In 2021, African health tech startups raised $392 million out of the total $4.9 billion secured in funding. This figure is far less compared to the amount needed to close the $66 billion financing shortfall in the African healthcare sector.
According to the World Health Organisation, Africa shoulders 25% of the global disease burden and yet only accounts for only 1% of the global financial resources for health.
While many startups are offering tech-enabled services in Africa, the health tech sector has yet to make headlines compared to fintech which raised 62% of all funding in 2021. However, things are now starting to look up for the healthcare sector.
Knight Frank, a London-based estate agency conducted a survey during its Africa Healthcare Webinar in June with more than 140 respondents from all types of property investors, including commercial and industrial. About 80% believed that Covid-19 had changed their investment strategy and that they would consider investing in healthcare, either through expansion or new investments.
Interestingly, many venture capital firms are now taking up the challenge to invest in the African health tech space.
Last week, Flying Doctors Healthcare Investment Company rebranded to Health Capital Africa to continue its mission of providing investment to Africa’s $66 billion healthcare gap.
Founded by British Nigerian Ola Brown in 2011, the venture capital firm is offering public-private partnerships (PPP) to finance the health system in Nigeria. HealthCap has enabled several companies to create over 1,000 direct and indirect jobs across the continent. It has invested in several African startups including Chison Express, Emergency Response, Influss, GertEquity, Reelfruit, Healthtracker, Bestcoin and Sygen among others.
Healthcap emphasises two major investment arms: infrastructure and venture capital. While its venture arm focuses on pre-series A startups, the infrastructure arm is more concerned with public-private partnerships in healthcare, clean energy and social infrastructure projects.
As part of its listings, Healthcap in collaboration with the Ogun State Government enabled the State’s Molecular Laboratory Project. The venture fund also partnered with private sector investors who worked with the Lagos State Government to develop and facilitate the Eti-Osa isolation centre project.
Ola Brown has been focused on building Healthcap as an independent investment company focused on venture capital and clean energy infrastructures like gas and solar, as well as healthcare and clean water.
The combined valuation of Healthcap’s portfolio companies is $690 million. The company has provided its services in over 100 countries.