Who is Funding Emerging Markets’ Healthcare Entrepreneurs?
Healthcare systems across emerging markets are under increasing pressure, caused by underlying factors which will persist beyond COVID-19: rapidly expanding populations and inadequate housing and hygiene infrastructures that lead to high rates of infection and disease.
Across emerging markets entrepreneurs are creating innovative healthcare solutions to tackle these problems. Who can they look to for financial support? There are a growing number of alternative finance providers for healthcare, creating a promising ecosystem for healthcare entrepreneurs to tap into.
Using The Capital Finder, we have analysed a range of alternative finance providers and used natural language processing to score them on their healthcare relevancy. Here we shall deep dive into several of the highest scoring providers, examining what they can provide entrepreneurs and detailing who ought to apply.
Investors
Novartis Venture Fund (NVF) is an important investor in biotechnology and biopharam life sciences companies. Self-described as ‘stage agnostic’, NVF do not screen potential applicants based on their current stage of development, so much as it looks at your potential impact. With over $800 million in committed capital, NVF are well experienced investors; across emerging markets, they are most involved in Asia and the Pacific.
Whilst NVF have a specific healthcare criterion that may put off some, entrepreneurs who fit this bill would do well to consider them. They possess a wealth of experience guiding companies from early stages through to successful IPOs, and they are committed to helping entrepreneurs who have innovative ideas that can disrupt the healthcare status quo.
Fogarty is a brilliant opportunity for more research focussed entrepreneurs to access grants and funding. These grants historically are available to low and middle-income countries (as defined by the World Bank), with the focus covering a broad range from career development to international research to education. Unlike others on this list, Fogarty is not an impact investor or incubator, but rather an institute looking to provide funding to help early stage entrepreneurs get a head start.
For healthcare entrepreneurs in emerging markets who are still early in their development, Fogarty presents a brilliant opportunity to access funding without offering equity or incurring cost. Particularly with entrepreneurs for whom scientific research forms the crux of their innovation, Fogarty is a well-established global institution that can support you.
Medical Credit Fund (MCF) are a nonprofit that holds claim to be the only fund dedicated to financing SME healthcare facilities across the African continent. The firm’s aim is to reduce the level of risk in healthcare markets across Africa, thereby easing access to finance by lowering the cost to entrepreneurs locked out by current interest rates. In turn, MCF’s funds invest in staff, procedures, facilities, and equipment.
This opportunity is present for entrepreneurs working across the healthcare industry: healthcare SMEs that include hospitals and health centers; specialist care providers such as diagnostic centers and pharmacies; and, businesses catering to healthcare facilities such as training institutes. For healthcare entrepreneurs working in Africa, this is a great opportunity to utilise finance that was previously inaccessible.
F Prime stands out as the largest investor that we are discussing today. They have invested just shy of $2 billion in healthcare, creating eighteen companies from scratch along the way, with nineteen products and drugs approved. In a world where roughly 0.02% of all drugs make it from idea to market, F Prime’s proven track record, with another 12 drugs arriving in their next phase, demonstrates a history of excellence. Their focus is broad: therapeutics, med-tech, and health IT & services; disrupting current healthcare via innovation is foundational, however.
For entrepreneurs in emerging markets, F Prime may seem an intimidating partner. Their focus on cutting edge healthcare advancements places an inherent bias in favour of more developed economies that have the underlying infrastructures to support such advances. This shouldn’t dissuade entrepreneurs from emerging markets from considering them though: F Prime’s core centres around solving important problems, and in this area those from emerging markets are just as capable as those elsewhere. You don’t need to create a cutting-edge piece of technology to be of interest, but you certainly need to show that you are being innovative and impactful in how you are solving a healthcare problem.
Where does this leave entrepreneurs?
Investment, funding, and expertise are open to healthcare entrepreneurs across emerging markets. It certainly isn’t the case that there is a one size fits all approach, and entrepreneurs must think carefully about how a funder’s goals and aims fit with their own.
Next week, we will publish a piece looking at how funders are responding to COVID-19. If you’re interested in learning more about our data, reach out to capital.finder@alliedcrowds.com.
