The Exit Podcast - How to Organically Sell a Business with Paulo Gomes
By Steve McGarry
Today we’re talking with Paulo Gomes, a business owner in the healthcare industry. As someone who has started and sold multiple businesses, he discusses starting, operating, and selling a business. He also discusses how sometimes a partnership is the best route and why. He shares what he’s learned throughout his career and what he wishes he would’ve known earlier.
From ADHD To Entrepreneur
As a kid, in high school and college, Paulo felt like he learned differently and had a hard time with structure in the education system. He was ultimately diagnosed with ADHD and just barely got by in school. After business school, he entered the industry and found that he made a very poor employee and decided entrepreneurship would be the best path for him. That was when Paulo discovered healthcare sales and was excited to be his own boss. As he met with more and more doctors he realized they were actually small business owners, but lacked the knowledge on the business side. This is when Paulo decided to start Doctor Care, a company aimed at helping doctors with the business side of things. They started as a consulting service, moved on to become a services-based organization, and then ended up as a tech-based organization.
Finding A Focus
When Doctor Care started up it was a bootstrap business. For the first few years, they operated without a lot of capital or a clear focus. Paulo says it wasn’t a sellable business back then as they were just chasing opportunities and money. In year five of the company, a regulatory switch made a lot of their revenue disappear. This led to a period of depression for Paulo. Eventually, he and his partner decided to build around what was left of the business. They decided they wanted to disrupt the medical billing space. In the last three years, this was achieved and they were approached by several companies wishing to acquire them. Ultimately they sold to WELL Health.
Timing Is Everything
Paulo says timing was everything in the sale of Doctor Care. They began to hit their stride just as the broader industry was heating up. It was perfect timing and they felt very lucky. Companies were seeking them out and while they had some conversations and met with a couple of interested buyers, they felt it wasn’t the time to sell. One of those companies was WELL Health and out of all potential buyers, they seemed like the best fit. They kept in touch with WELL Health and about a year later they decided to entertain an LOI. They decided they were sold on a broader mission of continuing Doctor Care and leading a business unit for them. Having never gone to market, Paulo thought they might regret it but he says he wouldn’t have it any other way.
Planning From Day One
In 2018 Paulo co-founded Cure Health, a tech platform in the rare disease industry. Paulo and the other co-founders all had day jobs and so they hired a team to run with their idea. As they were looking for capital they found companies were interested in buying them instead. They ultimately decided to sell. What helped with their exit was in building a sellable business from day one. They had all agreements and legal components in place. They learned who the potential buyers were in the early stages and aligned themselves. Having conversations from the beginning they were able to find out what potential buyers were looking for. Paulo says aside from that, some important components are having strong KPIs with trends growing over time. It’s important to be clear about where growth is coming from and what the strategic focus is.
Trust Your Gut
It’s hard to say what the ‘right time’ to sell is, but Paulo says you’ll feel it in your gut. He says that’s how it happened with Doctor Care. He knew they could continue to grow but they’d spent eight years growing and were ready for the next chapter and that was to be part of a bigger company. In regards to Cure Health, Paulo says it was super exciting to start a business but as the business got more complex he became less a part of decisions. An outstanding leadership team was brought on and they ultimately decided a partnership made the most sense.
Knowing What You Know Now, What Would You Tell Yourself Ten Years Ago?
Paulo says he would tell himself to chill out. He says a lot of entrepreneurs put a lot of pressure on themselves and he ended up struggling with anxiety because of this. As someone that wasn’t the most fun or happy to be around, Paulo wishes he would’ve told himself to invest in life habits around mental health a lot sooner. It took him many years to figure out and he now knows it’s a lifelong process. He says he would also tell himself that you’ll always have business issues, it’s best to realize it’s never going to end. As your career gets further along the problems get bigger. Paulo says it’s best to understand that the problems you’re most afraid to tackle are usually the most important to tackle. Lastly, he would tell himself the importance of people. As someone that was quick to trust people, he found that people decisions are usually the most costly. You can waste years hiring the wrong people or partnering with the wrong people. He now takes hiring and partnerships very seriously.
To Learn More
Paulo is not on social media but says he can be found on LinkedIn and he’s always interested in meeting new people and having conversations.