Yesterday, we reviewed 3 types of investors active in Nigerian healthcare. Today, we’ll review 4 more.

4. Bilateral and Multilateral Organizations

These are government agencies or organizations that are funded by a nation or group of nations to support development efforts in low-income countries. They provide long-term, patient capital with specific impact goals. The main downsides to raising from these groups is the length and rigor of their diligence processes and the heavy reporting requirements post fundraising.

Examples are USAID, DFID, SWEDFUND

5. Venture Capital (VC) Firms

If you have a startup with a high growth trajectory, venture capital is probably the best way to catalyze your growth. These firms pool capital from limited partners and invest in high-potential startups that can return many times the amount of capital invested. Because of the risky nature of the asset class, most VCs will invest only in organizations that have high-growth potential and with large target markets. Different VCs invest at different stages, with some focused on pre-seed and seed stage companies and others who invest starting at Series A or beyond. 

Examples of VCs: Newtown Partners, Consonance Investment Partners, Ventures Platform, FINCA Ventures

6. Private Equity Groups

Private Equity groups are investment firms that make capital investments into mid- to late-stage private companies with track records. They typically take bigger or even controlling stakes in businesses and are focused on operations optimization rather than exponential growth. 

Examples of active PE firms are Kuramo Capital, TPG 

7. Banks

Getting financing through banks is the most traditional way to fund your health business. Nigerian banks will typically provide debt financing only for established health providers. In the past couple of years, some banks such as Sterling Bank and FSDH have created healthcare divisions to focus on the financing needs for healthcare businesses. Debt financing can be a great thing for your business, but keep in mind that the interest rates are usually quite high and often require some form of collateral.

Bonus: Crowdfunding Platforms

Crowdfunding Platforms are a relatively new way to raise capital at the early stage and are a form of angel investing. These platforms allow you to raise money from retail (individual, non-professional) investors using tech platforms. It’s pretty easy to set up a crowdfunding page for your company, but because you are raising from retail investors, the amount per investor is usually small, and you will likely need a lot of investors to raise a substantial amount.

Examples are AngeList and GetEquity.