As Africa’s youth population continues to grow exponentially, it is of utmost importance that entrepreneurs create diverse healthcare solutions that will cater to the continent’s future medical needs. While the pandemic has caused investors to pay attention to Africa’s private healthcare space, women’s health — a subcategory dominated by female founders that broadly addresses women’s menstrual and reproductive health — has been neglected.
However, given that other emerging markets have set a precedent, it is only a matter of time before this category receives the venture capital dollars it deserves; The recent $21 million Series B investment in Rwandan startup Kasha is a subtle testament to the fact.
However, Kasha is not your typical women’s health startup. The best way to describe the startup, founded in 2016 by CEO Joanna Bichsel, is that it’s an e-commerce platform — serving a wide range of customers — with elements of women’s health.
The four-year-old startup offers a digital last-mile retail and distribution platform for pharmaceuticals and fast-moving consumer goods (FMCG) with a specific product focus on women’s healthcare needs and household items. Its customers include individual consumers, small resellers, hospitals, pharmacies and clinics. They can order products ranging from sanitary pads and contraceptives to diapers and cleaning supplies through its website or USSD.
In its first year, Kasha approached the Rwandan market strictly with a direct-to-consumer model that offers last-mile delivery of health products for women and newborns. But it wouldn’t take long for small shops to start placing orders for the same products. The e-commerce platform, easily sensing an opportunity, ventured into wholesale after obtaining the necessary pharmaceutical license to serve pharmacies, hospitals and clinics. Serving a wholesale and retail beach market, Kasha products cut across newborn child health, maternal health and menstrual hygiene in family planning, sexual and reproductive health and non-communicable diseases.
“We have always understood that women are the most influential customers in the health space, also because they have more health needs and are decision makers for health in the family and unlock the rest of the population. Since many women’s health products are stigmatized, Kasha has intentionally offered a wide variety of products, including personal care products like soap, health products like contraceptives, and household products like rice,” Bichsel told TechCrunch in an interview. Bichsel also noted that the platform’s best-selling products include HIV self-tests, contraceptives and pregnancy tests. “We have continued to expand our product variety simply by customer demand and the needs of different customer segments who shop by us, including small kiosk stores, pharmacies, hospitals, clinics and consumers.”
Starting in Rwanda, Kasha raised $1.5 million in seed funding from angel and impact investors. In late 2020, after expanding into Kenya, Kasha secured a $3.6 million Series A from Finnfund, Swedfund, DFC and Mastercard Corporate. Knife Capital led this latest Series B with participation from Finnfund, DFC, Tim Koogle (former Yahoo CEO), Beyond Capital Ventures, Altree Capital, Bamboo Capital’s BLOC Smart Africa Fund and Five35 Ventures.
“The team [led by founder and CEO Joanna Bichsel] have proven their ability to rapidly scale to date and this round of capital will help accelerate that,” Koogle noted in the growth phase deal. In addition to its operations in Kenya and Rwanda, Kasha, which recently registered in South Africa, will use the investment to push its platform in the country and also in West Africa later this year.
According to Bichsel, optimizing around health products differentiates Kasha from other established East African B2B e-commerce platforms, including Twiga and Wasoko, which have a more complete range of non-pharma SKUs (a product offering that Bichsel claims that Kasha is the largest supplier in Rwanda).
“Our main strategic focus is in health and that’s where we aim to win,” she said, noting that Kasha has capabilities around telehealth and credit, a prominent feature of B2B e-commerce startups. “If a customer orders from us and they don’t have a prescription, we connect them with a doctor,” said Bichsel, who worked for several years at Microsoft and was a technology adviser at the Bill & Melinda Gates Foundation. “There are other health technology capabilities; we offer inventory lending for pharmacies, clinics and hospitals. So we overlap in that general FMCG space, but our expertise is more in health. We also build a wider distribution network, reaching mass market customers across the country and going to the last mile.”
To ensure its products are authentic, the startup works directly with manufacturers and suppliers, sourcing and assembling the products it distributes to consumers, resellers and clinics. This coincides with its recent efforts to use various content channels to spread the word about how its consumers can stay safe – and benefit its enterprise business, where it provides visibility and insights for global health organizations on the way to market strategies.
Speaking about the investment, Keet van Zyl, co-founder and partner at Knife Capital, a $50 million pan-African fund, said: “In the current economic climate, it is refreshing to come across such a highly capital efficient business. that is led by women and optimized to serve the large mass market segment in Africa, being particularly strong in serving female customers. We look forward to being a partner in the Pan-African expansion journey with this dedicated and purpose-driven team.”
Since Kasha closed its Series A in late 2020, it has seen its annual recurring revenue grow 50x, according to Bischel. She also mentioned that the company, widely misperceived as a social impact business in its early years, aims to “continue to grow its revenue aggressively, become a global company, achieve a strong return for investors and ideally go public.” While it may seem grand for a female-founded and female-led startup whose peers held less than 3% of Africa’s $6 billion venture capital market last year, Rwanda’s most venture-backed company has propelled its chariot to stardom, and it may only be a matter of time before that ambition becomes a reality. Bischel says:
Having achieved this major milestone of closing the Series B, we are even more inspired and determined to achieve Kasha’s mission to be Africa’s leading digital platform for last mile access to health. The exponential revenue growth we have experienced over the past few years has been driven by high market demand for quality, affordable health products and household goods from mass market customers in urban and rural East Africa, and this has proven the model our business and our team’s ability to execute.
With Knife Capital leading our Series B, bringing their strong track record of portfolio companies spanning across the continent with successful exits to industry-leading global corporations, it provides us with the proven experience we need to achieve our ambitions us as a company and to take it to the next level. We will use the funding from the Series B to expand across Africa and invest in strategic areas of the business to continue our high growth trajectory. We are particularly excited to have the continued support and reinvestment from Kasha’s existing investors such as FinnFund, DFC, Beyond Capital Ventures and others.