SoYoung Secures RMB 200 Million in D-2 Financing, Bringing Total D-Series Funding to RMB 6 Billion and Expands into Diversified Beauty and Wellness Services

VCBeat (WeChat ID: vcbeat) has learned that on March 16, 2018, So-Young, China’s leading platform for non-surgical aesthetic treatments, officially announced the completion of its RMB 200 million Series D-2 financing round. The round was led by Orchid Asia Group Management (hereinafter referred to as “Orchid Asia”), with participation from Matrix Partners China, Trustbridge Partners, Apax Partners, and CDH Investments.

Among them, Matrix Partners China, the Series A investor, has invested in New Oxygen for the fourth time, while Taihe Capital continues to serve as the exclusive financial advisor for this transaction.

The proceeds from this funding round will be primarily allocated to attracting top-tier talent, strengthening infrastructure development, and delivering enhanced services and user experiences for both consumers and medical aesthetic institutions. Additionally, the company aims to further expand its service offerings and explore in-depth collaborations with upstream and downstream partners across the industry chain.

Data shows that Orchid Asia is an investment group focused on China and the Asian region, and one of the first international funds to invest in China, with twenty-four years of investment experience in China.

Lanxin Asia Management primarily invests in late-stage expansion and mature private enterprises with high entry barriers and growth potential, spanning the high-tech, retail, consumer products and services, and healthcare sectors. It has invested in and assisted more than 30 companies in going public, and has made investments in multiple vertical internet platforms, including Ctrip, China Distance Education Holdings (Zhengbao Education), EachNet, Autohome, and Zhaopin.

Following SoYoung’s announcement in December 2017 that it had secured RMB 400 million in Series D-1 financing, the company rapidly completed its Series D-2 round within three months. This brings SoYoung’s total Series D financing to RMB 600 million, all of which has been fully disbursed. SoYoung has become the only medical aesthetics platform to reach Series D, setting a record for the largest single-round financing in the medical aesthetics industry in recent years.

In 2013, New Oxygen was founded, opting to achieve a cold start with its "Plastic Surgery Diary" product. This initiative encouraged consumers to upload before-and-after photos of their plastic surgery procedures and document their authentic experiences in writing—a pioneering approach in China at the time.

Currently, the New Oxygen app and website recorded 114 million unique visitors in 2017, surpassing the traffic of RealSelf.com, a long-established global medical aesthetics platform.

Over the past four and a half years, SoYoung has earned the attention and favor of Chinese medical aesthetics consumers through its rich, professional content and community operations. Meanwhile, on SoYoung’s medical aesthetics e-commerce platform, clinics display transparent pricing, enabling consumers to “shop around.” SoYoung has promoted transparency and security in industry transactions, reshaped the industry ecosystem, and revolutionized efficiency and user experience.

With the support of capital, New Oxygen will accelerate its layout in the consumer healthcare and beauty industries, providing more convenient, comprehensive, and high-quality services centered around health and beauty.

Jin Xing, Founder and CEO of So-Young, stated that throughout its journey, So-Young has always placed user experience at its core, continuously analyzing industry and user pain points to explore and innovate high-quality business models and solutions that align with the new standards of China’s medical aesthetics market.

He revealed, “Through continuous practice and refinement, the New Oxygen platform has currently attracted 25 million medical aesthetics users and accumulated 3.5 million ‘Beauty Diaries’ personally written by consumers, fostering a community-driven e-commerce ecosystem characterized by a friendly atmosphere, professional information, and healthy values.”

The “New Oxygen 2017 White Paper on the Medical Aesthetics Industry” pointed out that in 2017, 14 million Chinese consumers engaged in medical aesthetic services, representing a year-on-year increase of 42% compared to 2016. This growth rate far exceeded the global average of 7%, making China the country with the fastest-growing medical aesthetics industry worldwide.

New Oxygen aims to bring together compliant institutions, licensed physicians, aesthetic medicine consumers, and upstream manufacturers within the industry, thereby enabling efficient connectivity and rapid feedback across the upstream, midstream, and downstream segments of the aesthetic medicine sector. This initiative seeks to eliminate information asymmetry and excessive profiteering prevalent in the industry, fostering an open environment characterized by price transparency and healthy competition.

To ensure a healthy business ecosystem amid rapid growth, New Oxygen has launched a series of safety upgrade initiatives across medical aesthetics education, insurance, finance, and consumer sectors, including products such as New Oxygen Select, New Oxygen Encyclopedia, Yangqi Bao, New Oxygen Aesthetics System, and Intelligent Customer Service.

Meanwhile, in its services for institutions, New Oxygen has established a virtuous cycle of competition and growth by developing intelligent user profiling, a backend marketing management system, pharmaceutical and medical device procurement, and a business school. These initiatives help high-quality institutions build their brands and reduce marketing costs, thereby purifying the industry and driving out inferior players through the principle that “good money drives out bad.” This enables more consumers to safely leverage technology for aesthetic enhancement and guides the healthy development of the industry.

Jin Xing revealed that So-Young has begun to deeply engage in the operations of offline institutions, helping these affiliated hospitals to position themselves reasonably and establish brands in niche segments of the medical aesthetics industry. Currently, So-Young’s business covers 351 cities across five countries: China, South Korea, Singapore, Japan, and Thailand.

In 2017, So-Young’s gross merchandise value (GMV) exceeded RMB 6 billion, representing a year-on-year increase of 300% and driving more than RMB 15 billion in medical aesthetics industry output. Wang Wei, Senior Investment Manager at Taihe Capital, stated that So-Young’s comprehensive monetization efficiency more than doubled compared with 2016, with current monthly revenue reaching tens of millions of yuan.

Amid the broader trend of consumption upgrading, domestic demand for medical aesthetics has grown rapidly, experiencing explosive growth over the past two years. The consumer base is trending younger; however, the industry has long been characterized by heavy marketing and inadequate service. With lengthy user decision-making processes and a lack of efficient operational systems among institutions and physicians, this landscape creates opportunities for platform-based channels.

After the market shakeout, the number of medical aesthetics apps has dwindled from over 30 initially to only a few leading platforms.

As early as 2016, New Oxygen achieved annual profitability for the first time. The subsequent introduction of high-quality investors and industrial capital served more to facilitate resource integration for platform development, rather than merely meeting funding needs. In 2018, New Oxygen will collaborate with more outstanding companies across the upstream and downstream segments of the industry chain.

Jin Xing revealed, “Currently, So-Young’s services cover more than 95% of legitimate medical aesthetic service providers across China. Since expanding its product offerings in January 2018, nearly 1,000 chain dental clinics and close to 5,000 beauty salons have joined the So-Young platform. So-Young is no longer just a medical aesthetics platform.”

Hong Deshang, a partner at Lanxin Asia, stated, “Driven by consumption upgrades and the ‘beauty economy,’ the medical aesthetics industry has experienced rapid growth in recent years. The extensive repository of ‘Beauty Diaries’ on So-Young has helped consumers make informed purchasing decisions and promoted greater transparency and marketization within the industry. As an industry leader, So-Young has achieved robust growth and delivers a superior user experience. The company provides high-quality services and content, establishing significant competitive barriers. Lanxin is very optimistic about this sector and So-Young’s future prospects.”

Wang Huadong, Partner at Matrix Partners China, stated, “As one of So-Young’s earliest investors, we have witnessed its platform evolution over the past three years, transitioning from a community to a transactional platform, and further to an industry-chain service provider. During this period, we have also observed the growth of Jin Xing and his team. This innovative and pragmatic team has built a transaction platform anchored by a user-generated content community, establishing significant competitive barriers and offering strong potential for future expansion.”

Jin Xing stated that in 2018, the company would continue to strengthen the management and expansion of its operations team. Serving as a connector among medical aesthetic institutions, physicians, upstream manufacturers, and consumers within the deeper layers of the medical aesthetics ecosystem, it would further restructure and optimize its business model, continuously improve user experience, and make substantial investments in the research, development, and implementation of business intelligence and artificial intelligence.

On the horizontal front, New Oxygen will efficiently expand its diversified portfolio of medical aesthetics and health categories, achieving comprehensive coverage across major Tier-1 and Tier-2 cities in China to provide more consumers with professional and convenient services.

Regarding the IPO, Jin Xing stated, “Whether in terms of revenue or profit, pursuing an IPO has become a matter of choice at our convenience; we can select a more optimal timing.”