Reliance Health, a digital healthcare firm based in Lagos and Texas, is the latest beneficiary, raising $40 million in big style. The Series B round is the biggest in African healthtech history.
“Our mission is super simple. I mean, the definition is simple, but the execution is sometimes more difficult than that,” said chief executive Femi Kuti,. “So essentially what we’re trying to do is to use technology to make quality health care accessible and affordable in emerging markets.”
General Atlantic led the fresh round of investment. Partech, Picus Capital, Tencent Exploration, Africa Healthcare Master Fund, P1 Ventures, Laerdal Million Lives Fund, and M3 Inc. are among the other investors in the round.
Reliance Health’s chief executive said the company aims to use some of the money to develop two more clinics in Nigeria’s Abuja and Port Harcourt. Reliance Health also plans to hire talent and expand new product lines, particularly for Nigerians living abroad.
Why The Investors Invested
The startup has acquired considerable traction. The six-year-old company claims to have grown its sales by 3.5 times year over year since 2016. This continued growth will be fueled by a new round of funding led by General Atlantic. It marks the company’s first investment in Africa, joining a growing list of first-time investors that have led expansion rounds in the last two years, including FTX, Avenir, SVB Capital, and Fidelity.
“General Atlantic is thrilled to announce our first technology investment in Africa in Reliance Health, backing a team focused on improving healthcare quality for millions of patients in Nigeria and abroad,” said Chris Caulkin, the managing director of General Atlantic and head of EMEA Technology in a statement. “We have been consistently impressed by Femi and Ope, who exemplify the entrepreneurialism and innovation we see across the African continent.”
This funding comes two years after the company raised $6 million in a Series A round in January 2020. Reliance previously secured a $2 million seed round in 2017, months after graduating from YC. Partech, Y Combinator, Golden Palm Investments, Ventures Platform, Lofty Inc– as well as Tencent and Picus– were among the investors in both rounds, which totaled $48 million.
A Look At What The Startup Does
Femi Kuti, Opeyemi Olumekun, and Matthew Mayaki launched the company in 2016. It provides health insurance and telemedicine through agreements with hospitals and healthcare providers using an integrated process.
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Reliance Health provides some of its healthcare directly, via its telemedicine platform, drug delivery system, and two clinics in Lagos, Nigeria. Hospitals, diagnostic centers, and pharmaceutical centers are examples of third-party provider partners.
Business-to-business and business-to-customer models are used by Reliance Health. Individuals can choose monthly, quarterly, or yearly health plans starting from NGN3,500 ($7.00) to NGN148,500 ($297.00) through RelianceHMO, the company’s health insurance plan for both groups of clients. Businesses, on the other hand, can purchase subscriptions on behalf of their employees, which, according to Kuti, are slightly less expensive than retail plans.
Reliance Health is used by over 200,000 people across both models. However, it is the platform’s business clients who have shown the most loyalty. According to Femi, the platform services 600 of them, including Biersdorf Nivea, Jumia, and PwC, while maintaining a 99 percent attributed intention rate.
With an app, these clients may talk with a doctor, identify healthcare providers near them to visit or get meds from and manage the delivery of their drugs. Reliance, for example, may propose lifestyle adjustments if a customer was diagnosed with diabetes and make hospital referrals if a user spent hours on the phone during his last visit to the clinic, according to Femi.
The health-tech firm will branch out into other markets. Egypt is at the top of the list, with Reliance Health already employing a national manager in preparation for a mid-year launch. According to Kuti, the company plans to enter two or three nations by the end of the year.
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Kangpe, a telemedicine-focused firm in Nigeria with the slogan “doctor in your pocket,” was founded by the three co-founders in 2015. They pivoted to Reliance after a year of running the firm and seeing how early the market was and the systematic follow-up gaps and processes that existed.
“Back then, for example, if a patient chats with this doctor and he recommends an x-ray checkup or after that, a surgery, what happens next?” Kuti queried. “We weren’t able to manage all those [end-to-end] processes and that necessitated sort of a soft pivot from the whole telemedicine focus thing to this integrated healthcare provider that we’re doing today.”
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