Lifestores Healthcare, a health-tech startup focused primarily on delivering quality healthcare service to Nigerians, has just secured $3 million in a pre-Series A investment that was oversubscribed. This round was not only done by Lifestores Healthcare only Health54, and Aruwa Capital Management jointly led it with other important investors.
Recall that a report made by National Primary Healthcare Development Agency (NPHDA) earlier this year (2022) stated that more than 70% of the medications prescribed in Nigeria were of poor quality. The report also said that many Nigerians lacked access to quality healthcare services.
Possibly the above reasons led Andrew Garza (COO) and Bryan Mezue (CEO to form the Lifestores Healthcare service. Lifestores Healthcare is an online pharmacy platform that connects and digitizes pharmacies to increase access to primary healthcare services. It is not just an online platform, it also runs a chain of retail pharmacies, but its objective is to employ technology to reshape the fragmented pharmaceutical retail sector.
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How Lifestores Healthcare Will Use This Funding
Lifestores will use the money to increase their presence in Nigeria, improve their software, and expand their clientele. Additionally, the senior management, marketing, and engineering teams will develop. This is because Lifestores plans to expand its audience in 2023 and wants to reach 400,000 patients, quadrupling its current 100,000 patient base.
To encourage expansion, Lifestores will introduce new technological features as part of its B2B offerings and establish a new production plant in Lagos. These features include patient management initiatives, AI-driven predictive ordering, pharmacy management software, and improved finance alternatives.
The reason for this funding and expansion plan by Lifestores Healthcare is mainly because of the statistics of mortality that have surrounded Nigerians and Africans in general. According to the Brazzaville Foundation, a non-profit organization headquartered in London, 120,000 Africans pass away annually.
Furthermore, Nigeria, which tops all African countries in terms of the annual number of citizens lost to fake pharmaceuticals, is also the most well-known market for counterfeit goods in the developing world, according to Punch. So, these are just a few of the latest statistics about the health system in Nigeria.
Another reason for this urgent expansion plan by Lifestores Healthcare is its competitors’ success in the Nigerian market. For example, OGApharmacy has more than 10% of Nigeria’s pharmacies registered as customers and has experienced a 25% monthly market gain.
Investors Are Now Confident About Investing In HealthTech Startup
Nigerian entrepreneurs have emerged during the past ten years with solutions in various industries, including financial services, logistics, and agriculture. However, as startups seek to create viable businesses around existing gaps in health services while leaving a lasting impression, the health tech sector is also gaining recognition.
Nigerians, as in many other African nations, neighborhood pharmacies play a crucial role as their main point of contact with the local medical system due to a lack of doctors, nurses, and hospitals. By increasing supply chain efficiency, Lifestores Healthcare can reach thousands of neighborhood pharmacies and small-scale chemist stores.
Because they are often managed as independent stores and order medications through intermediaries such as merchants rather than directly from manufacturers, local pharmacies confront several issues caused by inefficient supply chains.
The main goal of Lifestores is to eliminate these inefficiencies through better inventory control and purchasing. Lifestores gives business owners a way to buy goods more simply and at lower prices by letting small retailers pool their orders thanks to its access to drug makers. “We want to make sure people are buying from the best source, which translates into better costs and better quality,” says Andrew Garza, the chief operating officer.
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Ken Ahaotu, a seasoned Nigerian pharmacist who founded Oak Pharmacies in Abuja, the nation’s capital, has firsthand knowledge of the system’s difficulties. He is also a co-founder of the Lifestores Healthcare. According to him, Lifestores Healthcare spent its first several years of operation managing a network of pharmacies to grasp better the key problems facing the sector. ”We then used that experience and learning to create a support service for other pharmacies,” says Bryan Mezue, Lifestores’ chief executive.
Lifestores is pursuing an intensive model approach with thousands of pharmacies and chemists throughout the nation, commencing in Lagos, Nigeria’s financial hub, after evaluating its software offerings within its network.
The early success of a Ghana-based HealthTech, mPharma, would probably have influenced Lifestores’ investors. mPharma has raised more than $20 million and has businesses in five African nations since its founding in 2013. The second-largest drugstore business in Kenya was acquired by mPharma in a historic deal last year. There is also significant investor interest in the Nigerian pharmacy market. In March 2018, Alta Semper Capital invested $18 million in HealthPlus, a Nigerian pharmacy, to help it expand its retail presence throughout West Africa.
Lifestores, on the other hand, is aiming to grow a chain of pharmacies mostly through acquisitions.
By growing a chain of pharmacies, they get in touch with the latest happenings and challenges that face the health sector, and Lifestores, along with important stakeholders (which may include investors), would settle it.