The Extraction Trap: When Private Equity Eats Nations

The Promise

Mid-2024. Family visit to Morocco. My parents, in that distinctly Moroccan parental way, insisted: "Let's get this checked out while you're here."

The doctor was reassuring. Professional. "Routine outpatient procedure. You'll be walking tomorrow. Back to the States in a week or two, maximum."

Akdital—Morocco's largest private hospital network—looked the part of a world-class facility. The room could have been a 4-star hotel: immaculate linens, modern fixtures, excellent food. Staff attentive, perhaps a bit loud in the hallways, but genuinely caring. The kind of place that photographs well for hospital marketing materials.

One detail felt almost futuristic: The doctor gave me their personal number. Text anytime with questions. In the US, this would violate HIPAA six ways from Sunday. Here, it felt like premium concierge service. Direct access. Responsive care.

Everything looked world-class. Gleaming equipment. Professional protocols. Reassuring efficiency.

The promise was simple: Quick laser surgery. Walk the next day. Back to Oakland, back to my startup, back to building.

I joke now that Morocco missed me and created the perfect conditions for me to stay.

The Reality

What was supposed to be routine became catastrophic within days.

Severe complications. Then a near-death experience: massive bleeding episode, the kind where you understand viscerally that your body is not a guaranteed thing. Emergency re-operation—the non-laser kind they said wouldn't be necessary.

Two and a half months bedridden. Seven flight reschedules.

The startup I'd been building—passionate about, poured myself into—folded. When you're the founder and you're suddenly unable to function for months, there's no backup plan. We shut down all operations.

Personal cost beyond medical bills: Dreams deferred. Opportunities lost. That particular kind of grief that comes from watching something you built disintegrate while you're physically helpless to stop it.

The gap between "you'll be walking tomorrow" and "2.5 months bedridden" is not a small miscalculation. It's not bad luck. It's not even really about one doctor or one facility—complications happen in medicine everywhere. US hospitals, European hospitals, anywhere humans practice medicine on other humans.

I'm not sharing this for blame or sympathy. A lot of good came from those months and the rehab period that followed—notably, thinking deeply about the whole "Information Beings" concept that would later become central to my work.

I'm sharing it because this gap—between promise and reality, between optics and outcomes—is designed into the system.

This is Morocco's development strategy. This is many nations' strategy in the Global South. This is what happens when you optimize infrastructure for financial returns instead of actual outcomes.

And I'm going to show you exactly how private equity makes this inevitable.

The Mechanics of Extraction: Akdital as Case Study

Let's follow the money. Because money, unlike marketing materials, tells the truth.

2020: Mediterrania Capital Partners, a private equity firm, invests MAD 250 million (~$25 million USD) in Akdital. At the time, Akdital operated 5 hospitals—a regional player with potential.

The timing was perfect.

Morocco had just rolled out AMO (Assurance Maladie Obligatoire)—mandatory health insurance. By 2022, 78% of the population would be covered. Over 11.4 million free beneficiaries by 2025. A massive, government-created captive market for healthcare services.

Mediterrania Capital Partners saw the opportunity: Public policy creating private profit potential.

The Expansion was aggressive:

• 5 hospitals in 2020 → 35 hospitals by 2025
• 19 cities covered
• 3,706 beds operational
• 7,090 employees
• State-of-the-art equipment, modern facilities, attentive staff
• 12 new hospitals opened in 2024 alone

From the outside, this looks like success. Growth. Development. Infrastructure.

The Financial Performance reveals the real strategy:

• 2024 Revenue: MAD 2.95 billion (+55% year-over-year)
• 2024 EBITDA: MAD 839 million (+64% YoY)
• 2024 Net Income: MAD 348 million (+76% YoY)
• EBITDA CAGR 2020-2024: 66.2%
• Net Income CAGR 2020-2024: 91.3%
• Market capitalization: ~€2 billion (~MAD 20.2 billion)

These numbers are insane. A 66.2% compound annual growth rate in EBITDA over four years. In healthcare. During a period when public hospitals were collapsing.

The Exit is where the extraction completes:

• December 2022: Akdital IPOs on the Casablanca Stock Exchange
• April 2025: Mediterrania Capital Partners exits COMPLETELY
• Total realization: MAD 2.33 billion
• Initial investment: MAD 250 million (2020)
• Return: 9.3x over 5 years

Nine point three times their money in five years.

This is the private equity playbook executed to perfection:

1. Identify a sector with government-created tailwinds (AMO creating captive market)
2. Inject capital for rapid expansion
3. Optimize for financial metrics—revenue growth, EBITDA margins—not patient outcomes
4. Use IPO as exit vehicle
5. Sell at peak valuation to public market investors
6. Walk away with 9.3x return
7. What happens to care quality after exit? Not the PE firm's problem anymore

The question I kept asking myself, lying in that hospital bed during my second surgery, feeling my startup slip away: What happens to care quality when the incentive structure is 3-5 year exits, not 30-year patient outcomes?

My complications are the answer.

Great optics. Catastrophic outcome when tested.

The facility looked amazing because appearance drives valuation. Clean rooms, modern equipment, responsive doctors—these things photograph well for investors. But when complications happened, when the system was actually tested, it failed.

Were doctors and staff exhausted? Overworked? Was equipment inadequate? Was protocol weak?

Doesn't matter. The system optimized for the wrong metrics.

The AMO Gold Rush: Public Money, Private Profits

Morocco's creation of AMO—mandatory health insurance—was genuinely transformative policy. Universal healthcare coverage reaching 78% of the population. Over 11.4 million free beneficiaries. This is nation-building stuff. The kind of ambitious social policy that should be celebrated.

But implementation reveals everything.

The government created AMO without proportionally investing in public hospitals. Public facilities remained underfunded, understaffed, equipped with outdated technology. From parliamentary debates in 2025: "Pregnant women dying in waiting rooms." This isn't metaphor. This is documented reality in Morocco's public health system.

So patients face a choice:

• Wait months in a collapsing public hospital with AMO coverage
• OR use that same AMO coverage at a private facility like Akdital

Most choose the latter when they can. Rational individual choice. Systemic catastrophe.

The flow of money:

1. AMO = government/employer-funded insurance
2. Patients use AMO at Akdital (private provider)
3. Akdital bills the AMO system
4. Public money flows to private provider
5. Private provider optimizes for shareholder value
6. Private equity exits with 9.3x return
7. Public hospitals continue collapsing

Akdital's 2024 revenue: MAD 2.95 billion. Much of it from AMO reimbursements—public funds flowing to private coffers.

Meanwhile, public hospitals in 2025: Widespread failures documented in parliamentary debates. Equipment broken. Staff fleeing to private sector. Patients dying in waiting rooms.

The transfer is complete: Public funds → private profits → PE exits.

2026 makes it worse.

By law, all Moroccan companies must transition to AMO by 2026. The "Affiliés 114" companies—representing just 1% of firms but 31% of total salaries—are being forced to switch from private insurance to AMO.

An even larger captive market for private providers.

Akdital is positioned perfectly: 35 hospitals across 19 cities, ready to absorb this new wave of AMO-covered patients.

More public money. More private extraction.

Short-Term Extraction vs. Long-Term Nation Building

The fundamental problem is incentive mismatch.

Private equity's fiduciary duty is to their LPs—limited partners who invested in the fund. Not to Moroccan citizens. Not to patient outcomes. Not to national development.

LPs want: 3-5 year returns, 20%+ IRR, successful exits.

Nation-building requires: 20-30 year horizons, patient capital, resilience over optimization.

These are fundamentally incompatible.

The PE Playbook (short-term extraction):

• Financial engineering: Optimize debt structure, tax efficiency
• Cost optimization: Reduce staff, cut "unnecessary" expenses like training programs
• Revenue maximization: Premium services, billing optimization, volume growth
• Exit planning from day one
• Metrics: EBITDA growth, revenue growth, margin expansion

The Nation-Building Playbook (long-term resilience):

• Train professionals: 15-20 year investment before ROI materializes
• Build redundancies: Backup systems, safety margins—expensive but necessary when things go wrong
• Invest in public goods: Benefits diffuse across society, hard to capture in private returns
• Build resilience: Can withstand shocks, doesn't optimize purely for efficiency
• Metrics: Health outcomes, life expectancy, patient safety, equity of access

My surgery is the microcosm.

The facility looked amazing because appearance drives valuations. Modern equipment. Clean rooms. Attentive staff. These are the visible signals investors evaluate.

But when the system was tested—when complications emerged—it failed catastrophically.

Why?

Because resilience is expensive. Redundancy is expensive. Deep training is expensive. Having backup protocols for when things go wrong is expensive.

The PE playbook says: Optimize costs. Cut redundancies. Maximize efficiency.

My complications say: Some costs are necessary.

The system worked perfectly—for Mediterrania Capital Partners. They got their 9.3x return.

The system failed—for me. Two and a half months bedridden. A startup folded. Dreams deferred.

Both outcomes are predictable results of the incentive structure.

When nations outsource critical infrastructure to private equity, you get short-term polish and long-term fragility. You get great appearance, weak fundamentals. You get Akdital: world-class facilities, questionable outcomes when tested.

You get Morocco: building stadiums for the 2030 World Cup while hospitals fail in 2025.

What Morocco (And Every Nation) Must Ask

Can we afford to financialize critical infrastructure?

Is healthcare too important to subject to 3-5 year exit cycles?

Same question for education. Same for housing. Same for any infrastructure where failure costs lives, not just money.

The alternative isn't to reject private capital. It's to restructure incentives.

Patient capital: 10+ year horizons minimum, not 3-5 year flip cycles.

Public investment: No exit requirement. Returns measured in outcomes, not multiples.

Outcome-based returns: Tie PE returns to patient health outcomes, not just revenue growth. If your healthcare investment improves measurable patient outcomes—lower mortality rates, faster recovery times, fewer complications—you earn premium returns. If outcomes decline while revenue grows, your returns are capped.

Make the financial incentives align with the outcomes citizens need.

The DRI Question (from the framework in When GenZ Becomes an Information Being):

Who owns "prevent healthcare collapse"?

If the answer is "the market," the system will optimize for extraction, not outcomes.

Markets optimize for what they're incentivized to optimize for. Private equity is incentivized to optimize for exits, not outcomes.

If you want different outcomes, you need different incentives.

The uncomfortable truth: My surgery complications aren't an anomaly. They're a feature of the system.

When you optimize for financial returns over patient outcomes, you get financial returns and questionable patient outcomes.

Mediterrania Capital Partners got 9.3x.

I got 2.5 months bedridden and 7 flight reschedules.

Both are predictable outcomes of the incentive structure.

The Cliff Accelerates

Connect this back to the economic cliff from Post 1.

GenZ faces:

• No jobs (Morocco's official youth unemployment: 30%; real number closer to 60% when you count underemployment and those who've given up)
• Elite capturing resources via private equity extraction (this post)

Public money flows to private profits. Infrastructure optimized for exits, not outcomes. The development model itself is extractive.

Morocco isn't building resilience. It's building exit opportunities.

But GenZ isn't passive.

They're building coordination systems governments don't understand. While Morocco's elite extract wealth via PE playbooks, GenZ is gaming different systems entirely.

Next post: Gaming the Future—how GenZ's "useless" gaming skills are actually the coordination capacity that solves the governance crisis. Why Moroccan youth organizing PUBG tournaments understand distributed coordination better than the ministers planning 2030. How Kenya, Bangladesh, and Nepal are already building the future while their governments optimize for World Cup stadiums.

The extraction trap is real. The cliff is real.

But the response is already forming—in ways the extractors don't see coming.

This is Post 2 of 5 in the "Serving the Future" series. Post 1 established the economic cliff. Post 3 will show GenZ's coordination response.