Barely 2 months after receiving $1.1m in grant funding from the Bill & Melinda Gates Foundation, one of Africa’s most active investors, TLcom Capital has finally found faith in an African healthtech startup through Ilara Health, the Kenyan-based healthtech startup focused on bringing essential, affordable and life-saving diagnostics to African consumers. The startup has announced it has secured $3.75 million in Series A funding to enable it expand its diagnostic reach across Africa and to accelerate the development of its integrated patient health management platform.
“This funding round allows us to significantly grow our on-the-ground presence and invest resources into our technology capabilities. In just one year of operation, we have seen the incredible impact our Ilara Health platform has had in delivering improved services across maternal, metabolic, cardiovascular and infectious disease care,” said Emilian Popa, co-founder and chief executive officer (CEO) at Ilara Health.
Here Is What You Need To Know
- The investment was made by TLcom Capital, with participation from DOB Equity, Global Ventures and Chandaria Capital
- The startup will use the funding to grow its on-the-ground presence and invest resources into its technology capabilities.
- In 2019, Ilara Health raised $735k from ShakaVC, Chandaria Capital, and Villgro Kenya, with the round also including angel investors such as Esther Dyson, Nijhad Jamal, Aadil Mamujee, Selma Ribica, and Shakir Merali.
“In the coming months, we will continue working to reach patients who currently struggle to access basic lifesaving tests and on developing data-driven insights for better quality care across the continent,” Popa said.
Why The Investors Invested
This is TLcom’s first investment in any African early-stage healthtech startup. The VC has previously been investing mostly in fintech startups, some of its notable investments being those in Andela, Okra, Twiga Foods, uLesson, among others. Investment in Ilara Health is therefore a welcome development for the healthtech space in Africa, although a lot of seed investments are yet to be recorded in that space, compared to other sectors. Ido Sum, Partner at TLcom said TLcom has been monitoring the underserved health space in Africa for quite some time. Sum said since health is one of the areas on which African consumers spend the most, the quality of health outcomes needs to improve.
“The challenge of bringing affordable and high-quality diagnostics to the actual points of care is yet to be solved. We are excited about what Ilara Health was able to build in such a short time, and more so about their wider vision of combining world class technologies, financing and their own tech layer to bring true value to medical professionals and patients at the clinics visited by the majority of the population,” said Sum.
He further noted that Ilara Health very much represents the companies they like to partner with the most: solving a true, and large African problem, using tech to achieve scale, and bringing clear and very tangible value to its clients.
In February this year, TLcom announced the closing of its Tide Africa Fund at $71 million with plans to make up to 12 startup investments over the next 18 months. So far, out of that fund, TLcom has invested in Nigerian fintech startup Okra ($1m) and in car listing venture AutoChek ($3.4m).
DOB Equity’s investment in Ilara Health did not come as a surprise. Based (and actively investing) in the East African countries of Kenya and Tanzania, and in the Netherlands, the VC has specifically been investing in East African entrepreneurs trying to mitigate potential risks related to environmental, social and governance matters, whilst creating value and social impact for the company and its communities. It has previously invested in the Kenyan logistics startup Sendy; off-grid startup M-KOPA; ecommerce platform Copia Kenya and in a host of other agritech startups such as Twiga Foods, Countryside Diaries, Cropnuts, among other investments in that space and others. This is also the VC’s first investment in any healthtech startup in Africa.
On the other hands, Dubai-based Global Ventures is a global VC investing in emerging-market founders. In May, 2020, the VC made its first ever equity investment in the health technology sector in the Nigerian startup Helium Health. Ilara Health is its second investment in healthtech in Africa, a major indication that it is not regretting its previous investment in Helium Health.
Finally, Chandaria Capital is a Nairobi-based VC firm. The VC has previously invested in Nigeria’s TradeDepot, Sokowatch, Kobo360, among other investments. Investment in Ilara Health (first, last year) is also its first investment in the healthtech space.
In any case, over the years, investors have not appeared to see African healthcare startup ecosystem as investment-worthy. This perhaps explains the fact that in the past three years (2017–2019), healthcare startups in Africa only closed 27 deals (a majority of them being follow-on or new rounds of investments, as against investment in entirely new healthcare ventures). The worst fact about investment in the African healthcare startup space is that out of a jaw-breaking $4.1 billion received by African startups in total in four years (2016–2019), healthcare startups only boast of a meagre $237.1 million.
Even the coronavirus has not motivated so many investors to flock to the healthtech space. Only Nigeria’s Helium Health’s $10m fundraise in May, 2020 and Cameroon’s Healthlane’s $2.4million funding in September, 2020 surpassed the $1m funding threshold. The figures are too poor compared to other countries outside Africa. Venture capital investment in healthtech in India, for instance, hit $8.2 billion in the first quarter of 2020, the highest quarterly total on record ever.
A Look At What The Startup Does
Founded in 2018, Kenyan health startup Ilara Health sources tech-powered diagnostics equipment and makes it accessible to Africans who struggle to afford it, bundling the equipment and integrating the devices via a proprietary technology platform. Doctors pay a deposit to use the equipment and then pay off the remaining cost in installments determined by usage..
Ilara Health has partnered with over 200 facilities across wider Nairobi and Kisumu, up from 15 at the start of the year, and will look to expand across wider Kenya and a new East African market within the next 12 months. It has also recently announced the receipt of a USD$1.1 million grant from the Bill & Melinda Gates Foundation, in addition to its acceptance into MIT Solve’s fourth batch of Solvers, earlier this year.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer