How medical practice loans can help start a new practice, finance medical equipment, or add commercial real estate with Fifth Third Bank and Provide.
Dentists, veterinarians, and medical healthcare providers are highly trained to perform complex and high-stakes procedures every day: root canals, dental extractions, ACL surgery, anesthesia administration, to name just a few. But doctors who are opening or running their own practice have to add a lot of non-healthcare related roles to their job description: CFO, HR specialist, business loan specialist, insurance whiz, real estate expert, and more.
That’s because starting or expanding a healthcare or veterinary practice requires not just a passion for practicing medicine and helping people or their pets (that’s No. 1, clearly) but also must have patience for an administrative burden when it comes to financing the operation.
"When we got into the industry, what we saw was a very chaotic, manual, and paper-based process for healthcare practice financing," says Andrew Bennett, the Chief Business Officer at Provide, a digital platform that streamlines financing and banking for healthcare practices. "Doctors often have to make PDFs of their tax statements. They have to shuffle documents back and forth. They have to email and fax things that they’ve already submitted."
Provide was founded in 2013 by Daniel Titcomb and James Bachmeier III to revamp that time-consuming, labor-intensive system and allow doctors to focus more energy and time on what they love—caring for patients.
"The incumbents in our space do a lot of things really well from a credit risk perspective," says Bennett, "but we saw a chance to innovate on the process—to make it faster, more seamless, and to improve the certainty of a close of a loan." The company estimates that they save healthcare providers an average of 20 hours per transaction, whether it’s securing a loan for a brand-new office, investing in up-to-date digital dental X-ray machines, expanding to a second location, or updating the office billing/notification system.
Provide’s Partnership with Fifth Third Bank
Fifth Third was an early investor in the fintech company’s vision, playing a large part in Provide’s ability to originate prior to being fully acquired by Fifth Third. "As an independent, venture-backed lending company, we were already converting borrowers into customers of Fifth Third," says Bennett. "But being a part of the bank officially has given us the opportunity to grow at a pace we couldn’t before and to roll out new products and put resources behind those products."
The acquisition allows Provide customers to secure not just funding, but business checking accounts, treasury management, merchant services, insurance, payroll services, and other financial products all in one place. With Fifth Third behind them, Provide—which maintains its brand identity and operates as an independent business line—now supplies these core banking and payments services to over 70% of the doctors who initially used them for financing.
"We’re founded on providing a white glove concierge service to these doctors," says Kurt Simpson, Director of Healthcare Banking at Fifth Third/Provide. "With the acquisition of Provide, retail healthcare providers can perform their transactions and interact with the bank completely electronically, from start to finish. It’s so much more efficient." A doctor would never have to travel to a financial center to, say, sign a signature card, he explains. The time saved can be time for patients.
Veterinary and Dental Practice Financing
Who are the aspiring and seasoned practice owners who come to Provide for financing and banking? Dentists make up the vast majority—85%—of Provide’s clients, with the rest mostly veterinarians.
Why so many vets and dentists? "Those industries have not seen the consolidation into large group practices and hospitals that medical has," says Bennett. When you think about the practice around the corner, he says, you generally think of dental and veterinary practices. "You don’t see as many independent medical practices anymore." The likely reason for that: credit quality. "Dental and vets have been incredibly recession resistant through the years."
In fact, Provide entered the vet space just last year after the acquisition which allowed them to bulk up their veterinary-specific sales and credit talent team and create a competitive startup lending product. So far this year, they’ve already originated $100 million in veterinary loans (and on pace for $150 million by year’s end, Bennett notes), compared to $40 million last year.
"We feel like there is tons of room to grow in these two industries," says Bennett.
The Secret Sauce
In the early years of Provide, Bennett says, they knew they had a product that offered doctors a superior digital experience, but they quickly realized that to compete in the market, they needed a team that deeply understood the needs of healthcare practice owners. "Without industry expertise, the technology doesn’t really matter," he says.
They focused on forming a team of sales, credit, and operations talent who have been working with doctors throughout their whole careers. Why does it matter? A first-time healthcare practice owner, for example, may not understand their buying power. Provide consultants have "seen thousands of these transactions," says Bennett, and can help doctors assemble a team of needed advisors who might include a CPA who specializes in dental practices, say, or an attorney who only works with vet practices. Doctors can then invite their CPA or attorney or practice broker to collaborate with them on the Provide platform.
"We’ve found we can bring value with our industry network," says Bennett. "That combo of great people and innovative technology is our secret sauce."
Learn more about financing your practice with Provide from Fifth Third Bank.