, it might sound crazy, but what does it cost for us to deliver an egg freezing cycle, because it's not simple math. You know, there's fixed costs and variable costs. And so I think when I when I agreed to join in San fertility, and I had some really accomplished smart business, people who joined as well, and we started, you know, kind of making decisions about how we're going to set things up in the framework. I was, I think, expecting that these business business people with their MBAs, Ivy League MBAs would have some magic formula, they're going to pull out some Excel spreadsheet, and they're going to just have it all figured out. And like this is, you know, it should cost x. And as it turns out, they don't know, at best, they say, well, let's assume that this year, we're going to do this number of cycles. And let's assume we're gonna have to do X number of embryologist, doctors and obviously, you all the different things you have to put on paper. And then yes, there is some smart math you can do to sort of make a smart, smart decision and a smart assumption. But I think that it was sort of a little bit disturbing about how much of a business is done in a way that you just have to like, make thoughtful decisions based on as much available data and often there isn't a lot of available data, and kind of just try it and see what happens and then adjust along along the way. So I think that, you know, it definitely I've learned a lot about business over the last number of years. And I've learned to respect people enormously for their successes in business. At the same time, I think the my perception that there's like this business secret book that like you only get if you're a business person, and that doctors aren't privy to that, I think misconception has been, or I've been abused of that notion. So you kind of just have to get comfortable with saying, Well, this is like the best guess we're gonna make. And let's, let's go with it. So that's something I think that you only learn when you're on the other side and really see the books and know how the some of those decisions are made with regards to the dollars dollars and cents. That's one, I'd say another sort of big learning item for me was, I think, when you're on the outside and thinking about a business, from a financial perspective, in a relatively unsophisticated way, are you tend to think mostly about revenue and not about overhead, and he's out while they're doing 1000 cycles of IVF. And every cycle is, you know, they're getting 10,000 bucks. And so that's like, well, whatever that is $10 million of revenue. And so like, it's 10 million bucks, like that must be rolling in the dough, except that you don't realize that, like, your annual rent, if you're in Manhattan can be easily a million dollars or more. And then you've got, you know, four or $5 million of payroll for all of your people. And then you've got all of your equipment, and then we got like, etc, malpractice insurance. Yeah, and the insurance and not just malpractice and liability and the cyber insurance and like, and all of a sudden 10 million bucks is not exactly a ton of money anymore, you know? So I think that the to the to the uninitiated, it's easy to see a business as as a revenue entity, but it's not it's it's a it's a P&L entity. And so and there's so many more overhead items that you never dream of before you're kind of in it. And so I think that's something that I would definitely caution people to think about if they haven't gotten on the other side of the curtain yet is just you got to realize that that delivering a product and certainly a high quality product and certainly a you know, a high touch service. highly regulated product, like health care in America, for fertility patients is a very expensive thing to deliver. And it's not so easy to cut out a lot of these major major expenses and so, you know, it's for full transparency, you know, I kind of imagined we'd be able to push price points down a lot more than than is realistic before I knew what goes into it. And so you know what we charge for our server He says now is more than I thought we'd have to charge but the reality is, it's it's it's very expensive to deliver good quality care or even mediocre quality care, let alone good call quality care. And so, so don't forget the overhead it's it's it's an important other
Griffin Jones 40:14
how I remember the first time you did a budget, the first time we tried doing a budget was like, it's like, I don't know how much that's gonna like before we launch the podcast, but I don't know how much it is to podcast, like, I don't know how much we're going to end. So it does take some, like some expense tracking, which is different from budgeting that helps that informs but you know, it's a lot easier for us to do a budget and forecasting, because like, How the heck are we going to sales forecasts in the beginning? I don't know, how many clients am I going to sell this year? How many. And so that's that's two areas that I really would recommend that if somebody's thinking about starting their own business, their own practice and their their in an organization, I would I would try to do two things. And the first, well, maybe three. First is is see as much of the financials as you can some people do like that our firm is moving towards open book management, where we share that with our team. And maybe some places you can only see a piece of it. But David sable recommended a book to me last year called how to read a financial report. That's exactly what it sounds like. It's as interesting as reading New York state tax code. But it is it's the basics. And it would be great if you could do that for your own practice, or even your own Rei division if you're at an academic center, and to see what that is to have some education that the second is to know what to know, the sales and marketing pipeline, how are people coming in? That is extremely important to know, as deeply as you can. And the third is the Human Resources pipeline. How are we getting in retaining people? And like those are three areas where I think it makes sense to really delve in May, maybe even more than operations and delivery, I might even put those three areas ahead of operations and delivery. In terms of priority of learning, what do you think?
Dr. Joshua Klein 42:15
I think you're right, because that's kind of how you get to have a team that can do the things you want to do. And if you have that, then you figure out how to do you know, if you have the right team, you're gonna do the things you want to do the operations and delivery, but you can't, you can't get there without sort of getting your Human Resources figured out without getting your sales and marketing figured out. So you have you know, a customer and that you get your finances straight. So yeah, I think that's probably right. And by the way, the sales and marketing piece is also another thing. And I can reflect with our own experience that extend you know, we came in to be open and came into the market heavy on the increasing, increasing is more so than, you know, infertility treatment, an elective service line, it has less insurance coverage than IVF does. Even today, you know, even with progeny and Karen and when fertility, there's still only a very small percentage of of women will have coverage for fertility preservation, and only a minority percentage of our patients have coverage. And we were very aggressive with our marketing and our marketing spend early on. And we grew very fast. And so it was clear to us from the first couple years of doing it that marketing works when it comes to egg freezing. The problem is that that only actually works. Ultimately, in the long run, if you can spend money to get customers in a way that allows you to still have a profit margin on what you're charging for your service. Meaning if you got to spend $5,000 on marketing for every customer that you're going to convert every patient you're going to convert, that may not be a viable business model, because you're not charging enough to justify it. And so you know, how you're gonna get your patients the best way, of course, is when they show up, you know, they word of mouth, it's free. But the reality of fertility in the US right now, certainly in any major metropolitan area for sure, is that there's lots of competition, and everybody's got an angle. And most practices, even the academic practices are doing something on the sales and marketing. And so it's important to be realistic about the fact that that stuff has to be done carefully, thoughtfully, and it costs money and you have to keep track of how much money you're spending and what you're getting for that for those dollars. And once again, like maybe I was way too naive, but this isn't stuff that I thought about, you know, figuring okay, just buy some Google ads and there's your marketing and like it, you know, it's a lot more complicated than that, obviously. So that's definitely another area that that I've learned a lot about over the last number of years.
Griffin Jones 44:55
We're talking about lessons learned, you know, owning a practice or owning a business in the future. silletti field and things that you may want to learn how to do or learn about before you go and start your own venture. Another thing is some of the systems that are used, and oh people that can give really good recommendations on the different EMRs. They've shopped and the depth and scope of functions. But I would ask someone that you know, that uses engaged MD, if you're not already, if you don't use engage them D in your system, you're thinking, I want to open my own office within my own group, or I want to open my own practice, I want to go join somebody else, and I want to be able to add something to it, engage them D is one of the surest bets that you can do, but you don't take my word for it. Ask someone that you know, because more than half of your colleagues are using EngagedMD and more than half of your colleagues are extremely delighted with EngagedMD because they got real informed consent. They don't have stacks of papers that people have to sign and then account for and then keep an eye out file cabinet somewhere. They have true informed consent from patients that have a module at their convenience, so that the staff isn't overburdened with questions that they don't need to be getting that they can help the patient with the attention that needs to be devoted to that patient's case. Because the elementary the rudimentary is covered, and now it's just what that patient is stuck on or what's unique to their case that the care team can focus their care on. That's what personalized care is. And more than half of your colleagues have seen the benefit from engaged MD that way, so just reach out to any of them. Hey, guys, do you use EngagedMDin the people you want to fellowship with people that you see it ASRM? Hey, do you use engage MD? What do you think I hear Griff, talk about it. But he doesn't want to practice? What do you guys think, and see what they say. But if you want that free workflow assessment, want to see what other practices are doing, you want those insights that engagedMD has, and you want to see how your practice stacks against that ideal workflow, then you go to engage them the.com/griffin. And you mentioned that you heard them on the show, you mentioned that you heard them from me, and then you're going to get that free workflow assessment. So ask somebody else, don't take my word for it, but go to engage them db.com/griffin Or say, or an on the show. So you heard from me, so you can get that free work assessment for you. That's one of the biggest system wins that you can have right off the bat. And you can verify that just by asking people you already know, I hope you enjoy the rest of this episode about things you need to know for the fertility business, you might start, I'm gonna let you conclude on whatever topic you want to but before that, because we have so many younger Doc's that listen. And they're thinking about like, how do I choose who I'm going to work with you were you chose your your business partners, and, and they chose you. And so talk about how you did that? Well,
Dr. Joshua Klein 48:21
I'd say I was probably luckier than I realized, the main person, the main business person that I that I partnered with, is a wonderful guy named Michael Kohn, whose private equity hedge fund guy, the truth is looking back, I got lucky that he is of as high integrity as he is, because I probably could have gotten really treated much more poorly or gotten abused more if I wasn't so lucky to find someone. So I think that the advice would be, you definitely have to choose we get into bed with very, very carefully, especially when it comes to business people because I think that they're not all going to be the most high integrity people. And to be fair, like business people are, their profession is to use business to make money. And that's true for doctors too, obviously, with our professionals, how we pay our bills and make a living. But I think the mindset of young doctors is a little bit more idealistic than the mindset of probably mid career fitness people is and you got to be very careful not to be too trusting or too idealistic in that sense, you know, for young blacks are coming out and looking at job opportunities. So it's, it's complicated, because I think that, you know, the people that you're going to work with day to day are the clinical team, you're going to have obviously Doctor colleagues, and then other clinical colleagues and embryology colleagues and so forth, but these days, a lot of practices are either owned or part owned or managed by business entities that you may or may not have much direct interaction with. And it's it's a very, very seen I think that I Have the level of involvement and exposure to the business behind the practice is going to be very different from one place to another. And I think that that's those are important questions to try to really investigate while you're looking at different practice opportunities, you know, if there are going to be places that are looking at the conversion metrics, you know, how many consults did you do, and how many of those turned into IVF patients, and if you're below a certain bar, maybe they're gonna get dinged, or you're not going to get your bonus. And, you know, to some degree, that's not crazy. But if that's gonna bother you, like you better you should be aware of it. And in other places, certainly in more academic environments, the culture, maybe more sleepy, but, but that might be more comfortable, to not have to sort of think about numbers like that. And so I think that I'm not sure that I have much brilliant insight other than to say, it's a very, very playing field out there. And so you really want to ask as many questions as you can and talk to as many people as you can, looking at to what degree is that practice run like a business or like a medical practice that has a business behind it, because the culture of the place and look, business is not terrible. And there are some very successful, very busy places out there that run like a business and that patients are happy, and the doctors are happy. And you know, that's not necessarily always the worst thing. But I think different doctors have very different priorities of how they want to practice medicine, and what kind of lifestyle they're looking for. And it's going to be pretty different from one practice environment to another. And so just Just do as much investigation and homework as you can. Because it is going to be very different from one opportunity to another.
Griffin Jones 51:45
So that's for the homework, let's conclude with the introspection thing, because a lot of people listening are in the position of the 2012, Josh or Jean Klein. And maybe there's a couple different routes for that type of person, but some of them should stay at Columbia or wherever their academic center is, wherever they're doing fellowship, because they're going to be happy, they're at another one, some of them should go on to be should should just gobble and gobbling, gobbling till they're a bigger fish in the bigger pond that they end up with it someplace like an RMA or or an RMA or wherever they end up, some should go off on their own. And then there's other people still that it's like, oh, there's somebody that just started their own thing couple years ago, I don't totally want to start my own thing that I don't feel like starting from zero. But there's also a lot of opportunity for me to help make this bigger, I want to go join the Josh Klein's out there. So there's a couple of different options introspectively. And then this will this will be your final thought for the program? What How should people decide what's best for them?
Dr. Joshua Klein 52:58
That's a great question. I think that you can't have everything, I think that it's important to be realistic about the fact that if you're someone who is going to prioritize, you know, maximizing income, then you're probably not going to get that at a pure academic program. Because you're going to be salaried. And usually, that's not the culture. If you're someone who enjoys teaching who enjoys having some abstract today's stream every year going to conferences, then you're going to get that at a more academic program, it's gonna be much harder, you're gonna be sort of swimming upstream at at a pure private practice. If you're someone who has, you know, family, or hobbies or outside interests that are very important to them, that that, you know, you want to be out of the office by 5pm every every evening and not work weekends, you know, that that's going to be something that you want to take into account. And I think the bottom line is that there's no job, probably, that's gonna let you be like the division chief, and academically active going to conferences every couple of months. And you know, making a seven figure income, and not working weekends, and being out of the office by 5pm, every month, and every week, every day. So, so I think it's just a matter of, and again, no brilliant insight here, but you really just have to think about what are the things that are most important to you and your lifestyle and money is important, but it really is not necessarily the most important. And so, you know, make your list and then try to get as many of those things as as you can, because you're just it's like buying a house you're just not going to get everything unless unless something's you know, your I guess our unlimited budget, but most people are going to have to pick and choose. And so just think seriously about what's going to make you happy in five years and 10 years and then chase after those things. And maybe some of it will come along with it. You know, you can be in a private practice and still be the research person who does put together some research abstracts every year and like that's fantastic. But as long as you you know, are are comfortable the fact that that's kind of if you can, you'll do it but it may not happen then you're being being smart. So I think it's it's really a matter of triaging what what is going to be highest priority for you and your career and, you know, being honest with yourself about what's going to make you happy. And if you do that you should be landing in a good place. And there's lots of good places. That's another comment is that there's not like one right job, I think there's a lot of ways to be happy. So we're in a good time, there's a lot of good going on.
Griffin Jones 55:27
Well, if if one of those routes makes sense to talk to you, as you say, talk to everybody is that an offer you would extend are there that you would extend to the younger dogs that they can reach out to you on LinkedIn. So we will include that in the
Dr. Joshua Klein 55:45
video, I think my journey has been an interesting one and not the most common, you know, working and big place academic place, and then in New York, kind of CO founding my own place, and it's been a journey and it's been a learning journey. And so I do think that I can give people guidance, or at least my, my personal, you know, perspective, so I'd be happy to be available.
Griffin Jones 56:05
Dr. Josh Klein, thank you for coming on inside reproductive health.
Dr. Joshua Klein 56:09
Thank you for having me. It's been my pleasure.
56:12
You've been listening to the inside reproductive health podcast with Griffin Jones. If you're ready to take action to make sure that your practice thrives beyond the revolutionary changes that are happening in our field and in society. Visit fertility bridge.com To begin the first piece of the fertility marketing system, the goal and competitive diagnostic. Thank you for listening to inside reproductive health