How did this Vancouver based Healthcare Company get the attention of Hong Kong investment and real estate legend, Li Ka-Shing?

Li Ka-Shing Healthcare Investment
Published on: May 27, 2019
Author: Wendy Zhang

Since the development of modern society, a functioning and efficient healthcare system has been a major goal of most countries. However, even the most developed countries have not been able to completely solve the problems of increasing doctors’ workloads and patient wait times.

The information revolution characterized by the internet, big data, artificial intelligence, etc. is revolutionizing human society and our collective lifestyle. In just one short decade, everyday people have realized the convenience that was unimaginable in the past in areas like entertainment, shopping and mobile payment.

WELL Health Technologies Corp. (TSX.V:WELL), a listed company in Vancouver, is one company that seeks to apply the benefits of the information revolution to the  field of healthcare; and also a company that Mr. Li Ka-shing, famous Hong Kong investment legend, invested in.

How does WELL use information technology to improve the medical service system? Where does WELL’s confidence come from? How is the project progressing? How did the company gain the attention of the legendary Asian business leader? With these questions, I interviewed Mr. Hamed Shahbazi, Chairman and CEO of WELL Health Technologies.

The founder with a successful resume meets a more successful venture capital fund

WELL Health Technologies Corp. (TSX.V:WELL) specializes in acquiring integrated quality primary care clinics and upgrading the integrated operations of the clinic through information technology to provide better services to doctors and patients and to increase the revenue and margins of its individual clinics.

In February 2019, the company announced that it would sell up to 5.9 million shares at a price of $0.46 Canadian dollars per share through private placement, and completed the financing of $2.728 million Canadian dollars. The investors involved in the financing include Mr. Li Ka-shing’s Horizons Ventures Limited and members of WELL’s management.

In fact, in April 2018, after Mr. Li Ka-shing announced his retirement, he subscribed for 22.17 million shares of WELL at a price of 0.33 Canadian dollars per share. Although the 90-year-old man started his career with traditional industries, his investment in emerging technology is also praised by the world. In the past ten years, Li Ka-shing has invested in high-tech early-stage projects through Horizons Ventures Limited and participated in a number of the most iconic and innovative projects of the era, including Facebook, Siri, Skype, Spotify, Impossible Foods, Chromadex. and Modern Meadow.

Of course, Hamed Shahbazi, the founder of WELL, is successful in his own right. He has more than 20 years of successful technical operation experience. In 1997, Shahbazi founded TIO Networks (TSXV:TNC), and later transformed it into a multi-channel payment solution provider specializing in bill payment and other financial services. In 2014, TIO was named the “Stock of the Year” and in 2017, Shahbazi was awarded in the  mid-market category for Business in Vancouver’s BC CEO Awards. In July 2017, TIO Networks was acquired by PayPal (Nasdaq: PYPL), the originator of global electronic payment, with a purchase price of $304 million.

Shahbazi has not stopped in the field of electronic payment. In this global wave of information technology upgrading traditional industries, medicine is one of the oldest industries in society. Due to various operational factors the overall practice of medicine remains much like it always has.

However, where there is a pain point, there is an opportunity. With the desire to make the world a better place, Shahbazi expanded from the payment field to the healthcare sector, chose the business of medical clinics as his direction, and founded WELL Technology Company. Since February 2018, Hamed Shahbazi has invested more than $3.37 million Canadian dollars in the company, with a total investment of more than $4 million Canadian dollars.

In our interview, Shahbazi stated:

“We’re very pleased to have Mr. Li’s and Horizon Ventures’ support. Our management team is working hard to provide shareholders with a strong return by pursuing a very focused and disciplined mergers and acquisitions strategy not only allows us to accumulate profitable assets in The healthcare industry but also allows us to improve interoperability and modernization. We are absolutely committed to utilizing enhanced digitization in healthcare to improve health outcomes.”

Integrating Medical Clinics with Advances in Information Technology

WELL’s model is not complicated. It integrates well-operated primary health care services through acquisitions, and then introduces disruptive technology trends such as artificial intelligence and big data into the health field, as well as establishes a unified health information platform to improve the operational management of its clinics. In Hamed’s words, WELL is “full-heartedly committed to digital applications in the healthcare sector to improve the operational efficiency of healthcare.”

More generally speaking, WELL mainly enhances the quality of medical services through new technological means, such as shortening the waiting time for medical treatments, improving communication between doctors and patients, and developing online a medical treatment technology platform to assist doctors with remote diagnosis.

In January 2019, WELL completed the acquisition of the NerdEMR Service, which provides OSCAR (Open Source Clinical Application Resources) electronic medical record (EMR) services and support to approximately 220 clinics and more than 2,000 physicians. Most of these clinics are located in BC.

In our interview, Shahbazi stated that he is very excited about the possible changes in the patient’s electronic medical record (PMR). In the traditional doctor-patient relationship, the patient is in a completely passive state and only after getting sick does the patient go to the doctor; a model that is not particularly conducive to the improvement of personal health management. WELL hopes that patients can gain a deeper understanding of their personal health through PMR and be more proactive in managing their health, which will also reduce the overall workload of healthcare providers.

Data Talk

In 2019, WELL shares ranked second in the diversified industry in the top 50 of the TSX Venture Exchange. The 2019 TSX Venture 50 (2019 TSX Venture 50) refers to the best performing stock on the TSX Venture Exchange last year, consisting of 10 companies in each of the five industries, according to three equal weighting criteria for market value growth, stock price appreciation and trading volume.

For investors, it may be possible to get a clearer picture of WELL through its recent operational progress. WELL currently owns 19 clinics and provides digital electronic medical record services; it has an information network of more than 230 medical clinics serving more than 5 million patients and 2,000 registered doctors.

According to the company’s latest financial report, the continuing operating income for the 14 months ended December 31, 2018 was $10.56 million, and the gross profit margin of continuing operations was 29.7%. All of the continuing operating income comes from the medical expenses of its 19 clinics . For the two months ended December 31, 2018, the income from continuing operations amounted to 4.626 million Canadiandollars.

Looking at the stock trend (figure), in April 2018, Mr. Li Ka-shing bought the first price of 0.33 Canadian dollars. Under his influence, the stock price set off a small climax, and then returned to the second time in February 2019. The entry price is 0.46 Canadian dollars, and the price has remained at around 0.7. According to this, the book profit of Li Ka-shing’s first investment has exceeded 100%.

Li Ka-Shing Healthcare Investment

(Source: QuoteMedia)

WELL Health Technologies Corp. (TSX.V:WELL) is worthy of investors’ attention in the medical services industry market, Hamed Shahbazi’s experience in information technology and corporate mergers and acquisitions, and Li Ka-shing’s endorsement.

Healthcare Services Life Science

Wendy Zhang