Productivity

How To Manage Your Practice Finances ft. Andrew Riesen

 January 4, 2023

By  Uriah Guilford, MFT

minute read

Setting up or growing a private practice can seem daunting!

Most therapists are not secret experts in setting up an LLC, SCorp, accounting, billing, payroll, budgeting, etc, etc. 

Join me, Uriah Guilford, as I chat with Andrew Reisen and share some simple solutions with you. Click to listen now!

In This Episode, You'll Learn:

  • How to manage your practice finances simply and confidently
  • A simple all-in-one solution

Resources Mentioned In This Episode:

JoinHeard.com

⬇️ Click for full episode transcript ⬇️

Uriah
Hello there! Thanks for listening to the Productive Therapist podcast. Today I have the pleasure of talking to Andrew Reisen, who is a mission-driven entrepreneur, financial accountant, and CEO of Heard, the financial back office for therapists in private practice. Prior to herd, Andrew worked at PwC, where he worked as a financial accountant, helped build an internal software incubator, and cofounded an affordable sales tax solution for small to medium size businesses. When not supporting mental health professionals in private practice, andrew can be found exploring the nooks and crannies of the Pacific Northwest Trail, running, cycling or snowboarding, or at home with his nose in a book or journal. I really enjoyed this conversation with Andrew. He's a super interesting entrepreneur who's building an amazing company that serves therapists. And we share similar goals of helping therapists outsource so that they can get more done, have more fun, make more impact, make more money, and all of those things. So please enjoy my interview with Andrew Raisin from Heard. Andrew, welcome to the podcast.

Andrew
Thank you for having me, Uriah.

Uriah
Yeah, it's genuinely exciting to meet you and talk about Heard and everything that you all have to offer. First of all, I just wanted to thank you for starting this company and the services that you provide, seriously, because I think about this often. It's just astounding the amount of support services there are for therapists in private practice now, like I started 20 years ago, and it was hard to find anything to teach us about how to start a business, how to run a business, support services that were geared towards us. So, yeah, I just wanted to say thank you for what you do.

Andrew
Awesome. Yeah, I appreciate that. And again, I'm grateful for the opportunity to come and chat with you about it, but it's largely through the first hand experience of having a partner that's a clinician, having many best friends that are clinicians and seeing them go through this process. But I think holistically it's my belief that there's a pretty meaningful shortage of innovation still for the provider directly. I think if you look at the world that I live in, that is a venture capital backed software business, so much of the money goes towards care delivery and care management and innovation in a way that's not necessarily indicative of provider first solutions. And so I hope that we can continue to be a part of that positive trend.

Uriah
I like those words, provider first solutions. I like that a lot. It does, but I like it. It's good. So I have to ask you a question that I could not find the answer to, and I'm sure you get this often, but why is the company called Heard and what is the significance of that name?

Andrew
Yeah, great question. So, once upon a time, as the marketplaces, I have just alluded to we started by building a business that was anecdotally what I might consider bumble for a therapist. And so we had done a ton of market research and spent a year and a half trying to figure out how we wanted to build a solution in the space and where we wanted to start. And one of the common themes is that we had started seeing for clinicians and on the consumer side is like, it's very challenging to find a clinician because most folks are full. And then when you do find that clinician that's full, typically what's taking place on the back end is Uri as a therapist is referring out to Andrew as a therapist. And so we had built a solution to provide greater access to provide a better interconnectedness between providers for folks that are actually trying to find a clinician. And so the whole impetus for Heard, which was created by one of our co founders that's no longer on the team for AZ, was like, folks deserve to be heard. And oftentimes in that search process, oftentimes in that search process, they are just basically throwing rocks into the ocean and not hearing anything back. So it can be really challenging on the consumer side.

Uriah
I love that answer. That makes a lot of sense. Now it's all connecting in my brain.

Andrew
We're an accounting solution. It's like, what does hurt mean? Every time we have a new team member that I'm like interviewing or we are talking to new therapists, they're like, oh, Heard, it makes so much sense. We're like hurt with our accounting. And I'm like, yeah, that's exactly right. That's exactly right.

Uriah
Well, some of the best companies have names that don't make 1000% of sense. On the first, my favorite payroll company that we use and promote is Gusto. That's kind of a familiar name. But like, why? Who knows? I don't know. I named productive therapist. Obviously. It's very hopefully that's obvious to people what we do.

Andrew
No, your branding is exceptional. You're helping folks become more productive by supporting them with virtual assistants and how to approach their practice. Yes, this is how we should have thought about naming our practice.

Uriah
Although, you know what, I will say a caveat to that. I can't sell merch. Like you can sell merch because therapists don't want to walk around with a shirt that says Productive therapy. Look at me, I'm a mental health professional and I get shit done.

Andrew
No naming what I am.

Uriah
Right? But if it's like a cool shirt or a sweater that says her and be like, oh, what's that? That's interesting. I don't know. Pros and cons for branding, I suppose, right? Yeah, so that's so interesting. So the origin of the company was more like bumble for therapists to try to connect clinicians to potential clients and then you just kind of stuck with the name and then moved into financial services. Okay, that's interesting.

Andrew
Go ahead. We had started on that pathway of trying to build this marketplace and we pretty quickly realized, one, this necessarily isn't the best business ever. And we're trying to solve for this fragmented system of list serves and Facebook groups and memberships and communities. And there's so many different elements to how folks communicate with one another. So it's a challenging business to say the least.

Uriah
That makes sense. Yeah. So, financial services, it looks to me like, and I'm asking this as a group practice owner who is actually looking for a new CPA, so these questions hopefully will be very relevant. There's a lot of different things you do for folks who haven't heard of heard. Could you just give us a quick rundown of the actual services you provide for therapists in private practice?

Andrew
Yes. Awesome. And of course, happy to have a conversation if you are in the market for a new CPA. But I think the best way to describe herd is in kind of the life cycle of what it means to set up a new business and then manage your accounting back office. And so when a provider is moving into private practice and they want to set up an LLC or set up a Plc or a professional corporation, that's kind of that first starting point of which we can help providers. And then there's a natural transition point as well. When people have determined I'm earning X amount of dollars, it might make sense for me from a tax savings standpoint to become an escort. So we help with those legal transformation and the formation services. And then from an accounting standpoint, when you're building a private practice, it's important to keep track of your income and expenses and solutions like simple practice and therapy notes and your EHR when you're managing your billing and your receivables is really helpful. But trying to create a world where you bring all of those, both the income side and the expense side of your practice together is what we're really good at you with. And so you connect your bank account to our platform, all of the transactions come through and then we're able to do that bookkeeping and reconciliation. And then on a monthly basis, thinking through that accounting life cycle, we'll provide you financial reporting, we'll help you get a sense of how to set aside money for taxes, how to pay yourself an owner's draw if you run payroll. We have embedded payroll on our platform through as you had alluded to a partner called Gusto, who we believe is very excellent as well. And then on a quarterly basis, we'll help you calculate and file your quarterly taxes and on an annual basis help you with those tax filings as well.

Uriah
That provides enormous value. All those things that you mentioned, I didn't realize that you would do the sort of the forming of the corporation and the kind of set up work, but that's really fantastic. And honestly, being new to understanding and knowing about herd, your marketing is really excellent as far as the clarity of who you are and what you do. I mean, complete financial management service that combines software and accountants to handle bookkeeping taxes, payroll, and business filings for you. Oh, there it is. Business filings for your private practice. It's like, yeah, you do all those things, and that's primarily, correct me if I'm wrong, but all done for you services like you handle those things from start to finish.

Andrew
Yeah, that's exactly right. And I will take absolutely zero credit for any sort of marketing work that has been completed. That is Michael Fullwiler and that's Brittany Reynolds.

Uriah
Michael, excellent work.

Andrew
Yeah, no, but that's exactly right. And so it is a hands on, higher touch customer support experience. And so when you join Heard, it will help onboard you onto the platform. You'll get matched with a lead accountant, and then you'll have a team. You'll have a bookkeeper, a tax accountant, a tax prepared, and we have attorneys on our team as well. And so there's that full support and full service support on the back end as well, which through feedback from the folks that we've worked with, they've really found a lot of value throughout the year of being able to communicate with somebody and for lack of better terms, be heard as it relates to their business management.

Uriah
Oh, I think that's a great term. I think you should use it. You should go with that. Thank you.

Andrew
I appreciate that.

Uriah
Yeah, well, it's interesting. I think productive therapist and Heard have some overlap in the sense that we're trying to save therapists time and help them focus on the clients and focus on growing their businesses and not worry about the things that they either don't like to do or just are not skilled at doing. For us, it's like we'll handle all your intake, all your client inquiries and match those with your therapist and handle everything for you, and then you're handling the financial back end. I talk about it all the time. But the power of outsourcing, because if that therapist, whether they're solo or group, can really do the things that they're excellent at and not be trying to wrangle QuickBooks, they're just going to be happier, number one, and they're going to be more effective. Right. So that's a powerful combination, isn't it?

Andrew
Yeah, I 100% agree with that. And I think in my own personal experience of bringing on an executive assistant, not only has my level of joy in the role that I have increased, but my leverage of what I'm able to accomplish in the work that I actually do. And so what you're building and solving for makes absolute sense and is just an awesome resource for clinicians. And I think it's the same for every accounting. And I'm a huge advocate, and Jenny Schottmiller has a community of folks that want to DIY accounting and own that process, and I am 100% all for that. And every time we do workshops or we're out talking to the community. If that gives you joy, hey, I'm a nerdy accountant, I get it. But if that gets you joy and you want to dig in and do that work yourself, our hope is that we can at least provide educational resources and content and guidance around how to approach that most effectively as well. Totally agree. There's a certain amount of leverage. And sometimes at a certain point in your journey, or if you're running a small private practice, maybe it doesn't make sense for you. But hopefully the resources that you're providing and through the resources that we provide as well, we can provide at least some semblance of some guidance on how to best approach that.

Uriah
I like it. So this is not obvious to me and I'm curious and it might not be obvious to other people, but how is working with Heard different than going on Yelp and finding the local CPA or bookkeeper? How is it different?

Andrew
Yeah, that's a great question. So I think a couple of different things. So it's all in one is a big thing to call out and oftentimes what we see with folks that are coming to join herd. I probably tried to DIY on QuickBooks for a little bit and then got really frustrated because QuickBooks is really annoying. Maybe I set up Gusto for myself. And then I decided at a certain point, bringing in a bookkeeper was super helpful. But I had to pay an exceptional amount of money. And then at the end of the year, I had to bring in a tax preparer and all these disjointed systems and processes and services. And so bringing it all into one place is what folks have found really helpful. The second piece is having support throughout the year and being able to actively communicate through our messaging inbox with a support professional on the other side and somebody that has a very clear understanding and works with lots of other folks that look like the private practice owner that you are or the individual is that we're working with having that sort of value. And then I think from a product perspective, all of the work that we do, we care. A lot of people are like oh, we care a lot about our customer but everything that we build goes through extensive user research process therapists are involved at every single step in the way we're leaning into our advisors and our community to think through what's the best way to structure this? Does this copy make sense to you? Are these tool tips helpful? And so kind of nuts to bolts from the overall experience to bringing it all into one place to that support and validation that they're receiving on the back end. It's hopefully a more kind of cohesive and put together experience so you can just go to one place to solve that problem.

Uriah
I like that. It's fantastic. I actually love my bookkeeper and I want to fire my CPA right now.

Andrew
What if your old CPA is listening?! Shout out to your CPA!

Uriah
I'm sure there's an opportunity for not. Yeah, right. No, I did. I had a great CPA for many years and she was pretty very direct and straight to the point and always gave me very clear answers and was fantastic. And then she sold the practice to somebody who I really liked but it turned out has not been a good match for me. And what I'm looking for at this point in my business career, I have two businesses. One is a group psychotherapy practice, one is obviously productive therapist and I want somebody that can be more I don't need like a fractional or part time CFO necessarily yet, but I want somebody who can be more like a partner in my business and help me really guide my decision making and those kind of things. So that's what I'm looking for, at least in an accountant or an accountant firm or a company like that.

Andrew
Yeah, I think just as somebody that's been in the accounting world for an extended period of time, I think we very frequently hear it, especially in our inbound sales conversations or like when we're talking to new providers. Just the challenges that folks have historically had with CPAs and different sorts of accounting service professionals. And I think holistically as a community, we have an opportunity for more consistent communication, management of actions and to do and follow ups and an overall delivery of clarity around what are the specific types of services that we do provide and what is the skill set that I have and how can I best support you. And so I guess that's me on my soapbox scene. For folks that are whether it's coming to herd or going elsewhere, don't be afraid to ask all of the silly questions about what are the specific things that you're going to do to me do for me, hopefully not to me do for me. And then what is the work that you do as an actual accountant and a CPA because there's so many different scopes of services as to which accounting professionals do provide.

Uriah
Definitely, yeah, that makes sense. So I don't want to make any assumptions here. And for clarity's sake, it appears to me that you've built the back end platform and thus do not use QuickBooks or Wave or something else for accounting, is that correct?

Andrew
Yeah, that's exactly right. So pretty early on, I guess in the process this might be helpful context in the process of when we were starting heard we had started by building the bumble for therapist and then we're like, hey, we actually have no idea what we're doing. Let's just spend the next year doing customer development with tons and tons and tons of private practice therapists. And as a part of that customer development process, when we had routinely kept hearing the challenges of setting up a new business and managing the accounting. And it's like, okay, cool. Let's take 50 of these folks that we've been working with that are in our community, let's put them on QuickBooks and kind of let them run. We'll pay for it, and then we'll check in with them throughout the month and see what that process has been like. That first month, I think after we had set up those 50 people, like, two people were still using it at the end of the month and were irritated with it. And so what we did then the next month was for those 50 people, we put together some design mockups using our design solution, put that information in front of them, and basically had taken information from a spreadsheet like profit and loss and insights and reporting and put it in a way that we thought might be a little bit more helpful. And everybody was like, oh, this makes a lot of sense. And so for us, that was indicative of the fact of, like, hey, for the solution that we want to build, it makes sense for us to start kind of at the origination of it because it's going to allow us to drive more insights back to the providers, provide benchmarking in time to help folks understand in different geolocations how they're comparing to other folks and what they can expect, and just build an overall, more tailored solution for clinicians.

Uriah
Okay, so how does that work for folks who are currently using QuickBooks and moving to Heard, and then if they need to, for some reason, hopefully not move from Heard back to some other solution? How does that transition period work?

Andrew
Yeah, that's a great question. So typically what happens when providers are on QuickBooks or they're on Wave and they're joining Herd is what they will do is they'll typically download their general ledger or basically a listing of all of their transactions and how they've historically categorized those transactions. Because there's been a lot of work done, whether it's through you or whether it's through the accountant that you're working with. And so providing that when you do join Heard and connect to your bank account so we can get you up to date in a more seamless fashion. But when you leave Heard, if you make that determination, you can download all of your reports, we put together all of your documents, and we'll put together a package for you that you can just take, whether it's through your next accountant or if you're looking to DIY it for yourself, to save on file.

Uriah
Okay, that's good to know. I'm a huge software nerd, so I'm imagining just from looking at how clean and well designed your website is, I'm thinking that your platform probably is easy to use and very attractive. Would that be correct?

Andrew
Yeah, we have two very amazing designers, way and IB, that have given our product a fantastic facelift. And I would say that is exactly right.

Uriah
That's fantastic. All right, well, you're making my decision, my future decision more interesting now. Now, if somebody has QuickBooks and they have a bookkeeper, they like, like myself, do you do just some services or, like you mentioned, it's all kind of all in one. Is it sort of like that's really the best way to take advantage of what you do?

Andrew
Yeah, it's a good question, and I would welcome your feedback around that, of how you'd like to see that. I think it's an exploration for us. So with where we've started, it made a lot of sense for us to consolidate all of those services. But when we look at next year and the next few years ahead, being able to create a different kind of iteration, for lack of better words, around our packaging, to where people could just use payroll or just use the bookkeeping piece or leverage us for the tax services, it's something we're doing a lot of exploration around. So offline, I would love your feedback on what you think makes the most sense there.

Uriah
It's always such an interesting thing to talk about because we don't do all the cart services anymore. You get matched with a virtual assistant, and they can do this list of things for you, but you can't just have one or the other, sort of, and it makes it easier in some ways. Like, I was noticing that your pricing is incredibly it couldn't be simpler, possibly solo practice this price, group practice this price. I think that's so fantastic. And then if you start breaking things out, it's like, okay, well, how much does this cost? How much does this cost? And it gets more complex. Right. So it's like, that's something that I kind of reevaluate from time to time.

Andrew
Yeah. Pricing and packaging is a really interesting thing that it just takes a lot of experimentation. And I think the biggest thing, as you alluded to, that we always come back to is just simplicity and making it really easy. And for all of the clinicians that we do work with, that we have done this research with, it's like, you know what? We just want it all in one place. And I think it speaks to the persona of providers that we're working with right now, because that DIY group that is working with simple profit and all of those DIY solutions, I think their perspective might be a little bit different. But for the folks that we do work with, they found a lot of value in that.

Uriah
Maybe it's like Mac versus PC users. PC users want to take the thing apart. They want to build it. They want to know how to put lights inside, whatever. And then other people like me are just like, I just want it to.

Andrew
Work and to look pretty. I like my mac. It looks pretty. I don't use any of the actual capacity of what it can do, but it's a MacBook. It looks sleek.

Uriah
Right. I actually had a software bug on my iPhone that has something to do with iOS 16, and it's actually the first time since, whatever, 2004, I got the first iPhone that I've noticed, like, a glaring, like, obvious, annoying software bug. And I'm like, oh, that's not good, because the majority of the time, it just does what it's supposed to do. Right. Which is what you want. Yeah. Well, this has been super interesting and informational. I appreciate you sharing all this, and again, thank you for what you do, because I'm thinking about all the therapists out there who don't have training in business, who would have an anxiety attack if they tried to manage their own QuickBooks. Right. And so to be able to have a trusted company that can take over those things. And also the fact that, you know, I don't know, something about therapists, maybe it's just a human thing, but we want to work with people who understand us. But no, we're unique, and we are. And I think why people like to work with productive therapist, because it's like, okay, we get you. Right. We're here for you, and we get you. So that's so cool. So for everybody listening, I'll put it in the show notes, of course. But where can people go to find out more about Heard and all of your services?

Andrew
Yeah, you can go to join Herd.com joinhear.com. And you can schedule a consultation to talk to someone on our team and learn more about what we do. The pricing page has a ton of information about the types of services that we provide. And if you're just eager to get going, you can self serve yourself onto the platform and structure that first onboarding meeting with your lead accountant at Herd.

Uriah
That's awesome. I won't ask you this directly on this interview, but I'm super curious, like, if Heard.com is available or I'm sure you've looked at that.

Andrew
Yeah, I've requested access to that, and I think it's increased in price over time as I've sat on my hands longer, and so it might be a pipe dream at this point.

Uriah
There's a domain that I want to buy right now for a program that I'm developing, and it's only one $800. And it's not like, Phone.com or something like that, but I was just thinking, like, that's actually not a bad price if I want to own that. Right. I remember hearing the story of you've heard of AppSumo and Noah Kagan?

Andrew
Yeah, great.

Uriah
I'm a big fan. I buy their deals way too often. But I remember hearing him talk about how, like, the year long process I think it was three years, how long it took for them to actually buy and acquire Sumo.com, and I believe it ended up costing, like, a million dollars. But they felt like that was a worthy investment, and that was Internet property that they needed to own.

Andrew
Yeah. That is probably as an accountant by a background, I think I look at the numbers. That's the way that I sold my anxiety is like, getting the spreadsheets and playing with numbers. But when I start thinking about spending that much on that domain, it gets a little scary. But 1800, that's well within the wheelhouse. And judging by your decision to go with productive therapist, I'm sure it's a pretty good domain.

Uriah
I think I'm going to grab it. Thanks for the evaluation. I appreciate that. Well, thank you for your time, and it was wonderful to meet you.

Andrew
Yeah, thanks so much!

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Uriah Guilford, MFT


Uriah is a group practice owner and the creator of Productive Therapist. He is a technology nerd, a minimalist travel packer, a rock drummer and business development enthusiast.

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