The healthcare industry is a complex beast involving a diverse set of stakeholders. It also benefits, arguably, from one of the most enviable TAMs to speak of.

It is, however, a space where innovation has been painstakingly slow - both globally and regionally. The industry is heavily regulated, generates a wealth of (non-linear) data, and finding an alignment of incentives between stakeholders is almost more complicated than purchasing a gene-editing kit.

As we've mentioned in a previous piece, the most significant change in healthcare is an irreversible mindset shift in how we view and what we expect from healthcare. With an increase in awareness and monitoring, consumers will no longer accept surprise diagnoses. They also expect a better quality of care, better access, and a better sense of control over their health. In parallel, insurers, biopharma, and healthcare providers are looking to reduce wasteful spending, cost (financial, time, material) and optimize for efficiency. 

While healthcare is far from being commoditized, what we are seeing today is accelerated digitization of the space, years in the making, but expedited by Covid-19. We looked at the state of the market and the rising number of newcomers operating in subsectors that had remained inactive for the most part, such as Enterprise & Health IT, E-pharma, Wellness & Mental health, and more.

As we think through our thesis on innovation in Healthcare*, a few key points have emerged through various conversations:

1. Innovation will start where incentives are mostly aligned and move upstream in the value chain.
2. The interplay between horizontal and vertical (specialized) services/products will be interesting to watch. The interplay between homegrown and imported solutions/technologies will not necessarily be a zero-sum game.
3. Things that are going to function very differently: medical insurance, in-patient treatment experience (particularly of chronic diseases), patient data, and our view on wearables - among others. These will either be broken into smaller pieces (modular), become remote, or become more accessible (whether due to reducing costs or interoperability/ability to integrate).
4. MENA companies in this space may have a different trajectory than what we've seen for other venture-backed businesses.
5. The MENA has a young population and tech companies addressing mental (more on that later), physical, or sexual health may be filling a substantial gap their traditonal counterparts have not necessarily been built to manage conveniently nor adequately.

*By no means is this document comprehensive, it is a work in progress, meant to help us think through some of the trends shaping up, and changing our economies.

Stephanie Nour Prince is Partner at Nuwa Capital where she leads on the fund’s network engagements and operations. Ghassan Noursi is Nuwa Capital’s Venture Lead.

This document includes work by Kemuel Sabula and Mahnoor Sabir, participants in Nuwa Capital’s VC-in-Training program.

Artwork: Italian Rococo painter Gaspare Traversi, "The Operation (The Wound)", 1753-54