Health tech startups in Africa have got another pool of funds to tap from. Founders Factory Africa and South African healthcare company Netcare are looking to select 35 African health-tech startups for an acceleration and incubation program.
Here Are Details Of The Fund
- Founders Factory Africa is looking to commit a minimum of a £30,000 cash investment in accelerated startups as well as £220,000 in support services each. Incubator health-tech ventures will receive £60K cash and £100K toward support.
- Founders Factory Africa and Netcare will then both retain a 5 to 10 percent equity stake in each startup accepted into the program.
- The program will accelerate 5 startups a year and incubate 2, FFA CEO Roo Rogers.
- Criteria for the accelerator startups include that they have a healthcare focus, be post-revenue, and have a Pan-African scope.
- Startups aiming to pursue those objectives through Founders Factory Africa’s new accelerator program have until September 6 to apply
- This is the first big foray into tech funding for Netcare, which operates South Africa’s largest private hospital network, according to CEO, Dr. Richard Friedland.
- The partnership includes an investment (of an undisclosed amount) by Netcare in Founder’s Factory Africa, or FFA. The Johannesburg-located organization was formed in 2018 as an extension of Founders Factory in London — an accelerator that has graduated 122 startups.
How Startups Can Access The Funds
Interested startups who render health-tech services in Africa can forward all their applications to Founders Factory’s Online Portal for the FFA’s new Africa health-tech program.
There Are Huge Opportunities And Gaps In The African Health Sector
“There are so many issues in terms of healthcare delivery in Africa that can benefit from technological solutions,” Netcare CEO Richard Friedland said.
“I think the old bricks and mortar model of delivering healthcare in South Africa, in a private insurance or public setting, is archaic, it’s limited, it’s capital intensive and I think health-tech solutions can break that down,” he added.
Overall, Founders Factory’s move into Africa and healthcare (through FFA) raises several compelling things to watch.
One is the rise in African health-tech as a sector and the need for more capital. Formation of healthcare-focused African startups has picked up but investment into these ventures is relatively low compared to annual VC: only $19 million of roughly $1 billion (using Briter Bridges and Partech numbers).
This is also particularly meager given the potential impact of health-focused startups on a continent that still posts dismal stats comparatively. World Bank life expectancy rates, which on average place Africa last, are just one indicator. So the FFA initiative could serve as a needed boost for African health-tech
“The way we deliver healthcare in South Africa, Africa, and perhaps internationally…is in many cases broken,” he said, adding there’s a crisis of affordability and access to healthcare in Africa.
“I believe healthcare is ripe for disruption and innovation and that couldn’t be more true than it is here in South Africa and the rest of the continent,” Friedland said.
He named the FFA partnership as a way to increase the quality of healthcare in Africa. “We think the…continent and even our own business in South Africa can benefit,” he said.
Netcare’s interest in partnering with Founders Factory Africa to support startups comes down to multiplying healthcare solutions across the continent and shaking up the healthcare industry, according to Friedland.
Though a value wasn’t named for the Netcare round, it’s Founders Factory Africa’s second investment raise and collaboration.
Founders Factory entered Africa in 2018 through a partnership with Standard Bank (the continent’s largest bank), which a release said included a “multi-million-pound investment.” Founders Factory Africa selected the first five startups for its fintech accelerator track in April 2019.
Founders Factory Africa and Netcare’s investment in health-tech could produce innovation models with use-cases beyond Africa. Zipline and the rest have already given African health startups the green light.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.