Taking over a thriving dental practice group in the middle of a global health crisis is undoubtedly a challenge and no more so than when the business concerned is in the middle of an ambitious buy and build strategy. Maria Davies talks to Riverdale Healthcare CEO Emma Barnes about the company’s response to Covid-19 and its plans to create a presence in the corridor between its stronghold in the North East and new venture in Cambridge
With a lower-than-average supply of dental practices, a nationwide shortage of dentists and a lot of ‘levelling up’ still to be done, the North East might not seem the ideal location to build a network of dental practices. But that is exactly what Riverdale Healthcare set out to do when it secured backing from specialist healthcare private equity firm Apposite Capital to acquire Alpha Vitality at the beginning of 2019.
Almost three years on – more than half of which has been mired in Covid-19 – and the company has already achieved impressive growth. Following a string of acquisitions in the North East, it has extended its geographical footprint into Cambridge, where it plans to replicate its growth story with a series of bolt-on acquisitions.
Now under the tight reins of Emma Barnes, who joined as CEO last November, Riverdale is looking forward to an even more ambitious acquisitive phase spanning the East of England corridor between its centres in Cambridge and the North East.
Barnes led successful growth strategies as operations director at private equity-backed business Laurels, one of the largest funeral care businesses in the UK and was chief operating officer at Linnaeus Veterinary Group, which she helped take from an eight to 50-business portfolio.
After starting her career in the retail sector, with stints in the travel industry and later with mobile network provider Three, Barnes moved into healthcare – first with Southern Cross and HC-One before running the South Eastern region for dental group IDH.
It is a varied career, but, she says, every move has been dominated by two driving forces: a passion for people and purpose.
The following transcript of HMuk’s interview with Emma Barnes has been edited for brevity
HMuk Your career has spanned multiple sectors, how has your experience in varied retail and healthcare environments shaped your leadership style?
Emma Barnes Since leaving retail, I have joined businesses that are very healthcare centric, or have a clear purpose, and are about scaling businesses from small to large. I think I’ve been successful because I always start with my people and the communities that we serve. The mantra I’ve learned is that if you make the proposition right and you make sure your people are led well, growth will follow. I spend a lot of time trying to understand the business through the eyes of both the teams and the patient or consumer. I could sit in a room and only think commercially about dentistry, but what makes the difference is our people understanding why it’s important to the patient. The theme throughout the whole of my career has been to lead well and make sure that your offering is followed through and delivered.
HMuk How does that people-first philosophy inform your approach to a buy and build strategy?
Emma Barnes One of the first things I did when I came into Riverdale was restructured the operations team in a way that would facilitate continued growth. There is a race effect in a lot of growth businesses, but my view is that you have to start with your teams and invest in them first and foremost. You need to make sure you have the right skills and capabilities on the ground to enable growth. You don’t grow and then get the skills.
I’ve spent the last nine months here creating the infrastructure to cope with growth. I introduced a new role of integration manager, whose lens is focused on making sure that integration journey runs smoothly. I go to every single acquisition meeting. I meet everybody we talk to about joining Riverdale face-to-face. That’s really important because they hear directly from me what we promise to deliver. The only way to deliver on those promises is to ensure there is a good support network around those businesses as they come onto our platform. And that needs leadership, the right structure and the right systems.
HMuk Dentistry has had a tough time during the Covid-19 pandemic. How have you continued to support your practices over the past 18 months?
Emma Barnes We have been very proactive with our practices. We increased our protocols, gave them extra PPE and really started to work with them on diaries and fallow time to make sure they could continue seeing patients. We were the first dental corporate to go out to market and buy air filtration machines. That was one of our first purchases and it enabled our teams to get back to some form of normality, so now every time we buy a business, we also buy an air filtration system for every surgery.
As evidence grows, I think there will be adaptations to the way that people operate, but whether it’s Covid, another form of SARS or something else, when you are working inside the mouth there will always be treatments which aspirate. That is never going to go away, and I think the pandemic has shone a light on future risks as well. I think there will always be an element of increased PPE – though hopefully not at current levels – air filtration and fallow time. It will decrease, but I think we will get back to a new normal rather than an old normal and we need to be there supporting our practices while we make that journey.
HMuk Riverdale has expanded rapidly in the North East and recently into Cambridge with the acquisition of Devonshire House. Why target those regions?
Emma Barnes It was always our strategy to get one hub and then a second and, potentially, a third. The first acquisition, Alpha Vitality, was a platform that became the anchor, so we decided to target the North East as our first major hub. There was a lot of word of mouth. A lot of people knew the Alpha team and they recommended Riverdale which has enabled us to become a dominant player in the North East.
Our strategy was always to go for a second hub which we could still support but which opened up different geographical areas. We have the North East virtually sewn up, so we started to look for geographical locations that could be connected to the north. When Devonshire House became available, we went down there thinking we probably don’t have a chance for this because it’s a new hub and it’s purely private and specialist, but it went so well that it has actually formed the basis of our second hub. And now we are looking to fill the gaps from Cambridge to the North East and will be targeting all the cities coming down to connect the business – Leeds, Lincoln, Newark.
HMuk What are you looking for in a geography and in a practice?
Emma Barnes We don’t do turnarounds, so we are very targeted about what we buy. We are looking for businesses that have got good momentum and where the owners are still really invested in growth, but want to be part of a bigger family.
We do look at demographics of an area but the key for us is whether the business has the momentum – and by that we mean opportunity – to provide additional services. It needs to have growth potential. We look at a lot of different metrics – can the team drive the business on the ground, is there a passion to drive it on the ground, do the demographics support it and has the business got the opportunity to grow? And if it has, then we would definitely be interested.
HMuk How closely do you work with the team at Apposite?
Emma Barnes I work very closely with Rory Pope at Apposite. At the end of the day, he and the team at Apposite are responsible for other people’s money and it is our responsibility to make sure people get a return on their investment, but Apposite is very focused on doing that in the right way. I get complete support if I need to invest in an area that’s not about profit but about the team or the environment. We have a very strong supportive relationship and our strategic vision about what we buy and where we buy is always a joint decision.
HMuk As you look to scale up the business, do you have longer term plans to grow nationally or look further afield for growth?
Emma Barnes In short, no. We would have to create more infrastructure at that point and I think the corridor between what we’ve got in Cambridge into the North East is already going to be enough to stretch us depending on what we buy. We could start saying today, let’s go to Europe, but we would definitely fail at that. We just don’t have the infrastructure, so let’s do what we do well with a really good solid team.
Nationally, our mission is to get into the top ten dental groups in the UK. At the moment, we are probably 14th in terms of size but are much higher than that from a profit perspective – probably already in the top ten – but we also want to get there in terms of size.
HMuk What are your priorities for the next 12 months?
Emma Barnes We have three main priorities. The number one operational priority for the field team is to make sure that we are doing whatever we can to ensure there is enough availability in our practices for our patients to see a dentist. The second is to target some key employment groups. At the moment we’re focused on nurses, which are the biggest single cohort of the practice team. There is a massive shortage of nurses in the sector, so we’ve made quite a bold decision about a pay framework which gives them a much better career development pathway. We also have a number of strategies to engage nurse teams in a more intuitive way which allows them to have a voice within the company. That is going to be a real focus for us in the months ahead.
Our third priority is to create a really efficient way of working. We have just signed a deal with I Comply to manage our health and safety and we’re investing in our data warehouse, which enables practices to see how they are performing against their peers. We’re also involved in a big ESG project, which will include procuring green energy and enabling our practices to support local communities.
HMuk Looking long-term, where do you see the biggest opportunities arising in dentistry?
Emma Barnes The way the NHS contract is structured, means the growth opportunity is in private pay. The challenge is to communicate to patients that private doesn’t have to mean expensive. We need to create a patient proposition which says, ‘I can afford that’. We already offer patient plans, which are great for people with good oral health, but I think we need to go further than that so private options become affordable for all.
If we can meet patient demand, there is huge opportunity. Dentistry doesn’t have a lack of patients. We absolutely have patients who are underserved in the community. The opportunity is to make sure we can serve those patients and open the doors to them. We are just about to sign a lease on a new building up in the north which will be private only with full access to anybody who needs it. There are a lot of patients out there who need a dentist and that is the opportunity, provided you can service it.