00:00:04 – Glenn Harper
Welcome to another edition, The Empowering Entrepreneurs, The Harper and Company Way. I’m Glenn Harper
00:00:04 – Julie Smith
I’m Julie Smith.
00:00:06 – Glenn Harper
Good to see you, Julie. What’s up today?
00:00:07 – Julie Smith
You’re a little red. What happened this week in college graduation?
00:00:11 – Glenn Harper
And I was under the welder at the stadium, watched my daughter graduate. And apparently you’re supposed to wear sunscreen for that when you’re there for 4 hours and got you.
00:00:20 – Julie Smith
You missed that memo.
00:00:21 – Glenn Harper
But yeah, but we’ll get it next time. Daughter Number three It will be in a couple of years and I’ll wear the big hat so I can be a safari guy. Well, I just wanted to start today. We’ve got a guest today named Jon Appino, and he’s a fellow entrepreneur. He’s the brains behind Contract Diagnostics, a physician contract review. It’s a company that provides industry specific data. John will review the physician’s specific, specific contract and then partner with them to negotiate the more favorable contracts, which sounds kind of intriguing. And, John, it looks like you’re welcome and it looks like you’re from Brookings, South Dakota. Is that true?
00:00:59 – Jon Appino
Big city of dreams. I’m absolutely.
00:01:02 – Glenn Harper
It’s the craziest thing. You’re the second guest in our and our like window here. That is from Brookings, South Dakota, which is in the fourth largest city in South Dakota, which is really cool. Is that how you decide to go to South Dakota State there?
00:01:17 – Jon Appino
Unfortunately, I took the easy path and I did jump out of South Dakota for my undergrad. I stayed right there in my hometown and it was nice. My mom was close. I had tons of friends, but it was the easy thing to do. I wish I would have done it differently, but looking back. But. But, yeah, that’s why I became a jackrabbit. And I’m not. I’m curious on who your other guest was. Well.
00:01:38 – Glenn Harper
I heard I heard that you took the bookmobile for a joyride. Is that true?
00:01:44 – Jon Appino
00:01:44 – Glenn Harper
Sorry. The bookmobile. Apparently, south coast states got this one weird automobile thing that they do, and it’s like a whole traditional thing for, like, the last 60 years or something. I didn’t know if you were that. I just heard a rumor. I was just checking.
00:01:56 – Jon Appino
Oh, I have not stolen any bookmobile, but hobo days is our big like our big our day and homecoming or whatever. And it’s a big, giant party, and it’s a ton of fun for sure.
00:02:09 – Glenn Harper
Well, did you grow up on the agricultural side of it or are you a city kid?
00:02:14 – Jon Appino
No, a city kid from South Dakota, the fourth largest, which is 25,000 people, maybe now, you know, so a city for South Dakota. And then I moved to Rapid City, which is a bigger city, you know, about 100,000. And then I moved to Kansas City, a bigger city, two and one half million. But all my friends from New York and from San Francisco still called Kansas City a little tiny cow town. Is that funny, I guess, based on your perspective?
00:02:41 – Glenn Harper
Well, they just fly over it so they don’t really know. Right. Did you end up in Kansas City for the ribs, the royals or the chiefs or just did happen to go there?
00:02:49 – Jon Appino
No, I went down there for work, actually, and I had some family there. And it was an easy transition from where I was working in Rapid City after my undergrad. And then there was a bigger job, same company with a promotion and more money in Kansas City. And it was the path that I was in at that time in corporate, and that was like a great next step. It was a bigger city, more opportunity. Family there, still the Midwest. And it was still a big move for for us. But at the same time, it was an easy move with the company.
00:03:23 – Glenn Harper
Well, you wanted to you wanted to be have a real job and be in the corporate America. Is that what your goal was at the time?
00:03:29 – Jon Appino
It was. I worked in pharmaceuticals and in biotech and a couple of different companies and many different roles. I had lots of different roles in the organization, in the sales and the marketing and contracting and everything else. And it was a it was an interesting I learned a ton and it’s what ended up leading me to find a niche, which is what drives me today and kind of crave the passion behind contract diagnostics.
00:03:54 – Glenn Harper
Had you been a entrepreneur before? Growing up as a kid, your hustling, you know, yards and stuff like that, or was it not so much?
00:04:02 – Jon Appino
Oh, funny enough. So I started a stereo company Car Stereos when I was 17, not because I wanted to have a big company and make a lot of money. There were certain brands of stereo equipment that we wanted in Brookings, and there was one, one small stereo company, and they didn’t have the good brands and we didn’t feel like they gave the customer a good deal. They didn’t have the right brands, they didn’t have good service. They were more like We wanted to sell and push stuff on you than provide value and service. And so my friend and I started a company at 17 just so we could get our brands, and it did well. It’s still going successfully. I don’t have a participation in it now. And then I started in what was it in 1999 in South Dakota. Maybe, I don’t know, maybe the Internet was slower to catch on, but you could buy stuff online in the late nineties, and I was one of the few people who would go on and actually trust this computer with my credit card. And I set up a like a supplement distribution out of my dorm where I would get protein powders and create teens and vitamins in and sell them to the football players and the volleyball players and everything else. Again, not to make any money, not because I wanted to have a big company. I just wanted my protein powder for free. And so I got to meet a lot of good people.
00:05:16 – Jon Appino
And I went and met with the football players and the coaches and we put packages together for the basketball players for four for summer training. I think the nearest GNC was one overpriced and it was in Sioux Falls, which was a 45 minute drive, so you could buy protein powder in Brookings. So I set up a minimum order with a company called DPS Nutrition. I think they’re still around today. And I used to get boxes and boxes of boxes delivered to my dorm room and I would sell it out of my dorm. So and that’s it. Maybe it’s been kind of built in. And then I went into corporate and I was in corporate for quite some time. And you know, at first, at first it worked really well. And then I think I just I got sick of some of the. Some of the the box, if you will, that corporate puts you in. And when you want it, when you’re creative and you think out of the box like an entrepreneur does, and you try to apply some of those in the corporate space, sometimes they say, well, that’s not how we do it here. That’s against policy. Or You can’t do that. Or, you know, that’s not your job at somebody else’s. And sometimes you, you, you stick out and sometimes you decide to go your own way, which I ultimately did.
00:06:30 – Julie Smith
So how many times did you get told you can’t do something before you thought, all right, I got to do something different?
00:06:36 – Jon Appino
Oh, I don’t know. I don’t know. But it was one of those, like, you know, whether I was I wanted to I wanted to work my way through the organization, and I wanted to live in New York in a big, high rise. And I wanted to work 80 hour weeks and wear a $2,000 suit every day. And that’s what I wanted. And I wanted to have the big job with the big money. And and and I thought I wanted and then once I tried to kind of create my path and that’s not how it was done, I just kind of got sour on it. And there was a promotion that thank goodness it didn’t happen going to Denver. And that kind of soured me even more. And then I just I started looking at other options and I started contract diagnostics, which started out at a separate company, and then just kind of morphed into what it is today. And I just kind of started it on the side, you know, and I work nights and weekends and it took some time and it provided some financial stability for my family as it as it started to be profitable. But I didn’t need the money so I could put it back in. So yeah, I don’t regret my time in corporate at all. I mean, I learned a ton. I met some great lifelong friends. They paid well so I could live off of that, so I could invest in the company at an early age. I didn’t have to worry about making a profit. I could worry about the customers and making a good product. And so so yeah it’s been an interesting and industry. Well, for sure.
00:07:58 – Glenn Harper
Well, it’s kind of funny. It’s from selling stereos and the protein powder. And then now this contract services you’re selling what people didn’t even know they needed. And you’re like, they don’t even know they have a better stereo, but I’m going to go sell them. They don’t even know the protein powder because they all eat meat. But I’m going to give them protein powder and they don’t even know that they’ll need a whole big law firm to do a contract. They can use me to do this. So how about that? That’s. That’s definitely the trail of an entrepreneur, for sure.
00:08:24 – Jon Appino
Yeah, well, we kind of you know, when I was looking at this market, you know, 12 years ago or so, there really wasn’t like there wasn’t like a national brand. And I had lots of friends who were physicians who who could who could kind of give me guidance. I said, Well, who’d you use for this service? And, you know, they didn’t know they should, or they called some local attorney who didn’t understand physicians and physician contracts. And, you know, they if they were living in Kansas City, but they were starting a job in Texas, do I get a lawyer in Kansas City? Do I call somewhere in Texas? How do I find someone in Texas? Do I meet with them? Do I have a phone call? Do we email what’s best? There was no real guidance and there’s no real national company that could just do everything in all 50 states. So we found a nation and yeah, and now we have a new product that I feel hundreds of thousands of physicians need. And now we’re back in the process of telling them, you know, teaching them that they do absolutely need this product. And I mentioned to my my team all the time that I feel like we’re trying to sell an iPhone in 1984, you know, and you should try it. You need this in your pocket. It’s going to revolutionize the way you live. And people would say, What are you talking about? There’s no way I need this thing, you know? So it’s it’s it’s fun and challenging at the same time.
00:09:40 – Glenn Harper
We thought this would be a great time. Segue into tell us, what is it that your company does? It sounds like you’re kind of practicing law, but not really. But you’re in all the states. But how does that how does that work when you’re giving this kind of advice for clients? Tell us what you kind of do. I’m a physician and I have to, you know, get hired in. I got to sign a contract. Do I call you first? How does that work?
00:10:01 – Jon Appino
Yeah. So we’ve got great attorneys that work here, but we don’t operate like a law firm, so we don’t give legal advice. We’re consultants, if you will. So we understand the way that a physician should understand risk in a contract so we can go through it with him or her and really kind of explain it in plain English. As far as what’s clear in the document, if something’s not clear, we don’t interpret it. We tell the physician that they need to go better understand it or have it be more clear in the agreement. But we spend a lot of time focusing on compensation. So physician compensation has changed dramatically over the years and some of them are paid on productivity and some of them have very dynamic productivity structures. I mean, some compensation plans will be six or seven total pages long in themselves and they have no idea what our views are or what collection ratios are fair or, you know, how to analyze a report as far as their profitability or not. So we spend a lot of time just discussing and explaining what their particular situation is, comparing what they have to the market value. So if you’re a cardiologist in Chicago, it’s much different than a cardiologist in Texas or a cardiologist in California. But a cardiologist in you know, in in San Jose is much different than one in Sacramento and much different than one in San Diego. And if you’re at a hospital or a small practice, they’re also dramatically different.
00:11:28 – Jon Appino
So since this is all we do, we can focus and talk to the physician in a way that a physician needs to be talked with, because, of course, a cardiologist has a different personality typically than a pediatrician, different than a surgeon. So we’re able to kind of talk to each individual physician in their language and kind of coach them on. We might have to we might have to really motivate a pediatrician to ask for more money because they’re so sweet. They’re so kind. They would they how do I how do I ask for $5,000? And we sometimes have to tame the surgeon because they want to go in and say, I’m going to ask for 50,000. And, you know, well, maybe that’s not market norm. So we basically just get to discuss with them and we give them guidance on where the risk is and what how they could better discuss it, how they can understand it and how they can have a good discussion with the employer both now while they have the contract and then moving forward throughout their career. So I hate to say, like, I, it’s, it’s, it’s simple. It’s not easy. We just look at contract and we just talk to doctors and there’s there’s a lot of stuff that goes on in the background with compensation data, understanding market trends, understanding how different markets might move from one to the next and and everything else. So simple, not easy, I guess is an easy way to say it.
00:12:48 – Julie Smith
So, John, I’m curious, you were in your corporate job doing what you do. Where was the aha moment to create this to see this need to fulfill it? Obviously you did both for a little bit of time, but did someone come to you and ask for advice or what kind of made you have that idea or that moment?
00:13:08 – Jon Appino
So in my and in some of my roles, I interacted with physicians on a very routine basis. And I would just always I was always questioning, you know, what’s the worst part of your day? What’s what’s a hassle when you’re going through this one? I was just trying to become get to know them and be more be friends with them. But two, I was just curious and one of the things that a lot of physicians kept saying was when they finished their training, the process from I finished my medical training to I’m going to go get a job. It’s very, very challenging. I mean, physicians all get jobs. We hear about the physician shortage. It’s unlike a college grad who tries to get a job in accounting and they can’t find anything in accounting. But physicians always find jobs that might not be the ideal location or the ideal place, but they always get jobs. And then with most opportunities, a contract comes with it. But we didn’t want to work on the contract at first because all the physicians said the process of finding a job is difficult. The process of relocating all of our stuff is challenging. They typically finish their training in June, but they don’t start jobs until August or even September once they’re board certified and they’ve got credentials at the hospital and everything else. So there’s that lag in there where they don’t have financial means. Sometimes they don’t have a job. So they’re kind of waiting and doing paperwork and moving and everything else. But they said their recruiters, all my friends said the recruiters were a pain in the side.
00:14:35 – Jon Appino
They said this contract thing is a pain in the side. They said Just transitioning, just understanding what comes next is just a hassle. So I was going to create a company called New Cloud Medical, which is actually the parent company of contract diagnostics at DBA and knew Cloud was going to do everything. We going to reinvent the entire thing. We were going to reinvent recruiting. We’re going to reinvent contract reviews. We’re going to reinvent I mean, I was going to have a card that they can go down to their local BMW dealership and get a discount on a BMW if they wanted to or a moving company, they could get a discount. We’re going to have a real estate division and a banking division and an investment division and sell them life insurance and disability insurance. And we were going to do everything and reinvent it all. And and so that’s the way the company started. And of course, I realize you can’t do everything great. And one of the things I didn’t like around the recruiting thing was all the phone calls and all the back and forth emails and, you know, at the at the stereo company, people would come in, you’d help them, you’d sell them a stereo, and it was transactional. You buy something from me for $200 and I make $35 or whatever. There’s a transaction. I like that I could go home at the end of the day saying I worked for 8 hours. I got to help five people and four people bought something from me and I made $100 or so.
00:15:57 – Jon Appino
But with recruiting, much like with real estate, you might show a ton of houses or you might make a ton of phone calls and then nobody signs and nobody calls you back. It’s hard to decide if my day was well spent or not, and you might make $20,000 on some random day or 30,000 on some random day with one phone call. But you might go a month before you do that. And I didn’t like that. And so we did some contract reviews and I like that transactional nature. We provide you a service and knowledge and you give us money and and that we can do it again and again and again. And then I start looking at the market and talking to other friends and I realized that there was no company that was really looking at this thing on a national basis that was just a national brand that anybody can call in any state and get good advice from people who knew what they were doing. So that’s where we kind of started contract or I started contract diagnostics and we kind of dropped everything else because I said I’d rather be world class at one thing then sort of kind of good at a whole bunch of things. And so then we started contract or I started contract diagnostics. I think 12 years ago, maybe it was we’ve had some copycats, which is really kind of cool, I think, as far as other companies now, which is fun. But, but it started with something else and it ended up being totally different than what I had initially had the vision for.
00:17:20 – Julie Smith
So in the beginning, and as you went through that process of starting it, did you have a mentor or someone that was really by your side that you could ask that advice and get the solid truth instead of maybe what you wanted to hear?
00:17:32 – Jon Appino
You know, nobody like nobody that I would say I met with like every single week, you know, and they sat down and they grilled me. You know, my dad worked for a guy that in Brookings, Larson Storm doors and Dale Larson is a fantastic person and a wonderful entrepreneur and now a brilliant philanthropist. But I mean, I guess his whole life has been and I would talk to Dale from time to time, and he would you know, he would kind of just give me global advice. You know, here’s how to think of this. Here’s how to give back, you know, here’s how to treat people if you ever hire anybody. But it wasn’t necessarily like I was bringing my business problems to him. It was more kind of just global advice. And I had a handful of relationships like that that I could get kind of global advice on or coaches, if you will. But nobody that I could really sit down and say, this is my problem with this company or this website or this competitor or this pricing for packaging. It was just all kind of I just it was just kind of me in my basement, sleepless nights and a lot of weekends and and everything else.
00:18:36 – Glenn Harper
You know, it’s it’s a funny thing listening to you, because I think one of the cool parts about this is that you had already been indoctrinated talking to surgeons and doctors and and all these folks, and they just think about things in a little different way. And you just got to learn how to communicate with them and listen to what they’re really saying, because really they just want to go do doctoring stuff. They don’t really want to do anything else, but they just probably didn’t feel like anybody ever listened or nor that they even know the question to ask about the other stuff. And we see that doctors, they just don’t know the financial part of things and what it means for taxes and retirement and all those protections like you were mentioning, those other services that you were going to provide. You know, there’s a great opportunity for that because, you know, people really want someone they can trust to do all those things. And so I think it’s interesting that you really didn’t need to know what to sell. You just knew how to talk to people and you just listen to them. And all of a sudden, there you are. Now you’ve had to figure out how to package it. How did you come up with your packaging process and knowing, Hey, I got to be able to scale this thing. I don’t want to just deal with ten clients. I want to deal with thousands and not only going to be thousands of clients, but they’re going to start in these three states. And then in five years, doctors always move. I’m going to have to be in these 12 states and then three more years I got to be in 50 states. How did you figure that part out?
00:19:57 – Jon Appino
I did a lot of the work on my own at first. And, you know, I had some contractors that I would have, you know, help out with various things. But I think the company just kind of organically grew. And I put more time in and less time in corporate and more time in the company and less time in corporate. And then when we got to the right, when I was at my capacity where we just couldn’t help any more people, I thought we could raise prices and maybe we’ll get less business and we’ll still make the same amount of money. Or I could bring somebody else on, you know. And so I brought someone to help a little bit, you know, and we’re still a small company. We just got a handful of associates here that work with us. But, you know, over the years, I’ve always, you know, I’ve appropriately scaled and maybe that’s, you know, maybe my risk tolerance for a typical entrepreneur is much less because I haven’t cashed out the 401. K and hired, you know, five people at once and then worried about it later. I’ve just kind of very slowly scaled over the last 12 years, and it was probably just me for the first five years where I did everything from billing to, you know, to accounting to all the emails, to paperwork.
00:21:14 – Jon Appino
And I had like some contractors that I would have help with some attorneys in that thing. But, but then I brought somebody on to help with the books and then I brought somebody on to help with contracts. And then I brought and then my, my at the time, the gal who was helping me with billing, she took on more tasks and more roles and she went from 7 hours a week to now. I mean, she’s probably seven or 9 hours a day, you know, so so we just kind of appropriately and slowly kind of gone from there. But I did a lot of the work at first. And, you know, it’s those late nights and those those weekends that you give up that I think build. And you have that grit that builds a lot of character when you’re starting a company and then you look back and you appreciate it much more when your schedule’s a little more open.
00:21:55 – Glenn Harper
This seems really weird that like it just didn’t magically happen overnight. You’re a multi gazillionaire with 1000 employees. You mean it takes time and effort and sacrifice? Is that you telling us something different that other people tell us is so weird?
00:22:08 – Jon Appino
I don’t know if that’s a pass now with, you know, bitcoin and all that stuff or if it’s if it’s still one of those things that, you know, you find something that you really enjoy. You put your heart soul into it and and you work it till you’re blue in the face. And you don’t give up and you provide good products and then and things happen.
00:22:27 – Glenn Harper
I think that’s, you know, this, this, this podcast is all about the journey and how to get from A to B, from, you know, real job to an entrepreneur. And so when you had real job and decided to do this thing on the side, how long did it take for you to be double dipping before you said, you know, that’s it, it’s time I’m going full on in? How long a time was that, you think?
00:22:49 – Jon Appino
Again from my my individual risk tolerance is probably much different than a lot of typical brewers. I would say maybe it was seven years.
00:23:00 – Glenn Harper
00:23:01 – Jon Appino
Well, maybe eight years. And it just kind of again, it just kind of slowly kind of came on and I will schedule at my in my in corporate. So it wasn’t an 8 to 5 Monday through Friday type of job. Some days were longer, some days were shorter. You know, some nights I worked and then I took the other the next day off. And so the job was was very flexible and more results based than time based. And I had great results. And so my time wasn’t questioned. But, but yeah, it probably took that long, which again, it allowed me to not only bring the company up, but as I was working, you know, I could invest a little in the company. But it also because the company ended up making two or three times what my, my, my salary in corporate was. And so it wasn’t a thing about I should leave because I can afford to leave. But then it became, How do we feel again? My risk tolerance might be less than some entrepreneurs. So we spent time paying off debt. We spent time saving money for the kids. My wife was working a lot at the time as well, and we spent time paying off the house and, you know, and really kind of getting in a solid financial position, both with contract diagnostics and us individually.
00:24:14 – Jon Appino
And and then we made a decision to leave corporate together. And it actually took it was actually we made a decision to leave on a particular day. And it was actually the plan was kind of blown up because the company it was a fantastic company. But they actually came to us. They were they were going to fold the division that I was working in because it was a product that was running off of a patent and pharmaceuticals and biotech. And so as that product was coming off of the patent, they didn’t have any where to assign the division. So they announced a year, a year in advance, I think a year and a couple of months in advance that they’re going to dissolve the division and give everybody a severance package. So it’s a little ironic that they actually paid me to leave. So it was kind of everything worked out great. But again, we had made a decision that we’re going to leave on this particular day, on this particular month and the month before, we are going to throw the towel in, if you will, and give all the stock back and say, keep the job and the salary and everything.
00:25:13 – Jon Appino
They announce that if I would wanted to stick around for a year, they were going to pay me to leave. And again, I didn’t hate the job and the flexible schedule was was great and I had friends that I worked with. So it wasn’t like maybe some or they hate their job and are grinding 8 to 5 Monday through Friday. I was able to spend a lot of time on contract diagnostics while still meeting expectations at corporate. And then we kind of made a decision with my wife to stick around for another year just from a financial decision. It was a good one to make, and I didn’t think that leaving that job to focus on contract diagnostics at the time was, was something that that that was urgent. Urgent. But then we did book a trip to take our kids to Italy the entire summer of 2019, which is when we, when we ended up leaving corporate. And, and then we kind of celebrated by spending the entire summer of 2019 with the kids in Italy. So it worked out well.
00:26:08 – Glenn Harper
Is there a way I can get the number of that cushy corporate job so I can apply for that? That sounds awesome.
00:26:15 – Jon Appino
Well, it was it. I mean, I hate to say it wasn’t cushy. It was a ton of work. And you had to be very good and very talented at the position. But but yeah, it worked out well. And I still I still talk with my friends at the company and, you know, and I still miss everybody. I miss the camaraderie that we used to have, you know, because when you’re in a small company, you know, it’s just different than when you’re with a big company and you’ve got lots and lots of colleagues and associates.
00:26:41 – Julie Smith
So I was doing the math, John, and I’m not really good at math, so no, she’s not. If I did it incorrectly, please correct me. But did you hire your first employee to be a part of your team before you left corporate America?
00:26:53 – Jon Appino
00:26:54 – Julie Smith
That’s awesome. And so what ultimately led you to make that decision that you decided you needed to delegate and get that off of your plate in order to continue to juggle both those roles?
00:27:06 – Speaker3
The business was strong and my time was was kind of capped. And I realized that it has to get bigger than just me because I didn’t even if I if I left corporate, I wanted more of a flexible schedule. I didn’t want to leave. I didn’t want to go from getting up at three in the morning to get to the gym, to get both jobs done all day long, and then working three nights, four nights a week sometimes. I worked every Sunday night for eight or nine years. I worked from, I think 4:00 till 10:00 every single Sunday night for four, seven, eight years maybe. And I didn’t want to do that. I wanted to be able to go to Italy with my kids. That was one of the dreams my wife and I had. We wanted to spend a whole summer in Italy and I knew that I could do that if I was also doing 100% of the production. And I knew that there was also a lot more people out there that we needed to help. Because if you looked at the available market for our products and you look at how many we were serving, we were super busy, but but still not being able to serve everybody that needs it. And so I kind of felt an obligation to bring people on and do a little bit of scaling, if you will. And I felt that that was the best time was then when I had more of a financial backing with corporate, and I could kind of take the money and invest because I didn’t need it to pay bills. And so I felt like that was the right time versus when I might feel like my future self would tell me. I’m a little more tight with finances because I don’t have the corporate money coming in every single month.
00:28:30 – Glenn Harper
Did you have a at this point again, even though you’ve been doing this for seven years, how long has this been going on now? Since 12.
00:28:40 – Jon Appino
Contract. Yeah, 12.
00:28:42 – Glenn Harper
Years. Okay. So. But it’s only in the last. You’ve been on your own with no corporate job for like the last four then.
00:28:50 – Jon Appino
00:28:50 – Glenn Harper
Okay. So do you have any regrets or son of a moments that you wish you could do it over again, that you would have changed to get you where you are quicker? Or are you perfectly content with how the pace that you have developed your company and your career path and your entrepreneurial journey? Are you are you good with that? Or you’re like, Oh man, if I’d just known this person or that process or engage this person particular advisor, I could have got there quicker. Is there any advice for people listening that, you know, listen, if you could just see that one thing like, oh, pay attention to that blinking light.
00:29:24 – Jon Appino
Yeah. I think, you know, maybe the one thing that I would change was, is the the way that you that you prioritize initiatives. So I think like a lot of entrepreneurs, you have a laundry list of ideas for the company. You know, I’ve got I want to get this done and this done and add this and, you know, and do this to the website or this to the blog or this to the YouTube. I mean, there’s there’s I mean, I have a list of, I think still 32 ideas on ways that we can make the company better or new products or help more people or, you know, add something on or fill in the blank. And, you know, as and I’ve slowly kind of ticked things off that list, again, knowing that I’m not the type of person to just jump in and hire a chief operating officer to start knocking stuff off that list. But I think I would have maybe started prioritizing that list maybe a little bit different years ago. But I don’t know that I regret anything as far as timelines go, you know, the way that the corporate job worked out and when I hired my first person and how the company started and how things kind of fell in place, I think that’s that as as as as purposeful, I think as it was when my wife and I made those decisions, I think they were all the right ones, you know, because now at 43 with with a nine year old and a six, seven year old child, we feel like we’re in very good financial footing.
00:30:50 – Jon Appino
And I think because we we took our time and did it slow again for me, I know I’ve got friends who quit a store director job at at Target. You know, we thought our friend was going to be the next CEO of Target Corporation 15 years ago. And he was running a store by himself with a $300 budget and 400 employees at the age of 26. And he quit that job, cashes out his 401. K and starts a company, you know. And so it’s those things that you you I envy people who think like that. Unfortunately, it’s just not me. So I think the pace that I did it was appropriate for my particular risk tolerance and thresholds.
00:31:32 – Glenn Harper
Yeah, I think your, your, your perseverance, your you didn’t want to rush into it. You had very much purpose doing what you needed to do. I like that again. A lot of entrepreneurs wanted all you know, yesterday. It’s hard to have somebody that, you know is like, you know, I’m not in any hurry. I want to do it right and do it. Do it all I can.
00:31:53 – Jon Appino
Yeah. And again, I’ve, I’ve said many times you, I think my, the, the, the tolerance that I have for risk has, has impeded me in many ways from my investing strategy with excess funds to the way that I’ve run the company. You know, and I see what some of my friends have done and, and I’m like, if I had their risk tolerance, my company might be three times as big or four times as big. I may have I may have three times or four times a portfolio. I don’t know. Or maybe I would have crashed and burned. But again, I, I can’t force that. I mean, I can’t force that on, on, on, on myself. And I don’t want to try. I wouldn’t sleep at night. And so for my individual risk tolerance, I think the pace that I took was very was very reasonable, knowing that my mother still thought I was crazy when she said, you’re going to quit your job, your job, you have insurance and they give you all these wonderful things. How would you ever quit a job? You know, how are your kids going to have health insurance? You know, so, you know, so for me in my family tree, if you will, jumping out of the corporate plane, if you will, and and starting something on your own is even though it was well established, is not the typical in my gene pool.
00:32:59 – Glenn Harper
You know, that’s a good note on that is that, you know, entrepreneurs, it’s, you know, bigger isn’t better, better is better. And you don’t have to be big to be great. You don’t have to be big to achieve whatever. It’s your own individual thing that you really, really want to do. And if you had the right pace to do that, that that’s it’s that’s admirable to do it. Do it that way. Did you have any you don’t have a desire to you know, when you’re an entrepreneur, you have this everybody has this special thing that their good their superpower that just makes them set aside in their industry or who they are, just their shtick that they have. You know, do you have you really evaluated what your superpower is?
00:33:40 – Jon Appino
I have. No know. I mean, I’m I’m a natural salesman, you know? And so I don’t know if that’s a superpower or if I’m just a salesman. I love talking with people and I’m a nice guy, you know? So I’ve never I’ve never tried to take advantage of somebody or try to sell somebody something that they don’t need for for for a profit. Know, we’ve always focused on we’re we’re a service company, so we want to serve you. And if there’s I mean, I said from the beginning, I started the company not to make money, but to help people. And I figured if we helped enough people, we’d have plenty of money. And so I think I don’t know that I’m a superpower, but I think I’m a natural sales person. And at the same time, I’m not selling something for money. I’m just selling information and advice. And and so I don’t know if you want to call that a sales or a superpower, but I think just being a nice guy sometimes is is a wonderful thing. And maybe it’s the Brooking, South Dakota roots that stick out. And I think it comes through and I think I think people appreciate and notice that and and they like working with you as a as a result.
00:34:46 – Glenn Harper
How long ago did you get rid of all your flashy sales coats and sport jackets? I mean, you got to break all these stereotypes.
00:34:53 – Jon Appino
Yeah, it was nice. I had really, really nice, you know, business suits and I kept warm in case I need to go to a wedding ever. And I want to wear a suit. Right. And, and that’s it. So it was. Yeah, it was. I got I got rid of them before I even left corporate because the dress code has changed from business every day to wear some slacks and a collared shirt if you want to.
00:35:18 – Glenn Harper
Do you have did you have like when you’re doing this, entrepreneurs usually have this this wall that they hit or this insurmountable climbing, you know, steep ascent that they just can’t get over. There’s this this fear that they have, like, oh, my God. I just I just can’t break through that. Did you have any of that fear for you that prevented you from doing what you wanted to do? Or were you very it sounds like you were very methodical and just whittling that down so it wasn’t a big deal. But was there this big thing that like, my God, everybody’s against me, how do I succeed? Nobody’s going to respect me. I mean, what was that your biggest fear that you had to overcome?
00:35:56 – Jon Appino
And this is going to sound silly, but it’s a totally honest answer. It was health care. You know, I’ve got two young kids and we’ve got friends who have gotten gotten cancer and gotten sick. I’ve got a dad that has coronary disease. I’ve seen people break bones. I know how much health care costs in America. And so one of it was one of the things was, what are we going to do for insurance? And do you just pay, you know, 30,000 or 35,000 a year for a private plan? You know, do you jump into a health scare? Do you you know, do you jump into the to the Affordable Care Act and the marketplace? Do you I mean, and it was it sounds so silly, you know, and and I had a lot of my friends who were even entrepreneurs are like like, please tell me you’re not keeping your corporate job because of health insurance. You know, and it was a hang up for both my wife and I. And and so so that was it, you know, and we kind of worked through it. You know, we we did have both both children while we were in corporate. So, you know, $100 for the birth of a child when my sister was paying 3500, I think, for hers with her insurance. And she works at a hospital, you know, so know. But that was a big hang up for us and it was a lot of work to kind of navigate that process to make both my wife and me feel comfortable in the path that we were choosing for our family. As far as making sure that that health care didn’t bankrupt, bankrupt us in the future.
00:37:30 – Glenn Harper
That managing risk gets the hardest part of an entrepreneur, because sometimes you have to go all in and risk it all, and sometimes you don’t have to. You just got to be very purposeful with the way you do it. You know, a lot of entrepreneurs like to we and we like to call it you’re either doing business is when you’re doing your doing your task your thing that you do and and you do that very well and you have a small team around you, but you’re basically doing all the things that are kind of relevant. And then at some point an entrepreneur likes doing that and there’s nothing wrong with that. It’s a great business model and sometimes I like to flip the switch where they actually building a business where they’re going to bring in and just methodically hire people and all those categories to kind of just run it. And you, the entrepreneur, just kind of like being the business person where you’re really not day to day operations. You want the big picture. Do you have an affinity to which side of that aisle you want to be at? Are you in the middle of there right now transitioning or where you at in that or do you even care?
00:38:28 – Jon Appino
You know. No, I think about all the time. I’ve always said, you know, if you’re working if you’re working in the business, you can’t work on the business. You know? And so I spent a lot of time working in the business, and I couldn’t focus on working on it because I was so busy just producing, write just daily operational things that somebody that the company does. And so, yeah, as I’ve hired people, I’ve slowly kind of shifted away from having other people do that. I do love talking with physicians. You know, I love having those kind of calls. I love I love when you when you interact with somebody and and a lot of physicians, they can be arrogant. So the fact that they’re reaching out to us to ask for help because they’re used to everyone goes to them. Right. You have all the information. I’m coming to you to pay you to give me information. And so to have that role reversed when they’re looking at you and they’re so appreciative. Thank you so much for this. You’ve helped my family. You know, we’ll get an email. You know, I got a we have a we helped the physician that haven’t had a raise in four years get a $70,000 a year raise and an extra week of vacation every year. So over the next three years, $210,000 worth of extra income for his family and three extra weeks of vacation over those three years to enjoy time with his kids with no extra production that he had to do, no extra hours he had to put in because of the way that we rolled it out to his employer.
00:39:57 – Jon Appino
And so you get those messages from people and it brings you joy, number one. But you see how it impacts their family, number two. And that’s one of those things where I never want to get away from that, even though I’ve got great people that can do that now. I really enjoy those emails. I really enjoy that feedback from the clients, and so I don’t want to get away from that. But yeah, we’ve got lots of really important things that we’re trying to do to the business, which is why I’m spending a lot of time now with, with, with, with people that are helping build email funnels and build a YouTube channel and, you know, and set up podcast interviews with, with physicians that have their own podcasts and, you know, and add additional products and make our system more streamlined and reach more people through social media. I do want to spend a lot of time doing that in the future because I know that the company just has so much more that it can do, not from a moneymaking perspective, even though I know that will come. But there’s just so many more people that we can help that I feel almost an obligation to the physicians that we don’t get to talk to every year that to to to show them that we’re here so they can find us and we can provide some advice to them.
00:41:04 – Julie Smith
So a theme I’ve kind of heard throughout, but you haven’t really solidified it is. I think relationships have been the key to where you are today. No matter if it’s been in your business and corporate, in and around that area, it seems like you’ve really been able to solidify, grow all the relationships that you’ve had to in order to get to where you are.
00:41:23 – Jon Appino
Mm hmm. Yeah, I would agree.
00:41:26 – Glenn Harper
It’s a there’s a trick question that we did about 10 minutes ago that you said you only had a list with 32 things on it. And that is a blatant lie. You know it and I know it. That list, if I’m not mistaken, is infinity. And the hard part as an entrepreneur is staying on point and methodically like you have done very successfully. And I suspect you’re going to continue to do that is to your your head’s got all this stuff in it because it is really you see the market, you just know there’s unbridled optimism and opportunity everywhere and trying to just do one thing at a time and work on it. And I guess that dovetails back to the other question I had earlier is now that you kind of done a process to do this, one thing that you’re doing on the next, things that are like the big picture items is that’s something that you’re going to delegate, empower others to do that, to help get those up to speed quicker, or are you going to still stay on the same methodical step? Have you figured that part out yet?
00:42:24 – Jon Appino
Yeah, absolutely. Yeah. So I work with a like a small business. I want to have big enough to have like a like a a chief operating officer, if you will, that has everybody below them and a marketing division and a and a tech team and everything else. So there’s a small team that I work with that kind of has all those to work part time here and there on projects. And as we bring them more projects that we delegate more things to them, that’s becoming a very valuable relationship. But at the same time, you know, I do I enjoy working on these things. And so now the the challenge comes to how do I trade my time, you know? So there are so many things I want to do. I’ve got young kids and I refuse to be one of those parents who say, Oh, they grew up too fast. And now all of a sudden, I mean, my kids are nine and seven. And I’d like to I’d like to think that I’ve got nine more years with my son before he takes off and goes to get a job or goes to university or or starts a business.
00:43:24 – Jon Appino
But I realize that that 17 year old. Sons are not going to want to hang out with me all summer long. They’re going to want to go hang out with their friends. And so I maybe have a solid few years that, you know, that he wants to hang out with me and he wants to go on trips with me and and I get to see him quite a bit before he’s out running around with his friends, driving cars or walking around or whatever. So, so I’m trying to kind of balance now my, the, the level of work that I want to do. At the same time, the obligation that I feel to the company and the people who I get to work with to grow it and add products and that revenue and everything else. So it’s it’s that internal conflict. You know, I wish that I had 40 hour days. Unfortunately, I don’t. And so so I’ll kind of have to make do with balancing everything out in the interim.
00:44:12 – Glenn Harper
I feel like if you went back to about ten years ago when you were working the 12000 hours a week at three in the morning, that’s when it’s going to get done. But no, you’ve got a little soft and that’s okay, but you’re figuring it out as you go. But no.
00:44:27 – Jon Appino
I don’t know that that’s that may be an accurate statement. As far as as far as a little bit soft. I wouldn’t disagree with that.
00:44:34 – Glenn Harper
I’m kidding, of course. Well, is there a would you like to give a little plug for your company so we can put this on the podcast so people can find you if they need to?
00:44:41 – Jon Appino
Yeah. I mean, contract diagnostics, you know, you type it into the Google machine and it pops up. So it’s contract diagnostics dot com. And again, it’s so easy what we do, we help physicians understand their contracts and their compensation structures. So if any physicians listen, you know, they can call us. We have a free 15 minute consult. They can call us up and or they can book a consult and we can just talk with them for 15 minutes. No charge. We have a couple of products from a compensation analysis to a contract review on our website. And if somebody knows a physician, they can send them over to the site. We have free webinars and all kinds of free stuff, free resources all over the site. So it’s one of those things that if they want to find us, they can within a pretty good job of of putting ourselves out there on the line.
00:45:29 – Glenn Harper
Is it fair to say that you’ve got to kick butt stereo system in your car because you’re, you know, a guy?
00:45:36 – Jon Appino
I don’t I have a I love I have a I’ve kind of over that now, but I still am into customizing vehicles. I have a Toyota forerunner that is an overland vehicle. So it’s got a tent and it’s got all custom wheels and lift kits and kitchens in the back and all that kind of stuff. And I love getting up into the mountains and relaxing and and kind of getting away from things from time to time. But it definitely has a factory stereo, which for me is just.
00:46:07 – Glenn Harper
Fine, more than adequate. But boy, back in the day you had to get the cool stuff.
00:46:12 – Jon Appino
Back in the day. Absolutely.
00:46:13 – Glenn Harper
What was the brand back in the day? That was the one that they couldn’t get just out of curiosity. Kicker. Kicker, huh?
00:46:20 – Jon Appino
Yeah. There were subwoofers and we wanted kicker. And I think Rockford Fosgate was another one. And we want to Kenwood as far as like Dacs everything, the whole market has changed so much because with with with new cars and touch screens and apple CarPlay, I mean, everything is different. Oh, different now as far as adding secondary systems and everything else, I, I know the market’s changed quite a bit, but, but the stereo company is still very successful. They put stuff in boats and campers, they still do cars, they do old retro cars, they do remote starts and older vehicles. And it’s a it’s a pretty cool it’s a pretty cool company back and bringing still.
00:47:00 – Glenn Harper
That’s fantastic. Well, John, I really appreciate you taking the time today to come on and hopefully this will help some entrepreneurs out there realize that there’s more than one way to get to through your journey to get your entrepreneurial success. This is Glen Harper, Julie Smith. Thanks for joining us, everybody.
Episode Show Notes
Contract Diagnostics is a nationwide consulting company, not a law firm, and the ONLY company that specializes 100% in physician contract review.
Jon’s team of contract review specialists has served many thousands of physicians in all specialties across all 50 states.
Contract Diagnostics was formed in 2011 and has been Jon’s passion ever since. He is dedicated to the education of physicians in the non-clinical (business) aspect of medicine.
Had you been an entrepreneur before? Growing up as a kid?
Oh, funny enough. So I started a stereo company Car Stereos when I was 17, not because I wanted to have a big company and make a lot of money. There were certain brands of stereo equipment that we wanted in Brookings, and there was one, one small stereo company, and they didn’t have the good brands and we didn’t feel like they gave the customer a good deal. And so my friend and I started a company at 17 just so we could get our brands, and it did well. It’s still going successfully under separate ownership.
How did Contract Diagnostics start?
I was looking at this market, you know, 12 years ago or so, there really wasn’t like there wasn’t like a national brand. And I had lots of friends who were physicians who could kind of give me guidance. I said, Well, who’d you use for this service? And, you know, they didn’t know they should, or they called some local attorney who didn’t understand physicians and physician contracts.
But how do you sell a service or product to someone who doesn’t even know they need it?
Now we have a new product that I feel hundreds of thousands of physicians need. And now we’re back in the process of telling them, you know, teaching them that they do absolutely need this product. And I mentioned to my team all the time that I feel like we’re trying to sell an iPhone in 1984, you know, and you should try it. You need this in your pocket. It’s going to revolutionize the way you live. And people would say, What are you talking about? There’s no way I need this thing, you know? So it’s it’s fun and challenging at the same time.
So what does your team do to help physicians?
So we’ve got great attorneys that work here, but we don’t operate like a law firm, so we don’t give legal advice. We’re consultants if you will. So we understand the way that a physician should understand risk in a contract so we can go through it with him or her and really kind of explain it in plain English.
And what Jon sees as the “secret” to success…
It’s still one of those things that, you know, you find something that you really enjoy. You put your heart soul into it and and you work it till you’re blue in the face. And you don’t give up and you provide good products and then and things happen.
In an unusual growth pattern, Jon hires his first employee for his “side gig” before he even left his corporate job. Why?
The business was strong and my time was was kind of capped. And I realized that it has to get bigger than just me.
Do you have any regrets or son of a moments that you wish you could do it over again, that you would have changed to get you where you are quicker?
Maybe the one thing that I would change was, is the the way that you that you prioritize initiatives. I think still 32 ideas on ways that we can make the company better. But I think I would have maybe started prioritizing that list maybe a little bit different years ago.
What’s been key to Jon’s growth is relationships. They have been the key to where he is today. No matter if it’s been in his business and corporate, in and around that area, it seems like he’s really been able to solidify, grow all the relationships that he has to in order to get to where he is today.
My team ensures physicians and their families get the best possible employment compensation through information, consulting, and coaching on their employment contracts.
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