A look at funding reports from recent years will show a pattern of investor focus on sectors with the most perceived prospects for growth and prominence. We’ve seen eCommerce companies and financial services companies heavily dominate West Africa’s funding space in the last decade.
According to Techpoint Africa’s Nigerian Startup Funding Report 2020, Nigerian healthtech startups witnessed increased funding activity, coming second only to financial services startups in terms of funding size and the number of deals made in 2020.
For the period in question, these startups raised $32.5 million across seven deals, 404% higher than the entire disclosed record ($6.3 million) for 2019. This accounted for 26.8% of the total funding raised by Nigerian startups in 2020.
This increase in investment coincided with the advent of COVID-19 in Nigeria, and investors were seemingly willing to bet a lot more on healthtech companies than they have been willing to in the past.
As pointed out by various academic research, Nigeria, Africa’s most populous country has been sorely lacking in standard healthcare infrastructure, and according to Universal Health Coverage (UHC) effective coverage index the country only provides effective essential healthcare services to 38.3% of its population.
The Financing Global Health Database 2019, reports that in 2017, the Nigerian government spent only $11 million on health, with out-of-pocket spending accounting for $60 million.
However, There’s been encouraging signs as Nigeria’s Minister of Health, Dr Osagie Ehanire unveiled the Nigerian health sector roadmap in December 2020, which he claims will reduce the current imbalance between primary, secondary, and tertiary healthcare among other things.
Putting some relevant questions aside, Nigeria has not faired too badly with COVID-19, but its health sector clearly needs major shaking up.
Thankfully, companies like 54gene, Helium health, Flying doctors, and Life Bank have been making great strides in the fight against COVID-19, and in the development of Nigeria’s health infrastructure as well as research and development.