The Entrepreneurs of Aesthetics Series No. 1

Dr. Grant Stevens

Welcome back to the Technology of Beauty, where I have the opportunity to interview the movers and the shakers of the beauty business, and today is no exception. With us today is Dr. Shari Sperling and Ari Katz, who have both flown in today from New Jersey with their three beautiful children. They're married, two different last names and you're gonna hear all about it. And first, welcome you guys. Thank you so much for getting on a plane and flying from New Jersey to be on the technology of beauty.

Dr. Shari Sperling

Thank you so much. We're so happy to be here.

Dr. Grant Stevens

Yes, we're happy that you're here. Doctor Shari. So let's start with you. Tell us a little bit about yourself. We want to get to know you. So where'd you grow up? Where'd you go to school? What's your story?

Dr. Shari Sperling

What's my story? So I'm a New Jersey girl. Born and bred and still living there now. Went to Binghamton University in New York for college. And then went to New York College of Osteopathic Medicine for medical school. And from there, I'm actually board double board certified in family practice. And then I did my dermatology residency and now I am practicing as a dermatologist.

Dr. Grant Stevens

That's fantastic. And when did you go into practice?

Dr. Shari Sperling

So I graduated from residency 2011, and I worked in another practice for a few years and then I started my own practice in the summer of 2000. So about five years ago in New Jersey.

Dr. Grant Stevens

And at this point, how many locations do you have?

Dr. Shari Sperling

So it started out as one location in Floro Park, New Jersey. And now, today we have three locations all in New Jersey and we have the Sperling Sprinter, which we'll tell you about the mobile spa.

Dr. Grant Stevens

I love it. Yes. And when did you meet this knucklehead?

Dr. Shari Sperling

I met this guy in in, during my residency training. We met got married. We met, we dated for nine. Six months later we got married and now have three beautiful children.

Dr. Grant Stevens

I'll say you do. Boy. Did you get hit by a rainbow, huh?

Ari Katz

I would say so. She reminds me every day nothing would be possible without her. So she's absolutely right. And you're you're absolutely right too. I'm very lucky to have such an amazing woman now, and I'm lucky to have him too. So where'd you grow up? I grew up in Boston, and went to high school out there.

Then went to college in New York City, a place called Yeshiva University, which is a private Jewish college. And then from there I went into sales and marketing and really. Built a career in the digital marketing space before I came over to help my wife with Sperling Dermatology.

Dr. Grant Stevens

Okay. And when did we first meet?

Ari Katz

Oh, you got a story there, Dr. Stevens. Right when I got involved in the business, it was probably late 2017, early 2018. Some one of my contacts in the industry told me about AIS and said, man, Ari, you're gonna love this. It's the business side of the industry. It's not so much on the clinical side.

It's really the business. And it was in New York City. It was when asaps was in New York. And I came there and you were this just mega celebrity doctor. And I remember very vividly, so you did a battle of the toxins on stage. You did all this really. Fun stuff. And I brought Shari actually, and we loved it.

I was actually sitting right next to Deeter, is it Manson? The founder of CoolSculpting. I was like, this is a celebrity row right here. And I remember you came off stage at one point and I tried to hustle over to you and catch you, and everyone was coming to you and I just said, Dr. Stevens, I'm Ari Katz.

I'm like, I'm gonna be the number one CoolSculpting provider in the country. It's all about marketing, Ari, and you said it as you keep walking. It's all about marketing. It's all about marketing. And here we are, man. Here we are. Four, four years later and I'm on the podcast, so it's full circle for me.

Dr. Grant Stevens

I love it. Okay, that's fantastic. So you got involved with your wife and she's the medical side of it, the doctor side, and you're the marketer and the business side that way? That's right, I'm sure you work as a team. So tell me what you did. What's it look like?

Ari Katz

Sure. So as Shari said, she started the practice really like a traditional dermatology practice. Super passionate about medicine, helping people and really just, you could tell them your vision when you started.

Dr. Shari Sperling

Yeah, so I always had the vision and want to start my own practice. I grew up, my dad was a psychologist. Is a psychologist and works out of my house, and I grew up always wanting to have my own practice.

In July of 2016, I opened up my practice. I had my third baby. I remember nursing as I was learning my electronic medical system, learning it, tired, pumping, all that. So I did it, I ca and opened up the office. I have a passion to treat patients. I do medical cosmetic, some surgical dermatology lasers and all the injectables.

And I did that for a few years and then I'll tell Ari, Ari will tell the story about how we started with CoolSculpting and opened up to body sculpting, and that's where things really expanded.

Ari Katz

Okay. Go for it. Yeah, it was July of 2016, she started the practice. She actually, one of her first patients became her front desk person.

One of those stories where build organically in a tiny little space. And I was actually at the gym. I was going to the gym at the time at a personal. And I told him, oh, my wife started a dermatology practice. He said, oh, that's so cool. He goes, have you heard of this thing called cold sculpt?

Like cold sculpting. What are you talking about? He goes, oh, one of my, the other, a woman I trained, she's a rep for this company called Cold Sculpting, and they're gonna freeze my fat. They're gonna do my abs and gimme a six pack. I'm like, oh, that's it. What? Put me in touch. So we set up a call, I'm like I'll learn about this.

At that time, CoolSculpting was still Zeltiq, it was pre Allergan, all that stuff. So the word wasn't fully out yet. We, I remember we had a call with with the rep and I think what jumped out to us on that, Was just the fact that the treatment worked. It wasn't like this hocus pocus fat pill or this diet pill.

It was a procedure that was non-invasive, that actually had phenomenal results across millions of patients. And I remember getting pretty excited about the opportunity with CoolSculpting. Of course finding out how much it costs was like, oh it's $150,000 for a machine. I'm like we just started this business, should we take this leap?

And we went back and forth for a while and I think ultimately it was just about taking a little bit of a leap of faith and saying, Hey, you have this traditional derm practice, which anyone who's ever started a, Durham practice knows. You list yourself with the insurance carriers. The phone starts ringing, especially when you're a young, beautiful woman like this.

People want to get in because they're used to waiting months to get in with the dermatologist. Now, they could get in days cuz she was brand new. So that side of it was taken care of. But we said the cool sculpt could be a cool thing to explore in terms of expanding the practice. And so we made the decision.

Even with a bunch of pushback and a bunch of kind of.

Dr. Shari Sperling

It was nerve-wracking. It was definitely a challenge to get over and to really. Put our faith into having this new device and offering new treatments. I said, I'm a dermatologist. How is, was this the beginning of your practice aesthetics within the germ?

I was still doing injectables. But this went into the body sculpting part. Sure. So it was a little nerve-wracking, but we did take that risk. Ultimately, we decided, we talked about it a lot and we. Do it. I remember signing the papers for the contracts and we were all nervous and shaky and we said, let's just do it.

We're gonna go full force and here we are. So it was a good decision.

Ari Katz

Yeah. I think when you reference we looked at it and we said, what does a dermatologist have to do with fat? And of course, the rep said to us fat has skin on it, doesn't it? You? I was like, all I guess that makes.

So we ended up purchasing our first CoolSculpting machine in late 20 se 2016. It was around December time and back then there was all the rage was these cool events where you basically marketed to the local community, said, come learn about CoolSculpting. And we did that very organically, on the phone.

Maybe we put something up on our Instagram where we had 50 followers. Like it was very basic. And I remember, and this is really what turned the corner for us, was that first cool event with zero marketing and zero effort. Seven or eight people showed up, Shari did three or four consults, and we booked each, we booked probably four or five treatments for about two or 3000 each.

And I said, look, the machine was 150 grand. We financed it for about three grand a month. So our thinking was if you book one treatment a month at about three grand, you pay for the whole thing. That was like basic, min, bare minimum. And at that first, cool, there was so much interest in it, and again, without any marketing effort.

I was like, no, we just made 10 grand in this one. Cool. This is interesting. And from there, slowly started to dabble in the marketing side. And again, with my background in digital marketing specifically for small businesses, I worked at a company called Yodel that was all about local online advertising.

I started to take some of those best practices and apply them in our business, and this is all while I was working full-time in corporate America, I was a sales guy for a big company, very cushy job. So I was doing this on the.

Dr. Shari Sperling

And then I went to CoolSculpting, has a CSU CoolSculpting University, and I went there and I was blown away.

I was so excited about the opportunity, I learned about it. I spoke to other people coming from different practices all over the country. And I remember that night after being in the class all day, I called Ari and I'm like, wow, this is so exciting. I. I was amazed at what the opportunity had and to see the results of people are so happy, they feel better about themselves, and it really worked so,

We came home and I think Ari sees, saw that I was so excited and that just fueled him. I, yeah, and I'm coming from a medical background. I don't have the knowledge of sales and marketing and all of that technology. I don't know all of that. And we don't learn that in medical school and residency we learned a little bit, not much, but about that part. So Ari came and then you started coming on work.

Ari Katz

When she came home, I've never seen my wife get so excited about a financial opportunity and came home with this whole sales mindset of, I guess at CoolSculpting University, they had her do a worksheet of okay, if you have one machine and you do X number of cycles, x number of times per week, x number of times per month, and you'd extrapolate this big number, you're like, holy crap.

We could make I don't know, 40 grand a month doing this. And she got all excited. I don't, probably was, it was probably like more four grand a month at that time, but, She got really excited about the opportunity and that just, I was like, okay, now we gotta run with this. If you're on board and I'm on board, let's figure out a way to continue to double down.

And so actually went back to my trainer at the gym. I said, Dan, you got this girlfriend Danielle, she's got a great work ethic. She's got great salesmanship. Can I hire her to run some CoolSculpting business for us? He said. So I, of course, I went to Shari and said, I wanna hire someone from the gym to run our CoolSculpting.

Dr. Shari Sperling

As I was completely skeptical, I'm like, what are you doing? You're taking a trainer from the gym who has no medical background, no experience in any of this. But she came on and she like blew my mind. And she is amazing. She was great with patients. She understood the me everything about it. She learned as she dove headfirst in, and today she.

Our head of clinical excellence with our practice, with the body sculpting. And it just goes to show you, you put someone in the right seat. They really do well.

Dr. Grant Stevens

Now you're in New Jersey. Who can run these machines in New Jersey? Because I know every state has a different idea of who can and who can't. I'm just curious.

Dr. Shari Sperling

So I'm in the, I'm in, we have three different offices, like I said, and a mobile spa. So between myself, I have two physician assistants, and then I have a whole team of technicians that are trained in all the machines. These are non-medical grade devices, so they could be used by non-physician providers.

Okay, so they're the ones that are doing, yeah, and for the most part, I started. Doing all the consults and all the treatments and being really hands on, and that's where I got all my experience and learned the ins and outs of the machines. Once I felt comfortable, then I taught Danielle, she got comfortable and then it's trickled down to teach everyone until they are trained.

Dr. Grant Stevens

Did you send any of them to CoolSculpting University?

Dr. Shari Sperling

They've all been there. They all had that experience. And it's a great program, as you know.

Ari Katz

It sure is, and I think, when I think back about the success we've had with CoolSculpting, I think there was a few core ingredients that were necessary, and one of the main ones was that it didn't require a doctor to perform the treatment, so we weren't restricted to the volume based on hiring more doctors and taking up their time.

That was one of the best parts about CoolSculpting was that. They could be train, you could train a technician, you could train someone off the street in how to do this. It's not a complicated treatment or procedure by any means. And that once you learn it and you're comfortable and no, and you're accredited the ability to find people to do the treatment.

And it was funny cuz Shari started doing the consults and the treatments and slowly I started to wean her off to Danielle. And again, at that point she's are you sure about this? And we got, Danielle became very good at doing a consult and then Danielle was doing the treatments and we slowly started to.

In this office in Flore Park to the point that we were with very little effort in marketing. Cause at this point I was getting involved a little bit, putting some money into Google AdWords, about 2000 bucks a month. Facebook ad, a very little bit on my own. And the results were pretty impressive for very little effort.

And I remember at the time we were probably getting in the vicinity. 50 to a hundred leads a month. And these were people finding us on Google or Facebook seeing like up to $900 off CoolSculpting. Let me get a coupon and the leads would come in name, email, phone number, and I would call them. And I was working my day job in corporate America, but I would hop in a conference room, Hey, it's Ari from Sperling Dermatology.

I'd love to set you up. The consult with my wife made it very like Homie Family Run. And I just start setting up consults with her and then eventually to Danielle and they would book treatments and I was like, I started to see this funnel and I was like. This is interesting. Like this is very little effort.

I'm working full-time somewhere else, putting very little money at, we're starting to make 20, 30, 45.

Dr. Shari Sperling

And then on the side, that's when I could focus on my dermatology practice with seeing my medical patients. Sure. And then also building up my cosmetic with my injectables, doing fillers and Botox lasers.

And that's where I spend more of my focus, overseeing the other side as well. But I had other people doing it.

Dr. Grant Stevens

And what do you think the key marketing takeaway that you have, what do you think was the most important thing you learned in that early stage? I'm sure it's changed a little bit.

Ari Katz

Yeah. So in that early stage, this was throughout the year 2017, before I came on full-time, we consistently were at about $2,000 a month in marketing. Which some people listening might say that's a huge number, and some other people might say that's a tiny number for us, 2000 was our learning budget.

Dr. Shari Sperling

And again, that was like a ton for me. Yes. I was like, oh my God, you're putting that money into it, like, that's crazy.

Dr. Grant Stevens

And you had one machine at that point.

Ari Katz

Yes we bought a, we soon had a second machine in mid two, 2017 cuz we realized, hey, if we, with advantage, if you had two machines, you could treat two places at once and whatever.

Dual sculpting. I know they don't like it when we say that, but really what we learned at that point was, We started to understand what the market reacted to what was driving the demand for CoolSculpting, and I'm sure obviously, you know this. CoolSculpting was soon after we bought into their system.

They were acquired by Allergan, which came out of nowhere from us. You may have known about it long before, but. That was a huge turning point as well, because then you had this company that prior to the Allergan acquisition, was this private company with limited marketing budget. Now all of a sudden they went to Allergan and that they were on TV and they were on the radio and they were everywhere.

And one other thing was we got a lot of pushback when we thought about going with them originally because there were so many cool scalping providers around us already, one of the top providers in New Jersey was actually up the street from us. Same street addressed like a different, And, for us, the marketing we were doing is what we felt differentiated us.

And what we learned was what the market reacted to. What did, what would, what language did we need to use in an ad copy? What type of imagery did we want on a landing page? And again, this was me building it mostly from scratch. What type of pictures. What type of positioning? So in those first couple of years, we really spent the time to understand what worked in our market.

And for us it was, again, with a minimal budget on Google, understanding what we needed to put in the ad copies to get people's attention, to get a click right, and then what needed to be on the landing page to get them to actually fill out the form, believe it or not. In the industry, there's about a 10% average conversion rate from a click to someone filling out the form.

Which means if a hundred people click on your Google link, which of course you're paying for it, cuz it's pay per click, only 10 of those a hundred actually fill out a form and that's considered good. That to me is one of the craziest things ever that Google's got us to believe that it's okay that 90 people will come there and not feel like what's the disconnect?

But anyways, we learnt in those first two years what was the, what was, what did we need to do to get people's attention? And I would say that was the turning point. Cuz over the course of 2017 we got our second CoolSculpting machine. We continued to see our revenues grow. They grew from 20,000 a month to 30 to 40 to 50.

And we're like, this continued to be really interesting. And it was around that point in late 2017, about a year after getting the first device that I started, really the wheels started turning in my head saying, man, if I left corporate America and came to do this full-time this could be really interesting there.

There's a lot of opportunity here that if I don't take this risk, we'll never know what could have happened.

Dr. Grant Stevens

So you bought your second machine, bought second machine then, and you ended up with many more than that. So tell me how you got there.

Ari Katz

With our second machine this was late 2017. In late 2017. We very quickly became the number one CoolSculpting provider in New Jersey, which again, we talked about. There were a lot of competitors around us, and they're all phenomenal doctors, great businesses. We don't say one negative thing about them, but we marketed in a very different way than them, I think.

I think a lot of the marketing and medicine as usual, and Shari can speak to this, it's more traditional. It's a little less edgy. They utilize the radio, they utilize tv, they utilize billboards. We were utilizing the. Which we felt gave us such a, an advantage in the space. And again, we were recognized very quickly as the number one provider in New Jersey.

And I think at that point I went to, back to Danielle, who was my first hire, said, Hey, forget the gym. I need you to leave. I need you here full-time. That was in the summer of 20 17. And by the end of 2017, we had two machines. I said I remember I came to Shari and I said, I think I should leave my job.

Very nice six figure salary benefits, cushy, easy sales job, traveling around the country. But I said, I think I should leave and I think I should come work for you and with Sperling Dermatology full-time. And you could tell them what your original reaction was.

Dr. Shari Sperling

It was a conversation to say the least. It was just like buying the first CoolSculpting machine. This was a big change. How are we gonna work together? How are we gonna stay in our own lanes? Can we afford this? Can we do this? Can we make it work? And we, after our long conversation, we said, let's try it. Let's give it a go and see how it works and works.

And there were some learning curves along the way. But I think we learned to, do what we're good at. And I stayed with my medical and my injectables and lasers and really took off with that while overseeing the CoolSculpting body sculpting on the clinical car side, on the clinical side.

And even patients, my staff, they have my cell phone. They call me all the time. I'm always available. I'm always in and out with patients there too. But we said that Ari was gonna come on and really blow it off, build the business and really build the business even more. And like Ari said, on our street alone in New Jersey, five to six other practices that have CoolSculpting machines within a mile.

And it really it just shows the, with the right marketing and the right sales. And I also think, having a board certified dermatologist at the basis of the practice and me meaning the patients, and knowing my staff my practice and my office, it really is like my fourth child and they all know that.

And it's really. We're like a family and it's really a warm, welcoming team. I really, we have the most amazing people that work with us, and I really want them to feel that my staff, and then they push it onto all the patients and see. So I think that all brings it together, that the patients feel comfortable and come in.

Ari Katz

Yeah, and I think Shari nailed it when she said that, at first it was really about staying in our lanes. Working together. Husband, I remember I approached a few people in the community, like the elder statesmen and eh, I don't know, husband and wife. Going into business doesn't usually end well.

And I remember I went to my dad about it. She said, that pops, I wanna leave, my job and go for. He goes Ari, are you sure you wanna be known as Shari's husband? Cuz by the way, everyone who asked me what I do now, like Ari, oh hey, nice to meet you. What do you do? I'm like my wife's a board certified dermatologist.

And together we run a medical practice. But my dad said to me, are you really? You really wanna build her brand And nothing against he loves Shari, but you're gonna totally build Sperling. And I said, dad, great. Fine with me. I don't have an ego about this. I just saw killer opportunity and.

We made the decision for me to come on board full-time in January of 18. Like Shari said, I think the original challenge in working together was staying in our lanes knowing that she stays in the medical lane. I stay in the business lane and I remember, and obviously you remember that for the first year, we definitely butted heads a lot and I think, and I really believe I had to earn her trust on the marketing side cuz again, spending 2000 a month, right, was enough.

When I started, Dr. Stevens, in January of 18, guess where I popped that? $2,000 a month budget to on day one. How much? 30,000 a month. And you can imagine that was not an easy conversation. But I said, we've spent the last year learning what works. Now it's time to prove it. And I cranked that budget up to 30,000 a month and we've been at 30,000 every month since.

And immediately our whole business blew up from the fact that we were now dominating the internet space with marketing flooding the space, becoming, quote unquote, the celebrity dermatologist in the area became more of a lifestyle brand. We partnered with influencers, we partnered with micro influencers, we partnered with TV celebrities.

We quickly started to take the Sperling brand that was started as this very traditional great medical practice and take it into the lifestyle category. And in a lot of ways, everyone loves Shari. Everyone who knows her, loves her. But if you like did a focus group and say, what do you know Sperling Dermatology for?

It's like CoolSculpting. It's like in injectables, it's aesthetics. And we really, we branded ourselves for that space and. Across 2018, I started again, doubling down on the business. I looked immediately to open our second location. I said, let's open a CoolSculpting standalone studio in a place called Montclair, New Jersey, which is a great market, and 10 minutes from our house.

I said, that would be awesome. We did that. I found the most unbelievable salesperson, I think, in the whole industry. Her name is Kat. She's incredible. We met her in a Starbucks. She was the first person we interviewed for it. And. I don't know, don't to go with anyone else. She was a top sales rep at Bosley, the hair rejuvenation place.

And we just said, and she lived like nearby and we said she'll kill it. She came in before Montclair was even open, it was still under construction. She was closing CoolSculpting treatments with the construction guys, the pse n g Energy guys. And from there she just took the whole business and raised the bar for us because and when you asked Kat what made her successful, it was.

Not being afraid to talk about money, right? Not being afraid to tell someone who needed eight cycles, that you need eight cycles and it's gonna be 4,800 bucks. And B, not being afraid to tell someone, Hey, this, you're not gonna get what you want with two cycles on your abs. You're gonna need two rounds of six cycles each.

And she took our average CoolSculpting ticket from the $2,000 level to closer to the four or $5,000 level. And we, at first were very concerned. Is she overselling? Is she over-prescribing or are we gonna get a. One star reviews from people who, and guess what? None of that happened. All these people were that much happier.

And you referenced earlier treatment to transformation. I think your wife came up with that slogan that happened around the same time that Kat was starting to sell more treatments in the right way. And it changed everything for us because it allowed us to be very honest with the patient. Say, Hey, a lot of people wanted to limp into, let me try it with two cycles.

And that's like getting half Lasik, right? It's like you're not gonna get the results you want or lemme get half my teeth whitened. We need, if you wanna fix this area of your stomach, we need to treat the abs, the flanks, all these different areas. And when treatment to transformation came out, it changed everything because all of a sudden we weren't afraid to sell people on 2, 2, 2 treatments, right?

Or the right number of cycles. And so over the course of 2018, we continued to just make that investment, start to grow the team. At that point, we probably had 10 or 15 employees across, across both offices by the end of 2018. Around Memorial Day, actually, we were recognized as the number one CoolSculpting provider in the country.

We hit that kind of mark. I remember they called us and said, yeah, we looked at the numbers. You guys had done more treatments like month. It was that month, I think, or year to date, excuse me, than anyone else. And it was like, Wow, this is really starting to work. So around that time, we got in touch with a few.

We, we said, now we're gonna continue to double down. Let's get other treatment categories in here. We looked into M Sculpt. We made a decision, even though that was a hard decision to take on M Scalp, which is the muscle toning treatment. And by the end of 2018, we now had four CoolSculpting machines in Montclair.

Two in Flore Park. And we had two, we had one sculp machine as well in Montclair. So we were immediately starting to spread our wings a little bit and see how much further we could take this thing.

Dr. Grant Stevens

And when did you start the mobile?

Ari Katz

Oh, that's the whole story. You're getting very ahead of me now. Lemme take you to the mobile. If we're only at the end of 2018 at that point, we now are up to probably. Crazy to say it, but in the vicinity of two to 300,000 a month in CoolSculpting. And again, at that point it was certified that this was a good. We then looked in early 2019 at opening our third location in a place called Redbank, which is a great, phenomenal area for aesthetics in general.

Okay. And we got that. We actually started in Neptune, New Jersey. We opened up a CoolSculpting studio there. And again, this is one of the mistakes, I talk about this on stage sometimes. This is one of the mistakes we made, was we thought you could open a CoolSculpting studio in a WeWork space. We said, it'd be great.

You'll have a few rooms. You have it like you can open it in the day. And what we didn't realize was people don't wanna. $5,000 on a medical treatment in a WeWork.

Dr. Shari Sperling

Back to Danielle. Danielle moved down the shore for us to open up that Neptune store location for us. And then soon after we moved the location to Redbank because we realized that Redbank was a better location.

Ari Katz

We figured if we could make it work in WeWork, we could bang out, 20, 30 locations quickly because it's so easy.

Dr. Grant Stevens

So what was the problem with WeWork? Is it the clientele that uses WeWork?

Ari Katz

It was really the fact that when people would walk through the, they got a more of a business office vibe and we were trying to sell them a $3,000 cosmetic, really high-end cosmetic spa experience. And it just didn't match. And so we just saw like the show rate was good on the consults, but the close rate was lowered than all the other offices.

And when they did buy, they limped in with two cycles instead of what they really needed. And so we very quickly just said, we gotta, cut our losses. We moved the spot to the best street in all of Redbank called Broad Street, across the street from Tiffany's and Restoration Hardware.

Like great location. We actually got our certificate of occupancy for Redbank March 15th, 2020. So we had waited months doing construction.

Dr. Shari Sperling

And then two days later, COVID hits.

Dr. Grant Stevens

Covid hit. How big is that, that space you're talking about?

Ari Katz

So that space is probably, people are surprised to hear this. It's probably only about 1500 square feet, but we hired an unbelievable PA out there named Christina. She is a world class rockstar. She had come from plastics doing injectables and. She was at a practice where she couldn't really do the marketing side of it. She was very energetic. She had great personality and wanted to be on Instagram but couldn't really do it. And we gave her that. We actually met her at csu.

Dr. Shari Sperling

That's exactly what I was gonna say. That Ari met her at csu. I was, she was with another practice at the time and that's when they met and here and then she.

Ari Katz

Yeah, I was one of the keynote speakers at the NBA class in csu and I remember she, she has this whole story where she saw my laptop and said, spur.

Oh, that's Ari from Sperling. Ah, he's crushing all of us. Cuz she was at a practice in new. She approached me and tried to, facilitate something and I didn't really take much notice. But then a few weeks later, I hit her up on Instagram and I was like, this actually could be interesting. And one thing led to another.

We got her in, her name's Christina, absolutely magnificent. I call her the Botox bus queen now. But throughout the process of covid o at that point, right? Coming into Covid, we were on a tear as a business. At that point, three locations, nine CoolSculpting machines, two M sculp. We had brought on M tone, which was a cellulite.

We had great injectable business. Business was booming, and I remember leaving the Red Bank office the day before the shutdown. I called my brother Aton, who runs my marketing and I. It's such a, at that point, we knew we were gonna have to shut down the pandemic. The word was out. I said.

Dr. Shari Sperling

For two weeks only, we thought. We thought two weeks at the time. I said, that's what everyone said. Two weeks. Two weeks.

Ari Katz

I said, it's such a shame that ended up being a little longer than that. We're gonna have to shut down because business is booming and we're starting to crank, and what a shame. We're gonna have to pump the brakes. And we did. We shut down for 90. Three months the, probably.

Dr. Shari Sperling

After just hiring Christina, our PA there, right?

Ari Katz

Yep. We had, so we put everything, we closed the doors. We do, yeah. We stayed open for a few weeks. Shari started doing some television.

Dr. Shari Sperling

I did some virtual, I did telemedicine for that time. That was a great pivot.

Ari Katz

But during those 90 days, at that point, we had about 35 people working across the practices. One of the biggest decisions we made was to open up a remote sales team that handled the leads. And just to go back to that, at that point we were generating about a thousand leads a month. So we started with 50 leads a month, and we upped our budget.

Now we were generating a thousand a month, which meant you had to make at least a thousand phone calls a month, if not more, to follow up with these people, bring 'em in. At that point, the thousand leads was turning into 400 consults, turning into 300 treatments. And we had to shut that all down. The entire operation needed to be shut down.

We had to learn what the word what was it furlough, what that meant. We had to learn the unemployment rules. I had phenomenal my operations had, Lee was instrumental that time. I remember the Monday that we shut down. I had an Apple watch on. I looked at it. And I had to. Phone calls to 35 different people to tell them that they were gonna have to go on unemployment.

And it was one of the hardest days of my entire life, calling every single member of our team who worked like a dog, unbelievable contributors, passionate about our business, treats it like it's their own, and to say, we can't continue to pay you because we don't know when the money's gonna come in and it's too risky and we're gonna need to have you go out unemployment.

And almost every single one of them, Dr. Steven said to me, Ari, I. Thank you for the call. Thank you for the honesty. I don't blame you. I said, guys, here's what I said. I remember I said, it's not a, it's not an Ari issue. It's not a Shari issue. It's not a Sperling issue. It's not a New Jersey issue. It's not a america issue. This is a world issue right now, and I gotta be honest with you it's too risky. And so every single employee went on furlough and unemployment. I remember looking at my Apple Watch at the end of that day, just in my own house without leaving. I walked over 10 miles because I was pacing the whole day on the phone trying to deal with these very challenging conversations.

And it was that shutdown that led us to think up the mobile spa. Came about really as a reaction to Covid and saying, Hey, what happens if people are not comfortable coming back to our stores? What are we gonna do? We have all these machines, we have payroll, we have overhead. What are we, at that point, Dr.

Stevens, I had almost $2 million in debt on these machines cuz I, we financed every single one of them and hundreds of thousands of dollars each. And we were sitting on a Friday night.

Dr. Shari Sperling

But before that, yeah, one day I said, oh, let's just go get one of the machines and bring them to the house. And let me, let's use some of the machines while we're here. So one thing led to another, and then we were sitting on a Friday night.

Ari Katz

You were sitting on a Friday night. I joked that we had a glass of wine and then another glass, and then another glass. And we started talking about what are we gonna do if no one comes back?

And how could we approach that? And again, Shari brought up, maybe we bring. The machines to the house. Maybe we do it in the garage where we could keep it open and get airflow. And I was like, what happens if we introduce a mobile spot and we actually bring the machines onto a truck, bring 'em to people's driveway, bring 'em to popular destinations, keep the door open for airflow, and like one thing led to another.

And that Friday night we both were like, either we're really drunk and this is the worst idea ever. Or it might be the best idea ever. And that's Sunday. Two days later, I went online. I found like a party bus, limo place that you can buy in. This was in the midst of Covid. This was in May, and I remember by Sunday afternoon, I had contacted someone.

It was actually in Beverly Hills. There was a party bus listed for sales Mercedes-Benz Sprinter, 20 foot long, two big screen, 50 inch TVs, huge six foot ceiling. Gorgeous. Some guy out here had one and was looking to get rid of it for a fraction of what it cost, $150,000 truck that he was looking to offshoot for a lot less than that. And one thing led to another and we started doing the specs. Could we fit the machines on? Could we power them? How would this work? Can we legally do this? And we checked all the boxes.

Dr. Shari Sperling

And a few weeks later we met the driver the sprinter in like an abandoned parking lot in the middle of the night as he drove across country with our kids. They were super excited getting on this new sprinter. We, and we took it home. It was a black SP sprinter and we took it home. We got it wrapped with our Sperling Dermatology logo, and we put the machine, we took out some seats to Sure. Stage it appropriately, and then it's been running.

Ari Katz

Yeah, it was an unbelievable introduction. We videoed the whole thing. We put it on Instagram. That was one of the best examples of utilizing Instagram because leading up to it, we teased it. We got a big announcement, big enough, and we, everyone, and all of a sudden we are growing at that point based on the micro influencers and the people who were driving views Hage we're growing a 15,000 plus audience followings, which probably for you is not all that much, but for us it was a big deal.

That's a big deal. And and we started teasing this big announcement and I remember when we went Instagram live to announce. We had a lot of people the response was unbelievable. Oh my God, I love this. Come to my house. Come to my house. I want Botox at my house. I want CoolSculpting at my house.

Dr. Shari Sperling

All these women and men even were so excited. They haven't had a Botox in months because of Covid. So they got a bunch of friends together. We would bring the sprinter to their driveway. One at a time. It was very covid safe. The doors are open, one at a time would come on. And then we brought some of the devices on and we, had between HydraFacial and we did CoolSculpting for a little.

That was, the M sculpt. We did all the machines on there and bring it to people's houses where they felt comfortable, where we felt comfortable in a covid-safe fashion.

Ari Katz

Right from the get-go, the business took off and the demand and the response was any better than we could have asked.

Ever asked for. I think within weeks of intro, before we even had it, just introducing it, we were booked out for a month with people wanting, to book treatments, HydraFacials and Botox and treatments filler is, we actually pivoted to an alternative strategy that actually is very interesting.

We started partnering with hotels and we actually got invited out to the Hamptons to a boutique hotel out there called Capri. In Southampton the weekend that the Chainsmokers were playing. It ended up being a whole controversial event, but we were out there.

Dr. Shari Sperling

We were there before that happened.

Ari Katz

It was a big weekend and we came out there and we brought the Sprinter and all these women who are out in the Hamptons who had not had Botox in months cuz all the, they were afraid to go out and they were what they call us social distancing in the Hampton. They lined up. They lined up for the Sprinter and I.

Dr. Shari Sperling

We parked the sprinter in the parking lot in front of the hotel. And with all of our Instagram and social media. We had, our days were packed. We did. So our kids are at the pool, and I'm going, I'm the physician. And I'm the physician going back and forth and meeting patients on the sprinter to do Botox injectables. We had some of our devices as well.

And they were loving it. And then from there, we've continued to go back. A lot of these women or men were coming from the city or other places. Sure. So that wanted to continue. And then we made these classes.

Dr. Grant Stevens

And you had exam chairs in the Sprinter? And you could do the CoolSculpting or the injectables that you chose to do? That's fantastic.

Ari Katz

It's the Hamptons was the best, Dr. Stevens, cuz literally the women walk on the hand you the credit card. They say, I don't even just charge me whatever you want. Give me everything. So it was an amazing experience and one of the things we learned about running a mobile business, cuz at that point we still had the three brick and mortar and we can talk about how they came back post pandemic.

But the mobile sprinter in particular, we were learning a brand new business and we learned. What services work better on there? So you asked about CoolSculpting. CoolSculpting didn't work great on a sprinter. It got too hot. The machines are too big, not enough space injectables work great. The concept of Botox parties at people's house, we introduced a host program where women and men would actually invite.

10 or 15 of their girlfriends to their home, we'd show up with the sprinter and we'd spend all day there, shooting them up with Botox and filler. And so the whole business really evolved into this incredible fourth location traveling billboard. And at the same time as that, we were so blessed that the pandemic created this pent up demand.

I'm sure you felt it in your. Business here as well. The pent up demand for our services. Specifically CoolSculpting, to be honest, cuz remember the quarantine, 15 people weren't going to gyms, they weren't working out, they were eating a lot. They were sitting at home. They had zoom face. That was the time.

We also brought in the two evok machines, which our handsfree skin, hands free, facial skin tightening. It was all in response to the fact that people were not liking the way they looked and they couldn't even go to the gyms cuz the gym was, were closed. So it played right into our hands. CoolSculpting for fat m sculpt for muscle evoke for your face, and it's just one thing led to another and the business exploded.

Dr. Shari Sperling

First pandemic, and our red bank third location was reopened. And that expanded as well.

Ari Katz

Yeah, the the business started booming.

Dr. Grant Stevens

And were there any medical board issues with the mobile? Botox and injectables.

Ari Katz

The only restriction we had on it was no medical procedures, no laser, no using a scalpel. It was really like you can do injectables on it, you can do non, non-medical grade devices on it. We checked with many lawyers to confirm everything, and it was pretty straightforward to be honest.

Dr. Shari Sperling

So that's just to be clear, it's either myself or my physician assistant Christina, who's doing all the treatment.

Dr. Grant Stevens

Sure. Yeah, sure. And there's no issues about it being mobile.

Dr. Shari Sperling

No, because as long as you're in the state of New Jersey that, or New York. I'm licensed in New York and New Jersey as well, so as long as I have my medical license there.

Ari Katz

Yeah, it was all about just having the license in the state that you were gonna practice it in.

Dr. Grant Stevens

And how about your malpractice carrier?

Ari Katz

So we had to.

Dr. Shari Sperling

We checked with everything.

Ari Katz

We had to get a lot more coverage. Coverage for the Sprinter, coverage for the mobile side of it. And again, they were looking at us like we were crazy. Remember that we had made the decision to buy the Sprinter when we had, we were actually at a point both on unemployment.

The whole business was shut down, no income coming in, no idea what was coming at that point. No one knew. and we made the decision to go take on more debt and take a huge risk. And when I look back on it now, it's one of the proudest moments for me on the journey is that we had the guts to do that and they say, no guts, no glory, take a risk.

This was a huge risk and it totally ended up working out and we feel so blessed that it worked out so well. And from there, the rest of the business also started to boom. Credit to the entire team, not me. Almost forget Shari, forget us. It was the team around us that treated this business like it was their family.

My brother Aton running the marketing, my head's in all the different offices cranking, and we started to just fly and PR. Prior to Covid, we had some discussions about m and a. We had some discussions about what's the long-term plan for this business. We knew we had grown it to a great level, but we also knew that at a certain point we'd hit our threshold of risk and we would need a big partner to help us take it to the next level.

Pre Covid, we started having some discussions with a, a broker group called Physicians Growth. Partners, providers, something like that. Pgp, Ezra Simons is the president of that group, and we had this conversation pre Covid that kind of fizzled out during Covid of course, and he said, let's talk again.

We'll see what happens. He said, when you reopen June, maybe you'll do 20% of what you did there and we'll roll back up. And little did we know we would shoot out of a cannon in June.

Dr. Shari Sperling

But it's also, I'm young, I'm not 78 years old, so it was very different for me. I just started my practice five years ago.

This is so new for me. I planned God willing to practice for a long time. And when this whole conversation came about, it was, I really had to think about it. But to get where we wanted to go, where we wanted to expand and build and keep getting larger, we needed that help.

Ari Katz

And I think what Shari's talking about is a really interesting topic. That was another example. Like when we first started, we, we'd butt heads and then she's finally trusted me cuz it all worked out, so to speak, and we were making money and it was all good. Then I'm telling her, let's sell this. And she's what are you crazy?

I just started, this is my baby. It's like my, I'm going let my three-year-old walk down the island, move outta the house. And it was really tough because again and you can speak to this in more detail as a doctor, you are almost, it's ingrained in you. And you could look at the Facebook.

Private equity is bad. Selling out is bad. They ruin your brand, they ruin your business. They take it over, don't do it. So for her, she's I would never sell out. It's terrible. And you can speak to maybe that sentiment.

Dr. Shari Sperling

Yeah. I open my practice because I want the autonomy. I wanna be able to make my own decisions, run my practice the way I.

I have three kids at home. I need to be there for them as well. And, but most importantly, I wanna be able to do what I want. And you hear these horror stories with PE backed offices. They come in, they transform the entire office, they take over, you hear horror stories. So that's what I was afraid of and I did not want that.

Dr. Grant Stevens

No. So that's understandable. So you got over that.

Dr. Shari Sperling

So I got over that when I, when we met the right people. So we had to find the, Partners for us to go forward.

Dr. Grant Stevens

And have you done that now with your practice?

Ari Katz

Yeah. So we got back in touch post Covid and again, the business just took off and we said this is a good time to start to go to market.

We were peaking, numbers were huge. We said we can, we're gonna get a great valuation now because we're just, we're booming and we had this covid adjustment strategy on the financials to recognize there were three months off. So we didn't get hit for it. And we spent a few months putting together a marketing plan.

We positioned ourselves. For the first time ever, PGP went out with more of a, I think they called it a skin platform, not a dermatology practice, not a medical practice, but we positioned ourselves as like almost a technology platform like Silicone Valley. And I did this whole sizzle video to all the potential buyers, and I looked right in the camera.

I go, we're not a, we're not a dermatology practice. We're the, we're a Silicone Valley company disguised as a dermatology practice, and that was the angle we took. And by December of 20, we went to market with this whole marketing brochure of who we were. We got about 200 buyers who saw the materials out of the 200.

Ezra put us in front of 40 of them, signed NDAs and said, we wanna learn more Of the 40 that signed NDAs, about 10 of them said, we wanna get on the phone with. We want to hear the pitch. We wanna meet the practice. And in March of 2021, we said that's a due date. We want bids, we want an loi, Lois from people who are interested.

And all 10 people I spoke with, nine of them were private equity. One of them was a strategic, which ended up being the one we go with. Not to give away the secret at the end, but nine of them were private equity and all 10 that I spoke to came back with offers and at that point we had a decision to make because the question was not so much who could give us the best.

Dollar amount because again, like Shari said, we're 40 years old. We're not looking to retire, we're not looking to transition out. So we wanted to go with people who we felt we could ride for the next 20 years with and double down on the business and grow it more and partner with us. And every single person who submitted bids, great people, there was not one who we were like disregarded.

All of them were great. And if they're listening, thank you for those generous. But in the end we did decide to go with this strategic and a lot of that was rooted in some of the stuff that Shari knew about private equity, which was that it was a little bit more cutthroat and maybe not the right environment for us.

And the notion that they pitch there a lot is second bite of the apple. So they say, you will give you what we give you now, then you grow it for five years and you blow it up and you open 30. Look at, then you're gonna get. We're like I don't know that. I don't know. I just don't know. I don't know what's gonna happen.

So what are we, what can we do today? And that's where the strategic came in with an unbelievable offer. Their name is Forefront Dermatology. To be honest, we hadn't heard of them before. They're based out of Wisconsin, but they are the largest medical dermatology network in the country, and they are backed by one of the largest private equity firms in the world called O Omars out of Canada.

And they came in with just a phenomenal offer. Wasn't even so much about the numbers as much as it was about the strategy, the vision, the partnership, and we ended up signing.

Dr. Shari Sperling

And it's all and all dermatologists now. It's very important to me. It was a dermatology owned practice. And they know what my practice is like.

They have experience with over 150 other locations all in the Midwest. They're now, they're growing all or all over the country now. And we really found a great match with them. And June of. 2021 is when we officially became part of Forefront Dermatology. So now it's Sperling Dermatology, a forefront dermatology practice.

Dr. Grant Stevens

And how many practices are in forefront?

Dr. Shari Sperling

Over 150 locations.

Ari Katz

And they actually, so they were really deep-rooted in the medical side of the space, but with the acquisition of us, they actually acquired Dr. Mary Lupa, who I know you know. They started to bridge into aesthetics and they actually recently announced a few weeks ago, they bought Dr. Sandra Lee, the pimple Popper. They brought her onboard.

Dr. Shari Sperling

So they're growing, they're continuing to grow.

Ari Katz

They're investing on the aesthetic side and it's a great strategy for them. It's very exciting. But to their credit, they really saw the vision of what we could bring to the table as more than just a medical practice or a derm practice.

They saw the strategy and the sales and marketing platform that we had built that they could replicate for not only their other offices, but for other services, for future locations. And that's what we've done. And we really peaked right before the. in March and April of 2021. We peaked with our best months ever.

And I'm humbled to say that's nice. We did over a million dollars a month in body sculpting, those two months, and it's an incredible credit to the unbelievable team that we have from our marketing team driving over a thousand leads a month. Our sales team making over a thousand calls a month.

Our directors, our technicians, our entire staff grinding every day. We call them the Sperling Rock. Every single one of them is, I would put them up against anyone in the industry. One percenters all around. And the best part is we treat them like family. So much so that I'm, one of the proudest things I can ever tell you is that since Covid, when there was the great resignation, everyone left their jobs.

Everyone left for unemployment, knock on wood, we haven't lost one employee. They've all stayed through and that's because they love the environment we've created. We treat them with such respect, professional, professionalism and we appreciate them. We don't nickel and dime them. And I think it's a great lesson for others in the industry to say, if someone asks for 20 bucks an hour, it doesn't mean you need to give 'em 20, give 'em 22.

Would the $2 an hour kill ya when if you give 'em the 20? Six months later someone offers him 21 and you lost him for a buck and now you're really far behind, be a little bit more generous. And that was a big sales part of this that cherry wasn't all that comfortable with as a doctor. It was always about how can we save money?

And I was like, how can we spend money? Cuz the more we spend, the more we're gonna make. And that was another area where we found this common ground and it, and served us.

Dr. Grant Stevens

You guys have been very successful and I can't wait to see what the future holds for you. Many more stores. I'm sure many more outlets than your practice is unbelievable.

Thank you. You've grown it by leaps and bounds and to do a million dollars in body conting a month is. Is unbelievable. Congratulations to you. Thank you so much. It's been an absolute pleasure getting to know both of you, and I hope you have a wonderful time this weekend here in the LA area with your three beautiful children.

I hope you come out to see us in San Diego at the Aesthetic Society meeting. Absolutely. We met that time, the first. At the the Aesthetics, innovation Summit, ais, and hopefully you'll come out to the one this year too.

Ari Katz

I love the fact that it came full circle. We've always, we've looked up to you and we look up to other doctors like you who have taken taken the internet seriously, taken marketing seriously. We work with a company called Influx, who you introduced us to, who, who handles our website, a lot of digital marketing for us. We have a great partner, Merkaba, and by leveraging the internet, we've absolutely transformed our business.

And the number one message I wanna leave people with is I'm nothing special. I really have no business sitting in this seat today. How did Sperling Dermatology come out of nowhere to become the number one body sculpting center in the country? How did we. We did it with a great team around us, a great doctor, a great business strategy.

We leveraged marketing. We leveraged available technologies. We weren't afraid to push the limits a little bit, and anyone who's listening to this podcast, they can do that too. It's not impossible. And when I look at the future of this industry, I do know that a lot of people today who are wondering, should I start the practice with my wife?

Should I buy a CoolSculpt? Should I buy a mobile spa? They're gonna do it. Some of them are gonna, some of them are not. The ones who don't, you'll never hear from them again. The ones that do, you'll be sitting with them a few years from now and hopefully they'll be telling you an amazing story.

Dr. Grant Stevens

Fantastic. Again, thank you very much for joining us. I look forward to seeing you. and thank you all very much for joining us on another episode of the Technology of Beauty. Where we get to interview the movers and shakers of the beauty business, and as you've just heard, today was no exception number one body contouring practice in the world.

Thank you very much you guys. Thank you. Thank you so much everyone. Stay safe.