Practo Files for IPO After $55 Million Series D Led by Tencent to Expand Global Digital Healthcare Platform

Few companies have attracted Tencent’s consecutive heavy investments, and Practo is one of them. As a star enterprise in India, Practo is headquartered in Bangalore. It was founded in May 2008 by Shashank ND, the current CEO, and Abhinav Lal, the CTO. Practo was included in VCBeat’s 2016 “Top 100 Future Healthcare Companies” International List.

In 2015, Practo completed a $90 million Series C financing round, led by Tencent. In January 2017, Tencent again led Practo’s $55 million Series D financing round, with participation from seven other investment firms, including Russia’s Ru-Net, Japan’s RSI Fund, and New York-based Thrive Capital. Following this round, the company plans to use the raised funds to expand its business into emerging markets worldwide. To date, Practo’s total funding has reached $179 million.

Practo can be described as the longest-established online doctor appointment platform in the Indian market, currently boasting a substantial workforce of 1,500 employees. Its flagship product, Practo Ray, commands a 90% share of the Indian market. Public data indicates that the platform facilitates nearly 45 million appointments annually, with monthly search volumes reaching 10 million. Within its current coverage area, the platform includes 200,000 doctors, 10,000 hospitals, and 5,000 clinics.

Regarding its core products, Practo’s initial offering at inception was Practo Ray, a management tool designed for doctors and hospitals, co-developed by the company’s two founders. After years of refinement, it has evolved into a comprehensive medical records management software solution. For physicians, Practo Ray enables the management of patient appointments and electronic health records (EHRs).

For hospitals, Ray is essentially a SaaS system, which is also the key aspect that Tencent values. Practo Ray not only enables doctors to achieve paperless operations but also enhances their management efficiency by digitizing scheduling, pharmaceutical inventory, medical billing, and other services. This helps doctors excel in administrative tasks, allowing them to devote more energy to patient care. It primarily offers four specific features:

1. Appointment Management Function: Accept and reschedule appointments anytime, anywhere; automatically send appointment confirmations and reminders to patients via SMS and email; perform electronic registration for patients upon their arrival.

2. Billing Management Function: Generate and send electronic bills; automatically remind patients to pay their bills; accept advance and installment payments; create a catalog of treatable conditions and a treatment price list.

3. Electronic Medical Record (EMR) Management Functions: Create electronic medical records for patients; convert patients' existing paper-based medical records into electronic format and integrate them into the newly created EMRs; facilitate the management of various complex documents, such as X-ray images; automatically send electronic prescriptions to patients via SMS and email; provide robust security measures to ensure the safety of user data.

4. Notification Features: Alerts staff to return missed calls from patients; notifies staff of patient arrival times at the clinic; automatically sends greetings to designated patients on special occasions, such as birthdays.

Ray offers two billing tiers: the Basic version at 999 rupees per month (approximately 100 yuan) and the Premium version at 1,999 rupees per month (approximately 200 yuan). Meanwhile, Practo also provides specialty-specific electronic medical record (EMR) services, currently offering options for pediatrics and dentistry, each priced at 500 rupees per month. The platform has surpassed 1.5 million registered users and has expanded its operations to Singapore and the Philippines.

Practo initially provided services exclusively to doctors and hospitals. Later, the company launched web-based services and a mobile app for general users, enabling patients to schedule medical appointments through these platforms. The company’s service scope has since expanded to encompass all stakeholders in the healthcare industry, including pharmaceutical manufacturers, hospitals, and health examination institutions, in addition to doctors and patients.

Unlike Practo’s physician-oriented services and products, most of which are paid, its patient-facing services and products are entirely free. In 2011, Practo launched its own physician search website, Practo.com, marking its entry into patient services. Currently, Practo’s primary offering to patients is its search engine, Practo.com, which helps them find and book appointments with doctors. To enable patients to quickly locate suitable physicians, Practo focused on three key areas when developing its search engine: physician resources, algorithms, and user experience.

Practo has specifically hired two professional teams to encourage as many doctors as possible to provide their practice information on the platform and to ensure the authenticity and validity of the information provided by each doctor. Practo employs its own proprietary relevance algorithm, whereby search results are ranked solely based on their match with the search query, without offering any paid ranking services.

To ensure that highly skilled physicians appear at the top of search results, Practo has incorporated patient feedback into its algorithm. Specifically, verified patients can rate physicians’ medical services, and those with higher overall ratings receive additional points in the system’s ranking calculations, thereby helping these high-quality physicians appear prominently in search listings. Overall, Practo’s search page features a clean design with clearly organized results, delivering an excellent user experience throughout the search and booking process. Additionally, Practo’s product portfolio includes Practo Reach, a paid service for physicians, and Practo Profile, a complimentary service for physicians.

Regarding the company’s development direction, Shashank N.D., CEO of Practo, stated that following this round of financing, Practo will further expand its overseas presence by entering more emerging markets, namely Southeast Asia, Latin America, the Middle East, and Africa. International revenue currently accounts for nearly 20% to 25% of total revenue, but the company is still in the early stages of aggressive expansion. “Last year, we acquired several companies (in India) to build our enterprise business, and we have been continuously expanding the services offered to consumers in India. We have established a solid revenue stream through SaaS and other services. Moving forward, we will continue to deepen our penetration in existing markets and are evaluating new opportunities in the Middle East and other regions. Our vision is to help people live healthier and longer lives.”

Next, Practo aims to enter the health insurance industry. Tencent, the lead investor in its two funding rounds, has been advocating the concept of “connection” in recent years, and Practo seeks to learn from Tencent’s expertise in platform building. “Over the past year, we have been committed to transforming Practo into a platform.”， “Shashank stated, ‘By providing consumers with an integrated healthcare platform, we can subsequently meet their health needs through this comprehensive medical platform.’”

“Practo has made remarkable progress, expanding its platform to meet the growing healthcare needs of consumers and providers. While it is difficult to gain a competitive edge with a full-stack model in the healthcare sector, Practo has built and rapidly scaled a full-stack solution that is considered successful on a global scale,” said Chen Hongwei, Executive Director of Investment and M&A at Tencent, in a statement.

Since securing its seed funding round in 2011, Practo has expanded its business operations both domestically and internationally.Good, but its CEO remains unfocused on exit strategies or an IPO. “This round of financing will sustain the company’s operations for a period of time; there are currently no plans for an IPO,” said Shashank. “We still believe that this industry is in its early stages, and technology, as a practical tool in healthcare, is just beginning to demonstrate its capabilities, so we have significant growth potential.”