As a Nigerian medical doctor, I have navigated the healthcare ecosystem from multiple vantage points: implementing global health programs with the Clinton Health Access Initiative, consulting for healthtech startups in Lagos at INC Consulting, contributing to Novartis-funded malaria research, and founding Medintech Africa, a student-led and student-focused health tech incubator.
These experiences have given me a front-row seat to the bottlenecks founders face: fragmented payer systems, regulatory fog, and uncertain exit pathways. Strikingly, these hurdles echo those faced by Nigerian fintech between 2015 and 2017. Back then, fintech attracted record interest but remained stifled by fragile infrastructure and trust deficits. Today, fintech is our crown jewel.
I believe healthtech is at that same precipice. But to cross it, we must stop building “shiny apps” and start building the “rails.”
The historical analogue: Why 2017 matters
In 2017, fintech accounted for 45% of Africa’s startup funding, yet growth was constrained by outdated regulations and customer scepticism. The “gold rush” only truly arrived when fragmented startups found common ground through regulatory sandboxes and bank partnerships.
By 2018, fintech captured 58% of Nigerian startup funding ($103M). Healthtech is following a similar trajectory but with two critical divergences:
- The Capital Stack: While early fintech relied on foreign VC, healthtech is even more dependent on catalytic grants. From my work at INC Consulting, I’ve seen that founders often struggle to secure pre-seed rounds without “grant scaffolding” to mitigate risk in the venture.
- The Regulatory Maze: While fintech had a central anchor in the CBN, healthtech founders must navigate a fragmented alphabet soup of agencies (NAFDAC, MDCN, NHIA, etc.) without a “one-stop shop.”
From healthtech 1.0 to 2.0: The infrastructure pivot
We are witnessing a shift from healthtech 1.0 (isolated, grant-heavy pilots) to healthtech 2.0 (infrastructure-first platform plays).
The B2C “Uber for Doctors” model is failing because customer acquisition costs are unsustainable in a market where 75% of spending is out-of-pocket. Instead, the winners of 1.0 are those digitising the “un-sexy” parts of the value chain
- Pharmacy Supply Chains: Digitising procurement in a $1.2B medicines market.
- SaaS for Clinics: Creating sticky, annuity-like revenue through EMRs and inventory management.
- Embedded Financing: Moving away from out-of-pocket payments toward micro-premiums and subscription packages.
Lessons from the trenches: Success and failure
The contrast between success and “perpetual pilot mode” often comes down to distribution and capital structure.
- The Success Case (WellaHealth): By focusing on pharmacy networks rather than direct apps, WellaHealth processed ₦1.4 billion in pharmacy benefits by 2024. They treated pharmacies as the “agent networks” of healthcare—trusted, local, and accessible.
- The Warning Case (EMedrep & ProNOV): These ventures demonstrated strong product-market fit but were hindered by restrictive capital structures (e.g., 35% equity for small seed investments) and a lack of follow-on funding. It proves that in healthtech, profitability alone isn’t a shield; you need “patient” risk capital.
The regional benchmark: Where does Nigeria stand?
Compared to our peers, the “readiness” of the ecosystem varies:
- South Africa: Leads in policy scale and insurance depth (15% coverage), making it ideal for high-complexity hospital software and IoMT (Internet of Medical Things).
- Kenya: The “pragmatic testbed.” Their mobile-money culture and openness to interoperability standards (FHIR) make it the easiest place to pilot public-sector integrations.
- Nigeria: The largest commercial opportunity, but one that requires “infrastructure-aware” design. Success here requires offline-first UX and USSD interfaces to bypass connectivity gaps.
The exit myth: Rethinking liquidity
Silicon Valley-style unicorn IPOs are unlikely for African healthtech in the near term. Instead, we should look for four “M&A Archetypes”:
- Corporate Acquisitions: Telcos and Insurers buying startups to plug claims-processing gaps.
- PE Roll-ups: Consolidating fragmented EMRs and labs into national platforms.
- Blended Finance Transitions: DFIs and private VCs co-investing to move startups from grant dependence to commercial scale.
- Secondaries: Early VCs selling to late-stage PE firms with longer time horizons.
The “smart capital” opportunity
Nigeria’s healthtech is at a familiar inflection point. The winners won’t be those chasing vanity metrics; they will be those who build infrastructure moats and align with public-private financing rails.
Regulation will eventually catch up, just as it did for fintech, but the arbitrage window is open now. Investors who underwrite the transition from “isolated pilots” to “systemic rails” will own the foundations of Nigeria’s $100B health economy. This is not just a tech play; it is a systemic rewiring. The capital that understands this will capture both outsized returns and enduring impact.
About the Author
Isaac Ekundayo, MD, is a digital health innovator passionate about increasing access to healthcare in Africa. He is also a member of Included VC. Follow him on LinkedIn for more insights here: https://www.linkedin.com/in/isaac-ekundayo/
