RECORD FUNDING IN HEALTHTECH STARTUPS LED BY WOMEN SETS AGENDA FOR FOUNDERS
Women-led healthtech companies in Africa saw a significant bump in funding from investors in 2023, according to a new report by Salient Advisory.
Rwandan-based startup Kasha, Kenya’s Maisha Meds, and Egypt-based startups Dawi Clinics and Chefaa collectively secured $52 million across 33 deals, contributing to a 2,000% surge in funding for women-led companies in Africa’s healthtech industry.
Jessica Vernon, CEO of Maisha Meds, attributed her company’s funding success to a distinctive business model focused on addressing problems. She emphasized reaching people at their primary points of care, such as private drug shops, pharmacies, and clinics, and leveraging technology to enhance digital efficiency and accessibility.
In 2022, women-led healthcare companies garnered only $2 million across 26 deals, constituting 1.4% of total healthtech funding. Notably, Kasha’s $21 million Series B funding marked the largest investment ever made in a woman-led health tech company in Africa. Funding for mixed-gender founding teams increased from 10% in 2022 to 21% in 2023.
This funding trend aligns with a robust year for the general healthtech space, which received $167 million in 2023. While this represented a 2% decrease from 2022, it outperformed the broader African tech ecosystem, which experienced a 39% funding decline.
Despite historical underrepresentation, women-led startups in Africa saw positive growth in 2023, raising just over $200 million, reflecting a 7% year-on-year increase. The 2,000% funding growth represents a significant step in narrowing the gender financing gap in health tech startups and the ecosystem as a whole, constituting 31% of total healthtech investment in 2023.
Noteworthy investors in Maisha Meds and other women-led companies include global development institutions like USAID and the Bill & Melinda Gates Foundation, primarily offering grants. Grants from these institutions play a crucial role in supporting early-stage healthtech innovators, comprising 52% of the 145 deals for African healthtech innovators in 2023.
While equity funding accounted for 91% of the total funding raised, with an average ticket size of $3.2 million, grants addressed funding gaps for innovators. The average grant size was $168,000, representing 7% of the total funding raised.
Barriers to private equity or venture capital funding for women founders or CEOs may stem from factors like prioritizing family over business, according to Ibijoke Faborode, founder of Africa Female Founders Collective (AFFC). AFFC, launched in February, aims to assist women founders or CEOs in creating more time for startups and connecting with interested investors through a 2024 program.
Jessica Vernon highlighted that women-led startups funded in the DIV round focus on innovative healthcare delivery models, particularly emphasizing the last mile and underserved populations.
Despite the challenges, Amaan Khalfan, CEO of Goodlife Pharmacy, and Jenne Nwokoye, founder of Clafiya, emphasized the importance of good record keeping, understanding opportunities in the health tech space, and fostering intentional connections with investors.
Jenne Nwokoye expressed the need for more VC funds led by women entrepreneurs and emphasized the importance of women being open in sharing funding opportunities. Looking ahead, she plans to be more intentional in finding investors who understand health, consumerism, and finance in Africa or globally for the next funding cycle.
Frank Eleanya; From the News Source: TechCabal
