Why Your Hospital Startup Failed Before You Started


Hamza Asumah, MD

Hospital startups are the most common form of doctorpreneurship in Africa. It has almost become the only business that any doctor considers when they decide to be entrepreneurs. Now, let’s do the math; if the majority of doctors believe that setting up a hospital is the only viable option in healthcare entrepreneurship, then what happens to the demand of the fixed number of patients who may already be committed to a specific healthcare provider? My guess is as good as yours.  As I mentioned in my previous post, doctorpreneurship extends beyond this.

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Consequently, the building, the equipment, and perhaps the location of the new are the only things that differ between it and the old. Everything else is identical to the competition already on the market. So, where is the value being created?

A business’s habit of repeatedly recycling business ideas and structures with the delusion of creating something new has nothing to do with identifying a pain point and creating structures to address it. Doctorpreneurship covers too wide a spectrum to be limited to the very narrow boundaries of how we practice it in Africa. By limiting your idea generation to what the competition is already doing, you fail before you begin.

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Over the years, my experience in the private sector has consistently revealed patterns that recur in hospital startups, often leading to their demise before they even get started. When you find yourself in any of these situations, it is time to rethink your entire strategy

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First of all, hospitals are built as retirement plans, not as a result of a drive for entrepreneurship. The company’s WHY is misguided. That has been a regrettable tendency in Africa for a long time. More and more hospital startups are springing up in response to a real need that arises when a doctor retires. The longevity of a startup is frequently determined by the desire of one individual rather than the need of the many who will be the fuel for long-term development and sustainability. They are only intended to provide a source of income for the founder’s remaining years of life. Because the decision was made with no regard for market demand, it is on life support until it dies.

Secondly, new Private Hospital Businesses are just an imitation of already existing hospital business, so you start from “6 feet” under, never to make it up and even be seen before you get wiped out. Over 95% of private hospital businesses in Africa operate the same way. You can almost predict what you expect to see in the hospital set up even before you step foot there. You just might meet new faces. There is a general approach to doing just anything and everything to survive. There is no clear value and uniqueness communicated to the people you refer to as customers.

Thirdly, when you decide to go into business alone. I am yet to find that person who advised that it is okay to start and manage your business alone. Many entrepreneurs push the thought of collaboration so far to the back of their minds that it never even comes up during the idea’s conception. We forget that our adage says that if you want to go fast, go alone, but if you want to go far, go with others. The benefit of partnerships and collaborations is a full textbook of wisdom that can only be experienced. According to Morning Business chat, even if it sounds like a good idea, in the beginning, remember that you simply do not have the time to do it all especially as the demand of the business grows.

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Fourthly, the “Jack of all Trades” mentality. This occurs frequently in all sectors of entrepreneurship, particularly at the start, but it is overcome as the firm expands. Founders will frequently begin by looking for the appropriate individuals for the figures, the right people for operations, and so on. This, however, is not the narrative of many African hospital startups.

The Doctor, who is also the founder, is the accountant as well as the chief operations officer. Gardening, security, and cleaning are the only roles I haven’t seen most entrepreneurs take on. Even when every signal in the business screams for extra hands and a diverse collection of skill sets, the founder continues to turn a blind eye and deaf ear to these warning flags. When he/she finally decides to listen to the demands of the business, it is too late to reverse the mountain of issues that the firm is experiencing.

Lastly, when your employees are the same as your family and friends, there is a big misunderstanding of responsibilities and, most of the time, an alarming lack of professionalism and accountability. The inability of founders to be objective in taking decisive steps when necessary is the most serious threat to the business’s survival. Some firms have worked out how to work with these folks, but the majority haven’t. The data, on the other hand, do not support the consequences for firms that go off on this tangent. According to bookkeeping confidential, it is very difficult to modify negative behavior and communication patterns when it comes to working with family and friends

As a doctorpreneur, you must be careful not to set yourself up for failure before you ever begin to implement your concept. Let’s face it, no one teaches you about business in medical school, so it’s only natural to have the basics in place before you launch your hospital business. You may have had different experiences than mine; please share them in the comments section below.


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