Dingdang Kuaiyao, China’s leading online-to-offline (O2O) pharmacy app, said it has raised 1 billion yuan (US$150 million) in a B+ funding round, amid continued growth as the Covid-19 pandemic accelerates development of China’s online health care market.
The round involved investment from Dingdang Kuaiyao’s previous backers including Softbank China, China Merchants Bank’s investment arm CMB International, and Sinopharm-CICC Capital, according to a statement on Tuesday by Dingdang Kuaiyao. The company’s last funding announcement was in March last year when it raised 600 million yuan in its series B round.
“The new round of funding will be mainly used to accelerate the company’s rollout in China’s urban areas, by expanding its service to 10 more cities in mainland China by the end of this year, and covering all of China’s first, second, and third-tier cities in 2021,” Yang Wenlong, Dingdang Kuaiyao’s founder and CEO said in a statement sent to the Post.
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China’s e-commerce giants Alibaba and JD.com also have their own O2O medicine retail businesses which promise deliveries as fast as 30 minutes to an hour. Dingdang’s offline pharmacies are also listed on delivery giant Meituan’s services platform.
The investment comes as the impact of Covid-19 accelerates a wide swathe of online activity, from e-commerce to work-from-home, gaming and online health care. Revenue in China’s online health care market is expected to reach 200 billion yuan in 2020 from 133.6 billion yuan in 2019, according to a report this June by Beijing-based research firm Analysys, citing the pandemic, 5G, and the internet of things as growth drivers.
Founded in 2014 and launched in February 2015, Beijing-based Dingdang Kuaiyao provides a combination of online and offline pharmacy services, including medicine delivery. The company promises to deliver over-the-counter medicines to clients within 28 minutes in a certain radius, 24 hours a day, and offers an online medical consultation service.
It operates its own offline pharmacies in over 10 major Chinese cities including Beijing, Shanghai, and Guangzhou and has partnered with more than 600 pharmaceutical companies worldwide including Bayer, GlaxoSmithKline, and Kobayashi.
Since January, Dingdang says it has had a 700 to 800 per cent increase in deliveries compared to before the pandemic, although it declined to say how many current users it has.