XiaoCheng Group Secures Tens of Millions in Strategic Financing to Accelerate Digital Healthcare and Elderly Care Layout
VCBeat has learned that,Tianjin Kanghu Pension Industry Development Co., Ltd. (hereinafter referred to as “Kanghu Group”) has recently completed a new round of strategic financing amounting to tens of millions of yuan.In the first half of this year, Xiaocheng Group disclosed that it had completed a nearly RMB 100 million Series A financing round, led by a prominent industrial investor and followed by institutions such as Citron Capital. The successful closure of this funding marks another acceleration in Xiaocheng Group’s development within the elderly care sector.
As Tianjin Kanghu Pension Industry Development Co., Ltd. continues to develop, its competitive advantages are increasingly coming to the fore. Its delivery of high-quality nursing and elderly care services, exploration of innovative models such as providing novel care products and leasing assistive devices, and construction of a digital ecosystem have all further driven its leapfrog development, bringing new solutions to the field of elderly care—a sector facing significant challenges.
Behind investors’ optimism lies not only recognition of the growth prospects in the sector where Xiao Cheng Group operates and affirmation of its phased development achievements, but more critically, acknowledgment of the core competitiveness built upon its “product + service + digitalization” model.This round of investment will further enhance Kanghu Group’s capabilities, promote the multi-regional expansion of its “product + service + digitalization” model, accelerate the deployment of its digital healthcare and elderly care services, and better serve the elderly population and society at large.
As a provider of digital healthcare solutions integrating “smart elderly care products, elderly nursing services, and a digital medical-care platform,” Xiaocheng Group adheres to its mission of “serving society, leading innovation, and ensuring that all seniors have support and enjoyment,” with the vision of “becoming a leading brand in China’s health and elderly care industry,” while deeply cultivating the smart elderly care sector.gradually forming a development pattern with the North as its base and radiating across China.
Currently, Xiao Cheng Group has established a service network covering 12 provinces and 26 cities across China, serving nearly 40,000 households, and has become one of the largest domestic home-based elderly care and rehabilitation service providers in Northern China.Additionally, according to disclosures from the Xiaocheng Group, its revenue exceeded RMB 200 million in 2022.
This achievement is closely tied to Xiaocheng Group’s construction of a closed-loop elderly care ecosystem based on its “product + service” model.
From a product perspective, Tianjin Kanghu Pension Industry Development Co., Ltd.’s diversified product portfolio fully meets the diverse needs across various scenarios.Since its inception, Xiaocheng has entered the elderly care and rehabilitation services market with products such as nursing beds and rehabilitation aids, leveraging its strong capabilities in product R&D, manufacturing, and supply chain integration. Its age-friendly product portfolio includes nursing robots, millimeter-wave vital signs monitors, rehabilitation aids, nursing supplies, and foods for special medical purposes. To date, Xiaocheng has launched over 100 categories of health and wellness products, with application scenarios covering hospitals, elderly care institutions, and homes. These products cater to a wide range of users, including elderly individuals who are disabled, partially disabled, or living with dementia, as well as those suffering from various chronic or critical illnesses.
In the process of promoting innovative age-friendly products, Xiaocheng Group has gradually expanded its business landscape and, leveraging its inherent culture of innovation, has endowed each business module with a new “powertrain.”
One is the assistive device rental business.As long-term care insurance gradually implements measures to “raise reimbursement rates, expand coverage, and enrich benefit packages,” the population eligible for benefits has expanded from urban employees with severe disabilities to include those with moderate disabilities, urban and rural residents, and individuals requiring assistive device rentals. In response to users’ varying needs at different stages, Xiaocheng Group addresses the conflict between high product unit prices and usage demands through an assistive device rental model. Having won bids for assistive device rental projects in multiple regions, Xiaocheng Group has successively established several sterilization centers and 41 assistive device rental service outlets across various cities, providing services such as needs assessment, equipment configuration, and equipment recovery and sterilization.
The second is the business of age-friendly renovations.Under the “9073 model,” a large number of elderly individuals age in place, and Tianjin Kanghu Pension Industry Development Co., Ltd. (Xiaocheng Group) provides risk factor identification and home modifications for those aging at home. The deployment of smart devices, such as millimeter-wave health monitors, also creates entry points for the company to expand its follow-up services.
In terms of services, Tianjin Kanghu Pension Industry Development Co., Ltd. provides high-quality services to individuals in need of nursing and elderly care through its professional service platform.
Since its establishment in 2017, Tianjin Kanghu Pension Industry Development Co., Ltd. (Xiao Cheng Group), as a long-term care service provider, has accumulated extensive industry experience in the delivery of long-term care services. The company has solidified its presence in the Tianjin market and rapidly expanded its service model to other regions. To ensure high-quality service delivery, Xiao Cheng Group collaborates with professional associations to lead and formulate industry standards through the “Home-based Elderly Care Service Specifications.” Furthermore, it cultivates and assesses personnel through standardized training and evaluation systems, while implementing rigorous quality control via SOP-based process management.
Among these, a particularly critical component is Xiaocheng Group’s ability to precisely reach service demanders and efficiently match user needs by building a comprehensive service chain. Furthermore, backed by a nursing care team of thousands and full-process traceability of services, Xiaocheng Group ensures the quality of its offerings. By delivering high-quality services, Xiaocheng Group truly empowers seniors to enjoy a high-quality life at home. Notably, this precise outreach to user needs has also created opportunities for Xiaocheng Group to expand the market for its innovative products.
Under the “product + service” model, the provision of long-term care and other elderly nursing services, along with age-friendly smart products, creates an effective “dual-wheel drive” that enables mutual conversion, facilitating rapid business expansion and swift revenue growth.
The current situation in the elderly care sector remains severe.
The "Report on the Development of China's Elderly Care Industry (2021-2022)," released by the China Research Center on Aging, points out that by the end of 2022, the number of elderly people aged 60 and above in China reached 280 million, among whom approximately 44 million were disabled or semi-disabled. A previous demographic study by Peking University further indicated that by 2030, the number of disabled elderly in China will exceed 77 million, with an average disability period of 7.44 years. This signifies substantial demand and challenges in fields such as elderly care and nursing.
Meanwhile, this sector, characterized by substantial unmet demand, also boasts significant market potential. “As of the end of June 2023, the number of participants in the long-term care insurance (LTCI) system reached 170 million, with over 2 million beneficiaries having received benefits to date, and cumulative fund expenditures amounting to approximately RMB 65 billion.” With the rapid implementation of LTCI across China, the standalone market for long-term care services alone could reach a scale of hundreds of billions of yuan.
In response to market pain points and demands, Xiaocheng Group has stated that it will address the current challenges in the elderly care sector by leveraging its “product + service + digitalization” model. Through continuous exploration of a digital ecosystem, the company aims to deliver effective solutions to the industry. Furthermore, by harnessing its technological innovation capabilities and innovative business models, Xiaocheng Group seeks to better empower the development of the entire elderly care service ecosystem.
Clearly, digital innovation that integrates a “product + service” ecosystem is better positioned to address the current challenges.Meanwhile, Xiaocheng Group is continuously enhancing its capacity to deliver services at scale through internal and external digitalization.Leveraging digitalization as a core enabler, Tianjin Kanghu Pension Industry Development Co., Ltd. (Xiaocheng Group) has established an integrated management and service standard system that synergizes online and offline operations through platform development and data accumulation. Building on this foundation, the company has fostered a virtuous ecosystem where products and services mutually reinforce each other, thereby constructing a comprehensive commercial closed loop for smart elderly care.
From the perspective of internal digitalization, operational efficiency has been further enhanced.By streamlining its operations, Xiao Cheng Group has built key digital subsystems centered on its core business. Leveraging these digital systems, the Group has secured rapid expansion across 12 provinces and 26 cities, while laying the groundwork for swift entry into new markets and large-scale growth.
From the perspective of external digitalization, it facilitates the expansion of service capability boundaries.In addition to achieving scalable service capabilities through digital means, Tianjin Kanghu Pension Industry Development Co., Ltd. (Xiaocheng Group) is enhancing its proactive service capabilities based on its home-based elderly care monitoring and service platform. For instance, the company leverages a digital training platform to standardize and export its services externally. Furthermore, driven by its understanding of interoperability, Xiaocheng Group, as a provider of long-term care insurance services, is actively promoting the integration of information systems among medical insurance authorities, insurance companies, and service institutions.
More importantly, while continuously accelerating the layout of a digital healthcare and elderly care ecosystem through digitalization, Tianjin Kanghu Pension Industry Development Co., Ltd. (Xiao Cheng Group) is also integrating more resources to build a diversified elderly care ecosystem. By continuously merging medical care, nursing, pharmaceuticals, and insurance, the company provides comprehensive services and contributes its strength to fields such as elderly care and nursing.
Following the completion of this financing round, Tianjin Kanghu Pension Industry Development Co., Ltd. stated that 2024 is a pivotal year for the development of China’s elderly care sector. Driven by both the optimization and iteration of its business model and capital support, the company is confident in rapidly transforming its “product + service” model into a comprehensive elderly care ecosystem platform. By integrating resources from policy makers, the industry, and upstream and downstream partners, it aims to seize the opportunities presented in this critical year to achieve rapid growth.