The Center for Health Tourism Strategy has worked with a number of private equity firms interested assistance with due diligence prior to investing in health tourism opportunities.

Private equity firms generally buy mature companies that are already established, but may be failing due to inefficiency or poor business or launch strategies and tactics.  Private equity firms are often interested to buy hospitals, clinics, and other healthcare organizations and streamline operations to increase revenues. Sometimes, their first obstacle are corporate practice of medicine prohibitions that vary in terms of applicability to the type of provider organization and location. Ultimately, facing the insurmountable challenges of rule of law, we don’t see many private equity investors successfully enter health tourism through the acquisition of facilities and clinics. They often enter health tourism through hospitality, wellness and software ventures.

Venture capital firms invest in 50% or less of the equity of the health tourism companies, facilities or organizations they invest in.  Venture capitalists frequently spend $10 million or less in each company, since they mostly deal with start-ups with unpredictable chances of failure or success. Very few medical tourism startups exist in the $10-20 million space.  Many of the investments into health tourism companies by venture capital firms gave new health tourism businesses the means to become attractive to private equity buyers but ultimately failed because of flawed strategies, reliance on junk data and lack of traction.

Center for Health Tourism Strategy experts are frequently retained by venture capital firms to help with due diligence and market insights as unbiased subject matter experts.

The aim of a hedge fund is to provide the highest investment returns possible as quickly as possible. To achieve this goal, hedge fund investments are primarily in highly liquid assets, something not frequently encountered in the health tourism industry.  Hedge funds seek opportunities to take profits quickly on one investment and then shift funds into another investment that is more immediately promising. They are actively managed investment funds that pool money from accredited investors with higher risk tolerances. A few e-commerce and medical tourism software developers have attracted hedge fund investment managers, but they soon realize that the junk statistics published about market size and profit opportunities in medical tourism are impossible to validate and spurious at best.

At the Center for Health Tourism Strategy, we assist hedge fund managers with vetting information they discover via online research and business plans they review. We verify market report interpretation to mitigate risk from spurious published data