Washington-based The Icon Group is actively seeking medical tourism providers from around the world, who want American venture capital. Philip Slaton of Icon speaks to IMTJ.
Washington-based The Icon Group is actively seeking medical tourism providers from around the world, who want American venture capital. Philip Slaton of Icon speaks to IMTJ
Q: Is it your money?
A: We are agents of venture capital companies. We are not the actual venture capitalists. What we do is find the medical tourism company, have it prepare submission documents, and submit them to the VC investor company. We bring the parties together.
Venture capital is not lending money. It is making equity investment in the infrastructure of a business with the idea of making it a huge financial success.
Q: What areas are you targeting?
A: Central and South America, the Caribbean, Southeast and Southwest Asia, South and North Africa and Eastern Europe.
Q: What types of business?
A: Of primary interest are hospitals, clinics and medical tourism agencies.
Q: What level of finance?
A: Our VC investors are only interested in investment projects requiring a minimum of US$3 million invested per year for a minimum of three years.
Q: What do you look for in a prospect?
A: Business stability, proper accounts and good standing with governments. True sustainable growth opportunities that need investor capital.
Q: Who are the venture capitalists?
A: Venture capital is funded from private investors that place money with hedge fund managers. Investors are usually formed into limited partnership investor pools or limited liability corporations with the hedge fund manager as the managing officer or partner. This partnership invests in the company and takes a very substantial ownership position in the company including voting seats on the board of directors. Venture capitalist are owners of the company along with the original owners, according to an owners’ agreement that all parties agree to before money is funded. There is no investment to be returned and this is not a loan. It is an equity investment, in return for ownership in the business.
Q: Can you expand on your role?
A: The level of scrutiny of the VC investors is breathtaking. The challenge that I face daily is getting books of companies cleaned up enough so that standard accounting methods are implemented and an independent audit is done.
Q: What interest have you had so far?
A: I have interest from 35 medical tourism providers. I expect four to six at the most to pass muster for VC investment consideration.
Venture capital is not long-term money. It is an investment in a business to help it reach sufficient size that it can be sold or floated on a stock market. Medical tourism is a new business that banks are often wary of, so entrepreneurs need to turn to private markets for capital. Venture capitalists as co-owners will fire owners or managers who fail to perform; they keep a tight rein on their investment and ensure it is not used for personal gain.