Medical start-up collects 500 million euros

Cologne The French digital health company Doctolib is best known for its online booking for doctor appointments. It has now raised 500 million euros in a round of financing – and has suddenly become one of the most valuable digital health start-ups in Europe.

The money raised is to be invested primarily in the German business. Ilias Tsimpoulis, Germany boss of Doctolib, considers the German healthcare market to be the most important in Europe: “We know that our market share in Germany will probably be larger at some point than in France,” he says.

Doctolib was founded by Stan Niox-Chateau, who previously held shares in a company that makes online restaurant reservations possible. But not only in restaurants did the employees write down the appointments by hand, receptionists often still used pen and paper in doctors’ surgeries too. This gave Niox-Chateau the idea of ​​offering a service for arranging doctor’s appointments. Together with partners he founded Doctolib in Paris in 2013.

While patients know Doctolib mainly because of the SMS that reminds them of their next doctor’s appointment, doctors also use the Doctolib software to manage patient data. A doctor pays 129 euros a month for this. According to the company, 20,000 doctors in Germany are paying customers of Doctolib.

According to the company, a total of 50,000 healthcare professionals in Germany work with Doctolib, and 300,000 healthcare professionals worldwide. Doctors in private practices in particular use the services of Doctolib, but hospitals are also among the customers.

The data is stored in France and Germany in a cloud. They are end-to-end encrypted (E2EE) and, according to Doctolib, meet all the standards of the European General Data Protection Regulation (GDPR). The start-up cannot use it for its own purposes. In January, Doctolib acquired French company Tanker, which offers technology to secure sensitive data.

Other software providers dominate the market

So far, however, the Doctolib software has only been an upgrade to the practice management software (PVS) with which a practice operator organizes his everyday treatment. For example, he also uses the PVS to settle accounts with the health insurance company. Most of the money that a general practitioner spends on IT services therefore goes to the accounts of other IT companies.

For example those of CompuGroup Medical (CGM), the top dog among the PVS manufacturers in Germany. Last week, CGM presented the business figures for 2021 and announced an increase in sales of 22 percent to one billion euros. The Koblenz-based company earned the most money with the practice management software segment: 476 million euros. A 27 percent increase in sales compared to 2020.

David Matusiewicz, Professor of Medical Management at the private University of Economics and Management (FOM) in Essen, observes that the German market for the PVS is dominated by a few manufacturers. “It would be good if a new one came along,” he says. A second major PVS provider is Medatixx based in Eltville am Rhein.

Business area is “wasp’s nest”

Doctolib now wants to use the money collected to set up its own PVS. A clear challenge to the existing manufacturers. In this context, an insider speaks of a “wasps’ nest” and assumes that Doctolib will “evoke a big hello”.

But Doctolib could not only challenge German IT providers. The German medical practice has long since caught the eye of the European digital health economy. The Swedish video consultation provider Kry has been strengthening its presence in this country for several years and collected 262 million euros in venture capital last year alone. Polish healthcare provider Docplanner bought doctor rating platform Jameda in November 2021 to boost business in Germany.

The new Doctolib software should be able to do more than the software currently used by doctors. The can-do list reads like a legislative proposal from the home of former Minister of Health Jens Spahn (CDU), who has initiated numerous digitization laws for the healthcare system: There should be a Doctolib patient portal that patients can use online and before visiting the practice can transmit his data to the doctor. There should be a Doctolib patient file with which a patient can exchange data with the doctor. And there should be a Doctolib messenger that doctors can use to communicate with each other.

“We will push the development of the messenger between doctors and the exchange of documents between doctor and patient,” emphasizes Tsimpoulis. A fully developed PVS from Doctolib will not come onto the market this year.

IT talent competition

The crux for Doctolib and all tech companies in Germany is the acquisition of new employees. “That’s the biggest challenge,” says Tsimpoulis. 600 people are currently working for Doctolib at eleven locations in Germany. If you include the French and Italian locations, the company employs a total of 2,300 people. A total of 3,500 new employees are to be hired over the next five years, 1,000 of them in Germany. The tech team alone is expected to grow from 100 to 200 employees in Germany by the end of the year.

According to its own statements, Doctolib currently reaches 60 million patients. The majority of users come from France, according to the company, ten million patients use the Doctolib services in Germany. The company has also been active in Italy since last year.

The start-up is not yet profitable, says Tsimpoulis, but purely commercial profitability, as with many technology companies, has not been a goal in the past. US funds such as Accel and General Atlantic have invested in Doctolib. “Other well-known existing investors are also back.”

The lead investor in the current round is the financier Eurazeo, says Tsimpoulis. Eurazeo is a fund based in Paris and Luxembourg. “We can see that Doctolib is very successful in the markets,” emphasizes Zoé Fabian, Head of Germany at Investor Eurazeo.

If you include previous investment rounds, investors have invested a total of around 900 million euros in Doctolib, according to the company. According to the company, Doctolib is worth 5.8 billion euros. Is the stock market debut coming up? Doctolib would be the first digital health company in Europe to go public. “The IPO is not specifically planned,” says Tsimpoulis, “but of course it is a possible scenario.”

More: With fresh capital, Kry also wants to convince medical professionals of its offer in the complicated German market.