14 Healthcare Startups Secured Two Rounds of Major Funding Within a Year — Here’s How They Did It

After completing Series A financing, can a company secure Series B funding in a timely manner? Once Series B is secured, how should it approach Series C? Although a faster fundraising pace is not always better, timely capital infusion always provides greater reassurance to startup teams and instills more confidence in the market. Typically, the transition from seed/angel rounds to Series A is relatively rapid; however, whether a startup can maintain this fast-paced fundraising strategy after Series A remains a significant test of its fundraising capabilities.

Fast-Paced Fundraising Has at Least Several Positive Implications:

1. The project enjoys high acceptance among investors and the market.

2. The project’s own development and advancement are proceeding at a high pace.

3. The project itself has strong financing capabilities and is already on the path to becoming a financial powerhouse.

14 Projects Secure Two Consecutive Rounds of Financing Within One Year

VCBeat Internet Healthcare Research Institute compiled statistics on publicly disclosed financing information in the internet healthcare sector from 2010 to Q3 2015. Since Series A, a total of 14 projects have been recorded over the past six years.In 1 Within the Year, ConsecutiveSecured two rounds of financing (A→B, B→C, C→D, D→E), involving a total of 32 transactions and 18 stage advancements. This means that these 14 projects advanced their maturity to the next stage within less than a year. Some projects underwent three to four consecutive funding rounds, with intervals between each round not exceeding one year.



It can be seen that consecutive financing rounds mostly occur between Series A and Series B, while rapid-fire fundraising becomes increasingly rare in later stages. The two jumps shown in the chart above—from Series C to D and from Series D to E—actually both pertain to the same startup, Dayima.

In fact, Dayima’s financing intervals from Series A to Series E never exceeded one year. Interestingly, Meiyue, which offers similar products, also completed its Series A to Series C rounds within a year. However, after its Series C round in June 2014, there were no further reports of subsequent financing for Meiyue. Moreover, the investors in Dayima’s Series D and E rounds were not the same venture capital firms that had consistently participated in its Series A, B, and C rounds. Behind the financing race between these two projects, there are likely intense and dramatic stories.

Among these 14 projects, only two major categories are involved: health and wellness, and healthcare. Within the subcategories, there is more than one funded project in comprehensive disease management, sleep health, health monitoring, women’s health, and pharmaceutical e-commerce. Overall, there are more fast-financing projects in the consumer-oriented health and wellness sector.



Seven projects saw follow-on investment from participating investors in the previous round into the next round.

According to public information, statistics from VCBeat’s Internet Healthcare Research Institute reveal that among 14 projects, seven have received sustained and steadfast support from certain investment firms—meaning that investors who participated in the previous funding round continued to follow up in the subsequent round. As these seven projects constitute exactly half of the 14, it appears that there is no direct correlation between the ability to secure the next round of financing quickly and whether prior investors continue their participation. Among the firms that consistently followed up, Matrix Partners China and Sequoia Capital each appeared in more than one of these seven projects, alongside other investors such as Legend Star and SoftBank China.

The funding amount increased the most from Series A to Series B.

Among projects with publicly disclosed financing amounts, we compared the funding received in consecutive rounds and found that the increase from Series A to Series B was the most significant, with the vast majority of financing amounts growing by more than threefold, and some even exceeding fivefold. In contrast, the growth in financing amounts markedly declined from Series B to C, C to D, and D to E. This trend is likely positively correlated with the increasing valuation of startups; as companies mature, further valuation increases become progressively more difficult, and operational efficiency, profitability models, and competitive capabilities face increasingly rigorous and realistic tests.

Appendix: Cases of Chinese Internet Healthcare Companies Receiving Consecutive Financing Rounds Within One Year Starting from Series A, 2010–Q3 2015

Is the "Round X Death" a Curse?

Since the beginning of this year, rhetoric about “Series A death,” “Series B death,” and “Series C death” has shrouded various industries like a fog, causing concern among entrepreneurs and even greater anxiety among investors. Is this alarmist or impartial? And why has this narrative of “death at every funding round” emerged?

We have collected and compiled the viewpoints of three investors:

Liu Yizhou, a partner at Jiuxuan Capital, believes that startups fail at the Series A stage due to the following reasons: their products do not align with the “eight-character mantra” of being universal, explicit, essential, and high-frequency; the founding team holds an excessively low equity stake after the angel round; product and user metrics underperform; the profitability model faces a ceiling; there is a significant gap between founders’ and investors’ valuation expectations; the organizational structure has flaws; vertical platforms are ultimately overshadowed by larger platforms; and there are policy uncertainties and legal risks.

Chen Weiguang, a partner at BlueRun Ventures, believes that the “Series B crunch” stems from capital that should have been allocated to Series B and C rounds being diverted to Series A investments. Overinvestment in the early stages leads to a situation where too many companies compete for limited later-stage funding. Furthermore, if the majority of entrepreneurs fail to secure Series B financing, earlier Series A investors will likely consider withdrawing from the market.

Wang Ran of China Renaissance Capital believes that the “Series C curse” stems from an insufficiently large core market; a misaligned strategic perspective; failure to rank first or second in the chosen niche, with a significant gap behind the top two players; and an overly steep valuation growth curve, resulting in a “VM” index exceeding 0.5.