Independent But Not Alone: Why Building a Team Transforms Your Micro-Business

When I use the term micro-business I am referring to non-employed/self-employed doctors who build their professional business with the following basic characteristics:

• You are single member business since you are the only employee and owner

• Your lean business model has one intangible product: your professional services

• Your business is flexible in the marketplace including its visibility, mobility, and location

• You can choose the business entity as either unincorporated (sole proprietor, LLC, etc.) or incorporated (PC and PLLC, designed for licensed professionals).

• You can choose the federal tax classification of the business entity

Don't Be a Lone Ranger

Even if your business is a solo endeavor and operates on a lean framework, it's crucial to embrace the foundational concept that your micro-business will thrive most effectively when you foster the development of a robust professional support team. This team can provide invaluable expertise, diverse perspectives, and essential resources that are often beyond the reach of an individual entrepreneur. By surrounding yourself with skilled professionals who complement your strengths and compensate for any weaknesses, you can unlock new opportunities for growth and innovation.

Building this support network not only enhances operational efficiency but also leverages collective wisdom to navigate complex challenges more adeptly. A well-rounded team can offer strategic advice on financial management, marketing strategies, legal compliance, or tax code changes—areas where you might lack specialized knowledge. Furthermore, having a reliable support system reduces the risk of burnout by sharing responsibilities and workload. This allows you to focus on what you do best: driving your business forward with creativity and passion.

Read More: Build Your Support Team to Empower Your Micro-Corporation

In this post, I delve deeply into the immense value that forming a dedicated support team brings to your micro-business by doing a case study involving two types of doctors that start micro-corporations: The DYI vs the Team Player.

Why You Need a Professional Team as a Micro-Corporation Owner

Operating a micro-corporation is empowering; it allows you to control your career and financial future. However, along with freedom comes responsibility. Without a well-rounded support team, you might find yourself handling tasks outside your expertise, leading to potential oversights and missed opportunities for growth.

In traditional employment, there’s a built-in support structure with HR, legal, and administrative teams. As a micro-corporation owner, you’ll need to replicate that support to function effectively. With the right team, you’ll streamline operations, stay compliant, and focus on your strengths.

Essential Members of Your Micro-Corporation Team

Every micro-corporation needs specific roles for support, each bringing value to your business. Here’s a breakdown of the core members and their unique contributions:

1. Certified Public Accountant (CPA)

   • A CPA does more than file taxes—they manage finances, optimize deductions, provide bookkeeping, do tax planning and handle compliance, crucial for a doctor balancing multiple revenue streams.

2. Physician-Centric Attorney

   • A healthcare attorney ensures your professional micro-corporation complies with industry regulations, protects against liabilities, and aids with contracts. Their expertise shields you from costly legal pitfalls.

3. Physician Business Coach

   • A coach who is a physician helps you stay focused on your goals. With guidance tailored to physician-owned businesses, you’ll navigate challenges with clarity and direction.

4. Wealth Manager

   • Beyond immediate finances, a wealth manager shapes long-term strategies for retirement and legacy planning, helping you maximize and protect your wealth.

Case Study: DIY Doctor vs. Doctor with a Team

Let’s take a look at Dr. James and Dr. Patel, two physicians with similar income and ambitions to leverage a micro-corporation model for increased autonomy and wealth growth. Both are talented practitioners, but their approaches to managing their businesses and building wealth differ.

Dr. James tried to handle every aspect of his micro-corporation on his own, doing his own taxes, managing his business finances, and relying on online advice to navigate legal, financial, and administrative tasks. He figured this was a great way to save the $10,000 that it costs to have a professional team manage his micro-business. Dr. Patel, on the other hand, invested in building a professional team—engaging a CPA, a medical practice attorney, and a business coach with specialized expertise in physician-owned businesses. The $10,000 expenses were included her deductible business expenses.

Dr. James (DIY Approach)

• Income: $400,000 annually

• Retained Income: 5%

As a solo practitioner, Dr. James’ income breakdown looks like this:

1. Total Gross Income: $400,000

2. Expenses: Approx. $120,000 (including operational costs, professional fees, basic malpractice insurance, and general administrative expenses)

3. DIY Tax Strategy: Dr. James followed general online advice, which limited him to basic tax deductions without optimizing for advanced physician-specific strategies, like defined benefit plans or the right mix of retirement accounts.

4. Retained Income: 5% of his income

Without the guidance of a CPA, Dr. James missed critical tax savings, such as advanced retirement contributions or structuring his income for additional savings on payroll taxes. This left him with a net retained income of only 5%, or $20,000, to reinvest in his micro-corporation after taxes and expenses.

Financial Summary for Dr. James:

• Net Income: $280,000 (after expenses)

• Taxes Paid: $70,000 (25%)

• Total Retained Income: $20,000

Dr. James retained just 5% of his income, with most of his resources going toward taxes and missed opportunities for savings. His financial growth was limited, with little room for significant wealth building or reinvestment.

Dr. Patel (Team-Based Approach)

• Income: $400,000 annually

• Retained Income: 15%

By building a professional team, Dr. Patel followed a more strategic path. Here’s how her financial picture differs:

1. Total Gross Income: $400,000

2. Expenses: Approx. $130,000 (similar operational costs as Dr. James, but with added investment in the cost of his team’s specialized services)

3. Strategic Tax Optimization: Dr. Patel’s CPA implemented tax-saving strategies tailored to her micro-corporation. This included a defined benefit plan, maximizing contributions to tax-advantaged retirement accounts, and leveraging business deductions. Dr. Patel’s accountant also advised her on setting up a reasonable salary to minimize payroll taxes while maximizing distributions taxed at a lower rate.

4. Additional Wealth Strategies: With her financial planner, Dr. Patel structured a mix of real estate investments and dividend-yielding securities, generating additional tax-advantaged income streams that contributed to her retained income.

5. Retained Income: 15% of her income

Thanks to her team’s specialized guidance, Dr. Patel achieved a retained income of 15%, or $60,000, giving her a significant advantage in wealth-building potential.

Financial Summary for Dr. Patel:

• Net Income: $270,000 (after expenses, including professional fees for her team)

• Taxes Paid: $30,000 (11%)

• Total Retained Income: $60,000

Through effective tax planning and strategic financial decisions, Dr. Patel retained 15% of her income, giving her $60,000 for reinvestment and long-term growth. Her team’s expertise allowed her to leverage tax savings, additional revenue streams, and reinvestment opportunities that enhanced her overall wealth.

Dr. Patel’s decision to invest in a professional team paid off, as she retained an extra $40,000 per year—three times more than Dr. James. By following a physician-specific business-tax-wealth growth playbook, Dr. Patel has maximized her wealth-building potential, set herself up for long-term growth, and established financial security.

Let The Professionals Help You

Outsourcing the operation of our micro-corporation to a professional team is not just a smart choice; it's a strategic move that saves you time, reduces stress, and most importantly, cuts costs significantly. This case study clearly demonstrates the benefits of allowing professionals to assist you.

Let SimpliMD be your partner in success—whether through a one-time consultation, regular micro-business coaching, or by utilizing our affordable micro-business resources. Make the decision today to streamline your operations and maximize your potential!

Ready to Achieve Success?

You don’t have to go it alone like Dr. James! At SimpliMD, we offer a personalized micro-business consult for only $99. This consultation includes a one-year membership worth $2,500, giving you access to invaluable business resources crafted for doctors. In this consultation I will help connect you to professionals who understand the playbook that will help you thrive!

Plus, our Creating a Practice Without Walls course will guide you through the entire process of forming your own micro-corporation, empowering you with agency in the marketplace.

Get Started with SimpliMD’s Business Plan Suite!

SimpliMD’s Business Plan Suite includes:

• A tailored Business Plan Template designed for self-employed physicians.

• A Micro-Corporation Budget Template to streamline your financial planning.

• A SWOT Analysis Template to help you optimize your business strategy.

Take the first step toward financial growth and professional freedom with SimpliMD’s resources and support!