Negative remark has grown into successful hospital

It is not every day that a negative remark can turn a business idea into a roaring successfully.

That is what happened to Dr Sam Thenya, the CEO and owner of Nairobi Women’s Hospital. He dared and is today one of Kenya’s most successful investors in healthcare.

“I decided to set up a hospital in 2001. I was then working at a local hospital when a certain incident prompted me to think of starting my own health institution,” he says.

A woman who had been gang-raped walked into the hospital seeking treatment, but since she was poor, he had to pay the Sh1,000 consultation fee from his pocket.

“It was one of those rare moments when you pay for a patient in order for her to access your services,” says the gynaecologist.

He did not stop there; he asked the hospital administration to consider setting up a fund to assist such patients.

But his suggestion was not well received.

The boss challenged me to set up my own hospital where I would offer ‘free’ services. That is the story of the Nairobi Women’s Hospital,” he says.

Armed with a business proposal, he approached the owners of the former Hurlingham Hospital, which had put out a closing notice.

Through private placement, where he got other investors on board, he was able to raise Sh17 million to take over the facility.

The total initial investment was Sh50 million. The remaining capital was sourced after basic operations at the hospital had started.

“Initially, I held a 60 per cent shareholding. I have since bought out other investors because most of them were there for the short-term only,” he added.

The hospital ran as a single outlet, offering both inpatient and outpatient services for almost a decade until 2009, when Dr Thenya acquired the former Masaba Hospital near Nairobi’s Adams Arcade area.

He stopped practising to concentrate on expanding the business: “I realised that I was not giving my patients full attention because I was often caught up in strategy meetings. I had to chose between expanding the hospital and practising,” he says.

Last year, the hospital qualified for $2.66 million investment from the African Health Fund, financed by, among other partners, the International Finance Corporation (IFC), the Bill & Melinda Gates Foundation, and the African Development Bank, for expansion of the hospital.

This includes the recent opening of a branch at Ongata Rongai, with a capacity of 77 beds, boosting the hospital’s total capacity to 226 beds.

Plans are under way to open five other branches in other towns by the end of next year.

Although Dr Thenya says investing in a sector with no clear policies to encourage private investors has been challenging, he is determined to make a name in the region as he eyes other opportunities outside the country.

The funding from the Africa Health Fund is partly debt and partly equity. He says the financiers may consider extending the debt, depending on how successful the venture turns out.

Although he has been affected by the high cost of borrowing, like any other entrepreneur, Dr Thenya says he will stop at nothing to ensure that his institution provides holistic service, including training medical staff to alleviate the shortage of such professionals.

“Talks are ongoing to set up a training facility for nurses in all our branches. I am also looking at diversifying to stand-alone outpatient facilities,” he added.

By prioritising on gender based violence, the hospital gave rise to the Gender Violence Recovery Centre, a subsidiary that now address between 10 to 15 cases of gender violence.