Internet Healthcare Bubble 'Not Big Enough Yet,' Says Dongmai Founder as Company Files IPO Prospectus

On August 29, the inaugural “Yihu Baiying” Internet+ Cross-Industry Forum, jointly initiated by the digital health company Yihu Doctor and media outlets including VCBeat, NetEase Technology, Yiou.com, and Beikeshe, held its first salon event at Zhongguancun Innovation Street. At the salon, attendees discussed the topic of “whether there is a bubble in internet healthcare.”(From left to right: Li Li, Executive Editor-in-Chief of Oriental History Review; Wang Bin, Co-founder of Yiou.com; Zhang Lidong, Senior Vice President of Toutiao; Ma Haiping, Founder and CEO of Yihu Doctor; and Li Datao, Founder of VCBeat.)

Ma Haiping, Founder and CEO of Yihu Doctor, stated: “Bubbles are good news for the winners; for those who fail, it represents a significant setback. Without this bubble, regardless of whether the weather is scorching hot or freezing cold, you would still be waiting by the roadside for a ride. In the future, we hope that when this bubble—whether large or small—eventually bursts, accessing medical care will no longer be difficult or expensive.”

Li Datao, Founder and CEO of VCBeat, expressed his agreement: “In terms of industry trends, there was initially a period of significant bubble, followed by a rapid decline to the bottom, which essentially corresponds to an industry consolidation phase. After this cleansing process, the industry enters a more standardized stage of development. Currently, the internet healthcare sector is in a phase of rapid growth. I believe the bubble has not yet reached its peak, as there remain numerous pain points in the integrated healthcare field that need to be addressed.”

Li Datao further used figures to elaborate on his viewpoint: “Since the establishment of the healthcare system in the 19th century, the entire industry has maintained an upward growth trajectory. Although there have been numerous economic cycles and stock market crashes from the 19th century to the present, the healthcare sector has never experienced a downturn. The industry’s output value doubles every six years, so it is debatable whether it can be described as being in decline. In fact, these two data points provide entrepreneurs with strong confidence that the industry will certainly thrive in the future.”

“From another perspective, although the entire capital market has entered a winter period, companies with truly strong business models and exceptional teams are still able to secure investment, and indeed, substantial investment. This effectively filters out entrepreneurs whose business models may not yet be well-defined, which is a positive development for the industry,” said Li Datao.

Zhang Lidong, a partner at Toutiao, offered an alternative perspective on this topic: “Among the problems that the internet can solve, there remains a significant gap in services. While the internet can address information asymmetry, service-related issues ultimately depend on human involvement and must be carried out by people themselves. This is a challenge that the internet failed to adequately resolve in the past but is currently being addressed. We are already observing changes. By maximizing individual labor productivity and optimizing personal benefits under conditions of information symmetry, we may arrive at the desired model for current medical O2O (Online-to-Offline) services.”

The Breakthrough in Mobile Healthcare Lies in Patient Digitalization

Ma Haiping summarized the four major schools of thought currently prevalent in internet healthcare: The first is the traditional school, comprising doctors, hospitals, and pharmaceutical companies—particularly pharmaceutical sales representatives. A typical characteristic of this group is that they view healthcare from a purely medical perspective, adopting approaches based on incremental fixes or mimicking existing procedural systems. The second is the internet school, consisting of individuals with experience in both healthcare and the internet sector. Representatives of this group seek to transform healthcare from an internet-centric viewpoint. The third is the media school, and the fourth is the school of uncertain origins.

“The actions taken by these four factions differ. For instance, proponents of the medical establishment firmly believe that other schools of thought are wrong and that users are also mistaken. They repeatedly emphasize the uniqueness of the healthcare industry and the distinct role of physicians, while exaggerating attributes such as the complexity and safety of medical care. ‘I do not agree with this viewpoint; it is a common tactic used by vested interests to prevent others from entering the field. Therefore, I believe there is no market for the conservative faction,’ Ma Haiping stated bluntly.”

When discussing the “internet-driven” approach, Ma Haiping believes there are two extremes. At one extreme, some attempt to address healthcare industry challenges solely through internet-based technical solutions. For instance, some engage in big data collection and analysis, but it is somewhat premature to pursue big data initiatives at this stage. “An industry’s informatization can only leverage information for secondary processing to generate value when there is sufficient data richness. Just as companies like Baidu could not have emerged during the era of the three major web portals, because the volume of information was not yet massive.”

Moreover, Ma Haiping stated that internet healthcare should not remain at the level of simply competing on metrics such as the number of doctors, patients, and daily active users. “This is a strategy from the PC era.” Instead, the focus of internet healthcare—and its enduring priority—must be on patients, or in other words, user needs.

Ma Haiping further explained, “The breakthrough point for mobile healthcare lies in the digitalization of patient information. Any industry seeking to leverage the power of the internet must address the challenge of its own digital transformation; otherwise, it is like a tree without roots or water without a source. For instance, Didi Chuxing solved the information asymmetry problem in the taxi industry by equipping each vehicle with a smartphone, thereby making the cars ‘smart.’ Without this, such innovation would have been impossible. On the surface, their efforts appeared targeted at drivers, but in reality, they were aimed at serving users. We follow the same principle: while our initiatives may seem directed at physicians, they are ultimately designed to better serve patients. The patient-facing app of Yihu Doctor will be launched in late September.”