personal care physicians series b preferred investment presentation
Post on 15-Jul-2015
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It’s not for everyone.
It’s healthcare for you.
An estimated $5 billion dollar industry and growing at a 34% CAGR, concierge medicine in the U.S. is highly fragmented and growing quickly.
*The Concierge Medicine Research Collective
Legal Disclaimer
This presentation uses forward-looking statements and assumptions that involve risks and uncertainties, including, but not exclusively,
the risks associated with the effect of changing economic conditions, changes in the markets, variations in the company’s business plan,
market acceptance risk, technical development risks, and other business risk factors. In light of these and other risks, and uncertainties,
there can be no assurance that the events predicted will in fact transpire. All care and diligence has been used to ensure fair
and accurate projections, based upon current methodology, current market conditions, research and analytic data.
AN ALTERNATIVE INVESTMENT INVOLVES A HIGH DEGREE OF RISK AND SHOULD BE UNDERTAKEN ONLY BY PERSONS
WHOSE FINANCIAL RESOURCES ARE SUFFICIENT TO ENABLE THEM TO ASSUME SUCH RISK AND TO BEAR THE TOTAL
LOSS OF THEIR INVESTMENT.
THIS PRESENTATION IS ONLY FOR ACCREDITED INVESTORS, INSTITUTIONAL LENDERS AND QUALIFIED PURCHASERS.
PersonalCare helps doctors,
health systems, and companies
provide optimal health solutions to
the 1%.
Momentum Largest provider of concierge healthcare services in Orange County, CA
3 locations, 1,800 paying members
300 personal training members
20 enterprise accounts
$3M+ recurring management fee revenue
$5M+ in recurring practice access fee revenue
Health system brand license
Secured $4.5M in equity
Sourced immediate expansion opportunities in adjacent geographies
Trending EBITDA positive Q4 2015
Industry Growth Healthcare inflation & decreasing service quality has led to dissatisfaction with traditional primary care and has led to rapid
growth in concierge medicine.
Concierge physicians grown at 34% CAGR over the past 3 years
Market is estimated to be $5BB*
Highly fragmented market; 60% of concierge physicians practice alone*
A national category killer does not exist
Sophisticated competition does not exist in Southern California market
o Significant investment capital is being deployed in the space in an effort to meet growing
demand.
o One Medical, a low-price competitor has raised $140 million
o MDVIP sold for ~$300 million in April 2014; estimated to be 19 x trailing EBITDA
o Qliance has raised $27 million in investment capital
o iorahealth has raised $70 million in Series A, B, and C investment capital
*The Concierge Medical Research Collective
Customers
6
• Hoag
• St. Joseph’s
• Etc.
Hospitals
• PIMCO
• In-N-Out
• Irvine Company
Business to Business
• Affluent consumers with income of $250k+Business to Consumer
• Medical GroupsMedical Groups & Physicians
Geographic Scope
The prototypical PersonalCare member is an
executive with annual household income of
$250,000 or greater.
Southern California has 280,000 households with
income of $250,000+ representing 900,000
prospects.
PersonalCare’s goal is to acquire 3% of Southern
California residents earning $250k, which will
generate 21,000 members for PCP’s managed
practices.
• 24/7 access by phone, text, & email.
• Patient Time Priority• Same day
appointments • Critical health issue
response• Access to best
specialists and medical centers
• Personalized, comprehensive health & wellness plan
• One-on-one consultations
• Proactive, personalized health updates
• Continuous monitoring and assessing
• Board certified• Highly respected
in medical communities
• Medical partners steeped in patients’ health histories
• A team of highly trained clinicians
• State-of-the-art diagnostics
• Establish key preventive markers
• Assessment integrates nutrition, mobility, flexibility, and fitness
• Fitness & nutrition support with medical supervision
Business Model
PCP generates revenue by managing concierge medical practices for a fee
Fees are either formulated as a percent of revenue or a mark-up on cost
Fees in existing practices average 55% of practice revenue
Physicians generate approximately $625k in management fee revenue once membership panel hits 380
Practice margins at capacity are approximately 40%
o Fees of practices in development in Los Angeles and San Diego will be cost + mark up (approximately 20%)
oCost + management agreements have lower margins than percent of revenue management agreements but these
locations are immediately profitable and therefore enhance PCP’s ability to scale into new markets at minimal risks
Strategic Growth Plan
Secure large membership base by dominating the B2B market for executive health and concierge services; augment enterprise
growth by “rolling up” existing concierge medical groups.
Grow B2B
Partner with health networks to allow PCP services to be provided in the system’s closed-end insurance network
Partner with enterprise accounts that want to provide best-in-class healthcare to executives
Grow B2C
Increase prospect generation by investing in targeted marketing campaigns – historically all leads come from WOM and
referrals
Add “Cost +” and Specialists to scale
Partner with existing concierge providers in Orange County, Los Angeles and San Diego to maximize speed-to-market
Distribution
Direct SalesHospital
PartnershipsBenefits Brokers
Strategic Partnerships
Board of Directors
Troy Medley
•Chairman & CEO
•Pepperdine MBA
Will Kessinger
•Founder (VFormation)
•Managing Partner Parthenon Capital Partners
•Harvard MBA
Jordy Spiegel
•Spiegel & Partners
•Harvard MBA
Cynthia Perezzo
•Hoag Board Designee
•Senior Vice-President, Strategy and Business Development
•Harvard MBA
Dr. Jeffrey Barke, M.D.
•Founder
Dr. Kenneth Cheng, D.O.
•Founder
Senior Management Team
Troy Medley
•CEO
•MBA
Kevin Davidson
•CSO
•MHA
Dr. Jim Lindberg
•CMO
•M.D
•MBA
2015 2016 2017 2018
Practices 5 8 9 10
Physicians 14 20 25 30
Members 2,800 5,500 8,000 9,000
Revenue $4.1M $9.2M $12.8M $14.7M
Expenses $4.7M $7.3M $8.3M $8.4M
EBITDA $(684)K $1.9M $4.4M $6.3M
*PCP intends to build additional practices in Orange County and expand throughout Southern California. Practices are currently being developed for Newport Beach, La Jolla, Beverly Hills and Century City.
*Forecasted performance of current practice footprint AND practices in development
Forecast - Growth
2015 2016 2017 2018
Practices 3 3 3 3
Physicians 10 12 14 14
Members2,360 3,700 4,400 4,550
Revenue $3.6M $5.4M $7.3M $8.0M
Expenses $4.2M $4.3M $4.4M $4.5M
EBITDA $(660)K $1.1M $2.9M $3.5M
*Forecasted performance of current practice footprint at current growth trend
Forecast – Steady State
Forecast – Steady State vs. Growth
($2)
$0
$2
$4
$6
$8
$10
$12
$14
$16
2015 2016 2017 2018
Growth Forecast
Revenue Expense EBITDA
Million
($2)
$0
$2
$4
$6
$8
$10
$12
$14
$16
2015 2016 2017 2018
Steady State Forecast
Revenue Expense EBITDA
Million
Competition
target
target
Exit Strategy
Expected Price Premium at Exit
He
alth
Sy
ste
ms • Allows health
system access to the premium consumer of healthcare services which enhances the value of its closed insurance network
• Health systems need premium payers to subsidize mass market
Str
ate
gic
Bu
ye
r • Allows provider of revenue enhancement solutions to health systems to partner with health systems to rapidly create a concierge network
• Revenue enhancement consultants need a “new” service that can provide immediate value, as cost containment strategies have reached diminishing returns
Co
mp
etito
r • Allows competitor that invested in scale without a differentiated solution to plug a better service into its network
• Undifferentiated competitors need to purchase capabilities to compete as industry matures
Gro
wth
Eq
uity • Allows a financial
buyer looking to create critical mass entry into the lucrative Southern California market
• Financial buyers need scale to reach IPO
Investment $1M of an authorized $2M in Series B Preferred growth equity = 4% of the company.
Current investors: Management, Silicon Valley venture capital firm, and Hoag Hospital
LLC liquidation preference enhances tax shield and IRR
8% accruing preferred distribution
Closing before April 15th, 2014
Use of Capital
Add Business Development personnel
Underwrite legal costs associated with developing cost+ management agreements
Fund working capital
General corporate needs
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