Matrix Partners China's Healthcare Investment Playbook: Fast, Accurate, and Decisive

Investments in high-profile companies such as Didi Kuaidi, Momo, and Ele.me have propelled Matrix Partners China to prominence, showcasing the firm’s aggressive approach and substantial strength in TMT sector investments.

In fact, Matrix Partners China’s investment layout in the healthcare and medical sector began early on.

In the realm of physical healthcare, Matrix Partners China has cumulatively invested in approximately 15 companies, primarily focusing on sectors such as medical devices and point-of-care testing (POCT), including Kanghui Medical, Ruiqi Surgical, and StarChild Medical.

In the field of internet healthcare, Matrix Partners China is accelerating its strategic layout. To date, it has invested in approximately 20 companies across multiple specialized verticals, covering both business-to-business (B-end) and consumer-facing (C-end) sectors. Portfolio companies include So-Young, Meiyou, V Doctor, Palm Sugar Doctor, and Medicine Terminal Network.

Behind such an extensive investment portfolio is the healthcare investment team of Matrix Partners China. This issue features interviews with Xu Chuansheng, Wang Huadong, and Yu Zhiyun.



Xu Chuansheng, Founding Managing Partner, joined Matrix Partners China in 2008 and leads the firm’s Shanghai office. He has spearheaded investments in well-known companies such as Didi Kuaidi, Kingnet Network, and Bona Film Group. In the healthcare sector, his portfolio includes Kanghui Medical, RQ Medical, StarChild Medical, Suzhou Weizhen, and V Doctor.



Hua-Dong Wang, Partner at Matrix Partners China, formerly worked at Sohu and China Yahoo. He focuses on investments in the internet sector, specifically in social networking, content, entertainment, and healthcare. His successful investments include Momo, as well as healthcare companies such as So-Young and Meiyou.



Zhiyun Yu, Investment Director at Matrix Partners China, holds a Ph.D. in Computational Chemistry. He previously worked at McKinsey & Company, UBS, Shenzhen Capital Group, and Fidelity Asia. He focuses on investment opportunities in medical devices, healthcare services, and internet healthcare, and has invested in projects such as Yaopin Terminal Network.

The “Three Musketeers” of Matrix Partners China have formed a collaborative and complementary capability matrix with strong competitiveness, leveraging their diverse professional backgrounds, industry experience, and areas of focus. How will they ride the wave of China’s burgeoning internet healthcare sector, which is still in its early stages? Recently, VCBeat conducted exclusive interviews with Xu Chuansheng, Wang Huadong, and Yu Zhiyun to reveal their perspectives on the landscape of China’s internet healthcare industry.

"All martial arts under heaven, speed is the only thing that cannot be broken."

VCBeat’s editorial team has a strong impression of Matrix Partners China: it moves incredibly fast. Over the past two years, VCBeat has observed that for many projects it has covered or identified, Matrix Partners China completed its investments within three months of engagement, with some deals closed in under a month.

According to statistics from VCBeat’s Internet Healthcare Power Rankings, Matrix Partners China has been the most active investor in internet healthcare companies over the past two years, bar none.

Why such heavy and rapid investments? Driven by these questions, VCBeat visited the headquarters of Matrix Partners China to find out.

Faced with such questions, Xu Chuansheng, Founding Managing Partner of Matrix Partners China, chuckled. “The hallmark of Matrix is simple: fast, precise, and decisive.”

Behind the speed, precision, and decisiveness lies the seamless collaboration and thorough communication within the Matrix Partners China team. Xu Chuansheng believes that while many outstanding investment firms share common traits, Matrix Partners China is distinguished by its strong execution, efficiency, and avoidance of unnecessary delays or indecision. Whether deciding to invest or not, a clear viewpoint is formed quickly—all stemming from confidence.

Why such confidence? According to Yu Zhiyun, this stems from MPCi’s deep understanding of the industry. Only with sufficient industry insight and extensive knowledge of entrepreneurs can one dare to make judgments and decide quickly.

So, which industries does MPCi understand best, view most favorably, and research most thoroughly?

Layout in Four Key Areas

Internet healthcare continues to enjoy strong investor confidence. Among the many directions and opportunities, Matrix Partners China is most bullish on niche verticals, enterprise services, medical big data, and commercial health insurance.

I. Niche Vertical Specializations. After several years of rapid development in internet healthcare, Xu Chuansheng believes that opportunities in the general practice market have become limited, whereas various specialized clinical departments still harbor abundant opportunities. Due to significant differences among specialties in diagnostic and treatment workflows, resource elements, patient access channels, and relationships with the medical industry chain, it is difficult to address the needs of different specialties with a single, unified system. Therefore, specialized clinical departments are better suited for a model of deep, vertically integrated specialization.

In specific vertical sectors, Matrix Partners China has invested in projects such as “V Doctor,” a precision appointment platform for pediatricians, and So-Young, which provides online Q&A, reviews, and flash-sale services in the cosmetic surgery field.

II. Enterprise Services Sector. The “SaaS + Transaction Platform” model has been a key investment focus for Matrix Partners China in recent years. Yu Zhiyun stated that this model has already been validated in other sectors and will be rapidly adopted in the healthcare industry. Moreover, it is well-suited for deep integration within specialized medical departments, as well as in niche areas such as pharmaceuticals, reagents, and scientific research.

In the realm of enterprise SaaS and trading platforms, Matrix Partners China has successively invested in projects such as LinkCare Information, a dental SaaS service provider; Taimei Medical Technology, a pharmaceutical industry SaaS service provider; and Haoya Yi, an O2O platform for dental care.

III. The Field of Big Data in Healthcare. Yu Zhiyun pointed out that big data technology helps promote the development of precision medicine, effectively improving medical standards and service efficiency. Moreover, the development of IBM Watson demonstrates that the integration of big data and artificial intelligence is accelerating, which may provide further impetus to the growth of healthcare big data.

Of course, the development of big data in healthcare is not without its challenges. Wang Huadong told VCBeat that the biggest pain point hindering the development of healthcare big data lies in the lack of unified information systems across different hospitals and departments, leading to fragmented and scattered data. Nevertheless, Wang Huadong remains quite optimistic about the prospects for healthcare big data in China, as the country possesses a demographic advantage not found elsewhere, resulting in significant potential for data accumulation.

In the big data sector, Matrix Partners China has invested in projects such as Judao Technology, which focuses on cloud computing service platforms for genomic big data.

IV. Internet + Commercial Insurance. Yu Zhiyun specifically pointed out that the future market for commercial insurance will be at the trillion-yuan level, and the internet is bringing profound changes to marketing strategies, product design, and other aspects of the insurance industry. This may create opportunities for China’s future insurance market to overtake competitors on the curve and give rise to new industry giants.

Previously, Matrix Partners China had already invested in Kuaima Medical, which specializes in pharmacy benefit management (PBM).

Why the Strong Affinity for Internet Healthcare?

In recent days, a series of “internet healthcare controversies and crises” triggered by appointment registration issues have emerged, sparking renewed discussion on the impact of policies on internet healthcare.

In this regard, Matrix Partners China holds its own unique perspective. Wang Huadong stated that judgments on policy trends should not focus solely on the immediate present; instead, one must assess whether emerging developments represent the future direction, thereby determining whether government policies will loosen or tighten in the long run.

Matrix Partners China boasts extensive experience in navigating policy landscapes. In recent years, its investments in products such as Didi Kuaidi and Momo have all undergone rigorous policy scrutiny. Nevertheless, the public’s strong demand for convenient transportation and social interaction represents an irreversible trend; inevitably, policy frameworks and the development of emerging innovations will find their convergence point over the long term.

Yu Zhiyun believes that the pain points in healthcare are strikingly clear. These include a growing proportion of the elderly population with robust demand for medical and health services, rising incidence rates and patient numbers for conditions such as cancer and chronic diseases, and the continued rapid escalation of government-funded medical insurance expenditures. These realities necessitate that China’s healthcare system find a more cost-effective and efficient solution.

Technological innovations and business model innovations brought about by the Internet will inevitably be a key direction for addressing China’s healthcare challenges. Therefore, Matrix Partners China firmly believes that while regulatory policies in the healthcare sector may experience fluctuations and reversals, the overarching trend toward openness and marketization in China’s healthcare industry will remain unchanged, and investment opportunities arising from the integrated development of the Internet and healthcare will continue to emerge.

Investment: Prioritizing Startups’ Ability to Build Business Models

Although Matrix Partners China invests rapidly and is known for making bold bets on specific sectors, it never encourages entrepreneurs to burn cash. What Matrix Partners China truly values is a startup’s ability to build a viable business model and establish competitive barriers.

For instance, in the field of internet healthcare, entrepreneurs often have multiple entry points to consider: should they target the B-side or the C-side? Should they focus on hardware, services, or online communities? Xu Chuansheng advises entrepreneurs to return to core questions: Who is closest to commercialization? How can a closed-loop business model be established? And where do the startup team’s strengths lie for achieving breakthroughs?

Yu Zhiyun argues that it is necessary to carefully consider the transactional attributes of entrepreneurial ventures and assess whether their marketization is sufficient. For instance, in sectors such as dentistry and medical aesthetics, marketization is already quite advanced, and consumers have developed the habit of seeking services from private clinics and institutions. Therefore, startups in these areas may focus more on consumer-facing (C-end) strategies. In contrast, purchasing medication is a low-frequency need for consumers in the pharmaceutical e-commerce sector, making business-to-business (B-end) approaches more suitable for startups. A case in point is Yaopin Terminal Network, invested by Matrix Partners China, which is a third-party e-commerce service platform dedicated to serving the pharmaceutical distribution industry.

Besides proximity to revenue and strong business model-building capabilities, what other types of startups does Matrix Partners China favor? Xu Chuansheng stated that companies with unique technological advantages and the potential to become platform-level leaders in their respective niche markets through such advantages are the most desirable investment targets for Matrix Partners China.

It must be said that Matrix Partners China’s startup welfare package is excellent.

After swiftly securing investments in startups, Matrix Partners China’s high-efficiency execution did not end but rather had just begun. In its collaborations with entrepreneurs, Matrix Partners China adheres to the principle of “knowing what to do and what not to do”—providing full support to founders while refraining from arbitrary guidance or interference, thereby accompanying them as they strive to move forward with all their might.

To help entrepreneurs grow at the fastest possible pace, Matrix Partners China has built a comprehensive post-investment service system:

• HR: Matrix Partners China employs full-time staff, all of whom are senior headhunters with extensive industry experience, dedicated to helping startups recruit talent and build teams.




• PR: The public relations department of Matrix Partners China leverages its extensive PR experience to provide training and operational guidance to startups.




• GR: Matrix Partners China has dedicated full-time staff to provide startups with government public relations services and training.




• BD: Matrix Partners China has dedicated full-time staff to facilitate and assist business collaborations among its portfolio companies.




• Capital Markets: Matrix Partners China has dedicated full-time staff to help startups connect with the capital markets.




• Legal and Finance: Providing comprehensive services and relevant training for startups.




• Medical Team: Matrix Partners China has established a dedicated medical team for startups, composed entirely of senior professionals from the healthcare system. Leveraging extensive networks of top-tier physicians, the team provides high-quality medical services to entrepreneurs and their families.

Why is it so thoughtful? The "Three Musketeers" share a common view: Matrix Partners China still regards itself as a startup. This mindset not only preserves the firm’s drive and aggressive spirit, but also enables it to better understand entrepreneurs, anticipate their needs, and provide timely support.

“In the internet healthcare sector, where the curtain has only just risen, Matrix Partners China speaks the same language and shares the same operational style as startups. We hope to join hands with more entrepreneurial ventures in racing toward an infinitely broad future,” Xu Chuansheng finally told VCBeat.