This has already been mentioned several times but I’ll go ahead and repeat it one more time; It is hard to be an entrepreneur in Africa. It is even harder to venture into the healthcare sector. It is even hardest when your target beneficiaries are the bottom of the pyramid majority who can’t afford to spend two dollars a day let alone spend it on healthcare.
Well, that’s what Dr. Davis Musinguzi was up against when he decided to pursue his goal of revolutionizing how healthcare services are delivered. He is the Managing Director of The Medical Concierge Group (TMCG) with operations in Uganda, Kenya and Nigeria.
TMCG is a digital health company with a portfolio of innovative ventures in medical call centers, healthcare enterprise software, and connected medical devices.
Dr. Davis Musinguzi’s influence in the call center circles is resounding across East Africa as well as some parts of Africa. This is evidenced by his recent inclusion on the list of speakers at the Call Center Transformation Forum in Nairobi last week alongside Parshon Muranganwa from Econet Wireless and Goldermeir Opiyo from Safaricom.
In a conversation with Dr. Davis Musinguzi, he was able to walk us through his journey of, obviously, ups and downs – just like, you guessed, every entrepreneur is.
The Idea: 2009
His initial vision around starting the business was some kind of frustration with the health care system. To him, health care had always lagged behind in terms of being innovative and creative.
Secondly, it wasn’t his goal to have one of those mundane careers. For most people that pursue medicine or courses in the medical field, it is very easy to fall into that trap. A typical cycle goes like; get done with Medical School, work one or two years in a hospital then you go back for another three or four years of study to become a Specialist like a Surgeon or A Pediatrician.
After that, you get hired by someone else or maybe start up a small Doctor’s practice. What eventually happens, in the end, is that the better you get the busier you get. Yet the busier you get the less of any kind of lifestyle you actually have. Dr. Davis Musinguzi wasn’t one to be drawn to this run-of-the-mill narrative. He wanted to tame the lions and fight age-old demons in Healthcare.
Getting to work and looking for startup funding: 2012
It took Dr. Davis Musinguzi some time to get his idea off the ground. This was in part because he was still sniffing out for any opportunities that he’d leverage while at the same time refining it. He is a believer that when you get an idea, give it time to mature. Do some research and read as much as there is about it.
Most people get an idea and they want to act on it immediately. Ideas also need their time to mature because normally the initial way you conceive it is not the way it should be implemented.
On his quest for opportunities, Dr. Davis Musinguzi finally landed on the Inspire Africa Show. This was followed by being awarded the Warid Entrepreneurship Fund which was worth $50,000.
The real work begins…
Up until he was awarded the fund, Davis’s idea was still a mere concept that he was debating around as well as polishing. He had no MVP at hand. But after the fund, he realized the actual work had to begin.
However, to mitigate any risks of running out of cash anytime soon, he secured exactly the same amount ($50,000) from friends that he brought on board. His thinking was that as long as they had a vested interest in form of investment, they’d commit to the business.
Minimum Viable Product (MVP)
The MVP was setting up a call center. This was staffed with doctors and pharmacists. The reasoning behind was that the general public can have access. Their revenue model at that time was advertising by placing public health infomercial before the call with the Doctor.
However, it cost them around $100,000 – which is all the money Davis had raised. This implies that if he hadn’t thought of raising additional capital from friends, even the MVP would not have been completed.
As a startup, keep an MVP as strictly an MVP. Inject in what is necessary not what is “cool”. Because, in the end, it is bound to change due to customer preference. As you will read on, Davis’ model shifted from B2C to B2B. Therefore, try as much as you can to keep your MVP as an MVP.
Running out of money
After setting up the call center and hiring a few doctors and pharmacists, the $100,000 from the Warid Entrepreneurship Fund and friends ran out in 6 months. TMCG gave up half the staff and still, the founders weren’t getting paid.
Asked how he survived, his answer was “You hustle”. A phrase that’s very synonymous with all people trying to start up in Uganda. He was able to do a consultancy here and there and some savings he had stashed somewhere. He also had to ensure that the limits on his lifestyle in order to make ends meet.
This is a common occurrence especially for startups that are being bootstrapped. If it means taking up a job or offering any short-term products and services like consultancy that can keep you going, do that. You need cash flow.
Pivoting and landing the first client
The advertising revenue model of placing infomercials before the calls successfully failed. It simply didn’t work. Yet, six months down the road, TMCG landed its first our first client. So how did they survive and land their first client in six months?
They had to pivot their model to a B2B engagement, segment the health sector and identify the different players then embarked on creating a different value proposition for each.
As a startup, stop flogging a dead horse. Try as many things as possible but only keep what works. If your initial model isn’t working, don’t be skeptical to try out a different one.
Learning from past mistakes
After landing the first client, their main focus was efficiency as well as a “death ground” strategy as Robert Greene puts it in his book the 48 Laws of Power. This was because he didn’t want to increase his overhead. He also wanted to ensure that they stretch revenue generated to keep them alive for as long as it can.
He ensured that there was no repetition of past mistakes. As a business, their main focus was that the more revenue they generate, the less they burn. This was also achieved through automating some of the tasks.
As a startup, you’re on a lean budget and can’t afford to make a mistake twice. Therefore, keep track of whatever mistakes you’ve made and ensure no one in the team repeats them. This is not aimed at trampling down trying new things, it’s aimed at avoiding wastage of the little or unavailable resources.
After landing the first client their target was now, of course, to get more. But more important than that, “when you get a customer”, according to Davis, “you study the customer. Why did they sign on with you? What are their expectations? Are our services and products meeting their requirements? How can we get other clients that are within their category of the market? How can we improve our offerings? How can we get our pricing and quality right?”
For any startup, those questions that Davis and the team focused on are more important than “the money that you make from your first customer” as Davis put it. You need to understand your first few clients inside out. This is something that’ll help you refine your value proposition and product-market fit.
Getting Hands Dirty
At this point, almost a year in operation, the team is at a size of 4-5 employees. The founders were the sales people – and this, of course, including Davis. Davis says that he is yet to hire dedicated sales people. Instead, he leverages everything within his reach and network and so does his co-founders.
This is something that most startup founders need to learn. Getting involved in actively selling or “getting your hands dirty” as many call it not only motivates you but helps you get first-hand feedback that your employees might skip in the reports they write to you.
His comment on how their first year went is “we survived”. But, this shouldn’t be taken lightly in a country and continent where few startups live to see their first birthday. Therefore, to Dr. Davis Musinguzi and the team, surviving the first year wasn’t just surviving, it was a victory.
Like they say, most people don’t survive their first year but even those who survive their first year, do just that… survive.
Asked whether there’s a time Dr. Davis Musinguzi could look back and point to as TMCG’s breakthrough point, he says there is none.
Everything is so slightly incremental. Of course, you just realize that you get better at selling it, you get better at refining your value proposition, you get better at presenting your slides, you get better at writing your concept notes, you get better at sniffing out opportunities, and you get more word of mouth across. Somebody says they’ve heard about you which makes pitching a little easier.
And, not just Davis, a lot of successful entrepreneurs have the same answer. There’s no point in your entrepreneurship you’ll look back to and say, ‘that’s when I made it’. Instead, it’s the daily efforts that compound eventually.
The team is now comprised of 18 phenomenal employees. These are doing everything across clinical care, software engineering, communications, finance, quality assurance, business development, research and project management. However, something interesting is that they’re now rolling out to a B2C revenue model. There are two B2C services in beta testing that are going to be publicly launched this year.