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Investment firm focuses on long-term growth with eye care practices
The New York-based investment firm, ReFocus, is targeting optometry and ophthalmology practices in the Northeast as partners for long-term growth.
“After seeing firsthand what churn is doing to the eye care industry, a group of experienced health care business professionals has taken a different approach,” the company said in an announcement.
Refocus CEO Daniel Doman spoke with Primary Care Optometry News about how the ReFocus model is unique and how the company is assisting owners looking to sell their practices.
PCON: What is the ReFocus vision for eye care?
Doman: We are a team of committed eye care professionals that share a common vision: “To push the boundaries of what is possible in health care by uniting expert doctors who ask what isn’t possible.”
We are on a mission to build a collaboration of health care practices with world-class medical expertise, proven processes, advanced technology and business management. Our goal is to deliver more time and energy to our medical professionals to pursue their professional growth and to flourish as mentors, researchers and leaders in medical advancements.
The ReFocus business model means our patients are guaranteed the most advanced, highest level of care from collaborative experts providing eye exams, vision correction, glaucoma care, cataract surgery and many, many other eye care procedures. Basically, we are committed to delivering the best eye care for each and every patient.
PCON: Your company’s announcement mentions “attracting millions in permanent capital.” Can you please expand on that?
Doman: In order to fully appreciate the value of a permanent capital organization you have to know a little about private equity. The primary motivation for private equity firms is to realize return on investment over the course of 3 to 5 years, often through selling the health care organization/practice group. Before the sale, reorganization/restructuring, cost-cutting and consolidations are commonplace. In addition, private equity firms very often have diverse portfolios that don’t focus singularly on health care. That can lead to decisions that might not always be in the best interest of patients, doctors and their staff.
Enter Permanent Capital Investors (PCI) and ReFocus Eye Health. Our business model is to secure permanent capital vehicles and join forces with entrepreneurial organizations that are committed to more than just the bottom line. Zenyth Partners, our parent company, is doing just that as the funding partner of ReFocus. By securing permanent capital, Zenyth will be able to establish lasting partnerships centered around building sustainable health care organizations and ensuring success for all stakeholders: patients and doctors and professional and administrative staff. And since Zenyth is focused on health care, there is an understanding of core issues and opportunities from the start.
The bottom line is that permanent capital investors have a long-term view. Doctors have various options outside of liquidation and are compensated more fairly post-deal. Alignment occurs so that PCI and doctors work together to grow practices smartly. Because of the common objectives and long-term perspective, flexibility and collaboration are the norm. Building great practices together and enjoying the benefits of our collaboration for many years to come is what we are about.
PCON: How does the arrangement work?
Doman: We do not have a template approach to creating a meaningful partnership. Each practice is different, and, more importantly, each practice owner and their staff are different. We strive to create a partnership that is meaningful, beneficial and exciting to all involved. As we look to be in the partnership for the long-haul, agreeing to anything short of that would not make sense.
PCON: How many practices have you partnered with so far?
Doman: We are a new organization and are quickly making inroads in partnering with the types of practices that share our mission and vision. Last December we solidified our first partnership within our network with the addition of Acuity Eye Health of Connecticut. We are thrilled to have the honor of partnering with both Richard S. Casden, MD, and Betty Klein, MD, two immensely well-respected and talented physicians. We currently have several new partnerships that are in the final stages of discussions and hope to announce them very soon.
PCON: What type of practices appeal to your company?
Doman: Unlike other companies that look to acquire practices based on revenue or size of the practice, we look for the right organizational fit. Numbers only tell part of the story of a practice. It is the staff within that provides the most interest for ReFocus. Without the people in the practice – the doctors, professional and administrative staff –we don’t have much of a practice. Our mindset is that we don’t partner with a practice, we partner with the people in the practice. Therefore, we are looking for the “right fit.” We want doctors and staff who have an entrepreneurial spirit and a drive to improve the eye health space. Without alignment of these key beliefs the relationship will sour quickly. We all need to move in the same direction to achieve our goal of “best eye care for all patients.” When you have this type of alignment with your partner you can only achieve great things.
PCON: What else do optometrists need to know about ReFocus?
Doman: We are a firm believer in growth. Not just for the practice but for the doctors and their staff. That is easy to say, but where do eye care professionals find the time to grow professionally when they are running a busy practice? Our goal is to harness our collective “partner power” so the doctors can not only continue to provide quality eye care but also free up their time to do all the things that might have taken a backseat. That will certainly be different for each doctor. Many have told us they wish they had more time to mentor junior staff, research and publish, and get more closely involved with their communities. – interviewed by Abigail Sutton
Disclosure: Doman is CEO of ReFocus.