As Africa’s youthful population continues to grow exponentially, it is of utmost importance that entrepreneurs create diverse healthcare solutions that will meet the medical needs of the continent’s future. As the pandemic has drawn investors’ attention to the private health space in Africa, women’s health – a sub-category dominated by founding women that broadly addresses women’s menstrual and reproductive health – is subtly overlooked.
Yet, given that other emerging markets have set a precedent, it’s only a matter of time before this category gets the venture capital dollars it deserves; the recent $21 million Series B investment in Rwandan startup Kasha is a subtle testament to this.
Kasha isn’t the typical women’s health startup, though. The best way to describe the startup, founded in 2016 by the CEO Joanna Bischelis that it is an e-commerce platform – serving a wide range of customers – with women’s health elements.
The four-year-old startup provides a digital retail and last-mile distribution platform for pharmaceuticals and fast-moving consumer goods (FMCG) with a specific product focus on women’s health needs and household goods. Its customers include individuals, small retailers, hospitals, pharmacies and clinics. They can order products ranging from sanitary napkins and contraceptives to diapers and cleaning supplies through its website or USSD.
In its first year, Kasha strictly approached the Rwandan market with a direct-to-consumer model offering last mile delivery of health products for women and newborns. But it wouldn’t take long for smaller stores to start placing orders for those same products. The e-commerce platform, easily sensing an opportunity, ventured into the wholesale business after acquiring the necessary pharmaceutical license to serve pharmacies, hospitals and clinics. Serving a beachhead wholesale and retail market, Kasha products range from newborn health, maternal health and menstrual hygiene to family planning, sexual and reproductive health and non-communicable diseases.
“We have always understood that women are the most influential customer in health, both because they have the most health needs and because they are the health decision makers within the household and unlock the rest of the population. Since many health products for women are stigmatized, Kasha purposely offered a wide variety of products, including personal care products like soap, health products like contraceptives, and household staples like rice,” Bichsel told TechCrunch in an interview. Bichsel also noted that the platform’s top-selling products include HIV self-tests, contraceptives and pregnancy tests. “We have continued to expand our product line solely based on customer demand and the needs of the various customer segments that buy from us, including small kiosks, pharmacies, hospitals, clinics and consumers.”
Starting in Rwanda, Kasha has raised $1.5m in seed funding from angel and impact investors. At the end of 2020, after its expansion in Kenya, Kasha obtained a Series A of $3.6 million from Finnfund, Swedfund, DFC and Mastercard Corporate. Knife Capital led this recent Series B with participation from Finnfund, DFC, Tim Koogle (former CEO of Yahoo), Beyond Capital Ventures, Altree Capital, Bamboo Capital’s BLOC Smart Africa Fund and Five35 Ventures.
“The team (led by Founder and CEO Joanna Bichsel) has a proven track record of scaling rapidly to date and this fundraising will help accelerate that,” Koogle noted of the growth-stage deal. In addition to its operations in Kenya and Rwanda, Kasha, which recently registered in South Africa, will use this investment to expand its platform in the country and also in West Africa later this year.
According to Bichsel, the optimization around healthcare products differentiates Kasha from other B2B e-commerce platforms founded in East Africa, including Twiga and Wasoko, which offer a more comprehensive range of SKUs outside of pharmaceuticals (a product offering of which Bichsel says Kasha is the largest supplier in Rwanda).
“Our main strategic focus is healthcare and that’s where we aim to win,” she said while noting that Kasha has telehealth and credit capabilities, an important feature of B2B e-commerce newcomers. “If a consumer orders from us and they don’t have a prescription, we connect them with a doctor,” said Bichsel, who worked for Microsoft for several years and served as a technology adviser to the Bill & Melinda Gates Foundation. “There are other health technology capabilities; we offer inventory credit to pharmacies, clinics and hospitals. So, we overlap in this general FMCG space, but our expertise is more in the health field. We are also building a wider distribution network, reaching the mass market customer all over the country and reaching to the last mile.
To ensure its products are authentic, the startup works directly with manufacturers and suppliers, sourcing and stocking the products it distributes to consumers, resellers and clinics. This goes hand-in-hand with its last mile efforts of using various content channels to disseminate information on how its consumers can stay safe – and to the benefit of its corporate business, where it provides visibility and insights to global health organizations on the way to go-to-market strategies.
Speaking on the investment, Keet van Zyl, co-founder and partner of Knife Capital, a $50m pan-African fund, said: “In the current economic climate, it is refreshing to encounter a high-growth, capital-efficient company, run by women and optimized to serve the large mass market segment in Africa, being particularly strong in serving female clients. We look forward to being a partner in the pan-African expansion journey with this dedicated and motivated team.
Since Kasha shut down its Series A at the end of 2020, it has seen its annual recurring revenue increase 50x, according to Bischel. She also mentioned that the company, widely misunderstood as a social impact business in its early years, intends to “continue to grow revenue aggressively, become a global company, deliver strong returns for investors, and ideally go public.” While that might sound grand for a startup founded and led by women whose counterparts held less than 3% of Africa’s $6 billion venture capital market last year, Rwanda’s most venture capital-backed company has hitched its wagon to a star and it may only be a matter of time before the ambition becomes a reality. bischel says:
Having reached this major milestone of closing our Series B, we are even more inspired and driven to realize Kasha’s mission to be Africa’s leading digital platform for last mile access to healthcare. The exponential revenue growth we have experienced over the past few years has been driven by strong market demand for quality and affordable health and household goods from mass market customers in both urban and rural East Africa, and this has proven our business model and team’s ability to execute.
With Knife Capital leading our Series B, bringing its strong track record of portfolio companies that have grown across the continent with successful exits to industry-leading global companies, provides us with the proven experience we need to realize our ambitions as a business and scale to the next level. We will use Series B funds to expand across Africa and invest in strategic areas of the business to continue our high growth trajectory. We are especially pleased to have continued support and reinvestment from existing Kasha investors such as FinnFund, DFC, Beyond Capital Ventures and others.