Mach family's Privamed grows into billion-crown holding

The Privamed group, which grew from a debt-laden hospital in Plzeň into a medical holding with annual revenue of three billion crowns, is going through a generational change: operational leadership has passed from father to son — Jakub Mach — continuing work begun more than 30 years ago by two doctors with almost no business experience.

Privamed's story began in 1992, when doctors Petr Zimmermann and Miroslav Mach decided to take part in the second wave of privatisation of Czech healthcare and buy out the hospital where they worked. At the time they knew almost nothing about running a business — Zimmermann had to buy a commercial code and a business economics textbook just to make sense of a balance sheet and profit-and-loss statement.

The start was extremely difficult: the partners spent three years looking for a bank willing to lend them money for the privatisation, and when they found one, they had to guarantee the loan with personal property, including the houses their families lived in. The interest rate was 20% a year, and the hospital itself was buried in debts left by the previous management — debt collectors even came after Mach demanding old obligations be paid off.

Despite changing health ministers, constant reforms and the departure of staff who disagreed with the changes, the small privatised hospital gradually grew into an entire group. Today Privamed runs Mulač's Hospital in Plzeň and the Masaryk Hospital in Rakovník, as well as outpatient clinics in Plzeň, Brno and Louny. The company has also developed its own specialised fields, opening a one-day surgery and orthopaedics centre as well as a stroke centre for patients with acute cerebrovascular events.

Miroslav Mach, who led the company for almost three decades after swapping a doctor's white coat for the director's chair, decided to gradually step back from day-to-day management. “I never wanted to reach the point where I'd stop being objective in my decisions as director. So I decided to get off the train before it reached that station,” he explains.

Last year, his son Jakub Mach took over as head of the company, having specialised in internal medicine just like his father. Before taking charge, he spent several months working as an ordinary doctor in the internal medicine department to learn the hospital from the inside. “My father's departure from management was planned well in advance, and that's largely why we managed to keep the continuity of leadership,” says Jakub Mach. According to him, his father no longer handles the company's day-to-day affairs but continues to take part in strategic decisions.