Yaobili (药便利), a Beijing-based SaaS company focusing on drug delivery and distribution services for Chinese pharmacies, undertook its Series A funding round worth around CNY 30 million (the equivalent of around USD 4.5 mn), led by unicorn-hunter GGV Capital and XPeng's (小鹏汽车) founder and CEO He Xiaopeng He Xiaopeng (何小鹏).
Although the amount seems insignificant, by industry standards, it affords a glimpse into the evolving drug delivery scene in China. Yaobili and several other companies are now taking the lead in the application of SaaS and enterprise service technologies in the healthcare industry. Indeed, the applications wide, varying from biotech via drug-developing support software to the services through drug-distribution tools.
The one-year-old SaaS company serves for Chinese pharmacies by facilitating their drug distribution mechanism, an industry that has generated over USD 241.4 billion total sales volume in 2018, and private pharmacies made up USD 55.2 billion of it.
Yu Jun (余俊), CEO of Yaobili, has a nose for emerging and exponentially expanding businesses. Surprisingly, he has no prior experience in healthcare. Previously a strategic investment manager at GGV and IDG Capital, he has held a remarkable portfolio of investments in the US, including financing of TMT companies that later flourished, according to information obtained by EastMoney Securities. Yu is also known for his friendship with XPeng's He Xiaopeng.
Unlike in the US, the Chinese drug delivery scene/market is dominated by IT, retail and insurance giants. "It is almost impossible and too costly for small and medium-sized pharmacies to reach the end-customer without those intermediary drug delivery giants,” says Yu of Yaobili. "Yaobili will empower the pharmacies and help them to build their own distribution and smart inventory systems,"
The company is in a favourable position to land a spot on the PingAn―backed Rongrand (融贯电商) and the former GGV star investor may have found a venture, yet again, that promises lofty returns. However, his company might not be able to survive competition with behemoths such as Alibaba and JD are. What's more, whether there is a genuine market demand for the company's services remains to be seen.