In the small world of African finance, one of the great lessons of 2021 has been to see African start-ups earn their letters of nobility. The continent’s tech ecosystem has raised over $4 billion, slightly more than the gross domestic product of a country like Sierra Leone. For a scene which, ten years ago, was still in its infancy, we can clearly speak of a performance.
But behind these figures, of course, there are inequalities. These relate primarily to the distribution of these investments. Thus, English-speaking Africa takes the lion’s share. Of the $8.8 billion injected into the sector between 2015 and 2021, the region absorbed the bulk, leaving only $417.9 million to Francophone Africa. Crumbs. Inequalities are also sectoral. Fintech and AI are the main destinations for investments.
A simplistic reading of these figures might suggest that only English-speaking countries offer a mature ecosystem and only companies present in fintech and AI might be of interest to investors. It would therefore be better to be called Paga or Flutterwave than Meditect or GoMedical. But the reality is much more nuanced.
Salient Advisory and Noru Capital recently carried out an analysis on start-ups active in health technology (Health tech). The results of this work demonstrate that Francophone Africa has strong potential in this area and that active innovators in countries such as Côte d’Ivoire, Burkina Faso or Senegal are developing solutions that might potentially revolutionize the way Africans take care of themselves.
Telemedicine players such as Njureel (connecting patients with contact with practical and high-quality medical services), MaiSoin (home care and online consultation), or Tanél Health (private pharmacy management software) can become the next African success stories. In addition, the creation of accelerators dedicated to Health Tech such as Next Health Accelerator, offer French-speaking start-ups in the field both technical support and a network. Projects like “Investing in innovation”, which is supported by the Bill & Melinda Gates Foundation, will bring funding and market access to French-speaking innovators in the sector.
Does the future look bright for Health Tech in French-speaking Africa? There are some weak signals. Thus, investments in the healthcare sector in Africa have increased from $30.9 million in 2019 to $221.6 million in 2019. Start-ups in Francophone Africa are experiencing limited interest from investors. If in 2019, only one financing agreement had crossed the million dollar mark, in 2022, there have already been 15. French-speaking start-ups have already raised $240 million.
But there is still a long way to go from the cut to the lips. The main obstacle of Health tech in French-speaking Africa is regulation. These companies evolve in a vague environment when it is not particularly restrictive. Thus in countries such as Côte d’Ivoire, Senegal and Burkina Faso, which might constitute locomotives for the sector, e-pharmacies must go through a crossroads. Indeed, the legislation restricts their ability to store, sell or advertise medical products. Meanwhile, their English-speaking counterparts are playing on velvet. Pharmacy chains such as Goodlife Pharmacy and HealthPlus are now getting into e-commerce. Konga Health and MyDAWA sell medical products directly to consumers.
The competition between companies in the sector takes place partly on the regulatory ground. And if at this level, the flexibility of English-speaking legislators is to be welcomed, it opposes in French-speaking Africa to an immobility that struggles to hide the many laws on start-ups aimed at supporting innovators and creating an environment favorable to businesses. .
These difficulties are reminiscent of those of the continental fintech which had to face legislators, commercial banks and other public actors before imposing themselves. Today, African nations have learned and offer real support to these companies. An identical effort is expected with regard to Health tech. New regulatory frameworks, partnerships to test solutions and enable scaling up… A battery of measures will be needed to move from words to deeds.
This effort also concerns investors in the field who will have to provide both highly targeted investments and technical support to African entrepreneurs to enable them to access available capital.
For the various actors, the challenge is simple: it is a question of profoundly changing the way Africans treat themselves by bringing care and services closer to their natural public. A revolution, then. No more no less.
