Investors update: June 22 2023 - A health fund raises $50m to scale innovative healthcare in Africa

A health fund raises $50m to scale innovative healthcare in Africa

Highlights

• FSD Africa Investments, AfricInvest, Malaria No More, and Health Finance Coalition (HFC) have launched the Transform Health Fund (THF), a $50 million blended finance fund for scaling proven and innovative healthcare models in Africa.
• The fund aims to respond to the critical healthcare financing gap in Africa while building a resilient healthcare ecosystem that improves access, affordability, resilience, and quality of healthcare for low-income patients.
• Investments will target countries across sub-Saharan Africa, with a focus on East, Southern, and Francophone West Africa, to address the acute need for quality and affordable healthcare across the continent.

Source: ABC

Our Takeaway

Compared to the rest of the world, Africa still has a long way to go in terms of healthtech startups and healthcare provision more broadly. There are lingering issues such as the low doctor-to-population ratio yet to be addressed. But recently, especially since the disruption caused by Covid-19, a number of healthtech startups have sprung up providing innovative solutions to the problems bedeviling the continent’s healthcare system, and are increasingly getting VC backing to capture a widely underserved market. The new fund intends to target three critical areas serving low-income patients: supply chain transformation, innovative care delivery, and digital innovation.

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FMCG profits in Nigeria surge despite economic headwinds

Highlights

• Six fast-moving consumer goods (FMCG) companies in Nigeria reported a surge in revenue despite economic challenges in 2022 due to the Russia/Ukraine war.
• The collective revenue of BUA Foods, Cadbury, Dangote Sugar Refinery, Nascon, Nestle, and Unilever increased by 32.9% in 2022 compared to 2021, with combined profits after tax rising by 48.5%.
• Nestle had the highest revenue of ~₦447 billion ($596 million) in 2022 and BUA Foods had the second-highest at ~₦418 billion.

Source: Nairametrics

Our Takeaway

Africa is expected to represent 40% of the human population by the end of the 21st century with the FMCG market positioned to emerge as its first globally relevant industrial sector. As the demand for packaged food, beverages, personal care products, and household items surges, multinational companies are expanding their presence and local players are emerging. But challenges like infrastructure limitations and affordability remain. Nonetheless, with a rising middle class and increasing urbanization, the FMCG sector in Nigeria and Africa is poised for further expansion and presents lucrative opportunities for investors.

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Ethiopian upcycling startup Kubik raises $3.34m seed funding

Highlights

• Kubik, an upcycling firm with operations in Kenya and Ethiopia and one of the startups driving plastic waste recycling and sustainability initiatives in Africa, has closed a $3.34 million seed funding round.
• The startup turns hard-to-recycle plastic waste into affordable building materials including bricks, columns, beams, and jambs, removing 45,000 kgs of plastic waste from landfills every day.
• Following the investment, the firm plans to increase its focus on building material production in Ethiopia before expanding to other African countries.

Source: TechCrunch

Our Takeaway

Plastic pollution is a major problem that causes environmental damage and risks lives. Globally, plastic garbage production is on the path to quadruple to over 1,000 million tonnes by 2060. But estimates show that the share of recycled plastic will nearly double to 17% over the same time period as plastic entering waste management systems grows. In Africa, recyclers currently recover only 4% of the waste generated, indicating there’s a long way to go. But with VC-backed efforts from startups like Kubik, there’s a ray of hope.