African health tech startups raised only $200k in Q1, 2025 despite global funding spike

Ejike Kanife
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Global funding into the digital health space witnessed a massive uptick in the first quarter of 2025. However, African health tech startups appear to be lagging. According to the State of Digital Health Q1, 2025 report by analytics company CB Insights, African digital health startups attracted only $200,000 in the period under review.

The abysmal showing reflects the near-moribund state of the industry in Africa and other emerging countries around the world.

For instance, Health tech startups in the Latin American region raised $49 million during the same period. Similarly, those from the Oceania region raised $200 million, while health tech startups in Asia raised $300 million.

The largest fundraising was recorded in the more developed markets of Europe and North America, where health tech startups raised $1.5 billion and $3.4 billion, respectively.

This indicates that health tech is largely a feature of more developed economies. This is not surprising considering that they have the highest standard of digital infrastructure, and importantly, a generally well-to-do population that could pay for these services.

African health tech startups raised $200k in Q1 despite 47% spike in global funding
Credit: CB Insights

The decline is also pronounced in the number of deals recorded across the regions. Africa still has the lowest, with just two deals. The same applies to Latin America, even though the deals yielded way more.

The Oceania region attracted 7 deals while the Asian region amassed 53 deals. Europe, with 62 deals, is above Asia, while the USA amassed 166 deals.

Africa’s health tech funding decline

Venture funding into the African health tech space has dwindled over the years. Indeed, it suffered a 61 per cent decline in the share of total funding on the continent in 2024.

    Linda Obi, the CEO of Nigerian health startup AfriHealth, believes that health tech in Nigeria and Africa struggles with funding due to several interlinked challenges. The first is the long return on investment (ROI) cycle. Unlike fintech, where revenue generation is immediate, health tech solutions often require long-term investment before yielding significant returns.

    There is also the issue of perceived complexity, as many investors shy away from the sector due to the intricate interplay between technology, healthcare policy, and patient adoption. There is also a lack of local precedents, and with limited examples of large-scale health tech success stories, investors perceive higher risks.

    What is wrong with health tech in Nigeria? Afrihealth CEO, Linda Obi discusses
    Linda Obi, CEO of Afrihealth

    However, she maintained that the sector remains highly attractive for the right investors.

    Health tech presents untapped opportunities for impact-driven investments. Solutions like AI-based diagnostics, telemedicine platforms, and pharmacy delivery services are ripe for scaling in Nigeria. Health tech may not yet be mainstream, but its societal impact and profitability potential make it a sector worth betting on,” she said.

    She encouraged health tech startups to demonstrate clear metrics (e.g., cost savings, expanded access, improved outcomes) to attract venture capital and patient funding.

    AI sees global health tech funding spike by 47%

    Despite Africa’s not-so-encouraging Q1 numbers, digital health funding globally generally enjoyed an impressive first quarter, with funding rising by 47% to hit $5.3 billion. One has to go back to the second quarter of 2022 to find a better quarterly showing in global digital health funding.

    Indeed, the $5.3 billion raised in Q1, 2025, implies that 32.5% of the total of $16.3 billion raised in 2024 has been reached.

    Similarly, the sector saw the emergence of six new unicorns in the first three months of 2025. This is double the total number of digital health unicorns birthed in 2024 (3) and twice the number recorded in 2023 (4).

    Heala leverages innovative technology to transform healthcare delivery in Nigeria

    Also, only in Q2 2022 has the sector birthed an equal number of unicorns in one quarter (10).

    Observably, the impressive growth has been powered by Artificial Intelligence solutions, especially in the United States, Europe and Asia. AI-powered startups raised $3.2 billion in Q1, representing 60 per cent of the total funding. This is up from 41% recorded in 2024.

    Going forward, African health should seek to integrate artificial intelligence solutions to boost its offerings and increase revenue and funding.

    See also: What is wrong with health tech in Nigeria? -A chat with Afrihealth CEO, Linda Obi


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