You are a physician who has the dream to establish your own healthcare facility with the aim of making excellent healthcare accessible to hundreds. You have collated an experienced and expert panel of specialists with the technical knowledge, the qualifications, and the accreditations to ensure nothing but the best for your potential patients. You have started scouting for the right site to construct your hospital and are about to delve into the licensing part too. But a single factor that can prove to be a stumbling block in making your aspiration a reality is funding. A healthcare venture needs colossal investment because every aspect of a healthcare facility ranging from the construction, the infrastructure, the equipment, the skilled workforce reimbursement, the information management system …all entail tons of costs. Equipping, operation, functioning and futuristic planning all are impossible without the moolah.

If you are able to finance your venture on your own, it is a good thing. If not, you will have to arrange for finance from outside investors like banks, financial institutions, or private investors.

Some common ways in which a hospital is funded

Loans

Many banks and financial institutions offer loans to healthcare entrepreneurs as this business is lucrative, safe and of rewarding nature. These loans may be given against a collateral, at other times, there is no need for a security or surety too. Banks and financial institutions ask for numerous documents, your business plan, and many more legal records before sanctioning your loan.

Venture capital funds

Many venture capitalist firms invest in healthcare institutions if they are convinced that the venture will be successful in the long run. Venture capital can add dynamic cash flow to your investment.

Partnership

Two or more physicians share investments and liabilities to create a multispecialty clinic or hospital. Most physicians try this approach when they want to provide an assortment of services under one roof for their prospective clients. This method of financing is safe and sure as you can be partners with physicians who share your vision and values and goals, and the funds and the responsibilities of business also get shared.

However, you must ensure that you select your partners prudently.

You should also ensure that the partnership agreement is transparent and legalized.

Collaboration

Many healthcare entrepreneurs join or collaborate with other like-minded investors to gain a deeper reach into the core patient base and gain wider accessibility. Collaboration can help you fund your venture and reduce your risks.

Regardless of the means of funding that you select, you will have to pitch your business strategy and sell your healthcare idea to your external investors before funding becomes a reality.

Some steps that can help you secure funding

1. Concretize your business plan

A business goal without a plan is nothing more than a dream. A rock-solid business plan is the foundation of your goal, on which you can erect the towers of your future success. You need to curate your business plan thoughtfully and pitch it to your potential investors in a persuasive and compelling way so that they become eager to invest in your dream hospital project.

Your business plan should include

1. Your objective
2. Your vision
3. Demarcation of cost estimates.
4. Your breakeven prediction
5. Your projected growth milestones.
6. Your projected profits
7. Return on investment.
8. Plans for expansion

2. Convey your core strengths

While pitching, be sure to convey to the panel of investors all the ways in which your hospital with be a class above the others in that segment. This will convince your potential investors that you bring something unique to the table.

3. Rely on numbers

You may be enthusiastic and emotional about your dream project as it is your baby but remember, the panel of financers are not as involved or emotional about your venture. Only numbers and graphs and quantitative analysis will convince them to invest in your healthcare business aspiration.

Hence, be sure to serve them with accurate numerical data like sales forecast, growth targets, success margins, profit volumes and estimated return on investment.

Also present a transparent and lucid break-up of estimated costs to boost their confidence e.g., demarcate costs of infrastructure, site development, equipment procurement, skilled staff recruitment, reimbursement etc.

4. Keep your financial records clean

Your financial credibility will definitely come under the scanner before any financial institution makes an investment in your business plan. They will scrutinize your equity, your credit history, your debts and debits, your bank statements etc. before loan sanction.

To summarize, establishing a healthcare facility involves heaps and heaps of groundwork. One of the most important tasks that should be your priority will be finance arrangement. This is a challenging task for most first-time practitioners with their frenetic schedules. If this is your situation too, then you should not hesitate to enlist the services of Healthcare Consulting Firms for the financial and funding planning for your venture. Healthcare consultancy firms have a cohort of experts who can assist you in the selection of the financing solution which aptly fits your needs and vision.

If you need any help in this, be sure to contact Hospertz, a well-known Healthcare consultancy firm of India that can help you fund your healthcare venture, from start to finish.

Blog has been written by Dr. Vishal Jadhav, a veteran in the field of hospital consultancy with a rich experience of more than 20 years and founder of the Healthcare Consultancy Firm, Hospertz.

Dr. Vishal Jadhav, Director
hospertz@gmail.com
+91 9867712705/ 9820833149