Tianfangda Files IPO Prospectus: Building a Platform-Grade Primary Care Enterprise via Dual Entry Points in Physical Examination and Clinics

After years of successive upheavals in capital markets and policy landscapes, the internet healthcare sector has ceased its loud proclamations of “disrupting healthcare” and “making doctors obsolete.” Instead, it is actively collaborating with existing healthcare systems and resources, striving to secure a precious foothold for survival as the initial hype fades.

Li Dianzhao, Founder of Tianfangda

The industry has begun to cool down, while “legacy companies” with a profound understanding of the healthcare system and deep expertise in traditional Hospital Information Systems (HIS) are gaining prominence. Shenzhen Tianfangda Jianxin Technology Co., Ltd., founded in 1997 and which developed its medical record front-page management system in the same year, boasts over two decades of experience in healthcare informatization. In September 2014, Tianfangda began its transition to the internet, focusing on Kangkang Physical Examination Network, a third-party physical examination platform; Minkang SaaS Platform, designed for primary healthcare institutions; and Kangkang Online APP, which provides comprehensive medical and health management services to consumers. The company secured tens of millions of RMB in investment led by Matrix Partners China.

Can a “traditional corporate resume” spanning 20 years truly succeed in transitioning to an internet-based company? Li Dianzhao, founder of Tianfangda, confidently stated that as long as the mindset shifts, the industry accumulation of “old companies” will unleash exponential growth under the empowerment of the internet model.

Internet Healthcare Returns to Its Core: Tianfangda Seizes the Dual Entry Points of Health Checkups and Clinics

Li Dianzhao told VCBeat that before its transition to the internet, Tianfangda was essentially a project- and product-oriented company. Although it had achieved the number one position in multiple niche segments of medical software, its long-term growth potential remained limited.

As the internet model swept across various industries, Li Dianzhao gradually realized that pure-play internet companies, lacking industry insight, technological accumulation, and offline teams, would struggle to achieve in-depth development and tangible results in the healthcare sector. In contrast, Tianfangda’s 20 years of experience in healthcare informatization have forged a technical and ground-promotion team with both deep industry understanding and strong execution capabilities, giving it incomparable advantages over pure-play internet companies in product development and commercial promotion within healthcare informatization.

The remaining question is: with what products and through which pathways should one enter the internet healthcare sector, and what position should one occupy in the future industry landscape?

Li Dianzhao’s extensive experience in healthcare informatization has given him an intimate understanding of the characteristics of the existing medical system, as well as independent and clear insights into the potential directions of healthcare reform and future models of the medical system. Li points out that although the government has been striving to promote healthcare reform, progress has remained relatively slow. Tianfangda has chosen to bypass the mainstream healthcare system, where institutional forces are strong, and instead enter the market through two niche segments: more market-oriented health checkup institutions and private clinics. By providing asset-light internet-based informatization services, the company is pursuing a strategy akin to “encircling the cities from the countryside.”

Not long ago, Yunfeng Capital, under Jack Ma’s leadership, made a decisive move to end the nearly year-long acquisition battle between iKang Guobin and Meinian Onehealth, the two largest private chain health checkup providers in China. Li Dianzhao believes that this development not only demonstrates that major capital players at the BAT level have fully recognized the strategic value of health checkups, but also presents an excellent opportunity for Tianfangda to expand its reach among health checkup institutions: “The health checkup industry falls within the consumer healthcare sector, characterized by a high degree of marketization yet a fragmented landscape. The recent acquisition of Meinian Onehealth by Jack Ma will inevitably drive strong consolidation among private health checkup providers. However, state-owned institutions, which account for over 90% of the health checkup market, will remain independent and fragmented for a considerable period. Facing intense pressure from large-scale capital, they will have an increasingly urgent need for third-party internet platforms that can connect examinees, enterprises, and health checkup institutions, providing a service system covering the entire process from health checkups to comprehensive health management.”

Regarding private clinics, Li Dianzhao believes that they are entering a golden age from the perspective of policy environment and market trends: "Private clinics are currently on the periphery of the healthcare system, with relatively limited resources and service capabilities. However, driven by national policies vigorously promoting tiered diagnosis and treatment, primary care, and socially operated medical institutions—especially following the recent approval by the central government of the 'Healthy China 2030' Planning Outline—private clinics have strong incentives to expand their scale and improve operations. Adopting low-cost SaaS platforms is their best option. Moreover, well-known internet healthcare companies such as Dingxiang Yuan (DXY) and Chunyu Yisheng are actively expanding into offline clinic services, which further underscores the broadly optimistic outlook for the future of private clinics."

Tianfangda’s choice to focus on health checkups and private clinics reflects deeper strategic considerations. Li Dianzhao pointed out, “As internet healthcare continues to deepen its penetration, the industry has increasingly come to recognize that offline entry points are the core strategic foothold for internet healthcare. Tianfangda’s Kangkang Health Checkup Network captures the entry point for healthy individuals, while Minkang SaaS secures the entry point for patients. The strategic value of these two entry points will be fully realized in the coming years.”

Minkang SaaS Platform: Building an Ecosystem for the Primary Healthcare Industry Chain

From the current state of primary healthcare, there are over 900,000 primary medical institutions nationwide in China, including more than 30,000 state-run community health stations, nearly 200,000 private clinics in urban areas, and almost 700,000 rural health posts. Private institutions account for over 95% of the total.

Digitalization has become a necessity across all industries, and clinics are no exception. Compared to state-owned medical institutions, private clinics place greater emphasis on return on investment (ROI) and are more inclined to adopt cost-effective, high-efficiency SaaS platforms. Tianfangda has been deeply entrenched in the field of healthcare informatization for many years, successfully developing Hospital Information Systems (HIS), departmental informatization software, and regional informatization systems. This experience has allowed the company to accumulate strong technical capabilities and build a highly effective marketing team. In contrast to companies that have only recently entered the medical SaaS sector, it is not challenging for Tianfangda to develop a clinic-focused SaaS platform. Indeed, the clinic SaaS platform represents an entry point particularly well-suited to Tianfangda’s resource endowments.

To date, the Minkang SaaS platform has registered more than 7,000 users, with nearly 1,000 active users, and handles approximately 10,000 outpatient visits daily, establishing itself as a leading clinic informatization platform in China. As the central and local governments accelerate the implementation of tiered diagnosis and treatment and two-way referral systems, primary care clinics will assume the main responsibility for initial consultations. The Minkang SaaS platform is strategically positioned to capture this largest patient entry point.

What Valuable Services Can the Minkang SaaS Platform Offer to Private Clinics? Li Dianzhao told VCBeat that private clinics currently remain at a disadvantage in terms of scale, staffing, service capacity, and industry resources. In response, the Minkang SaaS platform provides basic services such as professional training, technology promotion, and resource integration, along with value-added services including supply chain integration and supply chain finance, to help clinics effectively improve management efficiency, increase revenue, and reduce costs.

Collaboration with commercial health insurers will also be a key business direction for the Minkang SaaS platform. Li Dianzhao stated that once clinics on the Minkang SaaS platform reach a critical mass in a given region, the company will partner with commercial health insurance providers to build a health insurance service platform tailored to these clinics, thereby creating an integrated online-to-offline closed loop of medical services.

Li Dianzhao revealed that the long-term goal of the Minkang SaaS platform is to build an industrial chain ecosystem based on the primary healthcare market, integrating upstream and downstream sectors. Currently, the Minkang SaaS platform has established strategic partnerships with third-party testing institutions such as KingMed Diagnostics and Daan Gene, jointly promoting outpatient laboratory testing services. Efforts are also actively underway to enable seamless two-way referral collaborations with tertiary hospitals. In the future, more large-scale institutions and partners will join the industrial chain ecosystem of the Minkang SaaS platform.

Kangkang Checkup Network: The B2B2C Model Built on a Monopolistic Health Checkup Gateway

Tianfangda has been cultivating the niche sector of health checkup informatization for over a decade, ranking first in both brand awareness and market share. Li Dianzhao stated that state-owned hospital health checkup centers currently account for 83% of the market share, while private checkup providers hold only 17%, with the combined market share of the three major brands under “Ai Ci Mei” totaling less than 7%. Meanwhile, Tianfangda’s “Xinglin Qixian” holds a 30% share in the information software market for state-owned health checkup institutions. This has enabled Tianfangda to control the internet information gateway for health checkup institutions, establishing a de facto monopolistic and exclusive position.

Influenced by the intense rivalry between Meinian Onehealth and iKang Guobin, the health checkup market has been quite “hot” in the past two years. However, both companies have pursued expansion through asset-heavy strategies involving acquisitions, facility expansions, and self-operated models, which place high demands on financial strength and management capabilities, making it difficult to balance growth speed with development quality.

Tianfangda has taken a different approach by adopting an asset-light operational model. Leveraging its third-party health checkup platform, Kangkang Checkup Network, it integrates resources from state-owned health checkup centers distributed across China, enabling the “Internet Plus” transformation of these centers and effectively enhancing their operational efficiency and service capabilities.

Li Dianzhao pointed out that the three major pain points in the current health checkup industry are standardized checkup packages, lack of post-checkup service management, and difficulty in organizing checkup reports. Kangkang Checkup Network has established a communication and exchange platform among checkup recipients, enterprises, and checkup institutions, providing effective solutions to these three pain points.

Unlike Minkang Clinic’s SaaS, which aims to build an industry chain ecosystem, Kangkang Checkup Network’s core advantage lies in its monopolistic position as an information gateway for B-side health checkup institutions. With relatively weak influence on the C-side, Kangkang Checkup Network has chosen to actively integrate into C-side traffic gateways, leveraging a B2B2C model to share in the traffic dividends of major platforms. It is reported that Kangkang Checkup Network has already partnered with large platforms such as Baidu and Alibaba, while collaborations with other platforms are also being actively advanced.

To date, more than 4,000 health examination centers have partnered with the Kangkang Health Examination Network platform across the three stages: pre-examination, during examination, and post-examination. Since its official launch in March 2016, Kangkang Health Examination Network has generated substantial transaction volume, with its Baidu Index soaring to rank first among third-party health examination trading platforms, rapidly surpassing competitors that had been operating for three to four years.

Electronic Health Records: The Core Resource for Winning in Internet Healthcare

Various concepts and business models have long been prevalent in the internet healthcare sector. Li Dianzhao bluntly stated that, until a secure and effective mechanism for the circulation and sharing of Electronic Health Records (EHRs) is established, initiatives such as online consultations, chronic disease management, telemedicine, post-consultation follow-ups, and commercial health insurance will remain merely “buzzwords,” as they lack the foundational infrastructure required for practical implementation.

Li Dianzhao pointed out that the key to Electronic Health Records (EHR) lies in two aspects: comprehensive coverage and shareability. This is because only by achieving comprehensive coverage of individual-centric medical and health data can physicians make complete and accurate diagnoses, thereby effectively delivering a range of services such as health management and chronic disease management, while also enabling insurance companies to better design products and control risks.

Shareability is another key element of Electronic Health Records (EHRs). By sharing personal EHRs among primary care institutions, tertiary hospitals, specialized hospitals, rehabilitation facilities, and elderly care institutions, it is possible to truly achieve effective continuity of personal healthcare services and the practical implementation of the tiered diagnosis and treatment system.

Tianfangda’s Kangkang Physical Examination Network and Minkang SaaS platform effectively cover health checkup reports for healthy individuals and electronic medical records (EMRs) from initial consultations at primary care institutions, thereby forming relatively complete personal electronic health records (EHRs). However, at first glance, a critical link appears to be missing in this chain: EMRs from tertiary hospitals that handle serious and complex conditions. Addressing this, Li Dianzhao expressed confidence, stating, “This issue will be resolved with the promotion of tiered diagnosis and treatment and two-way referral systems. If the EHRs uploaded by clinics to higher-level hospitals are provided by Tianfangda, then the EMRs from those higher-level hospitals will also be received through Tianfangda’s platform.”

Li Dianzhao pointed out that Tianfangda’s two B-side businesses—health checkups and clinics—will provide the company with a steady cash flow in the short to medium term, supporting its stable development. In the long run, these B-side operations will continuously accumulate large-scale, comprehensive C-side electronic health records (EHRs), which will become the core resource for winning in the future of internet healthcare.

When discussing what Tianfangda will become in the future, Li Dianzhao said, “Before the future arrives, anything is possible. The only certainty is that Tianfangda will grow into a platform-level enterprise in the primary healthcare sector.”

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