India’s eye care treatment market was around $2 billion between 2013 and 2014 and, according to a Crisil report, it is expected to grow to $3 billion in the next five years. New private eye care chains want to compete in a place that is dominated by big hospitals, and Akshara Eye Hospital is a case in point.
On August 31, 2014, Akshara Eye Hospital was co-founded by Dr Ashish Kumar, Dr P Rohitha Nayak, and Shailesh Kumar. The venture is conceived as a tertiary care center for ophthalmology with the latest technology in place for the diagnosis and treatment of various eye diseases. While both Ashish Kumar and P Rohitha Nayak are ophthalmologists who have worked with Sankara Eye Center, Narayana Nethralaya and Vasan Eye Care Hospital; Shailesh Kumar is an alumnus of IIM Bangalore and has previously worked with Sapient, HP and Infosys. Akshara Eye Hospital is a unit of Right Axis Eye Hospital Private Limited.
Akshara Eye Hospital saw the gaps in today’s healthcare delivery system when it realised that patients are not sure if they are getting the right treatment. Akshara Eye Hospital has taken care of more than 3000 patients in the last seven months of its operation, including more than 40 surgical procedures.
Second angel round of funding
“We are mainly funded by debt and promoters’ equity. However, we have been extremely fortunate to have raised seed/angel funding from friends and family,” says Shailesh. The company has raised a round of equity investment worth $61,000 from a group of angel investors. None of the investors joined the board of the company. Fresh round of funding will be used to expand the range of ophthalmic service offerings and brand building.
The funding was syndicated by DIA Capital Advisors from multiple angle investors. According to Nishant Navin, Founder and Managing Partner of Bangalore-based investment banking firm DIA Capital Advisors, “This transaction validates the fact that there is a continued interest in Indian healthcare sector and investors’ appetite for single specialty chains including eye care is persistent due to more attractive returns on the capital employed, ease of scale on an asset-light model, shorter break-even time, lesser capex requirement, and differentiated offering. Akshara Eye Hospital has an experienced and committed team with focused customer service and it provides high quality eye care adhering to the highest standards in quality control, corporate governance and ethics. DIA Capital Advisors remains committed to ensure access to capital for the growth-oriented businesses.”
Two aspects that makes this hospital unique
Patient empowerment – Maximum interaction with doctors with the objective of making patients part of the decision making process on treatment. This reduces information asymmetry and brings in transparency in the healthcare delivery process.
Being all startup – they have the benefit of creating a healthcare delivery system from scratch. Since it is in its formative years, Akshara Eye Hospital is focusing on building a strong culture of accountability and governance. Shailesh says, “This would influence all processes in the organisation including the kind of people we hire, their induction and training, compensation planning, internal processes, governance mechanism etc. For instance, we have decided that no hospital staff in a position to influence the patient care path will have any revenue linked compensation. This removes all perverse incentives for anybody to act in a manner not in the best interest of the patient.”
“These measures would effectively result in the most optimal clinical outcome for patients,” he adds.
Shailesh tells us what is ahead for Akshara Eye Hospital. “A critical element of the vision we have for this organisation is to have each patient walk in with the trust that the most optimal care would be provided to him. We have set in motion the right processes and governance mechanisms to achieve the same. Now it’s all execution for us. Our priority is to build a brand reflecting what we stand for – uncompromised quality and ethical standards. We believe this will be our strongest differentiator.”
The main growth driver in the eye care market is the increase in the disposable income of the population and increasing health consciousness. Technology plays an important role in maintaining electronic medical records, appointments etc. The hospital’s patient care process and record maintenance is almost paperless right now. Shailesh adds, “Going forward we intend to leverage technology in more ways to further enhance our patient experience.” Side effects emerging from lifestyle factors such as increased screen glare, excess computer and television usage might have contributed to the eye care industry in India touching $3 billion.