Weilai Capital Wins 'Best CVC in Financial Industry' – Investment Logic and Portfolio Highlights Behind China's First-Ever CVC Award
On the evening of November 8, the “2019 China CVC TOP 25” list was prominently unveiled. Organized by National Business Daily, with Zero2IPO Private Equity Tong as the exclusive data provider and Zero2IPO Research Center as the collaborating research institution, this marked the first authoritative ranking in China focused on the investment performance of Corporate Venture Capital (CVC) firms. For Future Capital was honored as the “Best Industry CVC” for its outstanding investments in innovative commercial health insurance and innovative healthcare scenarios.
Source: National Business Daily
For Future Capital is an industry-focused fund specializing in the field of medical innovation, with By-Health Co., Ltd., a publicly listed company, as its cornerstone investor. According to Zhao Yang, a partner at For Future Capital, the firm primarily invests in the migration and restructuring of the medical industry value chain against the backdrop of new medical industry policies. Its investment areas include innovative healthcare payment models, new retail in pharmaceuticals, innovative healthcare scenarios, and consumer-grade medical products.
Zhao Yang stated that, based on macroeconomic data, China's total national health expenditure was approximately RMB 5.7 trillion in 2018 and is projected to reach RMB 15–20 trillion by 2025. At present, as medical insurance coverage enters a phase of contraction, the growth rate of the traditional in-hospital market is gradually slowing down, with a larger share of incremental business originating from the out-of-hospital consumer healthcare market.
From the perspective of competitive landscape, cost containment measures by medical insurance have made the "out-of-hospital" shift an inevitable trend for traditional healthcare supply-side enterprises. The phenomenon of "easy discharge, difficult recovery" means that understanding the market-driven out-of-hospital consumer market is a critical challenge that pharmaceutical, medical device, and healthcare service companies must address during this transition period. China has more than 5,000 pharmaceutical companies, along with a large number of medical device and service providers. However, from a marketization standpoint, many in-hospital products are akin to "greenhouse flowers," protected by physicians' prescribing authority and medical insurance reimbursement. In contrast, the out-of-hospital consumer market has undergone years of intense competition, fostering abundant talent and continuous model innovation. Leading consumer goods companies have already established mature models for building brand perception among specific demographic segments, as well as for user and category management. Traditional in-hospital distribution models and patient education methods have benefited significantly from non-market factors; therefore, any attempt to directly replicate in-hospital models in the out-of-hospital consumer market is unlikely to succeed.
From a technical perspective, the development of new technologies has brought about fundamental changes to medical services and data acquisition, making them more equitable, open, and transparent. Patient engagement and autonomy in their own healthcare have reached historically unprecedented levels, with patients becoming active participants in medical care. The influence of patients’ personal needs, health literacy, and payment preferences on medical decision-making is growing increasingly significant. In the future, the shifting balance of power between the demand side and the supply side in medical decision-making will become even more pronounced.
Zhao Yang believes that entrepreneurs need to rethink the “people, product, and place” framework in consumer healthcare from the perspectives of capturing user mindshare, enhancing user engagement, and extending customer lifecycle. Companies that thrive in this wave of consumer healthcare will inevitably be cross-disciplinary new entities well-versed in both consumer market dynamics and medical supply chain operations, with a deep understanding of traffic acquisition, user management, and category management in the healthcare sector.
According to Zhao Yang, For Future Capital initially entered the market through innovative payment solutions and healthcare service scenarios. The payment sector serves as a critical traffic gateway for medical health management, enabling effective integration of medical services and health products, as well as connecting private traffic pools across diverse cross-industry ecosystems to build distributed private traffic networks. On the other hand, healthcare service scenarios play a pivotal role in shaping user perception, allowing for phased monetization throughout the user’s long lifecycle by leveraging traffic, supply chain, and data resources at different stages.
Jianyibao, invested by For Future Capital, is a company that provides innovative commercial health insurance products for individuals with pre-existing conditions, with pharmacies as its core scenario. Currently, Jianyibao has covered 30,000 pharmacies, and all of the global top 10 pharmaceutical companies are its clients. In the future, it is expected to become the innovative health insurance enterprise with the most extensive pharmacy coverage worldwide.
Grapefruit Health, invested by For Future Capital, is also a new retail pharmaceutical enterprise centered on pharmacy scenarios, primarily engaged in the sales of medical devices. The team demonstrates strong capabilities in category management and sales activation for home-use medical devices, addressing the industry-wide weakness in non-pharmaceutical sales within pharmacy retail. By empowering offline pharmacy channels, the company has achieved rapid growth.
Zhao Yang stated that consumer healthcare is the next hub for companies with valuations in the hundreds of billions, and we eagerly anticipate the arrival of this day.
