Nigerian health tech and the VC funding gender gap?

Ikpeme Neto
6 min readDec 16, 2021

Much has been rightfully made of the gender gap in VC funded startups in Africa. >80% of VC funding has accrued to male-only founding teams as illustrated by Max from “The big deal.”

This data often gets the retort, at least on social media, of ‘fund more women’. This is of course a given but does beg the question if this simple retort provides enough of a solution for the Nigerian scenario? Is the diagnosis accurate that the funding gap is simply because women are not being funded? Could there be more to consider?

I sought to find more data because in my anecdotal experience in Nigerian health tech, I interact with as many women as I do with men. I in fact deliberately mentor more women than men and work to connect them to investors and resources. This made me wonder if this gender gap exists in Nigerian health tech and if there are any insights to be drawn from health tech.

The health tech funding data

I happen to be writing my annual healthtech review at this moment so I had the funding data for Nigerian health tech in 2021 handy. Here’s what I found. There were 19 unique health tech startups funded across the year. Of these, over 50% had a female co-founder and 36% had a female CEO. A huge departure from the broader funding data.

This data suggests that in the case of Nigerian health tech at least, the gender funding gap isn’t quite so stark. Why is this the case? I think it’s related to the underlying industry of concern. In healthcare, females are well represented, some would say even overrepresented. This data from research done on the healthcare workforce in 2 tertiary health centres in Nigeria illustrates that around 60% of the workforce is female.

Workforce demographics of a selection of workers in OAU ile ife showing 59% females
Workforce demographics of a selection of healthcare workers in OOU Sagamu showing 63% females

In contrast, the most-funded industries such as fintech, derive a lot of their workforce from the usual private sector pipelines. The IFC and NGX published a report that looked at this private sector cohort. It showed that only about 33% of the workforce are women. Likely even fewer women are present in IT-related fields where men dominate even more.

So while the ‘fund women’ refrain is certainly reasonable, understanding the dynamics of the underlying industries that feed startups with ideas and founders would provide more insight as to where interventions should go. In the case of industries like fintech, the female pipeline would only ever be a maximum of 33%, all else being equal, thanks to the ceiling already set by the broader female talent pipeline available to the industry.

It’s thus fair to surmise, at least in the Nigerian instance, that in industries where women are overrepresented, more of them will invariably end up founding venture-backed companies, healthcare is a prime example. While in industries where men are overrepresented, finance and IT, more men will end up founding VC backed companies. This broad scenario methinks accounts for a decent proportion of the gap that exists.

There are certainly other factors at play and funding more women via interventions that have been touted in western markets such as having more female General partners for instance, or diversity training for male partners can be helpful. It just seems to me that these are solutions that don’t account for the Nigerian reality. A cursory look for instance at African focused funds with female GPs doesn’t reveal a much more gender balanced portfolio.

Locally relevant approaches

To balance up African portfolios, we should first assess our motivations and agree that that there is inherent value in female backed VC companies for the ecosystem, funders and societies at large. The data shows this to be the case. Women led startups are more likely to be financially successful.

Now that we are agreed that funding women is a great ideal, there are a couple of ways apparent to me on how to do it.

Firstly, a (relatively) low hanging fruit is to encourage people in traditionally female industries to launch more startups and fund these industries. Globally these are healthcare, education and caring professions. Simply having a dedicated fund for startups in these areas will immediately fill any pipeline with far more women. I know this intimately because I speak to female founders in healthcare regularly who would do great things with funding.

Currently, healthtech accounts for only 4% of VC funding in Africa. Based on this fact alone, the gender gap is not surprising. Increase funding to healthtech and more women will invariably be represented. The current 50% of female representation in VC funded healthtech companies vs 60% female in the healthcare workforce is related to the limited health tech funding. These 2 numbers will approximate each other as funding increases.

Secondly, increase the pipeline of women in the workforce by increasing their access to education and supports to succeed in school and early career. From the IFC and NGX gender equality in Nigeria’s private sector report:

“For a country like Nigeria, with a rapidly growing population, the need for high-quality jobs and skilled workers at every level is an urgent imperative. Addressing the education pipeline for girls to ensure that more female students have access to quality education at all levels, including STEM, is essential — otherwise, companies will continue to encounter skilled labor shortages, even with Nigeria’s rapidly increasing population.”

The report goes on to detail unequal access to education as a real barrier to women’s advancement in the private sector and consequently, in my view, representation in VC funding.

VC funding is an output

By the time pitches end up in VCs inboxes, the gender die is already cast and is most likely too late. The intervention required to even up access to funding needs to happen much earlier. We need more girls in schools that are being supported to university education and well into the workforce. So yes we should fund more women but not just in VC land alone, we should fund more women in primary, secondary and tertiary institutions, that’s how we’ll close (some) of the gender gap ultimately and sustainably in Nigeria.

P.S I’m open to counter opinions and critiques of my position. I feel in a good position to write this as I have over 50% of females as colleagues in my startup. I also mentor far more female founders than I do male founders and all my angel investments so far have been into women-led startups so I’m clearly and demonstrably on team ‘fund women’. I also recognize however that more needs to be done on a broader scale.