Afridigest Week in Review: Hard cash for health care

+Egypt's ascent continues +Dynamic pricing +Demand driving supply +Hypotheses, MVPs, and MVTs +More

Emeka Ajene

Sep 21

The Afridigest Week in Review is a must-read weekly recap for Africa-focused founders, executives, and investors, as well as interested observers.

Welcome back! Apologies for the delay here, busy times across a few dimensions. FYI, there are almost exactly 100 days left in the year as of now — good time for an end-of-year sprint 💪

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Week 37 2021

📰 Deal of the week

PRECISION MEDICINE

54Gene, a Nigerian genomics startup headquartered in Washington DC, raised a $25M Series B round led by Cathay AfricInvest Innovation Fund, with Adjuvant Capital, KdT Ventures, Plexo Capital, Endeavor Catalyst, and Ingressive Capital participating. 54gene has now raised over $45M since its 2019 founding.

💡 Why it’s the deal of the week: 54gene, one of the continent’s most innovative health-tech companies, gathers genomic and clinical data to improve health outcomes. In three short years, the startup has built a notable precision medicine platform with applications across drug discovery, molecular diagnostics, and clinical trials; and the company revenue now generates revenue from its diagnostics operations. 54gene is among the short list of Africa-focused companies to have progressed from seed stage to Series B in less than three years.

⛏️ Go deeper:

Key metric — number of biobank samples: Founder & CEO Abasi Ene-Obong, PhD disclosed to GenomeWeb in January that "we have hit a milestone in terms of participant recruitment…100,000 participants. Now we are looking at how we can expand our studies in multiple geographies to triple or quadruple that number within the next 18 to 24 months."
What 54gene actually does and why you should care: “54gene is more than just a biobank. We see ourselves as a health technology company deriving insights from the world’s most diverse populations to solve some of healthcare’s biggest challenges. This involves generating data that can inform treatment and translate research into potential drugs or molecular diagnostics down the road. We also run clinical programs that help to test drugs and treatments that ensure that we have optimal medicines for our population.” — COO, Delali Attipoe
Hear from Abasi Ene-Obong, PhD, 54gene’s CEO, in this June 2019 interview — right before the $4.5M seed round was announced:

🔦 Other deals

A DEAL DELUGE — EGYPT’S CONTINUED ASCENT

Capiter, an Egyptian B2B e-commerce platform, raised a $33M Series A co-led by Quona Capital and MSA Capital, with Savola, Shorooq Partners, Foundation Ventures, Accion Venture Lab, Derayah Ventures, and others participating — over 50,000 merchants use Capiter’s platform and the company projects reaching an annualized revenue run rate of $1B sometime in 2022
Dopay, an Egyptian payments platform, raised an $18M Series A co-led by Force Over Mass Capital, Dutch development bank FMO, and NN Group; Mbuyu Capital and Alder Tree Investments also participated — this comes after the startup was awarded a banking agent license last month, allowing it to launch a virtual banking platform
Releaf, a Nigerian agritech platform, raised a $2.7M seed round co-led by Samurai Incubate Africa, Future Africa, and Consonance Investment Managers; Stephen Pagliuca, chairman of Bain Capital, Justin Kan, co-founder of Twitch, and others participated — the startup has developed a proprietary patent-pending machine for extracting vegetable oil from palm nuts; in addition to the seed round, Releaf also secured $1.5M in grants from The Challenge Fund for Youth Employment and USAID
Kashat, an Egyptian provider of micro-loans to the unbanked, raised a $1.75M bridge round led by Launch Africa, with Cairo Angels and others participating — the startup offers short-term loans of between ~$13 and ~$95 with a repayment term of up to ~60 days
Sotech, an Egyptian e-health & internet of things platform, raised a $1M pre-seed round led by Innlife Investments and corporate investor Al Raya Kuwaiti — the startup operates an interesting model at the intersection of tech, data analytics, marketing, and healthcare and has over 200 clinics in its network
Aviro Health, a South African provider of digital healthcare solutions, raised an undisclosed pre-Series A from ASISA ESD Fund, Tuksnovation, and TIA — the startup disclosed that its digital counseling service, Aviro Pocket Clinic, has been used by over 50K patients across South Africa and Kenya
DataPathology, a Moroccan digital pathology platform, raised ~$223K from Witamax — the startup digitizes biopsy samples of cancer patients and shares secure & anonymized patient files with remote practitioners who can make use of artificial intelligence tools to aid their diagnosis
Viable Solutions, an Ethiopian startup that operates the EPhone app, raised a $200K pre-seed at a $1.9M valuation led by angel investor Ahmed Al Alola; also participating was Amadou Daffe, CEO and Co-Founder of Ethiopian/pan-African talent marketplace Gebeya — the EPhone app, which simplifies tedious USSD tasks for a variety of consumer and B2B services in Ethiopia, is said to have reached over 150K users after just 21 months of operation.
Jumuisha, a Kenyan provider of payments solutions for religious institutions, announced that it raised an undisclosed seed round from Austin-based SprintX Venture Studio in July — the startup has signed up ~140 churches and processed over 100K financial transactions since its October 2020 launch

DEBT

Finclusion, a pan-African financial services group focused on AI-driven alternative credit scoring models, raised $20M in debt financing from Lendable — Finclusion’s current portfolio includes eight brands that serve ~240K customers across five countries: SmartAdvance, TrustGro, Fractal Labs, Niftycover, Niftycredit, Click2Pay, HelloHR, and GetBucks.
Yellow, a South Africa and Malawi-based distributor of pay-as-you-go solar home systems, obtained a $4M loan from SunFunder — the company previously raised a $3.3M Series A round in September 2020

ACQUISITIONS

Picup, a South African on-demand logistics & fleet management platform, sold a 70.1% stake for $4.75M to NASDAQ-listed Karooooo, a SaaS platform for smart transportation — Picup does ~200K deliveries per month for blue-chip clients such as South Africa’s Pick n Pay & others, and it disclosed an annual revenue run rate of ~$5.3M; Founded by South African entrepreneur Zak Calisto, Karooooo’s market cap is just under $1B
- Pair with: South Africa’s tech billionaire behind the Nasdaq listed Karooooo

📚 Reads of the Week

ON DYNAMIC/ALGORITHMIC PRICING

A solid read from two marketing professors on AI/ML-enabled dynamic pricing, with real-world examples & recommendations.

“Today even the slowest-moving B2B industries are [using] powerful algorithmic-pricing tools. Technology has enabled firms to deepen their relationships with customers and, in parallel, become more efficient and proficient in extracting money from them. This combination, however, often leaves customers wondering what they should think and which companies they should trust.”

🥇 “The Pitfalls of Pricing Algorithms” by Marco Bertini and Oded Koenigsberg

UNLOCKING ORGANIC GROWTH FOR PLATFORMS

What do Airbnb, Square, Uber, Eventbrite, and others have in common? They share a little-understood growth loop: demand driving supply. Brian Rothenberg, ex-VP of Growth at Eventbrite writes here about how to identify and make the best of this opportunity.

“Because the conversion rate tends to be small, this loop is often more apparent and becomes a more powerful lever as the demand side of your business increases in scale. In the earliest days, … this may not materially move the needle in terms of supply-side growth. Where it becomes really powerful is when the volume of demand-side users ramps up…It’s around this time when the data will tell you some interesting things.”

“Demand driving supply” by Brian Rothenberg

📢 Afridigest is the industry newsletter for Africa’s startup ecosystem.

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📚 Quick Hits

FOR YOUR READING PLEASURE

B2B payments: unlocking a multi-trillion-dollar opportunity — While much of the fintech and payments innovation in the past has been consumer-facing, B2B payments presents an extremely attractive market for upstarts and investors alike.
How to raise investment — VC returns are driven by outlier companies. So VC investment decision-making is driven by fairly straightforward psychology. It’s the fear of missing out on one of these apparently “hot” deals.… You want to project quiet confidence, huge ambition, and relentless determination.
The minimum viable testing process for evaluating startup ideas — Traditional dogma in the startup ecosystem is to throw a minimum viable product out as fast as possible, but what’s important is an MVT: a test of an essential hypothesis that you must be right about or else the company won’t stand a chance.
The best startup ideas have multiple paths to success — A good entrepreneurial idea is simply a hypothesis that there is the potential to create and capture value by introducing something currently missing…but there will be multiple alternative paths forward to implement if the underlying hypothesis is indeed true.
Most startup ‘pivots’ aren’t really pivots, they’re just what startups are supposed to do — How a pivot is defined matters for two reasons: calling normal startup iteration a ‘pivot’ creates a psychological barrier to change; and pivots shouldn’t be cavalier decisions.
The supreme importance of innovation theories — if more innovators leverage good innovation theory, they’ll make better decisions that will ultimately lead to success…Theories focus on the supremely practical question of what causes what—and why?

Bonus:

The Exponential Age will transform economics forever

🕵️‍♀️ In case you missed it

NEWS & ANNOUNCEMENTS

Traditionally Africa-focused VC firm CRE Venture Capital co-led a ~$3M seed funding round in UK-based legal technology start-up Definely alongside Microsoft’s venture arm, M12 — Nigerian-born Nnamdi Emelifeonwu, a former barrister, is a Definely co-founder
Vodacom commits to funding Safaricom Ethiopia (which was awarded a license in May) — Vodacom has a 6.2% stake, while Kenya’s Safaricom Plc has a 55.7% stake
The Global Innovation Initiative Group is seeking to raise $100M fund to invest in innovative early-stage tech start-ups across Africa
University of Rwanda, Mastercard Foundation launch $55 million partnership to develop the next generation of African leaders
Bitcoin adoption in Africa grows 1200% in one year

LA FIN

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