Episode #54 – Shane Kelly

Do you work in the animal health industry or veterinary profession? Have you ever wondered how people began their careers and how they got to where they are today? Hi, everyone. I’m Stacy Pursell, the founder and CEO of the VET Recruiter, the leading executive search and recruiting firm for the animal health industry and veterinary profession. I was the first recruiter to specialize in the animal health industry and veterinary profession in the United States and built the first search firm to serve this unique niche.

For the past 25 plus years, I have built relationships with the industry’s top leaders and trailblazers. The People of Animal Health Podcast highlights the incredible individuals I have connected with throughout my career. You will be able to learn more about their lives, careers, and contributions. With our wide range of expert guest, you’ll be sure to learn something new in every episode. Thanks for tuning in, and enjoy the episode.

Welcome to the People of Animal Health Podcast. On today’s show, we are talking with Shane Kelly. Shane is a visionary leader with more than 30 years of experience building and scaling companies in human and pet care services. From founding Village Pet Care and Destination Pet to leading groundbreaking ventures like F2G and Pet’s Choice, Shane has consistently driven growth through innovation, strategic acquisitions, and strong operational leadership. He’s raised hundreds of millions in capital, built high performing teams, and helped shape the future of veterinary and pet care. Shane and I first met back in the 1990s when he was an executive at Pet’s Choice. Join us today as we dive into Shane’s incredible journey and the insights he’s gained along the way. Shane, welcome to the People of Animal Health Podcast.

Thank you, Stacy. It’s a pleasure.

Well, I’m so excited to talk with you today. I would love to start off at the beginning. Shane, what was your life like growing up and where did you grow up?

So, I grew up in Southern California, San Gabriel Valley in the Los Angeles area, and always loved the idea of … I grew up with the goal of becoming a veterinarian. So, that was kind of where I focused my life early on. Unfortunately, or fortunately, that didn’t come to pass.

Well, how did you first get involved in the veterinary profession?

So, like I said, I always wanted to be a veterinarian. Went to UC Davis as an undergraduate with the dream of becoming a veterinarian. That lasted to my first quarter in Chem 1A when I think I got a C. At that point, back in the mid to late ’70s, getting into vet school was almost impossible unless you had straight A’s. So, I took it as a sign and I took a different path, trying to understand economics and microeconomics, finance, and so forth with a thought of maybe someday getting back in the industry. So, it was fortuitous that I was able to take that route.

Well, Shane, you’ve built and led seven companies across human and pet care services. What common thread ties your leadership approach across such varied ventures?

Yeah. It’s a great point. I think I’ve been very fortunate in each of my companies in opportunities to surround myself with people that are much better than I am, smarter than I am quicker, have the technical skills, and I think that’s all the way through. When I started, my first venture-backed company was a primary care human physician roll-up, rollout. I had great medical leadership. I had a chairman that was one of the world’s great industrialists. So, I was able to sit back and watch that and same thing. As I did each of these companies, I found people that were very much expert in the field and had an understanding, and I gave them the space to actually utilize that and create great outcomes. That, I think, is consistent across all those companies.

Well, at both Destination Pet and Village Pet Care, you pioneered a vertically integrated model. What drew you to that structure and how did it change the pet care landscape?

A great question. So, early on, when we were doing Pet’s Choice, Pet’s Choice was mid to late ’90s, and it was at the beginning, really, of the consolidation phase in veterinary medicine. We did things that were a little bit different in the sense that we looked for ways of buying and building. So, we weren’t happy with just store hospitals that we bought. We wanted to have them grow, and we found out that stores that had boarding and grooming at that point, it’s the late ’90s, actually grew at double the rate of the stores that didn’t have those attributes. So, it became clear that there was a natural feed between the verticals. You had vet patients who needed boarding or grooming and you had … And so, they would refer to those parts of the business. The same thing with people that came in for grooming, they would naturally come there for their boarding or their veterinary services.

So, that’s where the concept of doing a vertically integrated model really came from. I was introduced early on. When I was at Pet’s Choice, we were introduced to Best Friends back here, which was on the East Coast at that point, and got to understand their economics, looked at maybe merging those concepts. Didn’t do it then, but it always came back into my mind during my career to put these kind of integrated verticals together to cross-pollinate.

And so, when I came back from running my biotech company in Europe, was able to then go and buy Best Friends Pet Care with the backing of Webster Capital and the IKEA Family office. We added vet to that concept, and it worked very well. Then we took that and we used that as the building blocks, particularly for Destination Pet and then eventually for Village Pet too.

Well, Shane, Village Pet Care scaled to 55 million in revenue and 800 employees in under two years. What were the biggest challenges and breakthroughs in growing that fast?

Well, it’s always a challenge when you don’t have existing infrastructure, when you start with no back office support and you’re building that. We used to describe it as building the airplane while we were flying it, and that was really what it felt like we were doing. We wanted to create critical mass fast. We wanted to get to EBITDA positive financial performance fast, but we had, to begin with, we had nothing. We had an outsourced bookkeeper that was using QuickBooks Pro. We had to set up the chart of accounts. We had to do all of the employee benefits, transactional benefits, all the valuation systems. All of those things had to be scaled why we were buying, at that point, I think 37 centers in the first year.

So, that is obviously a challenge, and there are compromises you have to make. You just got to make sure you’re in line with your team and your financial partners to understand what the targets are and get that growth, but that was the key issue. Roll-ups themselves are relatively easy. Operating the units after in a sustainable fashion is always a challenge, but we did it, and it’s a great company.

Yes, and you have led multiple successful exits and recapitalizations. What do you think separates businesses that attract top-tier capital from those that don’t?

So, there’s so many things in there, Stacy, that you need to think about. One of the issues is size. You have a whole different investment group depending on where you start or where the company is at the time. So, for example, most private equity firms need three to five million of EBITDA, earnings before interest, taxes, depreciation, and amortization, before they meet their requirements, and they want to build on something that’s existing. If you’re trying to start something new below that, that’s usually the venture capital stage, and venture is usually short-term capital. We’ll invest in an idea but then try to move. So, you’ve got to sort of work those.

Then there are scales within there that that go to different type of investors. So, while some private equity firms will go down to, say, five million in EBITDA, you’ve got others that come in at 10 to 20 million. So, you have those targets that you need to build to. Sometimes you find a unicorn. General Atlantic, when they backed Village Pet, we did that from a complete startup with a growth equity firm, which was unique, but again, that shows the confidence in not only the industry, the segment of the industry, but the team too that put it together. It was fun. It was quite a ride.

Yes. Well, Shane, Destination Pet grew to 77 locations, and it led to a $450 million transaction. What were some of the key decisions that drove that kind of exponential growth?

It was interesting. It was an interesting strategy. As we all know, we’ve seen the valuations. The interest in consolidating veterinary hospitals has went through an enormous growth curve, and valuations on individual practices became higher and higher, and it became harder to get the financial performance.

I was a bit of a contrarian. I knew I liked the vertically integrated model, and I knew I could buy pet care centers at a lower financial multiple than I could veterinary hospitals. So, with Destination Pet, we actually started by focusing on acquiring a core of pet care centers, about 10 to $20 million in revenue, and then adding veterinary hospitals either adjacent, nearby, or internal to those centers. We were very disciplined about that. So, we actually built fairly fast on the pet care services side and had great operators to be able to build the revenue stream and then carefully added vet in, which was sort of culminated when we ended up buying a group of veterinary hospitals that accelerated that growth. So, again, being very cognizant of the microeconomics, the valuation, having extreme discipline on valuation and modeling to make sure you’re buying the right units that you could actually grow, and it created a great outcome.

The other thing that was interesting at the time that I chose to be contrarian is you saw the introduction or the application of large lenders into the business, into veterinary and pet care services. So, acquisitions were substantially financed through outside debt, third party debt, and that was a change from what we had done in the past. Typically, we like to have the doctors completely aligned with the finance people to make sure that we’re building it the same way, but typically, in the Pet’s Choice days, we use seller debt as part of the transaction, and the doctors still were getting paid on a note and partial interest in the business.

When the influx of new capital came in through debt instruments, it changed that. It changed those motivations. I actually think going back to that structure’s even better. What we did, I started getting nervous because you saw a lot of the consolidators in all of pet getting what I called “over-leveraged.” The debt to EBITDA ratios were extremely high, and I was starting to feel nervous.

If you remember, this is back in early 2019. The Trump economy was actually roaring, which made me a little bit nervous because I was ready for it to come down and interest rates to go up. And so, that’s why we went ahead and did the recapitalization and the transaction in Q4 of 2019, which was great timing because it was just a few months before COVID. Then we were able. We had the financial capability, had the debt off of our balance sheet, so we weren’t under financial pressure to be able to actually excel through COVID.

Well, and what timing because nobody was expecting COVID to happen. Well, Shane, you’ve been at the helm of multiple pet care startups, Wagly, Pet’s Choice, Destination Pet, Village Pet. What has changed most in the pet industry since the ’90s and what hasn’t?

Yeah. So, many things have changed, Stacy. As you and I know, back when we first met in the late ’90s at Pet’s Choice, there was even building to be a surplus of veterinarians at that time. I remember when we first did Best Friends, we’d have interns come knocking on the door or young veterinarians just trying to get a job. There was downward pricing, compensation pressure in the vet fields. Of course, that changed as pet ownership grew, particularly through COVID, but you saw it even before. You saw changes in the availability of veterinarians. You saw changes in the compensation structure. Back in Pet’s Choice days, it was completely production-based compensation. There was no ProSal. There was no salary doctors, and of course, that changed. If we needed to grow a hospital, we could go out and build out more exam rooms, whatever, add capacity, and then hire the vets to come in to run those and see more clients.

That changed. I mean, obviously, we hit a maximum capacity of qualified veterinarians in the industry. It became harder and harder. You and I have talked over the years of trying to find those unicorns that could come in to exactly the right situation, and it became very difficult. As you had more utilization, you had more demand, and there didn’t seem to be pricing pressure. It changed everything. It changed the mode. It changed the mode of consolidation, where consolidators were now getting pressure to actually, really improve the financial performance of their individual hospitals, and that changed the dynamic. Companies that were intending to go public couldn’t get public because they didn’t have that same store information.

Now it’s changing again. You’re seeing volumes in veterinary medicine decline a little bit. Transactions tend to be softer right now. Price is still adding to a little bit of growth, but the trends are changing again, and I think there’s going to be more changes in the dynamic. You are seeing more creative examples of bringing veterinarians. You’re seeing new vet schools that are opening. You’re seeing the more training type processes. A company that I’m involved with, I’m on their board down in Scottsdale. Hippo Vet has a great fifth year program to get veterinarians actual training and then go into the marketplace, and you’re seeing more demand that … We’re changing again, and I think the ones that can adapt will do really well.

Yeah. I think you’re right, Shane. Well, Shane, you seem to have a knack for assembling high performing executive teams. What do you look for in leadership hires and how do you build trust fast?

That’s very interesting point. I really like to mentor. That’s kind of my jam, if you will, finding people that have really young, new talent that’s coming out with initiative and understanding and then bring them into a position where we can grow and build on that.

From an executive standpoint, I’ve got people out there that are running the companies now that came up through that system. Mollie Hoff at Lakefield, Matt Bradshaw, who’s now at Western, a number of others, Wes Godwin who did Valley Vet. They’re all from my coaching tree, and they came under sort of that guidance where there was something I saw that was really smart, young people.

With Destination Pet, I knew what I wanted as an operator. I needed somebody, ideally, that came out of an interesting mix, both had the financial background to operate and came out of retail. So, they really understood client experience, customer service because our businesses all built on that. So, I found a young man, Brett Erreca, who came out of investment banking and commercial banking, but worked his way through grad school at Abercrombie & Fitch, and he had that balance. That’s how we were able to grow that company that fast.

And so, all the way around, whether it’s my operating people, my finance people, that’s kind of the talent that I look for. What I hope I can do is then be a mentor like my mentors were to me, to get them broadened out, to go on and take their broader role.

I know that the mentorship has played a big role in your career. You’ve been both a mentor and a mentee. How do you continue to grow as a leader?

Again, it’s all about surrounding yourself with the right people that have that desire to learn and have that work ethic. I’ve probably stepped more into the mentor role now. As I mentioned earlier, I think I was very fortunate in my first healthcare company. My mentor was a gentleman named Bob Hansberger, who was the founder of Boise Cascade, which, at the time in the late ’60s, was the most valuable company in the world. He just happened to be in Boise, Idaho, where I was, and I was able to learn. I’d start every morning pouring coffee for him at a little local diner, and we’d just sit there and talk. That was my MBA. That’s how I learned, and I gained so much from that.

And so, my philosophy has always been to try to pass it on. I like having really talented, energetic people around me, and I think I have a pretty good indication of where they need support and help, and then I like to apply that. So, even now, I tend to gravitate to things where I can help people move along that ladder and learn from what I’ve done. I’ve seen so much out there, both in the operation, the industrial, and the finance side of the business that I feel like I’m in a unique position, and I like to pay it back a little bit.

Yeah. That’s so good. I love that. Pay it back. Pass it on. Well, from biopharma with F2G to community-based veterinary care, your ventures span highly regulated and operationally complex spaces. How do you tackle complexity without losing focus?

I try to find the simplest answers. I’ll give you an example. F2G, I went in to help one of my, actually, one of Pet’s Choice investors and look at this as a different investment. It was a genomics target company that wasn’t performing at the level they needed to, and the market was changing. Again, I did not burden myself with trying to really understand the science. I had a cursory knowledge, of course, of what was going on, but that … I brought in people that were really expert in that field and took that burden off.

So, that’s proven successful across the board, and whether those people are in-house councils that I’ve brought in and worked with for years that understand sort of a shorthand style, but really surrounding yourself with really great people. Now, that doesn’t mean that they’re the most complete resume. I’d rather pick somebody that has a lot of talent and maybe some experience over somebody that has a Harvard MBA or the Ivy League MBA. I think so much of this is learning as you go, and I think you can get so much out of it. So, that’s kind of the way I approach it.

Yeah. Well, looking ahead, what trends or opportunities in pet or vet care are you most excited or concerned about in the next five to 10 years?

I have a group of people that I invest and look at opportunities with, and what we’re excited on the pet side is so much in the ancillary product lines that … or ancillary services that go and can support the day-to-day operations, pharmaceuticals that are coming out that have applications in pet. We like those things. We like biologics that could have an impact in helping the health and welfare of not only companion animals, but can also be used in the production side.

We like outside services. There are businesses that are supportive of the core hospital, whether it’s outside expertise, radiology, dermatology, different things where there are outside businesses that can support the existing hospitals and build efficiencies into them so we can get to a higher EBITDA, a higher margin level.

So, we like things. I like things that are in those categories. I like things in veterinary finance. There’s some new players there. That dynamic needs to change. We’re now seeing, for the first time in a long time, we’re seeing pressure on pricing. It used to be that, early days, we used to have a number in mind that it was kind of the tipping point, where a client will treat a pet rather than euthanizing, and it’s a terrible number, but we all sort of knew it in our mind where that was. That number hasn’t grown as much as we’d like it to grow, but it’s substantially because of the inability for people to, on discretionary income, to pay a $2,000 surgical bill without planning and so forth.

So, I do think that there’s got to be a winner in the struggle between … or in practice finance, and I think that could go in a number of directions. Obviously, insurance adoption has been very slow in the US. Trupanion had a different model when they came in, I think, a healthy model. Not sure if it was executed as well, but you don’t have the data.

If you look at human healthcare, everything is run on CPT and ICD-9 codes. So, there’s data around everything, every treatment. You can go back. It’s how actuaries predict premium rates for life insurance. We just don’t really have that common coding system in veterinary medicine, and it makes that transition to insurance adoption that much harder.

Now, that being said, there are ways of getting around it, and people are being more creative. Again, Trupanion came to that with that approach, but there’s also other mechanisms. Years ago, the only alternative for veterinarian was to use CareCredit, and CareCredit’s still a major force, but there are some competitors out there that are more user and hospital friendly, and I think that’s going to change. I think you’re going to see practice finance, cashflow finance evolve here over the next year or two, and I think that’s a good thing.

Hey, everyone. We are interrupting the episode briefly to talk to you about today’s sponsor. This episode is brought to you by the VET Recruiter. The VET Recruiter is the go-to executive search and recruitment firm in the animal health industry and veterinary profession, dedicated to connecting exceptional employers with high caliber candidates. With a deep understanding of the animal health industry and veterinary profession and a vast pool of talented candidates, we make the hiring process seamless and efficient for the animal health and veterinary employers who have critical hiring needs.

If you are an employer in search of top talent or you work in the animal health industry or are a veterinarian ready to take the next step in your career, look no further than the VET Recruiter. The VET Recruiter has placed many of the industry’s top leaders, from CEOs to COOs to chief veterinary officers to VPs of marketing and sales and heads of R&D and chief scientific officers. We have built sales forces for many leading animal health companies and have placed more veterinarians in clinical practice than any other search firm in the US. Ready to take the next step? Visit thevetrecruiter.com today. That’s thevetrecruiter.com. And now, let’s get back into the episode.

Well, what has been the most surprising thing to you during your career in the veterinary profession or in the pet space?

I think the most surprising has been sort of the frenzy that went around with consolidation. We were early in it with Pet’s Choice. We were one of the original, I think, three or four, competed against NVA and VCA and others, a couple others, but we were fairly early in that realm.

I think there became sort of a land rush to … or a gold rush to try to roll up as many hospitals as people could, and I think we saw that. It was interesting. I’ve done a lot of work in Europe, in the UK, and the UK started consolidating. At Pet’s Choice, we were actually conceiving entering the UK market at that point, and there was really no consolidation at all. It took off and actually outpaced what the US did. It started later, became more fully consolidated, same thing with Scandinavia, and that was surprising.

Sort of the surprising part of it, at that point, there wasn’t a lot of focus on actual improvement in the hospital profitability. It was more focused on an arbitrage play. You buy it at a 10, and you sell it at a 20, and you make the money that way.

So, I don’t know that I was surprised when that paradigm changed back in essentially 2022. Yeah. I always used to describe it as a game of musical chairs with the valuations that are being put on these platforms, but the music, at some point, was going to stop playing, and it did, and it caused a ripple within that group and a refocus.

So, I don’t know that that was surprising. I do think consolidation oftentimes has benefits for the pets and for the clients. I’m not one of these people that say consolidation is a bad thing. It can be really helpful. It can add capital to practices that can add technology with that capital. I think, in the long run, it’s a good thing, but it is changing and it is evolving. It’s just not the same market that it was even two years ago.

Well, I know you’ve already mentioned a couple things. We talked about the consolidation, doctor compensation. How have you seen the profession change over the years? What are some other things that you’ve seen that have changed?

The way the practices have become continues to evolve, and part of that is the boarding system. Part of it is the universities, the way they look at it. When we were doing Pet’s Choice all those years ago, we would very seldom send anything out to a radiologist. Our doctors were told or taught in vet school how to read a radiograph, and they would very seldom do it.

I remember at Pet’s Choice, we were predominantly in Seattle initially. I think we did 27, 28 hospitals in Seattle, and we had a friendly radiologist that used to drive to each of our hospitals and read radiographs. Our doctors, for the most part, aren’t taught that anymore, and they’re also encouraged to refer out things that, typically, 20 years ago, 15 years ago, they would’ve taken internally.

Some of that is changing right now because of the economic pressure, which we saw in ’08 and ’09, where the general practice doctors tend to keep those things, but there is this referral process that is now sort of the teaching mode within our veterinary colleges and through the boards to make sure.

You can argue and I could argue that that should benefit the client and the pet because they’re getting expert opinions on things that they typically wouldn’t have had. So, that should result in better outcomes. On the other hand, you’re just seeing it as sort of a dying breed of veterinarian that will do just about anything in their general practices. I’ve got friends down in … particularly in the Houston market that are amazing doctors, but they’ll … They wouldn’t refer out a broken leg for anything in the world. They’re going to set that. They’re going to do the surgeries. So, again, qualitatively, that could be a good change. From an access standpoint, that could be more complicated and restrict access going up. So, that’s an evolution that I think is going to change.

On the doctor compensation side, as we’ve talked about, you’re just seeing different structures. When you got in post-COVID, you had all these pets adopted. You had pet ownership growth going through the roof. You had limited capacity at hospitals. Doctors had much more ability to choose their compensation method and structure, and that was a change.

Again, back in the Pet’s Choice days, we just had one group. It was production based compensation. It’s what we used at PetsRx, which was the first one I consulted for, and that substantially changed. You can’t be competitive, but what you’ve got to be, the ownership of these hospitals, whether it’s a corporate ownership or an individual ownership, has to make sure they’re balancing their compensation requirements with their production requirements to keep the operating margins where they need to be so that you can adjust with price. You can adjust in methodology, but it’s … One of the things that other industries in the human side have gone, have had problems with is as doctor compensation went up, and in human, you’ve got Medicare that sort of sets the reimbursement rates on all procedures in human medicine. So, you have a ceiling there and they got squeezed. I think one of the things we in veterinarian, yeah, medicine need to focus on is being able to watch those economics and make adjustments as they change because human medicine, it was a disaster.

Good points. Well, what does your crystal ball say about the future of the veterinary profession?

I think we’re seeing a little bit of a decline in pet ownership. I think that’s strongly due to economic pressure. I think the inflationary cycle, in fact, we’ve seen and done studies that have shown what is discretionary in the client’s mind and what is necessary. Those definitions are changing a little bit, but there is pricing pressure on it. You’re going to start seeing more. You’re going to stop seeing the growth in the industry being dominated by price increases. I think that’s going to even out.

I think pet ownership is going to even out now too. We saw the big bump during COVID, and then we saw that over the last three or four years has slowly declined. I think it’s, in my mind, it’s come to a pretty even standpoint now. The spend is going to be pretty stable. I think people are going to be concentrating on how to improve the performance of the hospitals, both qualitatively, how they treat the patient, how they treat the client because clients are going to have more choices, do have more choices, but I also think the financials are going to be more in focus on maintaining, finding other ways to create margin.

So, all in, I think it’s got a great future. We’re still looking at doing acquisitions in the space on small platforms that we can add to. We’re looking at the ancillary. So, I think the overall industry is really strong, and I think the prognosis is really good.

Well, good. Well, I’d like to pivot now to talk about your own career. Successful people have habits that help them to achieve success, and, Shane, you’ve had tremendous success. What are a few of your daily habits that you believe have allowed you to achieve success?

There are a number of things. I do get into a routine. I do make sure that I work out every morning in my timeframe, in my quiet timeframe. I shut everything else off and get on a machine or go outside for a bike ride or go skiing in the same portion of the day. That’s very important to me.

I also have developed sort of an ability to understand my subordinates, my direct reports, and what they’re capable of handling and what they’re not and to be available to them, really, at all time they need me, but I do delegate probably better now than I ever have. I think that’s allowed me to focus on broader things and multiple items and multitask, but when I do build that confidence in people, I do give them the authority. My expectation is that they can handle the issues, obviously with me being there to mentor.

So, my schedules are pretty fixed. I block time to contemplate. I block time to do the things that I feel like I need to do to emotionally recharge. Moving to the mountains and having Alta 10 miles from my house and Deer Valley eight miles from my house has improved my quality of life. Getting out into the outdoors has been really important, but also, the love of the pets that continues to work through. Our dog, Heimdall, rules our house. I’m not a great disciplinarian, but he is a joy, and I think I’ve been fortunate to have those pet friends all the way through. Then, frankly, like I said, the common theme is surrounding me, myself, with people that are really good at what they do. I can help them and they can certainly help me. So, those are my focuses.

Well, most people’s careers have highs and they have lows. Most people have adversity that they have to fight through throughout their career. There’s always challenges. What has been the biggest adversity that you’ve had to fight through throughout your career?

Oh. Every opportunity, there are ups and downs and challenges that you have to work through, whether it’s pleasing your sponsors and making sure you’re running the company in alignment with exactly with what they want. That is something that is paradigm in my focus is to make sure that myself and the management team aren’t going in a direction that isn’t necessarily what the sponsor wants.

I’ll give you a good example. When we bought Best Friends, we had run it for about nine months, little over nine months, and had great investors, but we started getting unsolicited offers to buy the business. When we started the business, when we had agreed to do it, we had a three to five year plan and new capital sources and so forth to build it. Then we had one of the investors that decided that one of the unsolicited offers would help them with a fundraise they were doing, so they were interested in taking the deal.

Well, that split the board. We had one group of investors that wanted to get liquidity, and we had one that wanted to keep going, but we had to walk through that. It was a change because we ended up going ahead and I ran a process. We ended up selling the company to the current owners. We ended up with four or five offers for it, but making sure that alignment is there instead of fighting that alignment is probably the main thing that I’ve got to keep reminding myself is to make sure that we’re completely aligned with all of the constituents, not just the private equity or the investors, venture capitalists, but with the team and the clients in particular, having a holistic view of the business.

If you can’t, and I’ve had this on a few occasions, if you can’t come to that common view of the world, then it’s not the right position. It’s not the right thing to stay there and run that company and having the ability and the fortitude to say, “Yeah. This is not right. This is not what I believe in.” You may be completely right. That’s not a qualitative judgment on anybody, but being able to say, “Okay. It’s better if you take somebody else and I step aside.” So, those are probably the areas that have been the biggest challenges, and they’ve become, over the years, easier to navigate. I’ve become much more transparent. I ask. I make sure I ask a lot of questions to make sure that alignment is there.

What advice would you give the younger version of yourself?

Hmm. My mentor, Bob Hansberger, when we were building primary health, used to have a saying because we’d get into meetings, and I’d have so many ideas and so much energy around things to move it forward and so forth. He would look at me and say, “Sometimes, Shane, you just need to keep your hands in your pockets and listen.” I think that’s probably would be really good advice to a younger Shane is to listen and react slower than probably I did in early in my career and just to contemplate it and listen to the alternatives and think it through rather than being reactive.

That’s good advice. Then what message or principle do you wish you could teach everyone listening today?

I think it’s the same thing. I think it’s you need to know your business. You need to know the economics. I think the most important classes I took in college were macroeconomics and microeconomics and, of course, the accounting functions, but the micro really, for me, understanding the microeconomics of any business, whether it’s an individual veterinary hospital or a pet care center or a human biotech company, is really understand your microeconomics going in and then the macro, what the plan is. It’s time well spent.

I also think anybody that wants to run a business should have a basic understanding of accounting. These are not complex businesses. The debits and credits aren’t really difficult, but you’d be surprised, even in executive groups, but particularly at store level. Operators don’t really understand a profit and loss statement or a balance sheet or how it affects, and taking a little time to understand those has proven, really, one of my superpowers is being able to do it. So, I think understanding that and then understanding where you’re trying to get to, where it fits into the paradigm because there are things we are looking at now that are so far away from pet care services, but you can come back and kind of push them in together, and you can see the synergy. So, having an understanding of that micro environment is … macro environment is important too.

Well, Shane, some of our guests say that they’ve had a key book that they’ve read along the way that helped their approach to success. Do you have a key book in your life that has impacted you the most? I’d love to hear that story.

Yeah. It’s different. It’s going to be something that you’re not expecting. It’s actually a book that I typically have bought for my direct reports and asked them to read it. It’s a historic history book called Undaunted Courage by Stephen Ambrose, and Stephen Ambrose wrote Band of Brothers and many other historical non-fiction.

Undaunted Courage is the story of Lewis and Clark and the politics behind it and how they ended up going and overcoming all their challenges in walking across a vast continent that didn’t really have any knowledge of and getting back with the loss of one person in the entire group. And so, that is inspiring. I think it teaches problem solving and fortitude. And so, that’s the book that I take the most from.

Well, I was just reading an article this week about leadership, and it said the number one trait that leaders need to have is courage.

Yeah. I couldn’t agree more. You can’t be afraid. You’ve got to step forward. You got to always calculate the risk and adjust to those risks, but I would agree with you completely, but that book has meant a lot to me over the years.

Well, Shane, you’ve got the mic. What is one thing that you want to share with our listeners at the People of Animal Health Podcast before you drop the mic today?

I really respect People in Animal Health. It’s an interesting business, but it is also a passion of love. Again, when you go back to me being in high school in Southern California and hoping among … over everything that I could get into UC Davis to be a vet, go to vet school, and be able to pursue that career, that came out of my love for pets. My childhood pets were amazing, and probably my only doubt at the time of being a veterinarian is I didn’t think I could do the hard stuff that you have to do as a veterinarian, but that was the drive, the dream that drove me. It came from that passion for pets.

I think one of the great things in this industry is finding people with that passion. I think when you stray beyond that and you don’t have that passion, it just doesn’t work. I used to have a policy that all of my senior management team had to have a pet. It was required to get the job to understand how we feel. I think that’s one of the great things about this industry is so many of the people have that gene, that push, and they really are attached to pets. I wouldn’t give that up.

So, the amount of respect I have for people that work in this industry is amazing, and I think my employees that I’ve had the fortune of working with at all levels have felt that from me. The response I’ve gotten walking through one of our pet care centers and going up and saying, “Thank you,” to one of our animal care technicians, you can see what that means. I think, again, I think that’s important, and I really respect and thank all of the pet care, pet health professionals out there for what they do.

Well, Shane, thank you for being here as my guest today on the People of Animal Health Podcast. I really enjoyed hearing your story and having this time with you today.

Thanks, Stacy. Look forward to talking again soon.