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Alain Nteff wished to make hospitals out of date by his startup Healthlane, however his unbridled spending and erratic choices have led to the corporate’s finish. TechCabal spoke with over 10 previous staff and obtained paperwork that exposed the celebrated founder’s behaviour and the true image of issues on the startup.
In Might 2021, when Sabina*, a product marketer, utilized to work at Healthlane, a preventive healthcare startup primarily based in Cameroon and Nigeria, that gives well being test companies, she was excited to hitch a budding modern firm.
Her interview came about on the five-star Eko Lodges & Suites in Lagos, Nigeria, over lunch, and inside the week she obtained her provide letter to start out at Healthlane the next month.
The startup, which was based in 2019 by Alain Nteff and Agbor Ashu, provided a beneficiant wage and mouth-watering perks for its staff. It offered lunch to workers; weekly swimming classes and a gymnasium teacher; an Oura ring, a well being monitoring wearable system; and work instruments—laptop computer and iPad. Some Healthlane staff have been provided lodging onsite in a six-bedroom mansion, a part of which doubled as workplace area.
Healthlane was a part of Y Combinator’s winter batch in 2020. After graduating from the accelerator, it raised $2.4 million from Silicon Valley’s topmost buyers similar to Sequoia Capital and Silicon Valley Financial institution, and was set to take the healthcare world by storm.
However by the second half of 2021, an imminent implosion began to brew on the startup, in keeping with interviews with 12 former and present staff—lots of whom spoke on situation of anonymity.
It began with Nteff making modifications to advertising campaigns and product options. Throughout product conferences Nteff made sudden modifications and new function requests, usually disrupting beforehand agreed plans.
These sequence of erratic choices by Nteff led to resignations and terminations—Sabina was considered one of such. By December 2021, the corporate couldn’t pay worker salaries regardless of Nteff assuring staff that the startup had over $1 million money within the financial institution.
“It was an excellent place from the skin, there was a spacious home, meals and different perks, so that you gained’t assume there’s something fallacious. However Alain was all the time making modifications, so it was tough to maneuver ahead,” Sabina instructed TechCabal.
It’s not clear how Healthlane blew by $2.4 million inside a 12 months, however many previous staff suspect that a few of the funds have been diverted to actions and ventures exterior Healthlane.
There have been accounts by previous staff of Nteff diverting firm funds. This included the sum of $109,000 (XAF 68 million) meant for a GAVI challenge, XAF 12 million ($18,500) funding by the Cameroon Angel Network meant for employees salaries, and the $50,000–$100,000 equity-free grant gotten from Google in September.
Eyebrows have been raised at enterprise transactions with Infiuss Well being, owned by Melissa Bime, who three previous staff declare was Nteff’s girlfriend.
Revenue from a bunch often known as “funded tech bros” was flagged by three former staff who maintained that Healthlane by no means offered service to this group.
There have been additionally claims by three former staff that Nteff received concerned in cryptocurrency. It’s not clear whether or not Nteff invested the corporate’s funds in crypto.
Many previous staff, a few of whom are owed 4–six months’ salaries, are aggrieved by what they describe as Nteff’s deceitfulness and are even contemplating a category motion swimsuit towards the founder, who they are saying is at the moment hiding from them, distributors and buyers.
“Between April and July 2022 when Alain was dwelling at Eko Lodge, I needed to name him and instructed him that regardless that salaries haven’t been paid that you must present up on the workplace. You employed us and also you’re hiding from us,” Olatunde, a former worker, instructed TechCabal.
One other former worker, Cynthia*, instructed us: “The problem right here is that Healthlane is closely indebted. You can’t be working to higher the lives of individuals and never care about your staff’ psychological well being. How can individuals be at a job for six months with out being paid a wage? For those who’re bankrupt, declare it and let everybody transfer on.”
Nteff declined to be interviewed for this text, saying that “most of the statements are factually incorrect” and there’s “an ongoing authorized investigation into unlawful entry of Healthlane recordsdata by journalists.”
“On the conclusion of this investigation, we shall be pleased to challenge a full assertion,” Nteff instructed TechCabal through electronic mail.
An early style of success
Raised in Cameroon as the one youngster of a single mom, Nteff selected to check laptop science on the Nationwide Superior College of Engineering in Yaoundé regardless of his mom’s want for him to develop into a medical physician.
His concept to unravel the issue of individuals receiving substandard care within the healthcare area was birthed in 2012 when Nteff, then a 20-year-old engineering pupil, visited a rural Cameroon hospital, the place he noticed pregnant girls ready for hours and never being attended to. Nteff based GiftedMom, a service offering well being data to pregnant girls, to unravel the problem of girls travelling 1000’s of miles to well being centres solely to obtain substandard care or not be attended to.
Over the subsequent seven years, GiftedMom scaled from serving to 20 moms inside a group to reaching 500,000 moms in Cameroon, Côte d’Ivoire, Mauritania, and Nigeria by digital channels. GiftedMom additionally launched “fast-track lanes” inside hospitals so as to be certain that pregnant girls received pressing and high quality care after they visited.
The success of GiftedMom introduced Nteff accolades. In 2014, he emerged as one of many winners of the 2014 Anzisha prize, a three-year fellowship programme that helps the expansion of younger entrepreneurs, and recognises their achievements. The prize got here with a $25,000 grant. The next 12 months Nteff was considered one of three Cameroonians who obtained the Young Leader Award from the Queen of England. He was later recognised by Bill Gates and Rwandan president Paul Kagame for his contributions to the well being sector in Africa.
The accolades helped GiftedMom achieve extra traction and appeal to extra funding in grants, but it surely wasn’t sufficient to draw conventional buyers.
“We had been chatting with many buyers for 2 years who had totally different circumstances and necessities. We even did about three audits by Deloitte,” Nteff mentioned in a recent podcast interview.
On the finish of 2019, after two years of failed makes an attempt to lift funding to broaden GiftedMom, Nteff set his eyes on stepping into Y Combinator (YC), the celebrated American accelerator.
“In November or possibly August 2019, after everybody went residence that night time, I sat within the workplace and I instructed myself, I’m not taking cash from these guys [investors]. I’m going to get us into Y Combinator,” Nteff mentioned to the interviewer, recounting the second he resolved to get into YC after an investor bailed on GiftedMom.
A number of months later, GiftedMom received into Y Combinator’s 2020 winter programme, a transfer that ended the corporate’s funding worries. Inside three months of commencement, the startup had closed $2.4 million in funding from VC buyers. The startup additionally modified its title to Healthlane, a extra befitting title for a “billion-dollar firm”, as recommended by Talia Frenkel, a YC companion.
“After we received into the programme one factor Talia [Frenkel], the YC companion for my group, mentioned was that you must change the title from Gifted Mother as a result of I don’t see GiftedMom because the title of a billion-dollar firm,” Nteff mentioned within the aforementioned podcast interview.
The ultimate section of the startup’s transformation occurred just a few months later when the demise of Nteff’s mom, who was misdiagnosed with typhoid and malaria whereas she had sepsis, led him to pivot the enterprise in the direction of offering preventive healthcare.
Making hospitals “out of date”
The corporate’s pivot meant that Healthlane was now centered on conducting comprehensive health checks which included kidney, coronary heart, diabetes and blood assessments to identify any anomalies approach forward of time. The corporate charged clients a payment that ranged from $60–250 per well being test.
“Many occasions when he mentioned the objective of Healthlane is to make hospitals out of date, I understood this to imply that the apply of going to the hospital solely while you’re sick isn’t the very best route and the standard of healthcare individuals obtained might be higher,” mentioned former worker, Olatunde, who joined the corporate in August, and who occurs to be a health care provider. “Nevertheless, as a medical practitioner, I knew he mentioned that largely simply to encourage staff as a result of primarily based on all of the issues he pitched Healthlane as, we have been by no means going to exchange hospitals.”
This pivot wasn’t welcomed by some buyers. Dunnie, one of many first set of staff employed, instructed TechCabal that Nteff had as soon as talked about that some buyers weren’t in help of this pivot as a result of he had raised funds on the again of the promise that Healthlane will develop into a telemedicine app.
Healthlane began hiring its first set of staff through the second quarter of 2021. For its workplace, Nteff selected an opulent $50,000-per-annum-rent, mansion in Lekki, Lagos, which was transformed to an workplace constructing. The mansion was absolutely furnished and had a pool and cinema room.
“I simply thought I used to be stretching myself”
The primary signal of implosion for Sabina was when she seen Nteff always altering his thoughts on choices.
She recalled him reaching out one night by 6 PM to ask her to get two fashions (female and male), a photographer and lab coats for a photoshoot the subsequent day. The shoot came about as scheduled, with Nteff being current.
After every week he got here again to say he didn’t like the pictures and that the advertising staff ought to do a brand new shoot, which they did. Sabina claims that the photographs from the primary shoot are what Healthlane makes use of on its web site at this time.
“At that time, I didn’t assume something was fallacious, I simply thought I used to be stretching myself,“ Sabina mentioned.
The second when she seen issues have been getting out of hand was when she realised she began avoiding him as a result of he’d ask her for what she was engaged on after which revise the plans.
“At a degree, I used to be starting to assume I didn’t know this advertising once more,” Sabina mentioned.
Dunnie, who labored at Healthlane as a product supervisor, instructed TechCabal that staff bore the brunt of Nteff’s ineptitude. “He makes these abrupt choices that aren’t backed by knowledge after which everybody will get the warmth for it, besides him,” she mentioned.
Many previous staff described Nteff as being open to concepts, but additionally erratic and set in his methods.
“Alain will simply get up within the morning and say an worker isn’t performing, and I’ll ask him, have you ever checked the particular person’s KPIs?” Cynthia mentioned. “Have you ever evaluated the particular person correctly? Have you ever given the particular person the required useful resource and coaching to carry out their duties and meet their goals?”
These erratic choices led to wastage and redundancy within the procurement of medical tools, which Ashu, Healthlane’s co-founder, was extra concerned in.
“I and my medical colleagues at Healthlane usually had conversations the place we have been all shocked on the announcement that the corporate had bought new medical tools,” mentioned Olatunde. He referred to an occasion the place an immunology analyser, which was procured with out correct analysis for hormonal research, had to get replaced with a brand new one as a result of it wasn’t producing constant outcomes.
One other time, the corporate procured 4 hematology analysers which have been sluggish and deemed pointless by Olatunde, and needed to be deserted as a result of they already had a purposeful hematology analyser. By August 2022, about 700–800 reagent discs expired on the Lagos workplace, regardless of a number of alarms raised by Olatunde and his colleague, who questioned the rationale behind procuring extreme quantities of reagent discs at a time.
“Contemplating that I used to be the one on the bottom attending to sufferers, I anticipated to be a minimum of consulted on these points,” Olatunde mentioned.
A weak or non-existent co-founder
Ashu was described by many previous staff as a quiet co-founder who largely spent his time working with the nurses and docs, and recommending care plans to sufferers. A number of staff shared that after they reached out to Ashu to complain about Nteff’s behaviour and unpaid salaries, he referred them again to Nteff.
One former worker shared that Ashu had instructed them that he had taken his palms off the corporate as he was additionally being owed XAF 17 million ($26,500) which he lent Healthlane to pay salaries and canopy operation prices.
“It was apparent that Alain was the primary man and Agbor was only a figurehead,” Olatunde mentioned.
Some former staff are sceptical of Ashu’s blamelessness in all of this, with some anticipating him to have resigned from his place or raised the alarm to the corporate’s buyers if he wasn’t a part of Nteff’s suspicious actions. Ashu didn’t reply to TechCabal’s request for remark.
Excessive burn charge, suspicious revenue, and rising money owed
There are questions on how cash got here into Healthlane and the way it went out, contemplating that it contributed to the corporate incurring money owed and lawsuits from disgruntled distributors.
In line with paperwork seen by TechCabal, Healthlane owed distributors in Cameroon XFA 35 million (~$55,000) as of August 2022. In Lagos, the corporate owes utility payments (energy and native authorities levy) of ₦714,000 (~$1,000).
Notably, on November 15 2021, Bime (CEO, Infiuss Well being) loaned Healthlane $400,000, in keeping with a doc seen by TechCabal. Bime would later sue Nteff in Might 2022 for failure to repay the mortgage which was on account of be paid again on November 30, 2021.
A number of staff shared that the corporate had taken loans from two fintech startups: Float and PayHippo. TechCabal obtained a doc which indicated Healthlane hadn’t repaid a ₦5 million (~$7,000) mortgage to Float; the mortgage had accrued curiosity of virtually ₦1 million as of August 2022.
“Among the numbers weren’t reconciling as a result of Alain would simply come and say, ‘Ship out this bill to this particular person’, and so they’d ship us cash for a job that we didn’t do,” Ngo, a former worker instructed TechCabal. “Then I simply used to chuckle and say, ‘You persons are doing cash laundering on this firm’, as a result of we’re speaking about hundreds of thousands of naira being transferred.”
Certainly one of such invoices was despatched out to the aforementioned entity, “funded tech bros”, for well being checks, dietary supplements and vaccination companies. Many previous staff additionally talked about comparable transactions occurring with Infiuss Well being.
Throughout firm conferences, the Nigerian staff raised issues that the corporate’s burn charge was too excessive. The issues have been downplayed by Nteff who assured them that the corporate had sufficient money to see the corporate by, referring to the over $1 million the corporate had within the financial institution.
Worker feeding prices averaged at about ₦500,000–600,000 ($700–850) per week for a staff dimension that wasn’t greater than 10–12 staff at any time limit, in keeping with Ngo. The corporate paid for Nteff’s journeys (some private) and stays in inns, typically overlaying the bills of his mates.
Healthlane had additional safety personnel, cell cops (MOPOs), which value over ₦500,000 month-to-month, and this raised eyebrows amongst staff who felt it was extreme for a small operations staff that didn’t deal with money.
“We struck a deal to pay about ₦150,000 every to those three MOPOs who rotated, after which ₦200,000 to their boss each month,” Ngo mentioned. Healthlane additionally usually offered lunch for the MOPOs.
Cash points, layoffs and the right-hand man
Healthlane’s monetary troubles grew to become evident in December 2021 when the corporate began owing distributors and didn’t pay staff their salaries on time.
“In December, when the cash points started, Emma [Nteff’s executive assistant] mentioned we have been having points changing crypto to {dollars} earlier than changing it to Naira,” Ngo mentioned. “I used to be questioning, does YC pay in crypto?” One other former worker confirmed having conversations with Nteff the place he severally admitted to be changing crypto to {dollars}.
Two days earlier than the corporate’s Christmas get together in 2021, Ngo was instructed that the cash had come, but it surely was within the checking account of Nteff’s private assistant, Fadeyi Mustapha (usually known as Fade by his colleagues). She would later discover out that the cash was a mortgage Mustapha had taken on behalf of the corporate.
“Earlier on, I had points with Fade as a result of he majorly purchased issues for the corporate and sometimes failed to provide backing receipts to justify the quantity he mentioned he spent,” Ngo mentioned. “Once I questioned him, it all the time ended up with arguments the place Fade would say stuff like, ‘You’re not my spouse, you’re not alleged to be speaking to me like that. I’ve your sort at residence!’”
Many previous staff expressed issues about Mustapha, who they claimed was Nteff’s, right-hand man.
“Fade has loads to reply. The corporate did lots of spending by Fade. We as soon as purchased an engine for Fade’s automobile,” Ngo mentioned.
TechCabal reached out to Mustapha for remark however he declined.
Healthlane closed 2021 with a Christmas get together and its staff went residence anticipating to obtain their salaries as typical, however they weren’t paid. The December salaries have been paid over an prolonged time period the next 12 months, with the final set of staff being paid their December wage on February 10.
Whereas salaries have been being owed, throughout bi-monthly workers conferences the corporate replace slides shared by Nteff nonetheless indicated that the corporate had over $1 million in its checking account. The explanations for not with the ability to pay salaries have been the identical, starting from points with the corporate’s checking account and difficulties changing cash.
Amid the corporate’s monetary struggles, a number of staff shared that Nteff abruptly fired staff. Two former staff defined that whereas Nteff usually attributed the rationale for firing staff to them not acting on the job, the true purpose for the firings was that the corporate was making an attempt to chop down prices.
In mid-February 2022, Ngo despatched in her resignation letter which had a month’s discover interval. The letter was accepted, just for Nteff to show round two days later to terminate her employment. It was a transfer she believes was made to absolve the corporate of the duty of paying her a wage throughout her discover interval.
“They claimed they wished me to make use of the remaining a part of the brand new month to relaxation as a result of I used to be pregnant,” Ngo mentioned. “I instructed them I’m solely pregnant, I’m not a labourer or a farmer that should relaxation.”
Dunnie, who was fired in March 2022 mentioned, “He accused me of not performing after which he fired me. I challenged him, asking him how. I can’t have you ever disrespect me by telling me I wasn’t performing.”
She added that within the first three months of 2022, six individuals have been fired at Healthlane. Healthlane disputed this declare when TechCabal reached out in April this 12 months and went on to state that, “For authorized causes, we can not specify who on that listing was fired by us, when, nor the explanations for these dismissals.”
Silence and looming questions
On September 6, 2022, Healthlane was announced as one of many 60 African startups that have been chosen for the second cohort of the Google for Startups Black Founders Fund. This announcement meant that Healthlane will obtain equity-free funding between $50,000 and $100,000, and as much as $200,000 in Google Cloud credit score.
Surprisingly, staff of Healthlane heard about this information on-line and lots of declare that until at this time there was no point out of the fund by Nteff. A former worker who was aware of the corporate’s banking data, shared that there was no signal that funding from Google entered the corporate’s checking account.
“We have been pleased at first once we heard about this information. It meant that lastly our salaries can be paid, however nothing has modified,” a former worker who resigned out of frustration, shortly after the Google Black Founders Fund announcement, instructed TechCabal.
Many previous staff of Healthlane are asking what the corporate’s buyers are doing concerning the present scenario and are contemplating a variety of choices to get recompense. TechCabal has reached out to a variety of Healthlane buyers however is but to get a response.
“It seems like premeditated fraud as we haven’t heard from the corporate shortly. The entire scenario is actually shady and complicated,” Olatunde mentioned.
*Identify modified to guard the particular person’s identification.
