The entrepreneur who saw a gap in Nigeria’s healthcare industry
MDaaS Global started in 2016 as an importer of refurbished medical diagnostic equipment in Nigeria. The company pivoted in its second year to become a service provider for hospitals, doctors and patients from its own stand-alone diagnostic centres, trading as BeaconHealth Diagnostics. Jeanette Clark speaks to co-founder and CEO, Oluwasoga Oni, about the company’s early days, growing the business and dealing with Nigeria’s medical brain drain.
Oluwasoga Oni grew up in a small town in Ondo State, in the south-west of Nigeria. His father was a medical doctor at a town hospital and often struggled to find the right equipment to run the requisite tests to help treat patients. Later, after relocating to the US and qualifying as a software engineer, Oni quit his job in 2015 to further his education.
The childhood memory of his father treating patients served as inspiration when his MIT Development Ventures lecturer challenged the students to create a business that could, eventually, impact a billion lives; a business plan in the medical field was a no-brainer.
“If you want to impact a billion lives, there is no better group than doctors and patients to solve a problem for,” he says.
Oni and a couple of students at MIT researched the viability of exporting refurbished medical diagnostic equipment back to his home country. In 2016, he returned to Nigeria, in part, spurred on by the funding received and the confidence boost from successfully applying for the African Leadership Network accelerator.
“The accelerator funding motivated me. If someone was willing to bet on this crazy idea we had, I thought we had better give it a shot,” recalls Oni. MDaaS launched with a simple business proposition: bringing in the equipment from the US and providing technical support on the ground.
The team of co-founders – Oni, Genevieve Barnard Oni (they since married), Opeyemi Ologun and Joe McCord – soon realised the economics of the business model was not working. For example, a doctor in rural Nigeria – who saw 10 to 20 patients a day with only a few needing X-rays – simply could not afford an expensive piece of diagnostic equipment.
“We realised the path to impacting that billion didn’t mean selling to the doctor but rather aggregating demand,” says Oni. “In essence, we’ve become the back-end diagnostic department for hundreds of clinics, pharmacies and hospitals.”
In 2017, MDaaS (an acronym for medical diagnostics as a service) opened its first medical centre. It has since added 15 more in Lagos as well as in smaller, less populated cities. It operates these centres under the company’s patient-facing brand BeaconHealth Diagnostics.
Last year, it established another subsidiary, SentinelX, a membership-based service that focuses on preventative health and screening.
MDaaS currently employs 160 people directly, which includes administrative and clinical staff.
Growing the company’s footprint
When deciding which cities to expand to next, MDaaS has a list of set criteria. Factors taken into consideration include the population density of the city; the number of hospitals, pharmacies, and clinics; and the income level of residents. By establishing a clear need upfront, the company saves on the cost of sales and marketing post opening day.
MDaaS only leases properties and has not invested in real estate ownership for a specific reason. “We optimise for the fastest route to market. By leasing our locations, we can get from site selection to seeing our first patients in eight weeks.”
Funding the business
The first funding by the African Leadership Network was padded with financial support from friends and family. Thereafter, it has been a steady trajectory; a small investment followed from a foundation in the US for the first diagnostic centre, then start-up funding from Techstars Austin Accelerator in the US helped the company grow to four outlets.
“On the back of the success of those centres, we were able to raise over $3 million from early-stage venture capital companies like Newtown Partners in South Africa and Consonance Investment Managers in Nigeria, among others. This got us to the 16 centres we have now. We are currently fundraising again,” reveals Oni.
Human resources hurdles
Considering its drive to scale to other locations in the country, one of the challenges BeaconHealth faces is a shortage of clinical skills. “Nigeria is currently facing a medical brain drain. Even though we train clinicians to staff our centres, we find we are losing some of them to countries like the UK and Canada,” says Oni.
As the company expands into smaller cities in Nigeria, attracting talent becomes difficult. Clinical staff are reluctant to relocate from the big cities. Oni believes digital health solutions such as telemedicine can partly assist in overcoming this and he is also looking at ways to train clinicians at scale. “The process of entrepreneurship is one of daily problem-solving. I won’t say we’ve solved this one yet, but with the additional funding we will receive in our next round, we are hopeful.”
The launch of SentinelX in 2021 was a natural progression for the company. According to Oni, Nigeria is seeing a shift in focus away from infectious diseases as the main concern, towards the danger of non-communicable chronic lifestyle diseases.
“At BeaconHealth, our job is diagnosing sick people. Over time, we identified the need for screening at an earlier stage in order for patients to make preventative changes.”
SentinelX provides annual medical and diagnostic screening services to identify risk markers in a patient’s health. Thereafter, it facilitates the connection between the patient and a dietician or fitness instructor if lifestyle changes would address some of the concerns.
Initially, the business focus was B2C, but over the last year, the company realised it would achieve more success via B2B. Many people already have health insurance as part of their employment contracts and didn’t want to pay additional extra for the annual medical screening plan available under the SentinelX brand. So, the company partnered with various medical insurance companies to act as a service provider, executing the annual health screenings included in those plans. “We have been quite successful in this venture and over 1,000 of these screenings are done each month at our centres,” he says.
From the start, the biggest obstacle has been Nigeria’s struggling economy. MDaaS can be successful only if its clients can afford its services. “People know they need good healthcare, but often they cannot afford it. The more our patients’ financial situation deteriorates, the harder it is for us to operate,” Oni says.
As MDaaS imports diagnostic equipment from the US and other markets, the exchange rate is also a serious player in the profitability of the company.
“If we scale and we achieve volumes, we have shown we can provide affordable healthcare solutions and overcome these challenges. We aim to aggregate demand in a way no one else can to ensure business success.”
Oni’s goal is to expand the business into a holistic healthcare provider that can eventually influence lifestyle behaviour changes and perhaps even offer rewards. An example of how this has been successful is South Africa’s Vitality behaviour change programme offered by Discovery, a health insurance provider. It helps members keep track of their health goals and rewards them with points which can be redeemed in the form of discounts or vouchers at partner companies.
“Behaviour change is difficult, especially in a city such as Lagos that is not conducive to a healthy lifestyle. Most people are stuck in traffic for hours every day, for example. We need to establish ourselves first but influencing and changing health behaviour is our dream for the future,” he says.