Medsaf, once a pioneering force in Nigeria’s healthtech sector, quietly ceased operations in early 2024 following nearly eight years of trying to digitise Africa’s fragmented pharmaceutical supply chain. The Lagos and US-registered startup, co-founded in 2017 by Chicago-born entrepreneur Vivian Nwakah, had raised over $2 million in disclosed funding from local and international investors and was widely seen as a trailblazer in tackling the continent’s counterfeit medication crisis.
Despite early momentum, global attention, and high-profile speaking engagements for its founder, Medsaf’s demise was marked by financial turbulence, investor disputes, and unresolved employee claims. The company’s shutdown went largely unnoticed in the broader tech media — a quiet end for a company that once helped shape Nigeria’s early healthtech narrative.
From promise to pause
Medsaf’s mission was ambitious: to make pharmaceutical procurement safer, more reliable, and transparent for hospitals and pharmacies in Nigeria, a country where over 10% of medicines are estimated to be substandard or counterfeit. It built a tech-enabled platform to centralise access to vetted medications from licensed manufacturers and suppliers, addressing a longstanding gap in Africa’s healthcare infrastructure.
The startup gained traction during the COVID-19 pandemic, with reports of 200% growth and a doubling down on its B2B procurement model. In January 2022, Medsaf announced that it had raised $2.7 million in total funding to date — including from investors such as Y Combinator and Techstars. But beneath the surface, cracks had begun to show.
According to internal communications seen by Launch Base Africa, Medsaf ran out of funds by January 2023 after a failed Series A fundraising effort. “We ran into considerable challenges when we did not raise a Series A in 2022, and our bank financing pulled out at the beginning of economic distress in Nigeria in 2023,” Nwakah wrote to investors in March 2024.
The startup’s final hope — a potential acquisition deal — fell through in November 2023. By that point, the company had already laid off its full-time staff, with many alleging that salaries and statutory deductions remained unpaid.
Employee allegations and unpaid dues
In July 2023, Nigerian tech publication TechCabal reported that Medsaf had laid off all full-time employees after months of salary delays. Former staff claimed they had not been paid since December 2022 and alleged that pension and tax contributions were not remitted. One former employee described the experience as a “tragedy.”
At the time, COO Rotimi Lawal acknowledged the financial difficulties, citing “funding gaps and dismal payment behavior of hospitals.” Medsaf’s leadership offered partial salary payments for early 2023 but struggled to make good on them, sources said. In response to the allegations, Nwakah said investor funding fell through at the last minute, compromising the company’s ability to meet obligations.
In her final investor communication, Nwakah added that she had tried to shield the news of the shutdown from becoming public to preserve the possibility of recovering outstanding hospital receivables. “They definitely won’t pay if I announce a close,” she wrote. “Please try and keep this to yourselves until I pull the plug on Nigeria-focused recovery efforts.”
“We were before our time”
Despite the operational breakdown, Nwakah remains unapologetic about the company’s closure and reflective about its significance. In a personal message posted to her network in 2024, she described the journey as both transformative and traumatic, citing burnout, betrayal, and envy from peers. “We were before our time,” she said. “Many people followed afterwards and improved upon things that we did first.”
She also highlighted Medsaf’s role in helping establish digital procurement as a viable concept in Nigeria’s healthcare system — a market long dominated by informal and opaque supply chains. “We were proud to be the first to introduce many of our clients to the concept of digitising pharmaceutical procurement,” she told investors. “Now it is being pushed as a standard.”
Still, she acknowledged that the startup’s foundational weaknesses — particularly its early team composition — ultimately contributed to its failure. “Most of the problems that plagued the company came from me trying to compensate for not having the right team in the very first place.”
The cost of being first
Medsaf’s trajectory echoes a broader theme in Africa’s startup ecosystem: first movers often struggle to survive long enough to reap the rewards of industry shifts they helped catalyse. Despite regulatory tailwinds and growing interest in African healthtech, early innovators like Medsaf face macroeconomic headwinds, infrastructural barriers, and difficult fundraising environments.
The startup’s collapse also raises questions about investor accountability, founder burnout, and the hidden costs of entrepreneurship in emerging markets — particularly in complex sectors like healthcare. “I built a drug company in Nigeria from scratch,” Nwakah wrote. “Going up against open drug markets, criminal syndicates, and multinational corporations… to thrive, at least for a little while.”
As the industry matures, former employees and industry observers say the lessons from Medsaf’s rise and fall will be instructive — not only for future founders, but for investors seeking to back ventures in similarly high-friction environments.
What remains
Medsaf’s Delaware corporation is still undergoing formal wind-down procedures, while its Nigerian entity remains dormant. According to Nwakah, a small team is still working — unpaid — to sell off remaining inventory and collect debts. But with liabilities outweighing assets, a full recovery for investors and former staff appears unlikely.
“Not all investments work out. That’s the risk we take,” Nwakah told stakeholders.
For many in Nigeria’s tech ecosystem, Medsaf’s quiet exit serves as both an exemplary tale and a moment of reflection — on how to better build, fund, and sustain ventures in critical industries, and at what human cost innovation truly comes.
Editor’s Note: While Medsaf has now shut down, several startups continue to operate in the pharmaceutical supply chain space in Nigeria — suggesting that Medsaf’s downfall was more unique than indicative of the sector’s prospects. Lifestores Healthcare, for instance, has grown steadily since 2017 by digitizing procurement through its B2B platform OGApharmacy. The startup, which raised $3 million in 2022, serves over 750 pharmacies and hospitals, offering them access to vetted medications at discounted rates. Other players such as DrugStoc and Remedial Health have similarly made headway by focusing on aggregating supply and leveraging software to solve distribution and inventory inefficiencies. The continued activity in the space highlights that, while Medsaf helped pioneer digital pharmaceutical procurement in Nigeria, its struggles stemmed from internal and contextual challenges rather than a lack of market opportunity.