Increased support for Africa’s digital health startups

Updated on 24 February 2016

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Today's top entrepreneurship and business stories (24 February)

There is a more concerted effort, especially by big pharma companies, to support digital health entrepreneurs across the continent. This is according to Saravanan Thangaraj, research analyst for transformational health at Frost & Sullivan Africa.

the most recent example is the launch by Merck, this month, of a digital health accelerator in Nairobi, Kenya.

Thangarai highlighted some of the programs that support digital health entrepreneurs in Africa. Including, among others, Ampion, a non-governmental organisation supporting digital health entrepreneurs to launch business in Africa, the MySkills4Afrika and Microsoft Virtual Academy programs which assist entrepreneurs in taking their business solutions to market and Bayer’s Grants4Apps Accelerator. (Med City News)

What funding for African tech startups looked like in 2015

There is significant funding in African solar, fintech and ecommerce projects with a total of 125 tech startups attracting $185-million in funding in 2015, according to the African Tech Startups Funding Report 2015.

South Africa attracted the largest amount of funding ($54.5-million) and was the most favoured destination (36%), followed by Nigeria (24%) in investments, and Kenya with $47.3-million (14.4%). The average deal size was $1.4-million.

“It’s a clear sign the tech startup sector remains strong in spite of economic slowdowns across the board,” Disrupt Africa co-founder Tom Jackson says.

“Increasingly, both international and local investors are spotting the opportunity, with the high level of innovations and the scale of the problems many tech startups are solving proving very attractive.” (Forbes)

US$2 million funding for SA startup, Hepstar 

Digital insurance distributor, Hepstar, has received US$2 million in funding from UK-based technology investor Amadeus Capital Partners.

Launched in 2013, Hepstar addresses the need for e-commerce companies in general, airlines and travel companies in particular, to maximize revenue from ancillaries.

With the new funding the company will build on its momentum including expanding its global reach, accelerating technology development and growing its brand.

“The global airline ancillary opportunity is around US$60 billion. We can help our partners make up to 30% of their net revenues from insurance ancillaries”, says Brett Dyason, Hepstar chief financial officer.

Research reveals the earliest mistake made by startup founders

One of those biggest pitfalls that many startup founders face is founder equity splits, i.e., the way founders allocate the ownership amongst themselves when starting their company. This is according to research by Noam Wasserman and Thomas Hellmann.

Their research, which began in 2008, studied the equity splits adopted by over 3,700 founders from over 1,300 startups in the U.S. and Canada.

Their research shows that even the best of ideas can fail when the founding team neglects to carefully consider early decisions about the team: the relationships, roles, and rewards that will make the founders a winning team.

They also found that the percentage of founders who say they are unhappy with their equity split increases by 2.5x as their startups mature. (Harvard Business Review)

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