Thought Leaders in Healthcare IT: Praava Health CEO Sylvana Sinha, Bangladesh (Part 5)

Sramana Mitra: What is the segmentation? What percentage of that 25 million can afford your service?

Sylvana Sinha: We believe that a third of them can afford our service. We are starting out with eight centers in Dhaka in the next three years. Then we would like to go beyond.

Sramana Mitra: Are you profitable?

Sylvana Sinha: We were EBITDA-profitable for the first time last year.

Sramana Mitra: Has fundraising become easier?

Sylvana Sinha: It has. I think Bangladesh is a little bit better understood among the investor community than when I started. In fact, just in the last year, we’ve seen Tiger, Sequoia, and Softbank making investments in Bangladesh. When VCs come into emerging markets, they don’t make their first investments in healthcare. They usually start in e-commerce and fintech which is what they’ve done in Bangladesh.

Sramana Mitra: Yes, at the same time digital health is of huge interest in the venture community. If you can spin your business as a subscription business, and if you can show adoption, that’s going to make a difference.

Sylvana Sinha: We can spin it, but I don’t think we can build it.

Sramana Mitra: By spin it, I mean you have to validate it.

Sylvana Sinha: I don’t think that that business will work in our market. It hasn’t worked in similar markets where insurance penetration is low. It’s worse in markets where there’s national health insurance. The challenge that we face with VCs is there is a lot of attention on digital health, but brick-and-click models are the hottest thing ever. In emerging markets, the VCs are focused on pure-play digital health.

Sramana Mitra: On my blog, there is a series on Indian unicorns 2022. There is a company that we’ve covered that’s doing surgery centers all over India.

Sylvana Sinha: You’re right that VCs in India are investing in hybrid models. For the next-level markets, they’re not.

Sramana Mitra: You’re right. The brick-and-click model has been in vogue for a while now.

Sylvana Sinha: Sequoia has invested in businesses like ours in India. So far today, they said, “We love businesses like yours but for Bangladesh, we want to focus on asset-light businesses.” At some point, it will have to shift. We’re still in conversations.

Sramana Mitra: Some of your capital requirements can be financed through banks.

Sylvana Sinha: Correct. One of the challenges in emerging markets is that the local banking system is setup in a way where there’s not a lot of venture debt.

Sramana Mitra: It’s not venture debt; term loans.

Sylvana Sinha: There’s no startup in Bangladesh that can access term loans except for mine because I’ve personally collateralized it. The banking system needs to be restructured.

Sramana Mitra: Everything needs to be restructured.

Sylvana Sinha: Right. If I didn’t have the collateral, I wouldn’t have been able to access the debt. I was very lucky to do that.

Sramana Mitra: I started a company in 1994 in India. I had to personally collateralize.

Sylvana Sinha: I think that’s about right. Bangladesh is about a generation behind India.

Sramana Mitra: I’m thrilled to meet you. Thank you for your time.

This segment is part 5 in the series : Thought Leaders in Healthcare IT: Praava Health CEO Sylvana Sinha, Bangladesh
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