Opportunities beckon for new investments in private health sector
An empty ward at the Kisumu East District Hospital a during a recent doctor’s strike. Private sector contributions and investments are increasingly needed to respond to a growing healthcare demand. Photo/FILE
What you need to know:
In the next five years, it is projected that the average age of half of the owners of the next 50 new hospitals will be just 33 years.
Despite all the challenges facing Kenyan business, there is a feel-good vibe in the medical and health industry.
Observations of goings on around the country confirm this positive outlook. We are making good progress in strengthening and deepening the private health sector’s contribution to the national economy.
Our financial projections for healthcare are generating interest both from local and international entrepreneurs and firms. A few critics have been quick to pour cold water on all this as mere hype. However our bad health statistics suggest there is opportunity for those willing to invest now.
There are about 30 million Kenyans to be insured, over 10,000 under-equipped medical facilities, we have a staffing shortage for over 100,000 health workers who need to be trained, more than 10 million terabits of medical data to be collected and stored, 45 million people needing access to medicine.
Several factors may be responsible for this new interest, but the most important one could be the shifting dynamics in the ages of entrepreneurs.
Traditionally most local entrepreneurs sourced capital from banks. The entry of individual foreign investors and venture capital funds is changing this.
A relatively easier access to capital for the current crop of entrepreneurs and a shift in social investments is leading to a change in the age of entrepreneurs too.
For some time many tended to be in their late 40s or early 50s, the new group is in their late 20s and early 30s. Often straight from college and without any long working history, they bring their untested ideas and assumption on to this playground based on one thing— a good hunch.
Their almost foolhardy ventures and investments are driven by passion. Of course a majority wither away but the few remaining successful ones spur others to join the chase.
In the next five years, it is projected that the average age of half of the owners of the next 50 new hospitals will be just 33 years. This is amazing considering that it took the previous lot an average age of about 45 years to establish such facilities.
The other important fact is that the age of foreign investors is also reducing. Early last year I was fortunate enough to attend a three month entrepreneurial course sponsored by Infodev; a World Bank programme.
Throughout this period several startups and entrepreneurs met regularly and shared their dreams with potential funders.
Granted, the majority of such funds are foreign-held, but the age of these managers was almost equal to their potential investees. Though such managers’ funds are also smaller, their ability to interact and share on a peer- to- peer level made things easier for business interactions.
They can reason and understand each other’s youthful aspirations better.
Both sides seem to agree on one thing: this is the time to get your idea out there!
This excitement is also aided by one fact—the current industry leaders will not be in the lead five years from today. That fledgling startup making a pitch for funding today could be the pace- setter then.
