How Industry Leaders Really View Internet Healthcare: A Comprehensive Insight from Recent Conferences
Over the past week, VCBeat, as a media partner, consecutively participated in the “5th China Healthcare Industry Investment and M&A Conference” initiated by Zero2IPO, and the “11th China Health Industry Summit Forum” launched by CEIBS. Additionally, at the invitation of Alibaba Cloud, we attended the “2015 CHINC (China Hospital Information Network Congress).” Despite different organizers and forums, internet healthcare remained a hot topic across all events. As researchers and reporters specializing in internet healthcare, VCBeat brings you the latest frontier insights from China’s internet healthcare sector, drawn directly from the front lines.
Key Concerns:
1. Does internet healthcare truly have a promising future? Has the time really come for a disruptive transformation in the medical industry?
2. As the core of internet healthcare, how do hospitals and physicians view it?
3. How do investment institutions view internet healthcare? Are they investing in the hype to secure a foothold, or are they investing based on long-term trends with a commitment to sustained investment?
4. How Are the Early Adopters of Internet Healthcare Faring?
With these questions in mind, the VCBeat editorial team has carefully curated the following substantive insights for your benefit. You’re welcome.
What Are Leading Internet Healthcare Entrepreneurs Up to Lately?
Last year, pioneers in the internet healthcare sector, such as Chunyu Yisheng, DXY, and Xingshulin, secured substantial funding rounds, generally reaching Series C. A further step would bring them close to an initial public offering (IPO). Recently, these industry leaders have been pivoting their strategies by launching pharmaceutical e-commerce platforms and opening offline clinics, signaling that internet healthcare has entered a new phase where business models are facing critical validation. Here is what they have to say.
Chunyu Doctor VP Bi Lei: No Plans to Expand into Offline Services
Regarding Chunyu's Offline Plans:Bi Lei stated, “Chunyu has no plans to develop offline medical services. As an internet healthcare company venturing into offline development, we lack the necessary experience, and such expansion is indeed very slow. Therefore, our business model is clear. I believe the most critical aspect of mobile internet is resource matching. As mentioned earlier regarding fragmented time, what Chunyu Doctor actually does is match these fragmented time slots.”
“Mobile internet has provided us with a tool. Our approach to operating offline hospitals is similar: many healthcare needs indeed cannot be addressed solely online. In such cases, we introduce a third dimension—enabling physicians to conduct consultations and patients to receive treatment in offline settings. Through these three dimensions, we optimize the allocation of societal resources.”
? On Defining the Diagnosis in Consultation and Medical CareBi Lei stated that, strictly speaking, it is indeed difficult to make a distinction based on definitions alone; the most critical factor relies on offline medical orders. In practice, resources are entirely skewed toward physicians, leaving patients with no say. Therefore, online medical services aim to empower users with greater informed consent rights during offline interactions.
DXY’s Li Tiantian: Building Self-Owned Clinics with a Unified Brand
DXY’s Clinic Initiative Draws Significant Attention.Chunyu stated that online consultations are designed to match physicians’ fragmented time slots, with no offline services involved. However, Li Tiantian clearly held a different view: “Physicians’ fragmented time can never be effectively consolidated. Doctors only have 24 hours in a day. Having practiced as a physician myself, I know we cannot truly aggregate fragmented time as one might imagine. Therefore, we provide offline services, leveraging physicians’ substantial blocks of time to deliver medical care with robust safety assurances.””
It is evident that at this juncture, Chunyu Yisheng and DXY have diverged in their strategic directions. DXY intends not only to establish its own clinics but also to build a brand, which is expected to require substantial investment from the company. Li Tiantian’s core viewpoint is:
1. Existing clinics in China are of poor quality; building new ones is preferable to acquiring existing ones;
2. Unified online and offline branding, both under the name DXY Doctor;
3. Differentiate services from large hospitals to achieve complementarity; therefore, the location should be adjacent to public hospitals;
4. At present, we will not consider cooperating with private hospitals due to their relatively poor service and quality.
Quyi.com’s Li Zhi: In-Hospital Mobile Healthcare Remains a Blue Ocean
Li Zhi believes that “all internet healthcare companies manage three types of relationships: hospital relationships, physician-physician relationships, and hospital-patient relationships. From my perspective, let me explain why we undertake such asset-heavy offline operations. Quyi Network focuses on hospital-patient relationships, based on several key points. First, all healthcare transactions inevitably occur at the point of care, which is also the critical point for mitigating medical risks.”
Li Zhi's core viewpoints are as follows:
1. In-hospital mobile healthcare remains a blue ocean market; 2. Growing capital interest in healthcare IT has led to differentiation within the in-hospital mobile healthcare sector, with increasing market concentration; 3. Current levels of informatization and data utilization remain low, indicating significant growth potential over the next three to five years; 4. The number of competitive players will continue to decline.
Gudong’s Shen Bo: Exercise is counterintuitive; gamified social features are needed to enhance user stickiness
Shen Bo mainly told us the following points:
1. Codoon is currently the largest sports social platform in China. Codoon was also the first company in China to develop wearable devices, having commenced research and development in this field as early as 2010, and launched its first Codoon smart band in 2013.
2. Codoon believes that exercise goes against human nature, so it has devoted significant effort to making people willing to work out. Gamified social interaction is a core feature of Codoon’s platform. For example, users can compete against friends in PK challenges, have an attractive companion join them for runs, or even organize competitions between companies. In short, Codoon aims to address a key challenge in the fitness tracker industry: user stickiness.
Haodaifu Wang Hang: Doctors’ Fragmented Time Cannot Solve the Problem
Wang Hang stated that Haodaifu is slightly younger than DXY, but older than other internet healthcare startups. Indeed, Haodaifu was a pioneer in enabling physicians to provide online consultations during the PC era.
Wang Hang’s main viewpoints are:
1. Haodf is a relatively professional platform, where over 90% of active users are physicians from Grade A tertiary hospitals, and the diseases discussed are primarily serious conditions such as cancer.
2. We previously noted that doctors’ interactions with patients during fragmented time slots were increasing. However, we later discovered that doctors’ actual fragmented time is predominantly spent on WeChat, where they prefer to engage in leisure activities. Consequently, fragmented time does not effectively address the issue.
Meinian Onehealth’s Yu Rong: Bullish on Preventive Medicine, with Telemedicine Playing a Major Role
Yu Rong put forward four perspectives on the future development and transformation of the medical service industry:
1. Prioritize preventive medicine, shifting the original focus to disease prevention and addressing health issues before they manifest;
2. Changes in the existing infrastructure and rules of the game, as well as new business models, brought about by physician mobility and the promotion of multi-site practice;
3. Over the next three to five years, or even longer, specialized medical care will remain a key entry point for social capital to penetrate and reform the traditional healthcare system;
4. Telemedicine plays a significant role;
iKang Guobin’s Li Hui: Two Major Trends—Hospital Healthcare Reform and Mobile Health Big Data
Li Hui believes that there are two key opportunities in the healthcare services industry:
1. Hospital healthcare reform;
2. Mobile healthcare big data, which is reflected in three sectors: prevention, treatment, and rehabilitation;
Fan Yu of Apricot Forest: Officially Launching Commercialization
Fan Yu’s main points are as follows:
1. The first is to deepen physician services, while simultaneously engaging patients by leveraging our tools to help physicians better manage their patient populations.
2. The second strategy is to initiate commercialization, with Xingshulin integrating pharmaceutical companies and healthcare clients to jointly provide services for doctors and patients.
3. The third strategy is internationalization.
Yinggu Co-founder Huang Yedong: What Is the Next Breakthrough Point in Telemedicine?
Xi'an Yinggu Network Technology Co., Ltd. provides imaging solutions for the backend of telemedicine. Huang Yedong believes:
1. On Value: Enabling symmetry and supersymmetry in medical information to generate healthcare collaboration services with decision-making value.
2. Experience: Simple, Fast, Beautiful, Comprehensive. Convenient and simple collaboration for both ends, fast information acquisition and application processing, aesthetically pleasing terminal applications, an all-in-one collaboration tool, leaving no regrets.
3. Scenario: Comprehensive medical collaboration across all scenarios, meeting the needs of medical collaboration in all network environments; achieving symmetrical and unified medical collaboration across all terminals; supporting BYOD (Bring Your Own Device) for medical collaboration; moving with doctors—not moving for the sake of mobility, but ensuring seamless mobility. Like a shadow following its form, it enables experts to generate decision-making value in medical collaboration during fragmented time.
4. Belief: We believe that the internet will transform healthcare. The internet is certain to provide significant opportunities for transformation in future healthcare delivery, particularly in core medical services.
How Investment Institutions View Internet Healthcare
As an entrepreneur, I am naturally concerned about how investment institutions view internet healthcare, especially since the sector is still in a highly controversial phase. Every day, there are large groups of people cheering it on and others predicting its demise. Of course, there is also a large cohort of investors frantically pouring money into it :)
Tencent Investment Executive Director Mu Yifei: Tencent Is Not Here to Disrupt; We Are Here to Build the Roads
Mu Yifei’s remarks were regarded as Tencent’s debut statement on its stance toward internet healthcare. In reality, however, Tencent had already made significant investments in this sector. This presents an opportune moment to delve deeply into Tencent’s strategic logic in internet healthcare, such as why it invested in DXY and why it places emphasis on blood glucose management.
Mu Yifei's Core Views Are as Follows:
1. “The Internet revolution may be a great boon to many traditional industries, but Tencent has never believed that the Internet is meant to disrupt healthcare. As Tencent sees itself as a road-builder, once the roads are built, it is still up to everyone else to drive the cars on them; we merely help people drive a bit faster.”
2. The main issues he identifies in the current healthcare landscape are: first, the cost of distrust; second, information silos; third, inefficiency; and fourth, the lack of an organic hierarchical structure. Mobile internet is well-positioned to reduce the costs of information access and coordination, thereby improving efficiency. For instance, internet healthcare can reengineer medical service processes, streamline procedures, and enhance efficiency. It enables asynchronous medical consultations, allowing for a more rational allocation of physician resources. It can break down information silos by structuring and standardizing patient data. Furthermore, through more efficient interactive experiences, it can transform the currently centralized healthcare model into a diversified one.
3. His vision of internet healthcare is as follows: 1. It represents a relatively cutting-edge concept; at the current stage, it is more important to leverage the internet to transform the existing healthcare system. 2. Internet healthcare is a service rather than a simple commodity; it cannot be separated from offline operations and medical professionals, with physicians remaining the core of healthcare services. 3. Data is the core of the service. Tencent aims to build a large-scale data platform to support various startups or facilitate data integration within its ecosystem. (Editor’s note: This appears remarkably similar to Alibaba Cloud’s big data platform—befitting rivals of comparable stature.)
Jiang Xiaodong, Global Partner and Managing Director for China at NEA: The healthcare sector evolves slowly, but there are signs of accelerating change in recent years
Jiang Xiaodong’s core viewpoint is:
1. Policy progress in the past has been relatively slow;
2. A large number of entrepreneurs, new technologies, and capital are driving the healthcare industry forward.
Sequoia Capital Partner Chen Penghui: Internet Healthcare Is a Process of Quantitative Change Leading to Qualitative Change
Chen Penghui atVCBeat’s 4th Thought Sharing SessionThe remarks have become one of the most widely circulated pieces of substantive content in the internet healthcare sector, offering insights into how investment firms view internet healthcare.
At the Zero2IPO conference, Chen Penghui articulated a similar core philosophy: internet healthcare represents a process in which quantitative changes lead to qualitative transformation, and this developmental trajectory itself presents investment opportunities. His key points are as follows:
1. The internet is a means to transform healthcare, similar to how "Internet + taxis" has changed the way people travel—the same cars are used, but transportation has become more convenient;
2. In the future, many medical consultations are likely to take place remotely, including specialist consultations, telemedicine, and online appointment registration. Hospitals will no longer require patients to wait in line; instead, patients can directly view their test reports on their mobile phones, pay for diagnosis and treatment fees, and purchase medications. Furthermore, patients will be able to maintain ongoing interaction with their attending physicians. While all these may seem merely as tools that do not alter the essence of face-to-face communication between doctors and patients, the emergence of these new technological means will change the way people seek medical care, thereby further transforming the inherent relationships within the entire healthcare system.
3. This space will present numerous opportunities, both for the industry and for investors.
Li Wengang, Managing Director and Founding Partner of Zhongwei Fund: How to Approach Mobile Healthcare
Li Wengang had originally prepared a presentation on wearable devices. However, considering that wearables also contribute to the development of mobile health and that this topic was already widely discussed, he changed his theme to “How to Engage with Mobile Health.” Li Wengang’s core viewpoints are as follows:
1. The healthcare system itself has undergone little change; patients still need to visit hospitals for medical consultations, and physicians continue to provide treatment through offline institutions. Hospitals remain physical entities, and pharmaceutical manufacturers remain as they are. What has changed is the overall patient experience and the environment in which medical care is delivered.
We focused on driving change in three key areas: integrating healthcare resources, improving physician efficiency, and enhancing the patient care experience, thereby transforming the overall healthcare environment. This has been a primary focus and target in our project selection process.
2. Mobile healthcare is in its nascent stage, with most services currently serving as entry points for online consultations, including medical knowledge, wellness information, and virtual consultations. The industry is increasingly shifting toward an O2O (Online-to-Offline) model. In the future, greater integration of online and offline services will form a closed loop, enabling deeper and more sustainable long-term development.
3. Drivers of Mobile Health Development: Economic, Social, Technological, Industry Regulatory, and User Awareness Factors.
4. We believe the optimal model is to address the pain points of both patients and physicians through online-offline interaction, with the O2O (Online-to-Offline) integration offering the most promising development prospects.
5. In vertical and niche sectors, we focus more on diabetes, oncology, healthy sleep, pediatric nutrition, maternal health, sports and fitness, medical aesthetics, and more.
Where is Healthcare Reform Headed?
For both entrepreneurs and investors in the internet healthcare sector, the primary concern remains the direction of healthcare reform.
Wang Dongjin, Special Researcher of the Counselors’ Office of the State Council, President of the China Health Insurance Research Association, and Former Vice Minister of the Ministry of Labor and Social Security: China’s Medical Insurance System Is Not Yet Ready for the “Integration of Three Insurances”
Wang Dongjin's Two Core Viewpoints:
1. Based on an analysis of the current actual development of China's medical insurance system, the conditions for truly achieving the “integration of three insurances into one” are not yet in place.
2. Recognizing the problem is the key to integrating the three insurance schemes, rather than so-called interest-related issues; this requires that the management system adapt to the chosen institutional model.
Liang Wannian, Director of the Department of Structural Reform under the National Health and Family Planning Commission: The Core of Price Adjustment in Healthcare Reform Lies in "Making Room for New Priorities"
The core of healthcare service price reform is "replacing the old with the new," seeking dividends from reforms in the circulation sector and from the regulation of medical practices.
Price Adjustment Based on Total Hospital Volume:
1. Eliminate unreasonable inefficiencies in the distribution sector. Secondly, eliminate unreasonable practices among medical personnel.
2. Reallocate the freed-up space to adjust labor costs.
At the meeting, Liang Wannian also revealed that the medical insurance sector is currently accelerating the formulation of principles and rules for medical insurance payment prices to guide various regions in establishing their respective medical insurance payment prices. Meanwhile, medical service pricing is also under study. The State Council’s Office of Healthcare Reform, in collaboration with relevant departments including the National Development and Reform Commission, the Ministry of Human Resources and Social Security, and the National Health and Family Planning Commission, is developing a related mechanism. Intensive research is currently underway on the liberalization of medical service prices.