Connecting Africa Podcast: S3 Ep. 5 - Revolutionizing healthcare access

On this episode of the Connecting Africa Podcast, medical doctor, health economist and Wellahealth Founder and CEO Dr. Ikpeme Neto, joins the podcast to speak about how tech-enabled health services and micro-insurance are helping to improve healthcare for Africa's underserved populations.

Wellahealth was founded in 2015 in Nigeria with a mission to provide quality and affordable healthcare to every African. The company provides healthcare financing options via low-cost micro-insurance health products for common illnesses and leverages pharmacies as points of care.

Dr. Neto shared his backstory and his belief that a lack of money should not hinder anyone from having access to quality healthcare, something that struck him while working as a medical doctor in developed markets like New Zealand.

"I think Africans are just as valuable as everybody else all across the world and do deserve access to great quality healthcare regardless of how much they have, or how much they earn, or who they are, what their status in society is," he said.

"So that is the driving belief that propelled me to leave the regular practice of clinical medicine and to return to Nigeria to figure out how to help the average person on the street afford great health care without really having to impact his finances," he went on.

He spoke about the challenges he faced as a new founder and the mistakes he made along the way, before finding success with Wellahealth.

"Eventually, I figured out that we've got to find a way to build for what people can afford and what people can afford is micro health products," he explained.

"So, we designed around what people were willing and able to pay. If people can only pay US$1 a month, what kind of service can we provide them and how can we make that dollar a month go farther? That's essentially how we came about with the kind of products that we have now," he added.

His initial interest was in treating chronic diseases and micro-insurance was not even on his radar in the beginning.

However, he realized that Africa was facing a "double peak of conditions" where people were not only facing chronic diseases and lifestyle illnesses but also infectious diseases like malaria, tuberculosis and HIV. Local health systems were not structured to fight both of those fronts at the same time.

"I realized that even though [chronic illnesses] were a problem, it was a longer-term problem, at least in the minds of individuals. People may have hypertension today, but hypertension doesn't give you any symptoms today. It'll give you a heart attack in say 20 years' time, but today you feel fine. Whereas, if you have malaria today, you don't feel fine. So, from the customer's perspective, people were still very focused on what was making them ill today," he explained.

This led to a pivot for the company – to offer micro-insurance products for day-to-day healthcare problems like malaria, typhoid, colds and flus and that is when it started to see progress.

The conversation shifted to the role of tele-medicine in Africa's healthcare market and the cultural challenges that this kind of service faces due to a lack of buy-in from older generations who want to see a physical doctor and not a video screen.

Wellahealth Founder and CEO, Dr. Ikpeme Neto. (Source: Wellahealth).

Dr. Neto spoke about the different facets of Wellahealth's business, which from the outside looks very consumer focused. However, most of its revenue comes from its business-to-business (B2B) and business-to-business-to-consumer (B2B2C) offerings.

"That is, helping existing insurers manage customer claims much more efficiently. Building out the technology to enable that to happen and building out the connections between healthcare providers, pharmacies in particular. So, our big focus is on how do community pharmacies connect into the broader healthcare ecosystem to provide better care? We manage payments for thousands of pharmacies, tens of insurers and for tens of thousands of patients," he said.

He said that Wellahealth's distribution also comes via partnerships with telcos like MTN and Airtel and financial services businesses like Standard Bank.

The curse of the pioneer

He shared how difficult it is to build a healthtech company in Africa and the "curse of the pioneer." Dr. Neto explained how he tried to overcome this via relationship building and being persistent until people gave him a chance to prove that the solution could work.

"I was very deliberate in trying to build relationships… and doing the hard yards of going in person. I was walking off the streets to healthcare professionals, insurers, literally talking to hundreds and hundreds of people. It's very discouraging, because in the first couple of years it feels like a waste of time, and lots of times it is a waste of time, but there's something about persistence. If people tell you no and you keep coming back, they'll kind of feel sorry for you and say, well, maybe we should give him a chance," he said.

"In my experience there are no shortcuts, there is no secret sauce, I was literally just persistent, I was in people's faces, and I was building relationships and trying to provide some value, and I had an angle that was a bit different to everybody else and I just kept at it. You just need one account [to start]," he added.

The team also discussed regulation, or lack of regulation, in Africa's healthtech industry and how tech-related regulation has shifted over the years.

Funding healthtech

Another topic of discussion was around the right kind of asset classes to fund healthtech companies and how venture capital is not always the right vehicle because the timelines for returns are not aligned with an industry like healthcare, which often moves slower.

"I straddle two worlds, health and technology. I find if I keep both sides unhappy, I am probably doing the right thing. What I mean by that is that on the tech side, when I talk to my tech friends or tech mentors, they say to me: you're not moving fast enough, you're not innovating fast enough, you're too slow. Then when I go to my healthcare people, they say: no, no calm down, you're just going way too fast," he said.

"When I get dissatisfaction from both sides then I think I'm on the right path, because both sides shouldn't agree with each other – healthcare people should feel like I'm going too fast, and tech people should feel like I'm going too slow. So that's kind of how I calibrate myself, because these two industries just exist on very different time scales," he added.

The Wellahealth team's mission is to provide affordable healthcare to all Africans via tech-enabled services including low-cost micro-insurance products for common illnesses. (Source: Wellahealth).

The conversation moved to how companies in all sectors are integrating fintech services into their businesses. For Wellahealth, that is their Healthsend service which allows individuals overseas to send money to friends and family in Africa to pay for healthcare needs.

"It was clear that for us to meet our growth goals, we needed to find a way to look for revenue outside of Nigeria and the naira – you know what's happened with the devaluation in the last 12 to 18 months. This was a very neat product for us to do that and use existing expertise and networks to essentially fulfill for people that have families abroad that want to pay for them to have access health care. That was just a natural thing for us to do," he explained.

He said the company is also looking to do partnerships with other remittance players to expand these kinds of offerings.

Dr. Neto commented on the funding crunch facing startups in Africa and said he thinks consolidation would be good for the healthtech sector to make it more efficient.

"I think sometimes [startups] are competing away a lot of the advantage and killing each other. So, it would be good for us to consolidate and then be able to really provide the infrastructure that others can build on top of," he explained.

He gave the example of how fintechs like Paystack and Flutterwave have enabled other companies to build on top of their services.

"A lot of us don't have to go build those companies, you can just build on top of them. I envision that happening in healthcare, where you have, say, two or three really big healthtech companies that build infrastructure for other people to build on top of," he suggested.

When it comes to advice for founders, he said one essential thing is to not build tech too early on, especially in traditional industries like healthcare.

"Go out, understand the problem, solve the problem with very simple, low-fidelity solutions, get paid for the solution, and then go build tech. The amount of code we wrote that we don't use today is mind boggling. So, the mantra now for my team is no revenue, no code," he concluded.

More Connecting Africa Podcasts

If you want to find more Connecting Africa Podcasts check out our Podcast Archive here.

This season we will be speaking to more startup founders and interesting personalities in Africa's tech ecosystem, so stay tuned for new episodes dropping soon.

If you want to catch up on all the previous episodes you can find the podcast on Apple Podcasts; Spotify; Pocket Casts or find other podcast platform options on our main page on Spotify for Podcasters.

You can also find the podcast hosts online here:

Paula Gilbert (@paulajgilbert)

Tobi Lafinhan (@TobiLafinhan)

Matshepo Sehloho (@tsokamatshepo)

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— Paula Gilbert, Editor, Connecting Africa