The healthcare landscape in Southeast Asia is undergoing a rapid transformation, driven by technological advancements and evolving patient needs. A key player in this revolution is HD, a Thailand-based healthcare startup that has developed a comprehensive marketplace, HDmall, to streamline access to medical services across the region. In a significant endorsement of its innovative approach, HD has recently secured $7.8 million in equity funding, spearheaded by none other than U.S. pharmaceutical giant Merck Sharp & Dohme (MSD). This investment marks MSD's first foray into healthtech startups within the Asia Pacific region, signaling a growing recognition of HD's potential to reshape the healthcare industry.
This latest funding round, which also saw participation from SBI Ven Capital, M Venture Partners, FEBE Ventures, and Partech Partners, brings HD's total funding to $18 million. It comes less than a year after the company raised $5.6 million, demonstrating the strong investor confidence in its vision and execution. The funds will be strategically deployed to enhance HD's existing marketplace, further develop its cutting-edge AI technology, and expand its reach across Southeast Asia.
Addressing a Fragmented Healthcare System
HD's emergence comes at a crucial time for Southeast Asia's healthcare sector. Unlike Western countries with established family doctor systems, patients in emerging markets like Thailand, Indonesia, and Vietnam often navigate a complex and fragmented landscape, directly seeking specialized care in hospitals or clinics. This can lead to difficulties in finding the right services, understanding costs, and making informed healthcare decisions.
"The healthcare industry is quite different in emerging Southeast Asian markets such as Thailand, Indonesia, and Vietnam," explains Sheji Ho, co-founder and CEO of HD, in an interview with TechCrunch. "Without a family doctor system like in Western countries, patients often go straight to hospitals or clinics. This makes it difficult for patients to find the right healthcare services, know where to go, and understand how to handle the costs."
This lack of a centralized system, coupled with high out-of-pocket healthcare expenses and limited private health insurance coverage, creates a significant burden on individuals. Price sensitivity is high, and patients often struggle to compare services and make cost-effective choices. HD's platform addresses this challenge by providing clarity, transparency, and easy comparison of healthcare services from various providers.
The "Amazon of Healthcare"
HD's platform is designed to function as an "Amazon of healthcare," offering a wide range of productized services from various healthcare providers. Instead of simply listing individual doctors or offering appointment scheduling, HD enables hospitals and clinics to sell comprehensive service packages. "Our offerings range from health check-ups, cancer screenings, and IVF procedures to root canal treatments, HPV vaccinations, and surgeries like thyroid and hemorrhoid surgeries," says Ho. "This approach aligns with how most people in the region begin their healthcare journeys—by searching for specific services rather than individual doctors."
This approach caters to the specific needs and behaviors of patients in Southeast Asia, who often search for specific treatments or procedures rather than individual physicians. By aggregating these services and providing transparent pricing and comparisons, HD empowers individuals to take control of their healthcare journey.
AI-Powered Transformation
A key differentiator for HD is its strategic investment in artificial intelligence. The company has developed an AI chatbot, Jib AI, trained on a vast dataset of anonymized healthcare product data, transaction data, and chat commerce data. Leveraging advanced large language models, Jib AI handles nearly 60% of customer interactions, providing instant, high-quality, 24/7 support.
"After implementing generative AI technology in its marketplace, almost 60% of customer interactions are managed by AI agents, which deliver ‘high-quality, instant 24/7 response to customers’,” Ho explains.
Jib AI not only enhances the customer experience but also frees up healthcare professionals, such as nurses, doctors, and surgeons, to focus on delivering quality patient care. By managing initial triaging and care navigation tasks, the AI chatbot streamlines workflows and improves efficiency.
HD has ambitious plans to further enhance Jib AI's capabilities in the coming months. The company aims to add functionalities such as order and refund processing, assisted checkouts, scheduling, electronic health record checking, and medical information retrieval. Ultimately, HD envisions Jib AI evolving into a comprehensive AI-powered health assistant and enabling AI-driven asynchronous virtual care with expert physicians.
A "B2C2B" Strategy for Sustainable Growth
HD's strategic approach to market penetration is what they call a "B2C2B" strategy. This unique approach, inspired by Andreessen Horowitz, leverages HD's existing success in the business-to-consumer (B2C) market to transition into the business-to-business (B2B) space. By initially focusing on building a strong B2C foundation, HD gains valuable insights into customer needs and preferences, which it can then leverage to develop tailored solutions for enterprise clients. This strategy allows HD to pursue enterprise monetization from the outset, ensuring a more sustainable and scalable business model.
Challenging the Telehealth Trend
While many venture-backed healthcare startups in Southeast Asia have focused on telehealth and virtual health services, HD believes that this approach is not sustainable in the long run. "Post-pandemic, telehealth as a business model in SEA has encountered significant challenges and is rapidly losing favor among both consumers and investors," says Ho.
Instead of focusing solely on virtual care, HD takes a more holistic approach, addressing the broader challenges of healthcare access and affordability. By providing a comprehensive marketplace that connects patients with a wide range of healthcare services, HD offers a more robust and sustainable solution for the region's unique healthcare needs.
Expansion Plans and Future Outlook
With its recent funding round, HD is poised for significant growth and expansion. The company plans to increase its network of healthcare providers to 5,000 and serve 600,000 patients in 2025. In addition to expanding its reach within Thailand and Indonesia, HD has its sights set on entering Vietnam and Myanmar, where the healthcare systems share similarities with those of Thailand and Indonesia.
HD also plans to expand its network of external partners, focusing on insurance and pharmaceutical companies, as well as employers and educational institutions. These partnerships will enable HD to further integrate its platform into the broader healthcare ecosystem and offer more comprehensive and accessible services to its users.
The Merck Connection
The investment from Merck is a significant validation of HD's vision and potential. According to Ho, Merck's interest in HD stemmed from the startup's success in online sales of HPV vaccines. "MSD, which produces the HPV vaccines, reached out to [us] because we were already selling a lot of HPV vaccines online that were being administered at the hospitals and clinics we work with," Ho explains. "And if you look at the numbers, we [offer] the largest number for vaccines online in the markets."
This partnership with Merck opens up exciting new possibilities for HD, including potential collaborations on vaccine distribution, patient education, and other healthcare initiatives.
Empowering Patients in a Changing Landscape
HD's success is driven by its deep understanding of the unique challenges and opportunities in Southeast Asia's healthcare market. The company recognizes the growing trend towards self-empowerment in healthcare, with individuals increasingly using online tools and resources to research and make informed decisions about their care. HD's platform empowers individuals to take control of their healthcare journey by providing access to a wide range of services, transparent pricing, and convenient comparisons.
As the healthcare landscape in Southeast Asia continues to evolve, HD is well-positioned to play a leading role in driving innovation and improving access to quality care. With its innovative marketplace, AI-powered technology, and strategic partnerships, HD is transforming the way people access healthcare in the region and empowering them to make informed choices about their health and well-being.
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