Two Decades of Growth at a Behavioral Healthcare Provider

Some investments last a few years. Others span decades. The relationship between Waud Capital Partners and Acadia Healthcare falls into the latter category—a 20-year partnership that began with company formation and continues through public company operations.

Reeve Waud founded Acadia Healthcare in December 2005. Today, he remains Chairman of the Board as Acadia operates 260 facilities across 40 states and Puerto Rico with approximately 11,400 beds.

2005-2011: Building Platform to IPO

Acadia Healthcare began as a startup platform targeting behavioral health facility consolidation. The sector was fragmented in 2005, with many facilities operating independently or as small regional chains. Quality standards varied. Many facilities lacked capital for improvements or expansion.

Reeve Waud and Waud Capital Partners provided growth capital to build a scaled platform. From 2005 through 2011, Acadia acquired existing behavioral health facilities and developed new locations. The company implemented standardized clinical protocols, compliance frameworks, and operational systems.

Initial acquisitions required convincing sellers that Acadia represented a credible buyer. The company lacked operating history and brand recognition. However, Waud Capital’s reputation and financial backing provided reassurance. As Acadia completed successful acquisitions and demonstrated operational capabilities, subsequent deals became easier to execute.

The company also developed de novo facilities—building new locations from the ground up. De novo development allowed Acadia to design facilities meeting current regulatory requirements and incorporating modern treatment approaches. However, new facilities take time to reach full occupancy and profitability.

2011-2021: Public Company Expansion

In November 2011, Acadia Healthcare completed an initial public offering. The IPO provided capital for continued expansion and offered liquidity for Waud Capital and other early investors. Public company status brought new requirements: quarterly earnings reports, SEC filings, and management interactions with public shareholders.

Reeve Waud transitioned from chairman of a private company to independent chairman of a public company’s board. Independent directors represent shareholder interests rather than management interests. They provide oversight of company strategy, executive performance, and risk management.

Following the IPO, Acadia continued expanding. The company entered the United Kingdom market through the 2014 acquisition of Priory Group for approximately $1.47 billion. This transaction represented significant geographic expansion and increased Acadia’s scale substantially.

Priory Group operated psychiatric hospitals, rehabilitation clinics, and addiction treatment centers across the UK. The acquisition gave Acadia international presence and diversified its revenue base beyond U.S. markets. However, it also increased complexity—managing operations across different regulatory environments, healthcare systems, and labor markets.

Between 2016 and 2021, Acadia divested its UK operations, including selling Priory Group. This strategic pivot allowed the company to refocus on the higher-growth U.S. market while deleveraging its balance sheet. The UK exit represented a major strategic decision requiring board evaluation of market opportunities, valuation considerations, and capital allocation priorities.

Current State: 260 Facilities Under Chairman Oversight

As of 2025, Acadia operates 260 behavioral healthcare facilities with approximately 11,400 beds across 40 states and Puerto Rico. The company provides psychiatric and substance abuse treatment services across multiple care settings: acute care hospitals, residential treatment centers, outpatient clinics, and comprehensive treatment programs.

Patient populations include individuals requiring treatment for psychiatric conditions (depression, anxiety, bipolar disorder, schizophrenia), substance use disorders (alcohol, opioids, other drugs), and eating disorders (anorexia, bulimia). Services range from short-term crisis stabilization to longer-term residential treatment.

Acadia’s revenue comes from multiple payor sources: approximately 57% Medicaid, 26% commercial insurance, 14% Medicare, and 3% self-pay and other sources (based on project documents). This payor mix reflects the patient populations served and the types of facilities operated.

Reeve Waud’s responsibilities as chairman include oversight of company strategy, capital allocation, and management performance. He provides institutional memory spanning Acadia’s 20-year history. He participated in CEO transitions, major acquisitions, geographic expansion decisions, and strategic pivots.

Board service requires significant time commitment. Directors attend quarterly board meetings, participate in committee work, review monthly financial reports, and remain available for management consultation. For a company operating 260 facilities across 40 states, governance complexities multiply.

Reeve Waud also serves on other boards, including the Northwestern Memorial HealthCare Finance Committee and as a Trustee of the Art Institute of Chicago. These roles complement his business activities by providing exposure to nonprofit governance and healthcare system operations.

Waud Capital Partners, founded by Reeve Waud in 1993, manages approximately $4.6 billion in assets. The firm has completed more than 460 investments across healthcare and software sectors since founding.

The Acadia relationship illustrates Waud Capital’s approach to company building. Rather than pursuing quick exits, the firm supported Acadia’s development from startup platform through public company operations. Reeve Waud’s continued board service, two decades after founding, demonstrates sustained commitment to the company’s mission of providing behavioral healthcare services.