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VIDEO - DUwHF #772 - Nathan Sparks
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AUDIO - DUwHF #772 - Nathan Sparks
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Nathan Sparks has a background in engineering services which pivoted to Dental practice management in 2007 when he joined founder and dentist Jordan Sparks at Open Dental Software. He is now the CEO at Open Dental and continues the tradition of adding new features at a rapid pace to best support a changing dental landscape. Nathan lives in Salem, Oregon with his wife and identical seven year old twin sons.
www.OpenDental.com
Howard Farran: It is just a huge honor for me today to be podcast interviewing Nathan Sparks of Open Dental Software in Salem Oregon. He has a background in engineering services, which pivoted to dental practice management in 2007 when he joined founder and dentist and brother Jordan Sparks at Open Dental Software. He is now the CEO at Open Dental and continues the tradition of adding new features at a rapid pace to best support a changing dental landscape. Nathan lives in Salem Oregon with his wife and identical 7-year-old twin sons. I just want to say that for the record, none of my podcasts are advertisements, no one pays to go on this show. I have been begging Nathan to come on this show for probably two years and I am switching to Open Dental this month.
I've already tested the converter. I've been on SoftDent since 1987.
Nathan Sparks: Oh wow.
Howard Farran: I've been on the same practice management software for 30 years and I'm switching ...
Nathan Sparks: Faithful customer.
Howard Farran: And the reason I'm switching to you ...
Nathan Sparks: Yeah. Why?
Howard Farran: To be very transparent about it is, when you survey dentists and you say, "Okay. If you want to learn more information about something, do you want to talk to the manufacturer?" Nine percent of the dentists say yes, the other 91% say no, I want to talk to my peers. If you go on Dental Town where a quarter of a million dentists have posted five million times and you do a search for Open Dental, you have raving fans, I mean just raving fans. Look these, threads. It just goes on forever and it just seems like anybody I talk to, anybody I podcast, almost everyone has been telling me for years, "Well dude, it's just time to switch to Open Dental." Tell my homies your journey. Is it your older brother or younger brother Jordan?
Nathan Sparks: Older brother.
Howard Farran: Older brother ...
Nathan Sparks: Yeah, about two years.
Howard Farran: What made your older brother, a dentist in Salem Oregon, start a practice management software? What's going on in your life when instead of taking a course on root canals, fillings and crowns, you decide to go start a dental software company, especially considering there were monster sized competitors to begin with? I mean it's kind of a David and Goliath story. What was going on in Jordan's head, in his life, his journey, that made him start this and what year was it?
Nathan Sparks: Well, I guess I'd take you all the way back 2003 and I think he was using Dentrix and I don't know if he chose that. I think it was just what was there when we purchased the practice and that was even before that, okay, so several years before. He'd been practicing for three, five, six years, I don't know how long. Well, I guess let's ask you Howard. I mean what are your highest margin, what kind of work gets highest margin for dentists typically? What kind of categories?
Howard Farran: A crown.
Nathan Sparks: Crowns. Crowns, and I think for him it was also just teeth whitening. Teeth whitening and improving the look. These are optional things, and really he wanted to target advertise. Okay. You can target advertise people for crowns if you've already treatment planned for them, right?
Howard Farran: Right.
Nathan Sparks: If you haven't, if you're just going out of the blue and you want to advertise for tooth whitening, you don't want to be advertising to people with no teeth because that's just insulting. He wanted to advertise to young ladies between the ages of I think 19 and 25 or something. He had a target audience and he wanted to just send them flyers and say hey. He couldn't do it and he called his practice management company. It's a good practice management software, but they told him, "No, you can't filter that. Maybe you can now but that time, he couldn't target." What he did is he was frustrated and he couldn't believe it. He's like, "I'm going to take the data out of there."
He came to me and I think it was at Christmas in 2002. I'm a computer guy, so he comes to me. He says, "How do I get my data out? I looked at it and I'm like, "Oh you can't get that out of there." I go, "There's no way." He did and then he says, "Well, I've got the data. I might as well do some other things with it, right?" Before long, he had a practice management software and then his peers wanted it and then they were calling him all the time. I actually worked for him over some summers and there were people be calling him and he's at a patient got his hands and got the drill going and then the receptionist comes along, "Yeah, there's an office down on ..." That didn't work too long and so we had to have separate staff to support the software, and that's how it started.
Howard Farran: Wow. You don't advertise, you don't advertise anywhere and all your fans on Dental Town are raving. What do you think it is that the other practice management software companies are advertising to get new customers and why are you not advertising and have so many raving fans switching over to you? What do you think os going on?
Nathan Sparks: I'd say just feature set and that we're straight-up. I mean that's part of it that we don't have a sales team. If you call us and you want to do a conversion or you want to ask questions about the software, we'll ask you if you want a call back and we'll call you back one time. If you don't call us back, that's that so you're not getting a pitch. I think part of it is just that we don't sell our customer data, we're straight up, and then the feature set. We listen to our customers and they can access their data. If someone comes up with an idea, look Howard, we can't predict what new cool thing comes along, right?
Howard Farran: Right. Right. I've missed everything ... I missed the cell phone, the ATM, I missed the garage door opener. I haven't made one ... In fact, my only predictions were completely wrong. In freshman year at Creeton, Warren Buffett came in and spoke and we got 10 extra credit points if we went to his lecture. Back then 1980, it was all about the nifty fifty stocks and he's talking about all these hunky-dunky stocks. I finally raised my hand and said, "Well, what about the nifty fifty?" He says, "You can't explain it to me with a number two pencil on a five by seven index card. I don't know what company you're in. I'm not investing. I don't understand any of that technology."
My review of him that he was an old crazy senile man and he was going nowhere, and what I should have done is taken my student loan money and my [inaudible 00:07:10] tuition, gave it to him and got a job at Taco Bell and then I'd be a multi-millionaire today. Yeah, so no one predicted the Berlin Wall, the Arab Uprising, no one predicts 9/11, nothing. Since no one can predict the future ...
Nathan Sparks: Yeah. Since no one can predict the future, what we try and do is ... I mean you've even, I've talked to you over the years and you have business ideas all over the place and that are fantastic. With Open Dental, you can actually implement those without some other companies who'll go unnamed. You have to call them up and you say, "Okay, here's my $5000 and then I'll pay X per user." With Open Dental, if you have a good idea, you can write software and make it interoperable with Open Dental without our permission even. Now we'll help you and we'll put your name on our website without you paying anything. What I'm trying to get at here is interoperability with third party software.
We're all about that, we're all about not only you accessing your data. If you have some software that you want to use that's good software, they can make it interoperable with Open Dental with less work than any other software out there.
Howard Farran: I'm sure you're talking to only dentists right now and no one can write a line of code, but is that because it was written on that opensource software? What is it called Linux or Linux?
Nathan Sparks: No. We don't even work really on Linux ...
Howard Farran: Linux.
Nathan Sparks: Yeah, Linux. Yeah, we're a Microsoft software, it's written in .NET, but what opensource means, yeah, a lot of people don't know that. Let me explain that just real briefly. It doesn't mean that anyone can come along and edit our code, so there's no risk, okay. It's not like someone can come in and change your code and introduce a bug. What the case is, is that you can inspect our code. You, if you're not a programmer so you might not want to, but if someone wanted to look and thought oh, you know, maybe Open Dental's not secure, they can look at our two million lines of code and they can change our code and have a separate something else, they can't call it Open Dental once they change the code though. Okay.
Open Dental's always Open Dental, but there's four, five other practice management software companies out there that sell something called something else that's just Open Dental with a little bit of changes. You can ...
Howard Farran: There's people selling your software, that's basically your software with just a few changes?
Nathan Sparks: Yeah. Yeah. The reason our prices are so low is that what we're really selling you is the ability to update with our newest features quickly. Okay. These other guys might not update as often. You've got our professional engineers able to support the product if there's problems and our customer service. If you're an Open Dental Customer, you can actually vote on what features we add next. We keep our prices really low, but yeah other ...
Howard Farran: How low is your price?
Nathan Sparks: Well, it's ...
Howard Farran: What's it cost to convert and go into Open Dental?
Nathan Sparks: Well, conversion's are $700, but that's still going to be less than anyone else's fee for ... Some people call it data migration. Okay. If you're going to Dentrix say from SoftDent, guarantee you you're going to be paying, and we've actually walked up to them and gotten quotes and in 2010 I think it was around $20,000 to switch to Dentrix, okay? The things that we don't charge you for ... It's $700 for a data conversion. You might need to do an imagining conversion that's different, but if you're just out of school and you're starting to use Open Dental, there's no upfront cost. You're just paying 159 a month and for the first year, and you can stop after six months. You own it. It's not like you're trapped. Yeah.
Our monthly cost is about the same as other practice management software, but there's no upfront. Okay. The same thing you'd be paying for support also includes the software and the updates. You want a new version of Dentrix? You've got to pay for that new version of Dentrix. Open Dental, you want new features, it just comes with it man. I mean that's the thing, you're not paying separate for that, so there's a conversion cost, but that's 700. The only reason we even charge for that really is to let people know we're serious. We do a free test conversion. If we give away our conversions, people get confused. It can't be that inexpensive. We've actually have problems charging too little.
We've had big institutions, the department of mental health thought, "Wow, this should cost half a million dollars. What's going on? What's the trick?" They wouldn't take us seriously, so I think you know we keep our price so low that people don't even sometimes really believe that it's just 159 a month. After a year, it's 99. You can stop whenever you want. You still own the software. That's my little sales pitch.
Howard Farran: Wow. Well, I mean that's what great about America, that's what's good about free enterprise, that's what's good about competition. That's amazing. Also the one thing I noticed. You started in 2003 and have two million lines of code. I started Dental Town five years earlier in 1998 and it's a half million lines of code. You have four times as much code in that software than Dental Town. That's ...
Nathan Sparks: That means that you're a better programmer maybe? Maybe you guys have tighter code but, no. Yeah, I mean it's a lot of work, right?
Howard Farran: Yeah, because with Dental Town, we've had five programmers for 20 years and the to-do list of what dentists want Dental Town to do were always we've been consistently one year behind for 20 years. For 20 years and every time we get done with some update, the townies want another one.
Nathan Sparks: Don't they?
Howard Farran: I want to ask you some other questions. We're hearing a lot about cloud, on the cloud. If a young kid is thinking okay well, if I buy this, do I have to have a server or can I buy it on the cloud? What does that mean to you and what do you think of the cloud versus the server?
Nathan Sparks: That's a good question. Cloud just means someone else's server. Okay and the advantage to a dentist is that sometimes I just want to do dentistry, I don't want to worry about anything else, I don't want have to do back-ups. Having something available on someone else's server is what they're talking about. Now some cloud services actually you can only do it through their cloud, right? You're actually buying the software and it's just automatically on their servers. With Open Dental, at this point, we're not hosting, but we'll help you put your database on Rackspace or you might have heard of Google, has a cloud that you can put it on. Microsoft has a cloud, Azure I think that you can put it on. We can even show you, we can demonstrate for you.
Open Dental can be put on a cloud, but to be honest for most small users, if I have multiple locations, I might do that because then I can easily access it from multiple locations, so that's a good argument towards doing it. Guess what? You're going to pay for using someone else's computer. Okay. Expect your prices to double, triple, if you're putting something on a cloud and that's true with anything. Not everything. I mean you can put pictures on the cloud for free because there's advertisement. If you're willing to accept advertisement, it might not cost you anything. Yeah, I like the idea. I think it's the direction things are going in some sense. I think sometimes people think of a browser based software when they think cloud, and Open Dental doesn't have a browser based version.
We have a mobile application that we just added the ability for people to be able to move appointments and create appointments. You can move, create, delete appointments starting with our version that's coming out in about a week on a tablet or a phone. You get some of that cloud-y kind of stuff and that just costs you 20 ... I think it's $15 a month right now. We're going to raise our prices I think on that because we're adding the ability to able to move appointments. That's probably going to be somewhere around $30 a month. You're paying when data's on someone else's server. I normally would advise people to use your own server because with Open Dental, you don't have to have, Howard, like a server, like server 2011 or 2012.
You don't have to have actual server software, you can just use your regular desktop and access the server. You can use a $500 computer. Okay. That's your least expensive option and if you want to put it in the cloud, you can.
Howard Farran: Everybody listening to you right now is commuting to work, so they can easily find you. I always your last Tweet, so you Open Dental software is at Open Dent. If you follow me at @Howard Farran, I just retweeted your last Tweet. What would my homies find if they go to Opendental.com? If they want to learn more about this, what are they going find at Opendental.com, your website?
Nathan Sparks: Well, they're going to see a trial version. They'll see a list of things we bridge to, some lists of our features and you can browse our features. You can look at our eServices. You can look at user testimonials. Townies tend to like, like you said, community stuff. We've got the discussion forum. If you have questions, you can call and ask us or you can look on our forum. Our forum's really active. We usually respond to stuff within the same day or so. We've got a couple of people ... Someone's putting something in there right now about our Perio-Chart voice plug-ins. Yeah, you can go to our discussion forum. On our homepage though, you've got the trial version. You can look at our prices. You can look at webinars. Webinars are really important I think. We've got maybe 50 webinars.
When we educate people, Howard, we used to give I think two or three hours free of online, just direct training because we have unlimited support. If you actually want training, that's kind of a little bit more limited if you want two hours of training or something. What we did is because people were getting different messages, I standardized it. They're kind of like podcasts, really casual. They're just webinars and we have different subjects. They could maybe look at our basic webinar and that shows how to use Open Dental and then there's news. We have a newsletter they could look at. I guess that's about what they would see.
Howard Farran: My office manager Robert, he just rants and raves about your customer service. He said you guys are the nicest, sweetest people. He just loves dealing with you guys and that's ...
Nathan Sparks: Bless his heart.
Howard Farran: That's got him very, very exited about the conversion. This is dentistry uncensored, so sometimes it comes off crass or weird. I don't mean it to. It just is what it is. Call centers are becoming very important because what people are realizing in abundance, it started with the scheduling institute out of Atlanta. Jay Geier figured it out first that it takes about three potentially new patients to call your office before your receptionist converts one to a scheduled patient. Then we know that from the data that it takes up three people who each have a cavity for you to convert one to get the filling done.
Nathan Sparks: Wow.
Howard Farran: If you look at it like a funnel three turns into one and you need three people to get one, so you need three patients, you need nine people calling your dental office to do one filling. The scheduling institute started training for the first time receptionists to get better at conversions, but now a lot of the data says that 50% of the incoming phone calls is when you're not even open. There's 168 hours in a week, the average is open 32, that's only 19% of the week. Now the trend is they say that in the future, patients are ... The first business that's really been booming is call centers and I've been to I think almost every call center in dentistry for PSOs, whatever.
When you're talking to the call centers, they only are happy when the dentist is on Open Dental. They just say it's so easy to schedule and there's a couple other big brand companies that when they find out the call is a dentist on that software, they actually yell profanity. I mean it's just corporate culture. I mean they love making Open Dental. Now people think the future trend now that people like to do ATM machines instead of a bank teller, that they're going to start scheduling, that patients are going to start scheduling their own new patient. They'll be on dentist websites and then you can look at the schedule and schedule a new patient clean, exam actually or whatever.
Do you see that coming? Is Open Dental going to do that? What are your thoughts on having your schedule open to people searching the internet?
Nathan Sparks: Well, you don't want them to see the schedule, but you want them to be able to schedule appointments. Yeah. It's a great idea and we did it. We have hundreds and hundreds of customers. While we've been talking, 30 or 40 patients have self-scheduled using Open Dental. New patients can schedule using Open Dental. I mean I've never even talked to you about this. I can't believe your asking me this, this is great. We have something called Web Sched. I don't know if you've heard of it. You can look on our website under Web Sched, W-E-B, S-C-H-E-D. There's two Web Sched products that we have. One is for new patients and that's just for new patients right now, and we might do it for planned appointments later.
Look, you have to have the receptionist involved to schedule a root canal and a crown. If someone just needs to come in and get their first appointment, it's always the same, that appointment is an hour, it might take an hour long appointment-ish. You can set it up and they'll put in, however you want, what operatories you want it to be in. Yeah. You can customize it, what days and times are free and it's live. As soon as they've scheduled their appointment, they get a confirmation and the receptionist sees it in live time, and the next person, that slot's closed. I don't know if anyone else has got it like this and certainly not at this kind of price. There's some people who do it.
Some third party softwares who do it for a few hundred dollars a month. We do it for $75 a month. You can do this web scheduling for new patients and they just go to your website. The cool thing is you can customize it, we have it so you can pick whatever color you want. Howard you seemed to like green, you've got the green background, you got the blue shirt, you got the purple glasses. You can choose, purple, blue, black, green, whatever color you want for that theme, and then it looks like it matches your website because some websites might have an orange color so you can make kind of a burnt orange color. It asks them if they're over 18 or you can ask your own questions, and then you can embed it if you want.
You can either do some programming and embed it or you can just have URL. It takes you to a page that's just scheduling and it says the name of your clinic. You put in your information and it puts the new patient into Open Dental, schedules them and then and guess what? You were talking about at night you were talking about nine calls, guess what? Zero calls. Zero calls and it happened at midnight and the thing is Howard, you're busy right now, apparently, you're busy every morning for the last two years, right?
Howard Farran: Right.
Nathan Sparks: You probably don't want to talk to someone. When your tooth's hurting, you don't really want to talk to someone. I mean you'd probably just have a friend do it but do your own. Now people don't really have time to have a conversation and negotiate with a receptionist. They want your insurance information and they can follow up and get all that, but we only ask for your name, first name, last name, birthdate and phone number and email. Those five things, that's the minimum you need, right? You need two ways to contact in case there's an error in one. You got that, then you've got an appointment.
Howard Farran: I am redoing Mytodaysdental.com and Jake is programming our new website, he's one of the Dental Town deals. How does put this on the website?
Nathan Sparks: It takes about two minutes. You just need a URL. Inside Open Dental, you push a button, it turns it on and our newest version of Open Dental that's ... Is it out? I'm just trying to think. I think it comes out next week. Yeah, next week. You'd be able to turn it on without even calling us. Right now, I think you might have to call us to turn it on. Then once you've turned it on from inside Open Dental, and we'll help you set up your, we call it eServices. You just run this service, you don't have to do anything with your router. We have geniuses. We thought long and hard about this. We actually used Skype as a model. How can you connect without opening up a hole in your router and we made it so that the customer, when you got your Open Dental, you push a button and it starts talking to Open Dental.
Okay, it's a little technical, but it starts talking to our headquarters here and now we're always in a conversation. Turning it on takes five minutes, then you have a URL and you embed that in your website it's that simple. Then when someone wants an appointment, they actually contact us. Not you, so you're secure, right? Your server's never being contacted by a patient. The patient contacts us. We ask you for your openings. This all happens in less than a quarter second and then they pick what date and time they want.
Howard Farran: Wow, that is so cool.
Nathan Sparks: Five minutes.
Howard Farran: Then you said in the future, you're also thinking about if we've already identified your next appointment, say your next appointment you would need an hour and a half to come in for a crown prep, that someday they might be able to long and say okay, I want to schedule my scheduled dental work that already ... Is that right?
Nathan Sparks: Yeah. We already have something for recalls, so there's Web Sched Recall and Web Sched New Patients. There's those two new products and then the Web Sched Recall, we'll probably add that at some point what you're talking about. The reason it's so complicated, Howard, is I can't figure out how for that front desk to communicate, on Tuesday's I don't want anything in op 2, I can only have one crown prep a day, I don't know, I don't know. I don't know but that's not ...
Howard Farran: I know and I'm not into that either. I mean I've gone to so many practice management courses over the years where they say ... I remember the big popular one in '87 was Jennifer D St George, love her to death, she taught me so much but she scheduled rock, sand, water, and the big rocks were in the morning. Then when we were fresh, then you come and do sand and then by the end of the day when you were tired, it was water, just checks whatever ...
Nathan Sparks: Easier things. Right.
Howard Farran: I got out of dental school at 24. I was pissing vinegar, I could do rocks from seven in the morning to seven at night. The other thing I never did was I never targeted a specific type of customer because I always saw us as a hospital emergency room, whatever you got a 2-year-old screaming, a 90-year-old with a broken whatever. I always like that. My model was always a family practice emergency room and all what you need, just whatever the hell. I loved the mixing it up. I mean obviously the most fun was when someone comes in holding their face in pain and they just can't even sleep or eat. I love that the most. You know what drives me crazy the most and I just want to talk about that.
Nathan Sparks: Yeah, sure.
Howard Farran: The bottom line in dentistry ... I think this is the number one problem in dentistry is you take a bottle of water. If I make this for 80 cents and I sell it at 7-Eleven and QuikTrip and then Safe Way for a dollar, I know I make 20 cents. Okay. The problem in dentistry is no one knows what their costs are. I mean I've been in this game 30 years. I have an MBA like you too. I've never been in dental office where a hygienist walked out of the room, did a cleaning, exam and bite wings and I stopped the doctor and the hygienist and say, "Okay, did you just make 12 bucks or lose 12 bucks?" No one knows ...
Nathan Sparks: No one knows man ...
Howard Farran: The cost because it's not plugged into accounting and then the dentist, 82% of dentists have taken PPOs and they're averaging about a 42% reduction in their price, but their prices are from A to Z. I'll go to this dentist and he was in the room for an hour doing two MOD composites and I'll say, "How much were those two MOD composites?" He'll say, "Oh I get 250 a piece for them and say that's 500." Okay, this was on a PPO and you didn't get $500, you got 200 and ... I mean you look at the prices and then they're selling a filling for 18 different prices and they don't even know the cost of their damn filling. When I got out of school, overhead was half, now it's 65% ...
Nathan Sparks: It changes depending on if you're in San Francisco or Indiana. It's completely different. San Francisco, your rent is 80% of your costs, labor is 80% of your cost in Portland or some other city.
Howard Farran: My fantasy was that to hook up an Open Dental to a online accounting software, unfortunately, the only one that's online is QuickBooks online, but QuickBooks online is elementary grammar school crap. I couldn't run my business on QuickBooks online, either could any DSO. The only person that loves QuickBooks online is just elementary accounting for a small family. They can't do anything sophisticated. We've been on Peachtree for 30 years, but Peachtree doesn't have an online version. I know Microsoft bought Great Plains Accounting. I don't know if they have an online version and since I'm not a programmer, I don't even know if I have to have an online version but my fantasy is that it's a schizophrenic system.
You have your QuickBooks online over here and you have your Dentrix or EagleSoft over here and they don't talk to each other until all the accounting is approximated to the office so the staffs clocking in instead of just billing and patients and address until virtually. I mean look to schedule this. Imagine if everything you pay, rent, mortgage, criminal bill act, computer insurance, malpractice, professional use, labor, lab supplies, imagine if you signed up for a PPO and they wanted to pay you $100 for a filling and the receptionist schedules an hour for this filling and the schedule turns red and says this room costs 200, you scheduled 100, you will lose $100 for this procedure.
Then she moves it down to a half an hour and then it says okay, now it's yellow, now you're doing free dentistry. Then she moves it down to 15 minutes and now the doctor is going to make 50 bucks, so now the doctor looks that and says, "Well, I'm only going to make money if I do that filling in 15 minutes. Well, it's an occlusal on a molar. I'm going back to amalgam. I could do that in amalgam." They've either got to change their protocol or they got to say well, who the hell's only paying me $50 for a filling and they go well ...
Nathan Sparks: Dump that PPO.
Howard Farran: Here's this PPO that you sign and by the way, the dentist, I love them to death. I'm a dentist so I got to love myself too. They signed these PPO contracts, they don't even read them. They don't they don't look at the prices. They're shocked on Dental Town when they find out that their PPO just started signing up for Medicaid and they're saying like wait, I didn't do that. Well, yeah dude, you signed a contract that says that I can really enroll you into Medicaid and for you to get out, we need a certified letter and then you can't get out for a year. Dentists aren't business people is what I'm trying to say. I mean dentist, the only analogy I can think of as a chef. Dentist want to go in the kitchen and make a souffle and beef stroganoff.
They just want to take cooking lessons. None of them know their numbers. I have an MBA and I think I want to bridge ... Like I say, it's got to be Peachtree or it can't be sophisticated, but I say I don't know about Great Plains Accounting but that's my fantasy. I mean some people fantasize about meeting a unicorn and a tooth fairy. I just want my homies to know when they're losing money because consultants will go in there and they'll charge 60,000 bucks, and they'll say, "Okay Nathan, you did a million dollars last year and took home 150. We're going to drop four of your 12 PPO plans and next year, you're only going to do $800,000 for the dentistry and you're going to take home 200."
There's so many times the dentist thinks he's doing everything right. He'll squeeze in a patient work through lunch and then instead of going home 5 at seeing his beautiful, identical 7-year-old twins and say I'm going to take this toothache at the end of the day. He doesn't even know that both of those procedures he lost some money on, so in a skipped lunch and stayed the hour and a half. He thinks he's doing everything right because he doesn't know what his bottled-water cost him to make and he's selling it for 12 different prices. That is my fantasy, that is why after 30 years of [softing 00:35:14] because I really didn't need to get all softing because I'm at scale with 50 employees. I have an accounting department. I have two people that do this.
They can pull stuff out of Excel, but I'm trying to think down the road. I mean I'm 54, I should be able to live at least another three or four years at the rate of bacon I'm eating.
Nathan Sparks: Love bacon.
Howard Farran: That's where I'm going, that's road in the path I'm going down. I just want my homies to be able to focus on fillings, crowns, root canals, and bone grafting, and have a simple. Look at all the corrections for software. How many dashboard systems are now available, and a lot of them are right by Dentrix. A lot of a right by Dentrix entries. Didn't you think that Dentrix has got to be wondering why are all these companies popping up around me to make my software easy to read. Okay, that's my one pet peeve. Here's my second pet peeve, here's my second pet peeve. It takes eight years in college to become a dentist. It takes four years to become a hygienist. My dental assistant Jen went to one year of dental assisting school, so did my youngest boy and the receptionist, they're off the street.
The software has added every feature known to man, so they open up this deal and they're mesmerized. When you go to any sophisticated business like the Marriott or Hertz rent-a-car, they've reduced all the software to like these are the seven things we do to check you and we do them in order. If you don't enter number three, you can't go to four or five or six. Then when you turn in your car, we do these, but the point I'm trying to make is that to be able to go into the software and say okay, I'm going to overwhelm my receptionist, I'm going to close out all these features so that I can get a process, because I'll go in there and I'll say, "Okay well, Nathan sparks is a new patient. Where was he referred by? We got to track our marketing? Did he come off a flier, website, drive by?"
Oh, she forgot to answer that because it's not a process. It's you had to ask and who may we think for referring you. Oh, I just did a Google search. Then if you talk to practice management consultants, they will tell you that when they go in and run reports on software, that 80% of all the features have never been used one time.
Nathan Sparks: I love what you're saying. I'm amazed about what you're saying. I think you're right having a process, but you know what, everyone doesn't want to be Marriott so you've got to have it so that each office can choose their own process a little bit, right?
Howard Farran: Yeah, but imagine for marketing, imagine if you bridge the gap to the major consultants, like Sandy Pardue, Lorraine Guth, Sally McKinsey, whoever, and they said here's our protocol, here's the eight things we do to check in, here's the four things to do to check in. Then you have all these people saying and by the way if you go to Open Dental and click here's a list of consultants, here's my way because the receptionist is completely overwhelmed. There's 40 million buttons ...
Nathan Sparks: Right. They're just trying to make it through the day.
Howard Farran: Yeah, and the phone's ringing, people are coming in, people are coming out.
Nathan Sparks: Yeah. I talk to them every day. I agree. It's a high-stress thing and like you said, they're training on Open Dental for like an hour or two. Okay. I mean that's where they're starting out.
Howard Farran: Let me tell you this. My son way back in the day, I think was like seven, eight years ago and he graduated college. He want to get a job at Subway. He had to go online and take seven hours of courses. Each hour course had 10 multiple choice. You couldn't take the same course, so it was online training and I thought to myself damn you have to do that to make a tuna fish sandwich. You could get job at any dental office and there wouldn't even be training.
Nathan Sparks: Fair enough.
Howard Farran: That would be amazingly cool that if you had online software and you said okay, here's the online training, you're going to start at my office next week, before you come, you got to go to Opendental.com, and there's going to be these webinars and there's questions at the end, blah, blah, blah.
Nathan Sparks: I like that. I'm taking notes here. Now questions at the end up, I like that.
Howard Farran: I'm sure if you came to Townie Meeting next year in Orlando ... When is the date to the Townie Meeting next year? April 19th? April 19th in Orlando. We could get a round table of all the fancy dancy consultants to brainstorm a deal and imagine if all the consultants of dentistry because I'll take you back in the day. Do you remember when Microsoft came out and windows 3.0 and all they had was a Word, PowerPoint and Excel?
Nathan Sparks: Yeah, I remember DOS man. Yeah, I remember that.
Howard Farran: It was so shitty and filled with bugs that had sprung up an entire industry of online DVD courses and training. It was so non-intuitive and then here comes a guy named Steve Jobs and says, "You know what, we're going to make this so simple and so intuitive that you don't need to go to a course that a 6-year-old and a 65-year-old will be able to figure out an Apple computer or the iPad, the music, the things like that." I think that it's the software has been so bad, that's why there's such a robust consulting industry in the United States because to call Dentrix or Eaglesoft practice management software when it doesn't generate your payroll, it can't make ...
I'm an MBA, it can't give me a statement of income, it can't give me a balance sheet, it can't give me a statement of cash flow, it can't tell me if I just made a dollar or lost a dollar when my receptionists off the street with no training just scheduled an hour for a failing and nobody in the office knows what the filling costs because we're getting paid 12 different prices from 12 different PPO plans. I mean it's getting insane. If all the dentists became better businessmen and realized okay I can't do a filling in Nathan's mouth for this price and I'm going to have to drop this software or change my technique or whatever. If all the dentists started making better, faster, smarter decisions, it would be great for the entire industry. It'd be great for the patients. It'd be great for America.
It'd be great for everyone. I'll tell you this. I could run on this forever. It's so obvious but when they came out with movies, they were silent while everybody had a phonograph for 40 years before one talking monkey thought look well, can we add the sound to the silent movie ...
Nathan Sparks: What's a phonograph?
Howard Farran: Then it took another ...
Nathan Sparks: Howard, what's a phonograph? What's a phonograph? I'm just kidding, go ahead.
Howard Farran: Then it took another 100 years for some guy to trip and fall with a chocolate bar into some guy who was holding a jar ...
Nathan Sparks: Peanut butter.
Howard Farran: Then we had the reason. I cannot believe that I was complaining about this when I graduated in 1987 and now 30 years later, now I got four kids and two grandkids, there's still no bridge between accounting and scheduling an insurance saying they got all the patients to schedule here, that's a massive amount of import there ...
Nathan Sparks: There is, there is. There are three companies that do that with Open Dental. They're getting better.
Howard Farran: Who are the three companies?
Nathan Sparks: Practice By Numbers, Elevate Practices, Dental Intel and Divergent has something. I don't know if it does the integration with accounting, but those three ...
Howard Farran: Practice By Numbers ...
Nathan Sparks: Elevate Practices and Dental Intel all do ... Practice By Numbers I think is going to be a little bit more integrated with Open Dental with our next revision.
Howard Farran: Okay, Practice By Numbers. Text me that link right. Dental Intel, they're out at Utah. What was the third one, Elevate?
Nathan Sparks: Elevate Practices. It has something called catalyst. It does Open Dental plus accounting. It does the accounting. There's room for more though. I'll put it this way. There's always a way to do it better, right? That's one of the things, we're not doing it. I think you told me about this idea before these guys did this. You talked to me about this four years ago, three years ago, four years ago.
Howard Farran: I talked about this in my sleep.
Nathan Sparks: Yeah, okay. The problem is here that I don't know for instance which accounting systems these integrate with. I do think there's more than one. I think they work with like three or four each. I don't know if Peachtree, but that's part of the problem for me is one of the things about Open Dental is we try and keep as close as we can to our mission and to the middle. I don't think we're ever going to actually get into the accounting, but other people can, and you can make it so it worked with Open Dental. If someone says to us, if one of these companies already does this, they mainly do reporting. Okay. They don't do what you're talking about quite.
They don't change color. They don't have business rules that tell you don't do this, drop this PP. They give you information that will help you know which PPO to drop, right? They'll give you information that will tell you how much it's costing you because they could include your overhead, they can include your wages, they can include your expenses really. We don't have that inside of Open Dental, so I think that's the thing, that's pretty important stuff. I don't think we're ever going to provide those extra services. This is what I was talking about at the very beginning when I said we don't know the future.
I've got now three or four companies who are competing against each other and whoever can make the best mousetrap, if they come to us and say, "Hey Nathan, look we've been doing these reports for a while now, but look we don't want to tell people the next day that they didn't fill their schedule or that they fill their schedule with the wrong thing. We want to tell them in lifetime. We want to tell them which patients to go after," then I don't mind building those features into Open Dental that anybody can can access so that you can plug it in. That's what we can do and that's what I really mean about being available to the whole dental community, is these are people who have these ideas and I'm not going to do the accounting side of it.
We have a little accounting thing in Open Dental, but it's even worse than ... I mean I'll be honest, it's not even QuickBooks Online. Okay. It does enough for us to do our internal accounting and so for us to understand Peachtree for instance, that's a little bit too much for me so I want other companies.
Howard Farran: You're saying you've programmed your own accounting for your own internal use?
Nathan Sparks: Yeah. If we have maybe 10 or 15 customers that used it, it's good for a small dentist. It does ...
Howard Farran: You know what, one of the first practice management softwares ever and I so regret it, it I didn't go with, they are friends with Jim and Naomi Rhode. It the time, it was called Semantodontics, so he Compudontics. The guy's name was Tom and he built his own little accounting software inside the practice management software and he had 1100 users.
Nathan Sparks: Oh wow.
Howard Farran: It was just perfect, but I had to go for the big soft and owned by Kodak and I was crazy. Big wrong mistake. Yeah. I mean because if you take something like a accounting and Peachtree or whatever, I mean you're just the numbers you need, it wouldn't be that much programming. I mean in fact, I'm not a programmer but I imagine all that code is already written somewhere. Yeah, to have a simple accounting package. You already have this and 15 dental offices are using it?
Nathan Sparks: Well, I don't know who's using it. I we don't advertise it. It's kind of heavy tucked away.
Howard Farran: Have you talked to my controller Stacey and Robert?
Nathan Sparks: Oh, no, no, we would never ... See, that's the thing. We would never try and convince you to use it because it doesn't do the things that you need it to do. I guess what I'm getting at is that maybe in the future, we might talk to you or other customers and say we really want ...
Howard Farran: Well, you already have 15 dentists using it.
Nathan Sparks: Yeah.
Howard Farran: I want to use it.
Nathan Sparks: Out of thousands and thousands but ...
Howard Farran: Yeah, but I want to try it.
Nathan Sparks: Oh, I don't think so. It's not something we push because it's very basic. For instance Howard, we've got stuff in Open Dental to push out your payroll but we don't use our accounting software to do our payroll. It doesn't print checks. There's things that it doesn't do, so we write up our checks by hand, but we enter them into this system. It's something we might consider, but again I think people would rather not ... We don't want to get in the business of transferring people from Peachtree to Open Dental accounting for instance. That's probably beyond where we're going to go.
Howard Farran: Right, right.
Nathan Sparks: Our focus ...
Howard Farran: I agree with that, but it might be really helpful just to have what limited accounting it does. By the way, I'm trying to help my homies. They're all commuting to work. I went to Elevate Practices. That's @Elevate Practice, but they never tweeted so I can't retweet anything. Are you friends with their CEO, Chris Brown?
Nathan Sparks: I'm not really ...
Howard Farran: You need to call them and say dude you need to just tweet something so my homie Howard can retweet something and then Practice By Numbers, we've podcasts him. We haven't it released yet, so I'm going to go to his ... He's got raving fans on Dental Town too. That's how I try to find most of my leads for podcasts. I want to sit there and give voice and reach on to the people that have raving fans on Dental Town. The website is Practice Numbers but the name of the company is Practice By Numbers, right?
Nathan Sparks: Yeah, and there's links on our website. If you click on our main webpage and there's something says supplemental services right our main page, and right at the top is business intelligence dashboards and KPIs. Those are listed Dental Intel, Divergent, Elevate and Practice By Numbers. You've gone over yeah, Practice By Numbers and the Practice By Numbers and Dental Intel are the only one that are really more integrated into Open Dental, but they all take numbers out of Open Dental. Does that make sense?
Howard Farran: Yes, it does.
Nathan Sparks: Then they mesh it with their accounting stuff.
Howard Farran: Where was Practice By Numbers? Would you send me that link? No, no, not, no Dental Intel, Dental Intel. I can go to Twitter. They're at ...
Nathan Sparks: Dental Intel is ...
Howard Farran: What's their Twitter?
Nathan Sparks: I don't know their Twitter. I'm not a ...
Howard Farran: You're not a Twitter boy?
Nathan Sparks: No.
Howard Farran: I mean I wasn't until I found out that you could be the president of the United States and may get five million Twitter followers.
Nathan Sparks: We have a Twitter account but I've got one of my employees who's really, really good. Erica is really good over social media and she handles that for me. Yeah. I think I don't ...
Howard Farran: I just retweeted today we started in 45 minutes Dental Intel. Yeah. I retweeted Dental Intel too.
Nathan Sparks: Yeah. Dentalintel.com I think is where they're at.
Howard Farran: Yeah.
Nathan Sparks: I don't know if they're ...
Howard Farran: There's already three companies that are talking about what I've been prying about for 30 years. That's amazing. Would you give me any advice on if I'm getting ready to convert? Any advice, lessons learned for offices about to go to a conversion. I mean should they take Prozac, should they start doubling up on it? If they're on Zoloft, so they go one and a half? How does one prepare for a dental conversion and how stressful or non-eventful is it?
Nathan Sparks: I would have your staff watch the basic video at the very least and maybe a couple of the others, like your clinical staff. Most of our webinars are 20 minutes. I got the 50-minute one, the 45-minute one for the basics. All the others, the goal is lunch time. I told my staff, I said, "Let them watch it during lunch. Maybe the dentist will buy them pizza or something and they can sit and watch it." There's some paperwork that comes with it that we go through with each conversion. We go through and talk through how are you going to handle your claims that are outstanding your other software, which software do you put it into, making sure that people understand you're not going to put your appointments into both software. It's kind of a knife-edge, right?
You might look at your old software to make sure something's right. If you've gone through and you've checked some accounts and your AR is the same and both piece of software, make sure you send out your statements the day before so that you've got a week or a couple days at least where you send out statements, right? I think just one day at a time. Don't hesitate to call us and I'd schedule a little bit light on your first morning back. If you're doing on a Thursday and then on Friday, maybe just go a little bit light in the morning. You don't really have to lose much production, but you don't want it to be too stressful. I'd go a little bit light and make sure people have a chance to call us. We can get us online and we can do a demo for you and that's free.
After your conversion if you need help, you can call anytime so that's important. It's not too painful usually. We had some people out of Texas one time. I remember there was this lady helping them run their practice. They had four locations and they were pretty big and they were all using Dentrix. She tells me I'm the number two or number three Dentrix ... I don't know how you can rank yourself but apparently there's some kind of ranking. She's, "I'm the number two Dentrix trainer in the United States." She's very resistant to switching to Open Dental. Halfway through the first day, so before lunch and I was there for three days, before lunch, we were just going to do ...
I mean the background here is we're going to convert one practice, okay and then a week later, we're going to the second practice, a week later the third practice. Halfway through the first morning Howard, she's like, "Let's do them all right now." Let me tell you this. Even someone who's married to another piece of software, Open Dental is not that hard. It's fairly easy. I would say don't get too much into the additional features. Just schedule your patients. Do the same things you're doing your other software. Don't worry about new features so much yet and then after you can take a breath. After a few weeks, you can take a breath then start looking into going paperless if that's what you're doing or switching your imaging software. All you're doing is switching, just try and keep it to just that.
Just switching that and that'll be pretty low stress I think for your staff, and let them know that they can call us. If you get stressed out or someone gets stressed out, you can send me an e-mail. You can escalate calls. If you call and you're not getting through, you can say look, I want to wait on hold until .. Because sometimes we get behind. Sometimes we might be 10 minutes behind. You can just say this is important, I need help right now, and we'll get someone to you within about a minute or two. That's really most of my advice.
Howard Farran: There's nine specialties recognized by the ADA. Does this really run any specialty offices or do they have to go on a specialty software? Is that better for them?
Nathan Sparks: We have a lot of pedo offices. We have a lot of ortho offices. We're working on a new feature to a better job of cloning for specialty offices to do cloning so that they can get separate billing. As far as using Open Dental, if you look at for instance our ortho page, we list what features we have. Our orthodontic chart, how to set up ortho insurance, how to bridge to Orthoplex, things like that. Then we also list what we don't have. We have a list of planned improvements. We have a list of 10 or 15 feature requests, like a print screen button for the ortho chart. As far as I know, certainly with ortho, endo, and pedo, I don't think you need a separate software.
For imaging, you do I think. Especially for endo, you probably need some 3D cone software for knowing where you're going to put that implant. Maybe you can give me some examples. I didn't even know there were 10 specialties.
Howard Farran: Nine.
Nathan Sparks: Nine.
Howard Farran: I don't know why pedo is just especially because all of this is a smaller human. I mean that's kind of a weird especially.
Nathan Sparks: No. It's actually ...
Howard Farran: Most specialties do something different.
Nathan Sparks: It's actually mind-blowingly different, it's mind-blowingly different. How you deal with parents and how your appointments are made and how you're not having anybody with their own payment plan, someone else having the payment plan. When those payments come in, how easy is it to make sure that they're getting to the right patient, how are the families constructed. Yeah. Pedo had some things that are a little bit different and some things that I found over the last year or two don't work as well with pedo, and so we try and add those features. Right now Howard, I'm just going to take a quick peek.
Right inside Open Dental software, there's a button that says help. You click the help button and then you click request features, and it has a list of all the features that anyone's ever requested for Open Dental.
Howard Farran: Two more questions. I can't believe we already went over an hour.
Nathan Sparks: Oh, okay.
Howard Farran: It's all over the news, all over the news, ransomware hacking, the Russians, the election. Is it a big problem in dentistry? Are you hearing many cases of this? What could my homies do so they don't have their computer lock down and have to play Bitcoin to some ransomware person? Is this an issue in dentistry? Are you seeing it much or is it not really?
Nathan Sparks: We've had about four customers out of 8000, 9000 that have called us and told us they've had problems with this. Backing up is the thing that you need to do. You've got to have back it up. I mean it's something I think about every day. It's one of my biggest fears that it's going to happen here, but what I do about it is I checked my backups. I make sure that the data is backed up. I have our data backed up every 15 minutes, so I could lose minutes.
Howard Farran: How many programmers do you have?
Nathan Sparks: Oh, I just hired three more this month, so I'm at 14 or 15.
Howard Farran: Wow, that's incredible. Okay, last question. You've been so sweet and adorable to spend an hour of my homies' last question. Since I'm a dentists, I have to ask, what's your dentist brother Jordan Sparks, what's he up to these days? What's he's passionate about? Is he so much fun doing dentistry?
Nathan Sparks: He's passionate about his kids.
Howard Farran: Do he still see patients?
Nathan Sparks: No. He stopped Howard doing dentistry about, oh I don't know, four years ago, maybe five years ago.
Howard Farran: Four years ago.
Nathan Sparks: Yeah.
Howard Farran: What's he doing all of his free time? Just I'm hunting ducks and beavers ... I mean we're told that Oregon only has two universities and one's a duck and the other's a beaver, so does he spend all the time shooting ducks or hunting beavers?
Nathan Sparks: No. He's into something called cryonics and I'll just leave it at that. Think Futurama, and most of his time right now is actually on building our new open little building. We have 16,000 square feet here and we're bursting at the seams, bursting at the seams. He's building an 8000-square foot building. It's going to be done in a few months and we're building a 2-storey building with another I think 20,000 feet. We're just building, building, building, and it takes up all this time really. He's getting our new buildings built and that's most of his time, and then cryonics is this other passion and that's ...
Howard Farran: That's how they build a dental office. You don't have advertise, do you?
Nathan Sparks: No, we don't.
Howard Farran: Yeah. Look at this, Google didn't advertise for the first decade. I mean they didn't do one and dentists think they're going to solve all their problems. When I got out of school, advertising was taboo and only the Yahoo who's did it. Then within a decade, then it was like oh you should do 3%. Now there's a lot of people saying you should do 6% or 7%.
Nathan Sparks: Wow.
Howard Farran: Hey buddy, maybe you should just perfect a new patient experience, train your staff so that everybody likes you comes back and you got to ask yourself, how come you practice in a small town of 5000 from age 25 to 65 and you still needed new patients 40 years later. Wouldn't you think that you would have got so many patients that wanted to come back that you don't have room for any new patients? You guys like Google don't advertise and you're busting at your seams, you're growing as fast you can from good old-fashioned, word-of-mouth referral and all you got to do is go to Dental Town. Dental Town has 52 categories and one of them is computer ... Let me see. Okay, so categories.
It's called computers and software, and then you go to practice management software, and then we have a form for all the different ones. If you go to Open Dental, everyone loves you, I love you. Thank you so much for coming on the show. Tell Jordan ...
Nathan Sparks: Thanks for having me.
Howard Farran: I said hello and we'll be ...
Nathan Sparks: He loves you too.
Howard Farran: I can't believe, you got me after 30 years. I think our goal is first it was going to be fortune alive, but now I think we moved it back to July 27th, 28th because one of my problem is that when we hire you, we give you a week's vacation. After like three years, you get our two weeks whatever. After five years, you get four weeks, so I got 50 employees and so many have been there 10 to 30 years and ...
Nathan Sparks: They're taking their vacation.
Howard Farran: Oh my god, it's a ghost town, it's a ghost town and my dental office and Dental Town when you got all these people who you love, you want to slow down employee turnover. When you get a month's vacation, you're not going to get it. Since everybody was gone, we thought that'd be a bad time to convert. We wanted to wait till they all came home a world. July 27, we are your customer and thank you so ...
Nathan Sparks: I'm excited man.
Howard Farran: Are you?
Nathan Sparks: I am. I'm so excited because now you have these ideas. I dig down with you and I can say yeah, let's do this. I'm really excited after you've been using it for a few weeks to get your input and you can tell me what you want. That's one of the things Howard, all my customers can vote on features but you have a special place. I'm always interested in your feedback, so we can get changes out sometimes within just a couple months. We can go from an idea to release product, stable product.
Howard Farran: All right buddy. Well, I can't wait, I can't wait. I see light at the end of the tunnel of finally being able to help my homies understand their overhead, their cause so they can make better decisions as they ... Because I think we're in that. I've seen this rodeo before in England. When I got out of school 30 years ago, there ere 19,000 dentists in the UK and they all took they NIH, the National Health Insurance still yeah and they just kept lowering the fees and lowering their fees, lowering their fees.
Nathan Sparks: It's a mess.
Howard Farran: The dentist wouldn't drop it because you just had to take it, so they hung on to it until they start going bankrupt. When they start going bankrupt, they start saying well, maybe I should get off the NIH and now you have 5000 dentists that are often completely and everyone else is doing a hybrid. I see the PPOs, I mean they just keep lowering and lowering and lowering the fees. When the dentist gets to the point where he understands, okay you can do this filling in 15 minutes or you can do it for free in 30 or you can give me the hour that you have for ...
Nathan Sparks: Are you going to still do it?
Howard Farran: Lose a grand. Thank you so much for all that you do ...
Nathan Sparks: Thanks Howard.
Howard Farran: For dentistry.
Nathan Sparks: Well, thank you. You're the one that does so much for dentists, so I'm glad that we're finally doing this and we'll keep in touch man.
Howard Farran: All right buddy.