Hospital Services Provider Kedu Raises USD 60 Million
The Chinese healthcare industry is flourishing, with more investors showing more confidence in the sector, mainly in the costly medical equipment services sector.
Shanghai-based healthcare services provider Kedu Healthcare Tech (柯渡医学科技) announced that it has carried out its Series C funding round, worth USD 60 million, led by China Merchants Capital Investment (招商局资本, a subsidiary of ‘China Merchants Group’).
The fundraising also saw participation from Singapore investment firm UOB Venture Management, Israel VC firm Infinity Group and Beijing-based PE investment firm Morale Capital (茂榕投资).
Founded in 2006, Kedu mainly focuses on providing medical device and supply chain management services to hospitals and healthcare-related enterprises. The company claims to have under management hospital assets worth more than CNY 50 billion, which cover nearly 3,000 customers. Other services include installation and maintenance.
Ma Meifang (马美芳), the CFO of Kedu, said that, in the past four years, the healthcare services provider experienced rapid growth, with revenue quietly tripling in that time. In 2018, the firm’s sales revenues reached a record of over CNY 1.5 billion (USD 210 million ), with a CAGR projected to reach 45% in the next three years, according to Kedu’s official website.
Such a remarkable growth pattern, according to the Kedu CFO, is due to the firm’s ‘Kedu-model,’ which mainly offers intelligent life-cycle management services for hospital medical equipment.
The Chinese healthcare industry is making its way into the new era of development, with tens of millions of dollars injected into the industry, particularly in the arena of medical devices. In 2016, the Chinese medical device market was worth USD 53.63 billion.
Early July, Chinese counterpart, medical imaging (MI) service provider, Rimag (一脉阳光), secured its Series C funding round worth ‘hundreds of millions’ led by PICC. In 2018, it managed to raise USD 64 million from internet giant Baidu (BAIDU: NASDAQ). Despite the company offers similar healthcare services as the Kedu, it differentiates itself by focusing its business on the medical imaging cloud service platform.
China's medical device market is being buoyed up by recent massive investment; the sector requires an enormous amount of capital, especially for R&D departments. Capital flows seem to be the central ‘driver’ behind new discoveries and innovation, and more may well be needed to achieve breakthroughs.
Will the investors continue to take risks and inject the capital needed? Well, looking at past trends, more capital flow is expected in an expanding market that addresses fundamental human needs.