We Got Funded: Saudi Arabia's HealthTech Startup Sihatech Closes US$1.3 Million Series A
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Riyadh-based healthcare tech startup Saudi Internet Health Application Technology Company (Sihatech) has closed a Series A round of funding raising SAR5 million (US$1.3 million) from Saudi Aramco Entrepreneurship Center (Wa’ed Ventures) and existing investor Waseel Application Service Provider, a healthcare IT firm based in KSA. Sihatech plans to use the funds to “improve its offering for the Saudi healthcare sector, expand its team, hire more local developers, and expand its core technology products,” aiming to drive the healthcare goals part of the Saudi Vision 2030.
Sihatech aims to provide answers to a question on most people’s minds in the region: who’s the best doctor for their ailments. The Sihatech website and app enables users to find doctors from over 100 different medical specialties, according to their needs, and book an appointment directly with the chosen professional. On the other hand, for hospitals and doctors, the company helps them address the issue of digitization and storage of medical records by offering a complete Hospital Information System (HIS) on the cloud.
Sihatech’s stand-out success in various regional ecosystem challenges seems to be a key enabler for the current funding. Al Bader believes the startup was approached by investors thanks to their victories including Startup of the Year at ArabNet Riyadh 2016, Startup Championship at ArabNet Digital Summit 2017, and finding a place in the Top 100 MENA Startups listing brought out by World Economic Forum in 2017. “We are very fortunate to have found investors that share our vision to improve healthcare across the MENA region,” Al Bader says. “They chose us and approached us. We have high aspirations for our partnership with Wa’ed. We have already approached John Hopkins Aramco Healthcare [a joint venture between Saudi Aramco and Johns Hopkins Medicine] with a long list of ideas to improve transparency and accountability for the 65,000 Saudi Aramco employees and their family members.”
As for its future priorities, Al Bader says the startup is keen to move beyond basic registration and appointment booking tasks, and develop capabilities for telemedicine consultations, patient procedure financing, drug delivery, laboratory test delivery etc. In fact, the startup also considers itself a fintech platform as it’s working on building its Jamalek product- one that offers financing on medical procedures costing between SAR40,000-150,000 in a Shariah-compliant format. “We are now in the process of building a payment gateway that will allow our users to apply for micro loans to finance certain medical procedures that are not typically covered by insurance and it will also allow small hospitals and clinics to manage their revenue cycle with insurance companies and their medical supply payments to their vendors,” he says. Maalem Financing Company, a leading Saudi financial institution licensed by the Saudi Arabian Monetary Agency (SAMA) is Sihatech’s partner in its effort to bring patient/health finance to the Kingdom.
According to the MENA Healthcare Sector report by Al Masah Capital, the MENA healthcare market is estimated to be worth $144 billion by 2020, and the GCC’s healthcare market alone, covering six countries, is projected to be worth $69 billion. No wonder then that the region’s aspiring entrepreneurs consider the sector lucrative for technology-powered ideas, despite the legal and regulatory constraints. And with over 2,000 doctors representing 30 different hospitals and medical centers across KSA, Sihatech is one of the largest health tech providers in the Kingdom. In such a setting, Al Bader considers their partnership networks and technology as competitive advantages. “Yes, there have been many doctor listing and booking websites. [But], we are different and unique in the following three ways: location, integration and service focus- keeping in mind that we are an online service that offers a complete Hospital Information System (HIS) on the cloud.”
Ahmed Al Bader, founder and CEO, Sihatech
What are your top tips for entrepreneurs who are looking to raise funds for their enterprise?
1. Get yourself ready “Be prepared to both explain your core business and to answer all the different questions about the market, your competition, your core customers, their acquisition costs, and all the key traction metrics.”
2. Have a targeted approach “Be focused on both the number of investors you approach, and your core business. Do not let fundraising get in the way of running the day-to-day operations of your business. Focus your energy only on smart money investors. Top investors in your industry that can help not only open doors, but guide you and hold your hand through them, and help you avoid common pitfalls faced by other startups.”
3. Stay true to who you are “Be honest. This above all else, [be honest] to [one] self (and to one’s investor)… Remember, they are your partners, and you must have an open, honest and realistic discussion about both your vision, and how you want them to share it and help you achieve it.”