Brace yourself, as in the near future, we are bound to see a lot of new health tech solutions. 35 African health-tech startups will soon start their journey to success. These startups will become part of the acceleration and incubation program financed by South African healthcare company Netcare and Founders Factory Africa.
The goal is to stimulate research and development in the health technology field. And, there is no better way to do it but to give funds to young and innovative people inspired to develop and deliver the new tech to the health sector.
Founders Factory Africa and Netcare Partnership
Founders Factory Africa was founded in 2018 with only one goal in mind – “to transform Africa’s startup economy by designing purpose-built scalable technology businesses, deliver new capital flows and develop the best talent.” It is a branch of the now-famous Founders Factory partner for founders established based in London, UK. Over the course of the last few years, this organization has helped well over 100 startups.
The first time Founders Factory Africa could be seen on this continent was in 2018. This is when the organization partnered up with Standard Bank which is the largest bank in Africa. The partnership between these two included a multi-million pounds investment. A couple of months following their arrival on the continent, Founders Factory Africa funded five startups.
The other player on the field is a South African healthcare company Netcare Limited. Netcare managed to build a huge Netcare family by providing quality care and professional excellence. Netcare is an investment holding company with head offices in Sandton and Benmore, South Africa. Currently, it operates South Africa’s largest private hospital network.
Netcare is, at the moment, in charge of 54 hospitals, and 18 primary care centers according to Dr. Richard Friedland, the CEO of Netcare. These hospitals are equipped to accommodate approximately 11,000 patients.
Netcare and Founders Factory Africa came together and formed a partnership with the goal to fund startups in the health tech industry. The partnership includes an investment. At this point, we don’t know the amount of the available funds as the companies didn’t disclose it.
The Application Process
After launching a new Africa health-tech program, Founders Factory Africa and Netcare opened the application process to startups. Roo Rogers, the CEO of Founders Factory Africa, said that the program will accelerate 5 startups and incubate 2 startups a year.
The funds will come right at the start as an investment, and another amount will follow towards startup support. Since the funders focus only on health-tech startups, they made the criteria for the applicants very clear.
For a startup to be eligible for accelerator funds it has to:
- Have a healthcare focus
- Have a Pan-African scope
- Be post-revenue
The application process is straightforward. Founders Factory Africa has provided a very easy-to-use web app and applicants can use it to submit their applications online.
The Rewards for Startups
A startup can get into two programs by the Founders Factory Africa and Netcare. One is the acceleration program and the other is the incubator program.
Accelerated startups will receive a cash investment of a £30,000, which is approximately $38,000. Additionally, accelerated startups will receive support services from Founders Factory Africa in the value of £220,000, which is approximately $278,000.
Health-tech startups that get into the incubator program are in line to receive a cash investment of £60,000, which is approximately $76,000. Incubator health-tech startups will also receive support services from Founders Factory Africa in the value of £100,000, which is approximately $125,000.
It is important to note that Netcare and Founders Factory will share 5% to 10% percent equity stake in each health-tech venture accepted into this program.
The Goal of the Investment
In one of the latest interviews, Dr. Richard Friedland, the CEO of Netcare said that there is a sort of crisis in Africa, in terms of access to and affordability of healthcare. By partnering up with Founders Factory Africa, Netcare hopes to shake up the entire healthcare industry in Africa and increase the number of viable healthcare solutions continent-wide. The ultimate goal of the investment is to increase the quality of healthcare in Africa.
“The way we deliver healthcare in South Africa, Africa, and perhaps internationally… is in many cases broken,” said Friedland in one of the interviews. He also added: “I believe healthcare is ripe for disruption and innovation and that couldn’t be truer than it is here in South Africa and the rest of the continent. We think the continent and even our own business in South Africa can benefit.”
Things to Watch For In the Future
The Founders Factory Africa moves into the continent and its partnership with Netcare will potentially change a few things up.
First, it will change the annual venture capital distribution. Until now, health-tech ventures were at the bottom of the annual venture capital investments lits. Helth-tech startups received only $19 million in investments last year, which is a fraction of $1 billion of investments into the African startup sector.
This is also great news for the people living on the continent. The fact is that life expectrancy rates are lowest in Africa, and new health-tech solutions will certainly improve this. Majority of the healthcare delivery issues on the continent are rooted in the lack of technological solutions. Breakthroughs in this field will most definitely improve the delivery of healthcare.
The solutions provided by the newly funded health-tech startups could easily end up being used outside of Africa as well.
We are looking forward to seeing the new health-tech solutions delivered by the 35 new startups and their impact on the healthcare delivery system in Africa and worldwide.
