The Real Cost of Startup: Time Debt vs. Money Debt in Early PT Group Growth

Julie Herres
10 hours ago
6 min read

At the PPO Club event in October, Zach Randolph shared some of the realest startup wisdom we’ve heard: If you’re in your first two years of building a physical therapy group, you are doing the hard, unscalable things that truly lay the foundation for future profit. It’s gritty, unglamorous, and often means working all hours and wearing every hat. But those early sacrifices—what Zach calls “unscalable foundations”—are where the magic (and the margin) really start.

At GreenOak Accounting, we love helping practice owners see how these early efforts pay off later. But here’s the financial reality: every startup is fueled by debt—either time debt, money debt, or a mix of both. Understanding the difference is the first step to building a business that doesn’t just survive, but thrives.

What Are “Unscalable Foundations”—and Why Do They Matter?

In the first two years, you’re wearing every hat. Credentialing? That’s you. Billing? You again. Intake, marketing, social media, cleaning the clinic at night, tracking expenses, managing payroll, writing policies, and answering the phones? All you. These are things you can’t keep doing forever, but you have to do them at the start. This “sweat equity” is what gets a PT group off the ground and builds trust, relationships, and momentum.

The financial upside? You’re keeping costs low, building word-of-mouth, and pushing more of every dollar down to the bottom line. That’s why it’s possible (for some) to keep 20–25% margins, even in the grind phase.

What might unscalable foundations look like?

Handwritten notes to every patient and their PCP at discharge
6am–5pm treatment days, with paperwork and business work done at night or on the weekend
Personally calling every new patient to welcome them
Following up on every insurance hiccup or denied claim yourself because there’s no one else to do it
Creating your own tracking spreadsheets for credentialing, scheduling, or collections

These aren’t sustainable in the long run, but they’re powerful investments early on. You’re keeping costs low, building word-of-mouth, and pushing more of every dollar down to the bottom line. That’s why it’s possible (for some) to keep 20–25% margins, even in the grind phase.

Why Every Startup Needs Debt—Time, Money, or Both

Here’s the truth almost nobody tells you: It’s nearly impossible to build a practice from scratch without debt. If you’re not spending cash, you’re spending time—and often, you’ll need a combination of both.

Time debt is the mountain of unpaid labor: all the hats, all the extra hours, all the family time or sleep you trade away to keep things moving.
Money debt could be a loan from a bank, a credit card, or even help from a family member—like an uncle or a parent pitching in to help you buy equipment or cover expenses while you get started.

Both are “investments” in your business. Both need a plan for how you’ll eventually pay them back.

Time Debt: The Invisible Loan

Time debt is the overtime you put in—hours that “borrow” from your personal life, family, sleep, and self-care. Most practice owners pay this kind of debt in the first few years, covering for missing systems, small teams, or lack of cash.

Time debt feels “free” at first, but it has a cost: burnout, missed family time, and eventually the need to “pay it back” with rest or reduced hours.
It lets you bootstrap—avoiding loans or big payroll—but you can only sustain it for so long.
This is unpaid labor: you’re not drawing a paycheck for the cleaning, bookkeeping, or credentialing—but those tasks are still essential.

Financial takeaway: You can use time debt to keep expenses down and build cash, but you need an exit plan. Too much, for too long, leads to exhaustion—and that’s expensive.

Money Debt: Fuel with a Price Tag (and a Future Tradeoff)

Money debt is borrowing cash—through loans, lines of credit, credit cards, or even from family—to pay for growth, payroll, marketing, or a new location. It’s riskier, but can help you accelerate faster if you’re disciplined.

Money debt gets paid back with interest (or with family expectations)—so every dollar borrowed means you need to generate even more profit in the future.
Used wisely, money debt lets you build systems, hire help sooner, or invest in marketing while you’re still small.
Used carelessly, it can create a cash crunch or high stress if profit lags behind your loan payments.
It’s important to remember: Paying back money debt will mean less take-home pay for you in the future. Even if your business is thriving, a chunk of your profit will go to repaying loans before it lands in your bank account.

Financial takeaway: Money debt can buy you time, help you scale faster, or cover costs when cash is tight. But the interest is real, and the pressure is higher. Make sure you’re investing borrowed money in things that will pay you back—and be prepared for the future tradeoff in your owner compensation.

Choosing Your Fuel: What’s Right for Your Practice?

Every startup practice uses some mix of time debt and money debt. The right balance depends on your risk tolerance, your support system, and your goals.

Questions to ask yourself:

Am I okay trading my time and personal energy for lower costs now, knowing I’ll need a break later?
Do I want to grow faster, even if it means taking on financial risk and making loan payments (and less take-home pay for a while)?
What’s my plan to “pay back” my debt—whether it’s to my bank, my family, or myself?

Experience founders know: Time debt is great for short bursts. Money debt is powerful but risky if you don’t have a plan for profit. Most practices use both at different times.

10,000 Foot View: The Systems That Matter Most

Even in the grind, keep an eye on these big-picture systems. If you’re making progress here, you’re building a strong financial foundation:

Patients arriving: Are you getting people in the door?
Patients staying: Are they completing their plan of care?
Patients getting better: Are outcomes strong (and are you getting reviews or referrals)?
Billing efficient: Are claims going out cleanly and quickly?
Collections efficient: Are you getting paid for the work you do?
Employees happy: Are you building a team that wants to stay?
Working on vs. in the business: Are you setting aside time each week to improve your systems, not just treat patients?

You won’t have everything perfect at the start, but if you’re moving these forward—even while wearing all the hats—you’re laying the right groundwork.

Moving From Unscalable to Sustainable

You can’t (and shouldn’t) do the “unscalable” things forever. But the habits and relationships you build early on are a down payment on your future profit.

Eventually, you’ll systematize patient communication, automate follow-ups, and delegate admin work.
Your financial reports will show the payoff—strong cash, better profit margins, and fewer late nights.

The goal? Trade in your debt (of any kind) for margin, healthy systems, and a business that serves you—not the other way around.

How GreenOak Accounting Helps You Make the Right Choices

At GreenOak, we help new PT group owners:

Understand the true cost of time vs. money debt—so you make decisions with eyes wide open
Track the ROI of early, unscalable efforts (yes, we’ll help you measure what matters!)
Build a roadmap for moving from hustle to healthy profit, step by step

We know every practice’s path is different. We’re here to help you see your options, run the numbers, and make your unscalable hard work count for the long term.

Ready to turn today’s sweat equity into tomorrow’s profit? GreenOak Accounting is here to help you fuel your growth—without burning out or overleveraging. Let’s talk.

This article is designed to provide information only and should not be considered legal or tax advice. Because of the complexity of the law and the variables in your own personal tax situation, you can’t rely on our advice specifically related to your unique circumstances. In order to get the best tax savings and legal advice available to you, you should consult with your own accountant, attorney, or advisor regarding your particular facts and circumstances.

GreenOak Accounting specializes in working with private practice owners across the United States. For more information on our services, visit our website.