Featuring a business model that places it at the intersection between fintech and healthtech, the Brazilian Dr.Cash announced today a BRL 1.5 million Seed round co-led by early-stage venture capital funds Bossanova Investimentos, from Brazil, and Incubate Fund, from Japan – this is the first investment the Japanese company has made in a Brazilian company.
Founded in 2018, Dr.Cash started as a consigned credit startup, but quickly its co-founders, Lucas Hamú and Gabriel Meireles, realized that the consigned credit segment was already well served by other players and did not offer much room for innovation. Thus, the two decided to pivot to the health credit current model.
“We identified a fairly common problem in the health segment, which is the difficulty of receiving or selling procedures that health insurance don’t cover,” Hamú told LABS in an interview.
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The key point of Dr.Cash’s business is its B2B2C credit product to serve both clinics and hospitals, as well as patients. Through the startup‘s platform, the clinics and hospitals can simulate financing and offer Dr.Cash as a payment alternative to patients seeking medical, aesthetic, ophthalmic, and dental procedures.
“Our strategy is to reach clinics and hospitals so that they take us to their patients as a payment alternative to traditional methods, such as credit card, cash, or bank slips. We position ourselves as a payment method. Our biggest competitor today is the credit card, we work to make Dr.Cash more interesting than the credit card for both parties,” explained Hamú.
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Once the patient chooses Dr.Cash, the startup grants the loan, but the transfer is made directly to the clinic or hospital, and the patient pays the financing directly with Dr.Cash. Thus, fintech becomes a payment method for clinics and hospitals and a “Buy now, pay later” solution for patients.
Through Dr.Cash it is possible to finance from BRL 1,000 to BRL 10,000 up to 24 times. The startup operates the so-called clean credit, in which the borrower does not present guarantees, thus, the interest rates charged range from 2.5% to 4% per month.
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Today, Dr.Cash is present in more than 2,000 clinics and hospitals in all Brazilian states, and has already financed about 15,000 procedures, for a total of BRL 40 million. The startup does not disclose its absolute numbers, but, according to Hamú, it manages a default rate below the market rate and generates cash. The projection is to close 2021 with a credit portfolio of BRL 70 million.
Future: a hub of healthcare financial solutions
The Seed round, according to the entrepreneur, was sealed after months of talks and the investors were carefully picked. “Bossanova will bring us networking. The Incubate Fund has no prospects of exiting in the short term, which means they can be investors in future rounds and partners for a possible international expansion. We were able to compose this round with two complementary investors”, he analyzed.
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The newly injected capital will be invested on two fronts: team expansion (currently formed by 25 professionals) and technology development. In addition, new products are on the radar: besides financing procedures, the startup also intends to finance medical equipment and cash flow for clinics and hospitals, and enter the acquiring market.
“We will invest heavily in data intelligence for Dr.Cash to be an aid to clinics and hospitals in decision making with patients. In the long term, we want to be a hub of financial solutions for the health sector, diversifying the range of financial products.”