Nigerian healthtech startup Lifestores secures $3M in series A round

Nigerian health technology company Lifestores Healthcare recently acquired $3 million in a pre-Series A funding round led by Health54, the CFAO Group's healthcare-focused corporate venture capital arm. A few existing investors as well as some new ones, such as Lionbear Conduit Capital, participated in the round, with Aruwa Capital Management serving as the supporting lead. The financing round was 50% oversubscribed, according to Lifestores.

Andrew Garza and Bryan Mezue established Lifestore in 2017, with the goal of providing Nigerians with access to trusted drugs through a chain of roughly six retail pharmacies.

As the company expanded and its founders developed knowledge of the pharmaceutical consumer market, they started to use technology to address some internal business issues. They ultimately chose to implement one of these solutions across the board, which resulted in the opening of OGAPharmacy, the company's online pharmacy platform for Nigerian pharmacies. The retail locations of Lifestores continue to be the testing grounds where the general requirements of pharmacies are assessed in order to develop solutions for the OGApharmacy product.

Lifestores offers two B2B items. The OGApharmacy B2B marketplace comes first. It was introduced in 2020 during the pandemic and enables pharmacies and hospitals to pool their purchase orders. Lifestores then negotiates with suppliers for the best deals on high-quality drugs, obtaining 10 to 20% discounts for them in the process. The second is an ERP system that may be used to manage operations by pharmacies and dispensaries.

Bryan Mezue, co-founder and CEO of Lifestores, commented on the funding round and expressed the company's excitement to have Health54 join its mission of democratizing access to high-quality, reasonably priced primary healthcare in sub-Saharan Africa, along with other existing investors like Aruwa Capital and the Lionbear consortium.

According to Lifestores, OGApharmacy has had growth of 25% MoM since its establishment and currently serves up to 10% of Nigerian pharmacies. This remarkable growth rate is what prompted Aruwa Capital Management to reinvest.

Health54, the lead investor in the round, is focused to high-growth businesses serving Africa's healthcare industry. By utilizing its extensive African healthcare network to increase the scale of its investees, the healthcare investment firm is on a mission to provide business support and financial empowerment to startups addressing the issues surrounding medical supplies and services for Africans, according to TechCabal.

“We’re proud and happy to make our first investment with Health54 in Nigeria and in Lifestores. We were impressed with Bryan and Andrew’s on-the-ground experience of having run multiple retail pharmacies in Nigeria,” said Côme Vercken, managing director, Health54.

“In two years, they have built a first-rate distribution platform with OGApharmacy. As a strategic partner, we’re delighted to work together and bring the benefits of our vertically integrated pharmaceutical supply chain so we can support more patients in Nigeria and beyond with quality primary healthcare.”

Out of the 7,000 pharmacies that are registered in Nigeria, Lifestores plans to increase its clientele of pharmacies from the current number of 750 to roughly 2000 using the money it has raised. By 2023, the startup will be able to double its customer base from 100,000 to 400,000 thanks to this. They will also open a new operations center in Lagos to handle the logistics and sorting needs of the company.

The business will enhance its patient management activities, credit options, AI-driven predictive ordering, and pharmacy management systems going forward. Additionally, Lifestores is aiming to trial B2C and B2B2C services like pharmaceutical distribution, care management, and patient savings. 

After raising this money, Lifestore healthcare plans to create more jobs for people in Nigeria.