ConnectMed

An African digital health startup that offered telehealth apps, kiosks, & chronic disease therapeutics - started in my MSc CompSci & ended in Merck KGaA asset sale

Role

Co-Founder & CEO / CPO

Industry

Health

Duration

3 years

ConnectMed aimed to improve primary healthcare accessibility in Sub-Saharan Africa through digital interventions and operated from July 2016 - November 2018 (though I built the MVP during my MSc Computer Science in 2015 & worked on business dev during my MBA). We started in South Africa and then moved to Kenya after facing regulatory hurdles in SA. We launched three core direct-to-consumer digital health products in Kenya (with several failed products in between): (1) a video-based telehealth web and mobile app, (2) a video-based telehealth kiosk, housed in partner pharmacies, and (3) a chronic disease digital therapeutics subscription product. We came to the conclusion that the market for direct-to-consumer digital health is still too small in Sub-Saharan Africa and sold the company’s assets to Merck KGaA at the end of 2018.

Stage 1. MVP Development & South Africa Pilot

MVP development: For my thesis, after exploring problem areas that could be tackled by tech and AI, I landed on primary healthcare and scarcity of doctors in Sub Saharan Africa. I built a telehealth web app &, leveraging NHS data, trained a machine learning model that predicted whether a patient could be treated by a nurse vs a doctor based on their provided symptoms (thesis).
SA pilot & refinement: For seeing if this had potential as as business, South Africa seemed like a good first market given higher income levels & tech access - and I was working with a South African doctor (from my Rhodes class) to get connected to they system and overcome regulatory hurdles with the HPCSA. I did a small pilot of the system in Johannesburg in September 2015 as well as and worked during my MBA on patient & system research (eg public health system), building a team & doctor network, and get initial seed capital through startup competitions (eg Demo Africa pitch).

Stage 2. Telehealth App in Kenya

Move to Kenya: After our strategy to get HPSCA approval (to avoid telehealth shutdowns that had happened in the past) failed, I decided to move the company to Kenya that had a higher ease of doing business than Nigeria, it's economy was stronger at the time (crude oil prices were at an all time low in 2016), and Nairobi is much more livable than Lagos :)
Launch of telehealth app: I spent the first few months in Kenya incorporating the business, building a doctor network, piloting the web app with patients (which I had improved a lot over the last year), and then doing a press launch to drive patients to the app (news interview, article). The main value props to patients were:
- Quality doctors: I positioned the offering as a premium, aspirational service, where you're seen by the best doctors in the country, to avoid it feeling like a lesser healthcare offering and could move to mass market from there.
- Convenience: You can see a doctor anytime, anywhere in the comfort of your own home.
Challenges in getting adoption: The main challenge here were efficiently finding people when they're sick, getting them to trust the service, having the value prop resonate with them, ensuring they have access to good internet & smartphone so they can video consult, and them having a condition we could actually treat remotely. It was a hard pitch and most of the acquisition strategies we tried failed because of it.
- Digital ads weren't trusted: No Kenyan trust digital ads (at the time); only businesses with physical manifestations
- Flyers in Uber cabs, influencers, mall & university activations and more didn't catch people at the right time: All drew little traffic. One of the biggest challenges is how to target people when they're sick or have them remember you when they get sick.
- Established doctors didn't have incentives to use/refer: I visited doctors at top hospitals and created pages for them to help, with the hope if they used us for free with their own patients, the patients would come back for paid consults later. But the doctors didn't engage (they already had enough leads and if they wanted to connect digitally with their existing patients WhatsApp was good enough).
- Flyers in pharmacies: We knew that pharmacies were patients first port of call when they got sick (pharmacy technicians were kind of the resident doctors in most communities and you would ask them for their clinical advice) so we tried putting advertising in pharmacies and offering the pharmacies a finders fee. This also tackled some of the trust issues as my trusted pharmacy was referring me. But conversions were still lackluster.

Stage 1. MVP Development & South Africa Pilot

MVP development: For my thesis, after exploring problem areas that could be tackled by tech and AI, I landed on primary healthcare and scarcity of doctors in Sub Saharan Africa. I built a telehealth web app &, leveraging NHS data, trained a machine learning model that predicted whether a patient could be treated by a nurse vs a doctor based on their provided symptoms (thesis).
SA pilot & refinement: For seeing if this had potential as as business, South Africa seemed like a good first market given higher income levels & tech access - and I was working with a South African doctor (from my Rhodes class) to get connected to they system and overcome regulatory hurdles with the HPCSA. I did a small pilot of the system in Johannesburg in September 2015 as well as and worked during my MBA on patient & system research (eg public health system), building a team & doctor network, and get initial seed capital through startup competitions (eg Demo Africa pitch).

Stage 2. Telehealth App in Kenya

Move to Kenya: After our strategy to get HPSCA approval (to avoid telehealth shutdowns that had happened in the past) failed, I decided to move the company to Kenya that had a higher ease of doing business than Nigeria, it's economy was stronger at the time (crude oil prices were at an all time low in 2016), and Nairobi is much more livable than Lagos :)
Launch of telehealth app: I spent the first few months in Kenya incorporating the business, building a doctor network, piloting the web app with patients (which I had improved a lot over the last year), and then doing a press launch to drive patients to the app (news interview, article). The main value props to patients were:
- Quality doctors: I positioned the offering as a premium, aspirational service, where you're seen by the best doctors in the country, to avoid it feeling like a lesser healthcare offering and could move to mass market from there.
- Convenience: You can see a doctor anytime, anywhere in the comfort of your own home.
Challenges in getting adoption: The main challenge here were efficiently finding people when they're sick, getting them to trust the service, having the value prop resonate with them, ensuring they have access to good internet & smartphone so they can video consult, and them having a condition we could actually treat remotely. It was a hard pitch and most of the acquisition strategies we tried failed because of it.
- Digital ads weren't trusted: No Kenyan trust digital ads (at the time); only businesses with physical manifestations
- Flyers in Uber cabs, influencers, mall & university activations and more didn't catch people at the right time: All drew little traffic. One of the biggest challenges is how to target people when they're sick or have them remember you when they get sick.
- Established doctors didn't have incentives to use/refer: I visited doctors at top hospitals and created pages for them to help, with the hope if they used us for free with their own patients, the patients would come back for paid consults later. But the doctors didn't engage (they already had enough leads and if they wanted to connect digitally with their existing patients WhatsApp was good enough).
- Flyers in pharmacies: We knew that pharmacies were patients first port of call when they got sick (pharmacy technicians were kind of the resident doctors in most communities and you would ask them for their clinical advice) so we tried putting advertising in pharmacies and offering the pharmacies a finders fee. This also tackled some of the trust issues as my trusted pharmacy was referring me. But conversions were still lackluster.

Pitching our South Africa progress at Demo Africa - Aug 2016

Launching telehealth app in Kenya - Nov 2016

Stage 3. Telehealth Kiosks in Pharmacy

Piloting the kiosk model: One of our flyer pharmacies (in the Sarit Center in Nairobi) owned by some entrepreneurial Kenyan Indians called us a few times and asked - "Hey, can this patient see the doctor now? Then we can make sure he gets the right diagnosis and I get the prescription needed to dispense the meds." It became clear the pharmacy is a great place to find & convert patients and pharmacies could be incentivized to offer this. I spent a week sitting in this pharmacy with a tablet and having one of our doctors on call and we got more patients than we had in the past 2 months.
Launching the pharmacy kiosks: At this point, it had been me and a right hand ops man (Dismus Masheti) doing everything and I needed some further funding & to find a cofounder that could help carry the load. I decided to join Entrepreneur First in London where I found Chris Harding, an ex-Palantir engineer who was ready to go on this journey with me. We worked on developing the kiosk, which was basically just an Android tablet (with our Android app we had now built) and a set of testing devices (eg blood pressure cuff, glucometer) with some professional signage.
Getting pharmacy kiosks to perform: We tried working with over 40 pharmacies across the greater Nairobi area, spanning income levels (expat-filled Karen to largest slum in Africa Kibera), commercial settings (shopping malls, downtown commerce, suburb commerce centers), pharmacy types (chains, mom-and-pop). We also tried several different conversion strategies (more professional looking kiosk constructs, offering referral rewards to the pharmacy staff, manning the pharmacies with our own sales people). Success came down to the below factors and we found most of our customers were middle income who liked the affordability (we had now reduced our price to less than local options) and convenience (and many had a chronic condition, foreshadowing the next section):
- Staff Incentives: For pharmacies where the owner isn't the one manning the store, the consults seemed like a distraction to the pharmacy techs; it was only in some small pharmacies where the owner is the staff did they realize that the consults could actually help their business overall (eg with Waroko Pharmacy in Kangemi, the owner Ormarice realized her customers would buy their diabetes meds more consistently if they had the consults where a doctor was telling them what to take / titrating). Watch the great news feature on our kiosks that features this case :)
- Foot traffic: Having high foot-traffic (basically top of funnel) was critical to getting a reasonable number of consults per day, especially to make our more expensive conversion strategies (ie having sales folks sitting there) work. So our other top performers were high traffic pharmacies in Nairobi CBD where it made sense to put a sales person.

Stage 4. Chronic Disease Digital Therapeutics

Seeing the need with chronic diseases: While we saw patients with a variety of conditions at our kiosks, there was a high prevalence of those with hypertension of diabetes. These patients really needed help with getting the right prescription (there's a process of measuring and titrating meds that most never pursue) and our kiosks were a great solution. We also so the economics of our kiosks were barely break even and we thought offering a higher value+revenue service to these chronic disease patients would be a more fruitful path, where we not only provide the consults but also the medications.
Launching the chronic disease therapeutics product: So we decided to flesh out a program with the consults, meds, testing device and a health coach, which included developing a consumer Android app as well as medication pickup partners. Because we wanted to capture the margin of giving the meds, we had to look for acquisition strategies that didn't depend on pharmacies and saw health screening activations were great (we would offer a free screening and then pitch appropriate patients on the program). The key was to do these in high foot traffic areas so we ended up getting approval to do these in Nairobi CBD (highest footraffic in the country). The economics seemed to be working and we had a patient subscription roster of 500 within a month and they were engaged (eg one of our patient education day).
Struggling with retention of patients: While patients engaged and we introduced the health coach component to both provide more value to the patient and ensure high touch+trust to keep the user subscribed, we saw 50% of patients churning by Month 3. At this point, they felt their meds were well titrated and getting the meds from us our pickup points was less convenient than their local pharmacy. They valued the testing device (which they could use an only owned after 6 months in the program) but they felt they already owned this (either they didn't understand it was a lease or in many cases, they just felt there was no way we'd get it back from them).

All our pharmacy agents & health coaches at our patient education day - May 2018

Health screening in Nairobi CBD - Mar 2018

Stage 5. Deciding to Close & Sell

To make this an impactful, growing business, we'd need to move into brick & mortar clinics: The economics of the therapeutics product out best and I felt like we were really solving a strong need here but unless we could provide and capture more value, it wouldn't be a strong enough business. Primary care provision in most markets is not a very profitable enterprise and providers make their money on secondary & tertiary care, while the primary care acts as a feeder for this. So it seemed clear to me that to make this the kind of impactful, high growth startup I wanted to build, we'd need to offer these kinds of services and leverage our telehealth offering for lead gen and cost reduction. With other social enterprises in the market already doing this well (eg Penda Health) and me being rather burnt out at this point having pushed too hard during the past 2 years, Chris and I both decided it was best to close shop. We had just gotten a check from a local investor as well but knew this was the right call.
Finding a buyer for our assets: We had built valuable tech, clinical expertise, and more and I reached out to different partners we had worked with and other healthcare providers to see who might be interested. Merck KGaA ran a set of tech-forward pharmacies, under the brand Curafa, in Nairobi and we had setup a kiosk at 1 of them. They gave the best offer for our full package of assets and we completed the sale at start of 2019. Some news posts: Disrupt Africa, Startup Graveyard.

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