Home Interview ‘It Took 16 Months To Make Our First Sale In Nigeria’

‘It Took 16 Months To Make Our First Sale In Nigeria’


The stifling business environment in Nigeria has given rise to indices suggesting most new businesses die off in less than 5 years. Uvie Ugono, CEO, Solynta Energy, and co-founder of Smaart Health, a new digital artificial intelligence app for healthcare, was nearly frustrated by the operating environment after returning from the UK to set up his business, without making sales for 16 months. Ugono was for 10 years an investment banker, and former CFO for HSBC’s Project and Export finance unit, which he says was at the time, a $250 million a year business. He tells BusinessDay in this interview, that his return to Nigeria however exposed him to a contrasting business environment; promising but extremely challenging. Excerpts:

We presently have quite a number of companies operating in the solar power space, so what is your own model and what differentiates it?
The solar space is vast. We focus very specifically on the urban residential and SME market space, and what that means is people living in towns and cities. These are people who typically already have some grid electricity but find it unreliable and rely on generators very heavily; these are our customers. What we do is generator displacement with solar at a significantly lower price point.
There are over 60 million generators in Nigeria, and our target market is about 45 million; 30 million used in households and 15 million for businesses.

How long have you been in this business and what prompted you to start it?
We started quite slowly after I came into Nigeria on April 20, 2013 but I did not make my first sale for 16 months. It was a challenge and it stemmed from the fact that at the time (which seems like ages now), most Nigerians had doubts about reliability of solar energy. There were lots of negative stories on it for instance, the street lights in Lagos that packed up after few weeks of installation. This had set in the mind of people and it took a while to convince them otherwise. We started by trying to sensitise and convince people, and once we did the first installation we did about 15 in quick succession on the basis of people first trying out the system. We became profitable after our first full year of trading and have remained so ever since.
We’ve grown very quickly to become a leading solar company in our space by far. This is because there is massive demand for power since people spend a lot of money on generators.
We operate the lease to own package where 35 percent of the system cost is paid upfront and we finance the remaining 65 percent for customers over two years. This has allowed a lot of people to be able to go solar. The cost of acquiring solar systems is quite high and since the financial institutions do not provide adequate facilitates for financing acquisitions like this, we have had to step into that space.
We realised that for us to be successful in our objective, we had to go beyond providing solar systems but also offering the financing framework for its acquisition.
We’ve been growing steadily, and this year, we just launched our pay as you go plan. It is a five year plan and lowers the entry point even more. During this period, full maintenance is our responsibility, including changing of batteries (if required).

With all the challenges of getting the solar business profitable, you’re starting a new business in untested waters, so, what is Smaart Health all about?
The whole plan and strategy behind the business is to disrupt the health care system in Nigeria because it doesn’t work very well. So we are creating a virtual primary healthcare system. We believe that 90 percent of all the hospital visits in Nigeria at the moment would no longer be required, because the same level of help, advice and treatment that you need in 90 percent of the time, can be delivered virtually.
So we use a combination of artificial intelligence to give accurate diagnosis, and then transferred to a doctor for consultation, after seeing the diagnostic report. This can be done via voice or video calling. It is a way of making healthcare accessible to all people in the country.

The doctors on Smaart Health platform, how many are they and how do you engage/interface with them?
So, we call it on boarding. We are building it like this; think of Uber for Doctors. That’s basically what this is, but with a twist. Doctors are able to build their own virtual clinics via our app. So, a patient downloads the app, the very first thing they do is carry out a diagnosis powered by AI, so they can do that on their own. Symptoms are imputed and it narrows down to possible conditions based on the responses given.
It takes about 90 seconds to 2 minutes to get a detailed diagnosis. At that point, it now prompts if you would like to speak with a doctor to discuss this further. The customer says yes and then a doctor is engaged. It asks if you have a unique reference number for a doctor, if you don’t you just ignore it and say find me a doctor. The first doctor that meets your requirement to respond takes the job.
The doctor then calls, provide consultation (after seeing your diagnostic report), ask some questions, and tell you what to do next. If the doctor feels you need to go to a hospital for some tests, or further checkups or wants to give you a prescription, he/she can do that and you’re basically sorted. But, what we’ve found is that 80-90 percent of all hospital visits are actually unnecessary, people go to hospital for exactly what we are doing via this App.
Now, the beauty of the system is it really is a platform for doctors to earn significantly more money than they currently earn. Nigeria has a major problem of doctors and brain drain. Because they are so poorly paid and working conditions are poor, most doctors if they can, will rather go and work abroad where those same skill sets are in much higher demand and they get much more money. So we felt that the way to save the healthcare system is to find a way of working with the doctors to make them more money. So, what we are doing is basically directing huge amounts of traffic to doctors. Once a doctor has a consultation with you, their performance can be rated on the app, and he/she can as well give you their unique identifier number and ask that you please give it to your friends. It is like their digital business card. So, the next time you need to see a doctor again, doctor-patient relationship has commenced so now you put in the doctor’s reference number and only that doctor gets that alert, and calls you. What that allows is for doctors to build up their own virtual healthcare centre. The doctor doesn’t have to find a clinic somewhere and set up.
It is like having an Amazon shop or on eBay. They can actually have a virtual practice sitting on that platform, and each time you have a consultation and the guy pays, the doctor is in turn paid and can earn about a million naira a month just from doing this. And this can be done along with their regular job; no need giving it up, as this is just a way of earning additional income which is about five times what they currently earn.
So, this works well for doctors and will encourage more of them to stay and try to help out with healthcare. The other major thing is that the ratio of people to doctors in Nigeria is extremely low. To put it in some perspective, the UK has a ratio of about one doctor for every 353 people. The US has the ratio of one doctor for every 392 people, Nigeria has a ratio of one doctor for every 3, 631 people.
By implication, we don’t have anywhere near enough doctors to actually do the job, and meet the level of demand which also grows by the years as the population is growing. At the same time, we are actually losing doctors. So what we are trying to do is bridging that gap through significant efficiency gains. By combining what we call man plus machine, that is, by having artificial intelligence do the basic diagnostic work, this saves the doctor 90 percent of the time it would normally take to get to the point of diagnosis. Which means consultation time can now be shortened.
Consultation for a patient can now be done in well under 10 minutes, even 5 minutes. What this means is that, because each doctor now has the capacity (without losing any form of accuracy) to now do probably six times as much consultations within the same time, as they could before, one would have effectively bridged that gap. So, that is the whole idea behind what we are doing, and we feel considering where we are in this time of our country’s history, it is unlikely that we are ever going to be able to build a medical system that is going to cater to the needs of people the way it does in the West. The only way we are going to be able to solve the problem is by using technology, leapfrogging, and giving our doctors (although few in number) tools to enable them work many times as quickly as their counterparts in a foreign country, then we could do the same with much fewer people.
And what we hope will happen is; as those Nigerian doctors practising abroad begin to see what is happening, it will encourage them to come back into the country, because we need them. But if we can’t remunerate them well, they definitely are not going to stay or come back.

What vetting process do you have in place for the doctors that are brought unto your platform?
We do quite an intense vetting process. It is almost like recruitment so we conduct background checks on prospective doctors, starting from their last place of employment. Whether or not it was at a hospital and we get references from there. If he/she still works there, the hospital is made to realise this is not their personnel leaving for another paid employment, but just offering services to help out the country. So, we get a reference from the current employer. We have a strong preference for doctors who have been working as doctors. We know there are a lot of doctors that are qualified and passed out from medical school, but doing something different.
We don’t allow those doctors unto our platform. Because, however much technical ability you have, a practical hand on experience is what counts. We also ensure there is verification from the schools they were trained because, we can never rule out the possibility of a doctor who’s working at a hospital; but never really qualified as one.

How long has the app been operational and what has been the level of activity so far?
We are still in Beta phase and testing, adding features. What we decided is not add all features at once, so we started with the artificial intelligence, introducing people to AI and how it works. As that is going on, we are now in the process of on boarding our doctors, so by the end of February, we are going to have about 1,400 Nigerian based doctors on the platform, and then we move to the next phase of our development.
We are also working with HMOs because, we realise that solving the health problem has so many different aspects to it. We are looking at primary healthcare basically; diagnostics etc which in the UK is what they call the GP, so this is the GP level for us here.
It is a very important level which acts as a filter against unnecessary visits to a hospital. So, we are taking care of that piece, but of course you still need the facilities that, when you do need care and the doctors refer you to a hospital, we want people to be able to afford the medical care.
This second major part of what we are doing is to work with the HMOs to bring their price points down, and make it significantly affordable to the masses. Now, the major problem that the HMOs have is cost; how to control it. There are no excesses unlike in the UK and US where it is called co-pay. What that means is, if you have health insurance in the US, the price that you pay for the health insurance, depends largely on your co-pay, which is the first amount you have to pay before the insurance company is required to pay. It could be a thousand dollars or even five, what that means is that I have gotten a lower premium but if I ever have to use, then I have to pay the first part upfront and it serves as a big buffer to the insurance company. So, they are not paying for every single visit to the hospital. This doesn’t happen in Nigeria where it is still a very small industry, so there’s zero percent co-pay.
Combined with that is the culture, because healthcare is largely sold through the corporates, the person that has the health plan is not the one paying for it. So if that person has a slight headache, they go to a hospital. Not necessarily realising or even caring that just by them showing up to the hospital, it is a ten to twenty thousand naira bill that will be incurred. Even if the doctor only saw them for one minute and said, go home, take some water and rest, it still incurs a bill sent to the HMO.
The more claims the HMO has to meet, the more difficult it is to make profit. So, they need to have their price points as high as they presently are to stay in business. The problem with that is, they are priced at a level the majority of Nigerian population cannot afford. So our tool is perfect for them in solving their problem, because, what we are introducing is the British way of dealing with healthcare. How it works in the UK is; you can’t go to the hospital unless it is an accident or emergency. You also can’t go the hospital and be seen by a doctor or member of staff unless you’ve been referred by your GP.
So the first port of call when feeling unwell should be visiting the GP who first examines you. UK statistics show that almost 80 percent of GP visits are solved at that level without any need for further referral to the hospital. What it does is serving as a filter to the hospital. If it wasn’t there, hospitals would have collapsed by the sheer volume of people who would be going there. That is exactly what is happening in Nigeria today, where there is no filter and people just go straight to the hospital and pay. It is particularly horrendous in government hospitals where queues can be very long and someone could be sitting for seven hours just to be attended to because of a headache.
What we are doing is to introduce that GP system using smart health and one of the great ways of doing this is via the health insurance system.
Now we are saying, you can go to the hospital but you have to be referred by one of the Smaart Health doctors. This means going through the process of diagnosis and then you have a virtual consultation which the insurance plan will pay for. It is then up to the doctor if a referral to the hospital is necessary.
We expect this to translate into about 90 percent reduction in visits to hospitals. Now this is very crucial because what we are doing in effect is saving the HMO money on more of their customers. It slashes their costs and this gives them ability to reduce their premiums. I think this platform is crucial to the rollout of health insurance in Nigeria. Now, if we can get insurance down to 8,000 – 10,000 naira per annum, at that price point there will be significantly greater take up. But right now, the lowest premium is like N20, 000 and a lot of people just can’t pay it.
The vision we have for this app is very massive and I strongly believe that this is the future of healthcare not just in Nigeria but across Africa. And obviously the rest of the world also believes that because even though we are still a pre-revenue company, we have just secured seed investment from US investors valuing the App at $1 million because there is a lot of interest in what we are doing.
This investment of $50,000 is coming through an Accelerator, which is the Houston Technology Centre (HTC).
We want the App to be as ubiquitous as having WhatsApp on Smart phones. We want everyone with a Smartphone to have this App in it because as we call it; it is your doctor in the pocket

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