Hangzhou's Top Three Unicorns – Ant Group, Cainiao, and WeDoctor – Pave a New Path for Industrial Digitalization Through a Three-Stage Strategy
As Zhejiang’s “No. 1 Project” for the digital economy is implemented in depth, Hangzhou has witnessed rapid development in its digital economy. Particularly during the critical transition from consumer internet to industrial internet in China, a cohort of innovative enterprises with international competitiveness has emerged.
Recently, the Hurun Research Institute released the “2023 Global Unicorn Index,” with 22 companies from Hangzhou making the list. Ant Group, Cainiao Network, and WeDoctor ranked in the top three, each holding the number one global valuation in their respective segments: “fintech,” “logistics,” and “health tech.”
As three of Zhejiang’s leading unicorn companies, Ant Group, Cainiao, and WeDoctor epitomize the province’s leapforward in industrial innovation. In recent years, leveraging emerging information technologies such as big data, artificial intelligence, and the Internet of Things (IoT), they have accomplished a “three-step” progression—from digitization of production factors, to scaling up transactions, and finally to personalized services. Driven by innovation, they have reshaped industries including finance, logistics, and healthcare, contributing to supply-side structural reform and forging a resilient path for industrial digital transformation.
The “2023 Report on the Digitalization Trends of China’s Industries” posits that data, as a newly added factor of production, can generate substantial value when integrated with other factors, thereby enhancing value across all segments of the industrial and supply chains and effectively elevating the overall level of industrial development. In this sense, the foundation of industrial digital upgrading lies in the digitalization of key factors of production.
Industry experts analyze that simply replicating the development path of consumer internet does not necessarily bring advantages to industrial internet; it is necessary to combine the needs of China's industrial upgrading and the pain points and difficulties faced by digitalization.
For instance, in the face of risks and challenges confronting traditional finance, Ant Group, as a leading enterprise in the “new finance” sector, offers full-stack digital solutions across payments, credit granting, and risk control, thereby reshaping and upgrading traditional finance through businesses such as digital payments and digital finance.
“New Logistics” leader Cainiao is addressing challenges such as high costs and low efficiency in the logistics industry by focusing on the research and development of new logistics technologies and products. It leverages technologies like the Internet of Things (IoT), artificial intelligence (AI), and big data to enhance the digital and intelligent capabilities across all segments of the industry. Currently, Cainiao’s self-developed technologies, including electronic shipping labels, autonomous delivery vehicles, and smart warehousing systems, have been widely adopted within the logistics sector.
“New Health” signifies WeDoctor’s ongoing efforts in recent years to digitally integrate the core elements of healthcare, pharmaceuticals, and health insurance, thereby establishing three major platforms: Digital Healthcare, Digital Pharmaceuticals, and Digital Traditional Chinese Medicine. Notably, its “Digital Hospital” model integrates digital platforms with medical service capabilities, creating a “cloud platform” that achieves comprehensive interconnectivity of data across healthcare, pharmaceuticals, and health insurance. This has become a crucial foundation for supporting regions in building integrated healthcare service systems.
Data shows that in recent years, the industrial internet has played an increasingly significant role in driving China's digital economy, further optimizing its structure. Among this, the scale of industrial digitalization reached 37.2 trillion yuan, accounting for 81.7% of the digital economy.
Peng Wensheng, Chief Economist at CICC, believes that the development of the digital economy will amplify economies of scale. In the digital era, large-scale economies will enjoy greater developmental advantages over smaller ones. China’s future advantage in economies of scale will stem not merely from individual enterprises, but more likely from overall efficiency gains driven by industrial agglomeration and the spreading of public service costs. In other words, the “multiplier effect” resulting from digitally empowering traditional industries will give rise to a larger market size.
Judging from the practices of the “Hangzhou Big Three,” digital integration across the upstream and downstream segments of the industrial chain has demonstrated stronger growth potential and breakthrough effects in their respective fields compared to traditional business models.
Public information indicates that WeDoctor, leveraging its 27 digital hospitals established in multiple cities across China, has been collaborating with large tertiary hospitals and primary care institutions on a city-by-city basis to build digital medical consortia, serving tens of millions of users within these regions. Its digital pharmaceutical segment, the Haixi Pharmaceutical Trading Center, as the only nationally authorized market-oriented platform for pharmaceuticals and medical devices in China, achieved a transaction volume of RMB 93 billion in 2022, with cumulative transactions exceeding RMB 360 billion as of March this year. Additionally, its digital traditional Chinese medicine (TCM) segment has undertaken the national consortium-based procurement of TCM decoction pieces and formula granules.
Ant Group, now a “tech giant,” leverages its digital finance platform to provide payment services and guarantees for over 1 billion users and 80 million merchants. Its open digital interconnection platform has offered product and service interfaces to more than 11,000 digital service providers. Additionally, it serves over 2,000 financial institutions across China and provides digital credit services to more than 49 million micro and small business operators.
The report to the 19th National Congress of the Communist Party of China pointed out that the principal contradiction facing Chinese society has evolved into the contradiction between unbalanced and inadequate development and the people’s ever-growing needs for a better life. Therefore, the core value of industrial digital transformation lies in leveraging technology to reshape relevant industries, thereby genuinely realizing a demand-oriented, value-centric personalized service model that meets the people’s ever-growing needs for a better life—this is also the ultimate objective of industrial digital upgrading.
Taking Ant Financial’s public convenience services as an example, since launching China’s first online payment service for water, electricity, and gas bills in 2008, Alipay has continuously explored breakthroughs in payment scenarios within the realm of everyday convenience. Targeting sectors such as government affairs and public livelihood, local lifestyle services, and education, it offers personalized solutions based on mobile payments, Internet of Things (IoT) identity recognition and payment, and credit-based payments, thereby helping to enhance the experience and efficiency of convenient public services.
WeDoctor leverages its years of accumulated digital medical resources and service capabilities to provide digital healthcare and health maintenance services to diverse user groups. Compared with traditional medical services, WeDoctor’s value-centered digital healthcare offerings are more accessible, effective, and affordable. For instance, in Tianjin, the Tianjin WeDoctor Internet Hospital took the lead in collaborating with 266 primary healthcare institutions across the city to establish a tightly integrated digital medical consortium—the Tianjin Primary Digital Health Community. Focusing on chronic disease management, this initiative has explored innovative performance-based payment models, such as capitation and diagnosis-related group (DRG) payments, thereby establishing a new mechanism for health accountability. Pilot primary healthcare institutions have achieved an 81.5% standardized management rate for diabetes patients, improved the blood glucose control rate by over 12.1%, and attained a 16.7% surplus rate in medical insurance funds among institutions implementing capitation-based payments.
Cainiao leverages its digital supply chain management system and nationwide warehousing and distribution infrastructure to provide logistics service providers with diversified, personalized solutions for managing complex supply chains. This effectively reduces inventory levels and accelerates turnover, ultimately enabling efficient collaboration across the upstream and downstream segments of the supply chain and facilitating industrial upgrading.
The digital transformation of the global economy is an overarching trend, and the new industrial revolution will profoundly reshape human society. The digital upgrading of industries is gaining momentum. It is believed that, through the concerted efforts of local governments, innovative unicorn enterprises, and other stakeholders, and by leveraging its first-mover advantages in digital reform, Zhejiang will contribute more “Zhejiang experience” to the new round of technological revolution and industrial transformation.