•Deals rise by 17% to hit $167m

•Women-led healthtech businesses attracted $52m

•Online pharmacy solutions raked in $63m

•114 Innovators received funding

By Juliet Umeh

Despite investments in the broader African startup ecosystem dipping by 39 percent at the end of 2023, the healthtech genre of the ecosystem, however, showed impressive growth with deals rising by 17 percent to hit $167 million.

The number of deals in African healthtech rose by 17% year-over-year (YoY) to 145, with total funding of $167 million and an average ticket size of $1.1 million.

  In total, 114 innovators received funding in 2023, with 23 receiving multiple investments in the year. In the same trajectory,the number of deals for women-led companies remained relatively steady, moving from 26 in 2022 to 33 in 2023,

However, the amount of funding saw a dramatic shift as the gender gaps significantly narrowed: women-led companies secured $52 million in funding, representing 31 percent of all investments in 2023. This represents a 2000% YoY increase compared to the $2 million 1.4 percent they received in 2022.

“Online pharmacy solutions attracted the majority of investor capital, capturing 38 percent ($63 million) of all funding raised.

These were driven by Series B funding rounds by Kenya’s Kasha which raised $21 million and MyDAWA that also raised $20 million. Also Egypt’s Yodawy added to the till by raising $16 million.

Still on growth, Electronic medical records solutions were the second-best funded category, driven by Helium Health’s $30 million Series B funding round.

Equity investments accounted for 91 percent of total funding with an average deal size of $3.2 million. This significantly outpaced grants, which only contributed 7 percent of capital with an average ticket size of $168,000. 

However, grants continue to play a crucial role in enabling access to early-stage funding for innovators to test and validate their business models. Debt funding remains rare as only one debt-based investment was tracked in 2023.

While still rare, merger and acquisition activity doubled in the past year with four key transactions. The prospect of future funding also appears strong as, despite broader economic headwinds which suggest a slowdown in funding for technology startups, over $600 million in new funding was announced by investors with an interest in African health systems.

All these are contained in a new report by healthcare consulting firm, Salient Advisory, titled “2023 RoundUp: Investments in African HealthTech” 

The report was funded by the Bill & Melinda Gates Foundation. The report presented findings on funding activity, covering grant, equity, and debt investments for African healthtech startups in 2023. 

The report also provided analysis on funding trends in African healthtech ecosystems, insights for key stakeholders across governments, investors, donors and global health institutions.

Speaking on the launch of the report, Engagement Manager at Salient Advisory, Yomi Kazeem, said “The resilience of African healthtech innovations shines through in the findings of this report. 

“Amid difficult headwinds, these innovations continue to demonstrate commercially viable models that have the potential to improve access to healthcare and deliver impact at scale. 

“The increased funding for women founders is a high point and, in coming years, investors must prioritise sustaining strategies that ensure equitable funding across founders.”

Also, Deputy Director, Global Health Agencies and Funds, Bill & Melinda Gates Foundation, Dr. Analía Porrás, said: “African healthtech has proven resilient over the past year, with innovators receiving investments to test, validate and scale solutions that have the potential to transform health systems across the continent. 

“We are pleased to be playing a role by providing innovators with risk-tolerant capital through the Investing in Innovation program and hope to see the current resilience translate into increased confidence and funding from investors and donors.”