The private healthcare sector has been on the rise in Québec and specifically Montreal. On June 9th, 2005, the Supreme Court struck down a law that prohibited private insurance to cover medical acts that were under the public healthcare system. This new ruling created a business opportunity for the emergence of private health care facilities since medical procedures that were covered under public healthcare could now be easily afforded through private insurance. Quick action was crucial before existing private healthcare facilities could expand their services to cover the new medical procedures supported under private insurance.

Challenge

The client had the necessary skills to operate a private facility but most of the start-up capital needed to come from doctors and outside investors. The project required that the following tasks be completed before investors could consider becoming shareholders:

- Secured real-estate and estimated construction costs

- Detailed operational plan that would include capacity utilization projections

- Accurate information on IT costs, since the health center would be 100% digital

- Business plan

- Investor presentations targeted for both doctors and outside parties

Solution

KOMAND consultants separated the project in two phases:

Phase I  - Secure real-estate and develop a business plan

Phase II - Separate investors between doctors and outside investors and present the pertinent information to secure
investment funds

Phase I

KOMAND consultants decided that securing the real-estate was the most important and timely aspect of the operation and began to scope out potential locations for the health center. In addition, potential suppliers for the medical supplies, machinery, and information technology were approached in order to obtain accurate estimates for all costs. Finally, after obtaining the blueprints of the healthcare facility, an operational plan was created to estimate capacity utilization for all services to be offered by the health center. All of this information was then compiled in order to create a sound business plan that would later be utilized to approach investors and financial institutions.

Phase II

Once the necessary tools and information were prepared in phase I, KOMAND consultants classified the investors depending on the probability of idea acceptance. Investor presentations were created and customized to fit the needs of the targeted investors. Initially, KOMAND consultants trained the client for the investor presentations and were present in the first 5 investor meetings to assist the client in presenting the business case.

Results

Business plan created for all operations of the health center - After Phase I, the client was delivered a final business and operational plan that could be used for obtaining funds from financial institutions in the future and from additional investors. The plans were developed in a timespan of 4 months. Furthermore, the operational plan allowed the client to determine which services can be added or eliminated in the future, depending on the value they will add to the health center.

Secured construction site for the health center - A letter of intent was signed between the client and the real-estate owner of a downtown Montreal property that would be valid for 6 months.

Secured capital from first investor group - The first capital investment was secured in a trust fund from an investment party that was involved in the pharmaceutical industry.