36Kr interview | Li Tiantian talked about Internet medical treatment: The epidemic dividend has fallen, and the entire industry is still in the early stages

"This is a once-in-a-lifetime opportunity."

At the end of 2020 and the beginning of 2021, some securities companies and investment institutions ran to Hangzhou to find Li Tiantian, chairman of Lilac Garden, and suggested that Lilac Garden must seize the market window period to quickly start listing. Lilac Garden financing has indeed reached the late stage, in 2020 to win the Trusttrust Capital led by Tencent and Hillhouse to invest in the $500 million Series E financing, the valuation of Lilac Garden is as high as tens of billions of yuan; in addition, in the past 3 years, Lilac Garden is still one of the few enterprises in the industry to achieve large-scale revenue and large-scale profitability.

However, after Li Tiantian considered it, he still did not catch up with this wave of "so-called once-in-a-lifetime opportunities", and in the wind outlet, Lilac Garden spent more time on the improvement of organizational capabilities and the landing of strategies.

After the outbreak of the new crown epidemic, Internet medical care has become an outlet industry, and companies have eaten the dividends of rapid completion of market education and soaring platform traffic; but since July 2021, the market wind direction has changed sharply, the stock prices of listed companies on the track have fallen sharply, and the listing of some star companies in the primary market has also encountered obstacles. Recently, the website of the National Health and Health Commission mentioned again in the document that the next step will focus on improving the "Internet +" medical service price and medical insurance payment policy, and promote the development of Internet medical services.

The industry has ups and downs, where is the way forward?

Li Tiantian, who has been in this field for more than 20 years, recently accepted an exclusive interview with 36Kr and shared some of his thoughts and judgments.

(The picture shows the three co-founders of Lilac Garden, from the left, Li Tiantian, Zhou Shuzhong, Zhang Jin)

In the past 20 years of entrepreneurial history, Li Tiantian led lilac garden seems to have embarked on a seemingly unique but simple Internet medical road: after accumulating the most and most active professional doctor resources in China, Lilac Garden integrates the professional capabilities of these doctors to output to the C-end and solve the health problems of ordinary users. Lilac Garden's "D" for doctor ("C" for consumer) strategy has served 2 million doctors and 80 million patients/the general public in China.

The following is a selection of li tiantian and 36Kr's dialogue:

"The epidemic dividend has fallen, and the market understands the industry better"

36Kr: A lot of companies are using OKR management, in 2022, what is your "Objective"?

Li Tiantian: My main work is two, the first is to have a better perception of the changes in the entire market environment, and the second is to promote the corresponding strategic landing internally according to our judgment of the market. My Objective can be summed up simply, which is to perceive the outside world and strategic landing.

36 Kr: What have you perceived in the past year?

Li Tiantian: The industry environment in 2021, I call it the decline period of the epidemic dividend. In fact, if you look at some of the changes in the secondary market that you see today, if you look at the epidemic dividend period in 2020, then 2021 is the decline in the dividend period brought about by the epidemic. This decline means that in 2020, there will be a sudden epidemic, and under the impetus of the epidemic, the Internet medical industry will actually have a wave of epidemic dividends. But in 2021, the dividend period will slowly decline and fall back to normal levels.

This time a year ago was a time when the market was very hot. I remember that at that time, some investment institutions and brokers came to us and said that this was a once-in-a-lifetime opportunity, and then said that Lilac Garden must seize such a window period to quickly start listing. But one of our judgments at that time was that this wave of so-called window periods, whether it was the wind outlet or the outlet, would not actually last long. Sure enough, in July last year, you can see a large decline in the entire Hong Kong market.

In December, there was a correction in the capital market that everyone could see.

36 Kr: Behind the fallback, what is the deep logic and reason?

Li Tiantian: I think one is the control of the epidemic, and the other is the gradual clarification of the business model.

The epidemic has been very well controlled in China, and the resumption of work and production has occurred rapidly. The original traffic dividend of a large number of people who have to go online to see a doctor, buy drugs, and consult a doctor has quickly changed from the original surge to a decline. Although after the fall, it does have a certain increase compared with before the epidemic, but it is completely different from the upsurge during the epidemic.

The second is the gradual clarity of the business model. The core logic of a business is actually to see what kind of effective solutions you bring to users and what kind of value you create.

If you go back to the entire Internet medical industry, then what you see now may actually be selling drugs or under various banners, but in fact, they are still doing the business of selling drugs. When these things are first proposed, the market is still interested in seeing or listening to them, but the market will also seriously think about and observe its business model. In 2021, the market raises more questions about selling drugs, or selling drugs on the Internet, is this thing sustainable? How can they compete with companies with very strong e-commerce genes like Ali and JD.com? Can a business like chronic disease management really get the support of medical insurance or commercial insurance?

By 2021, companies have actually handed over some of their own answers, and the market has seen some results. Whether it is listed or not, the market has a deeper understanding of these businesses, and the market has made its judgment and choice.

Upstream and downstream

36Kr: In some recent interviews, you divided the healthcare industry into upstream and downstream, what is the division?

Li Tiantian: Yes, we divide the medical and health industry into upstream and downstream, the downstream is actually more disease-centric, and the upstream is more health-centered. In the downstream, it is more about serving patients, facing the diagnosis and treatment of diseases, the supply of drugs, and so on, and I think these are valuable.

But when we analyze the industry, we believe that the downstream industry environment is more risky, more stringent regulation, stricter supervision, and lower frequency of users. Such an environment, in fact, will be very unfriendly to Internet companies like Lilac Garden, and we judge that the downstream may not be suitable for enterprises like us.

So we firmly go upstream, the upstream is more lifestyle-centered, it is not centered on disease, it is centered on the lifestyle of the masses, we pay attention to your health, your life, your habits, your travel, your work, including for example, the problem of baby,the problem of hair loss, the problem of overweight, the problem of the mouth, the problem of allergies, the problem of sleep, these problems are high-frequency occurrences in our lives, and these problems are more of a common small problem. Its risk is very low, so this piece is more suitable for companies like Lilac Garden to survive and explore.

36 Kr: Upstream and downstream, what are the respective landscapes?

Li Tiantian: I myself am a clinician, and I am very familiar with the downstream scene. Downstream is more of a hospital scene, everyone is doing is to find a way to prescribe drugs, do examinations, consultations and other hospitals of this set of things to copy online.

But in the past 7 years, we have continued to explore, slowly from the downstream to the upstream. Upstream scenes such as home, life, work, etc. These scenes may not have been so obvious before, but after the epidemic, in fact, these scenes have been greatly stimulated, there has been a strong growth, everyone pays more attention to the disinfection of hands, mothers hope that their babies are healthier, overweight people hope to be able to eat low-sugar, low-fat, low-calorie food. This is a big business scenario, for example, the biggest change that is happening in many consumer tracks is the desire to superimpose the attributes of health on their own products.

36Kr: There are rumors that digital marketing of medicine is the core business that contributes the most revenue to Lilac Garden, can it be understood?

Li Tiantian: Many of our businesses are actually still in an early stage of exploration, and it is not easy for us to make such a judgment that which piece of business is the core and which piece of business is non-core, but the value and significance of digital marketing is to help our corporate partners form a long-term partnership with Lilac Garden, and everyone explores together.

I have no way to disclose the exact numbers. But what I can say is that we've got more than half of our revenue.

Competition, moats and endgame

36Kr: Do you think there is irreplaceability for users?

Li Tiantian: I think that the irreplaceability of Lilac Garden is a series of important changes that we have completed in the past few years, which is different from the perception of many people in the industry about Internet medical companies.

When people often mention Internet medical treatment, they mention things such as consultation, drug sales, prescriptions, referrals, and chronic diseases. But we are completely different from these, if we use these businesses to define Internet medical treatment, I can say that we are not Internet medical companies. We are a provider of professional products and quality services in the field of health, we have completed the transformation from medical treatment to health, completed the transformation from downstream to upstream, and completed the transformation from the original simple public account to the comprehensive provider of products, services and content.

I think these three transformations are a very important thing for Lilac Garden, for our users, and can also answer your question, why no one can replace this thing, because today, all Internet medical companies are basically downstream, no one is upstream, Lilac Garden is a company that comes upstream.

Second, all companies do not have a "D+C" strategy like Lilac Garden. We have been doing it for more than 20 years on the doctor side, no enterprise in China has such an advantage and leading position, our influence and brand among doctors, as well as the help provided to doctors, in the whole industry, are number one, and no one has surpassed it so far. And we are still evolving, we began to take the doctor's high-quality resources to serve the C-side in the upstream demand.

This strategy is to make Lilac Garden different from the vast majority of Internet medical companies on the market. So for the user, does the user like it, and does the user approve of it? This can be seen from the ranking of our products, the scale of revenue, the scale of profits, etc., although I can't disclose it to you today, but one day you can see it.

36Kr: After spending so many years in the industry, have you ever met a very respectable opponent?

Li Tiantian: First of all, there is really no direct opponent. I think the whole track of the medical industry is very broad, and the upstream and downstream models are quite different. I judge that everyone in this industry is still in a relatively early stage, and everyone is still exploring their own models. The models I explore with each company are all about respect and learning. But in this process, I will still compare different companies, compare their styles, their strategic consistency, and whether the values they have adhered to over the years can really be reflected?

If you find that a company tells a different story every year, and does something different every year, I think it's quite confusing.

But for example, Like Wang Hang, a good doctor, for more than 10 years, he and Hu Shaoyu have been sticking to the online consultation, and can go to do it in a down-to-earth manner, and I respect him very much. He is not my opponent, he is my good friend, I feel that such a person is worthy of my study and respect.

36 Kr: Have you ever thought about a topic like endgame?

Li Tiantian: This is a very good question, because when we discuss the strategy earlier, we will think of the endgame problem that you just mentioned. At the end of the day, what exactly do we want? This question was actually figured out to us a few years ago.

Before 2019, the vision of Lilac Garden was called more health, less disease, more health, less disease. Why? Because the founders of our team are all doctors, we are excited when we see diseases, and we want to go up to treat patients, so I position the direction we want to go to the whole company to be more healthy and less disease.

This vision changed in 2019 because we believe that our end game is not less disease, but better life, so we changed the vision to healthier, better life.

I often tell our colleagues such a story, there are two people fishing in the river, fishing, suddenly a child in the river appeared and drowned, these two people quickly jumped down the river to save the child, before they could rest, found that a large number of children floated down upstream. One guy said, I'm not here to save the kids, I'm going to go upstream and see which bastard is constantly throwing the kids into the river, and what I'm going to solve is the asshole problem, and that's the endgame we're going to get to.

By establishing healthy habits and cultivating healthy lifestyles in the upstream, we can make the downstream diseases occur less, occur later, or even not occur, which is our destination and the end we are going to.

36 Kr: What is the biggest danger that Lilac Garden can encounter on the way to the endgame?

Li Tiantian: The biggest danger is that the ass is sitting crooked, and the ass is no longer sitting on the user's side, but sitting in other places, which is the biggest risk. Sit your ass on the user's side, this sentence, you must write to me in the manuscript.