French startup champion Doctolib struggles to expand abroad – BBC News

Doctolib is one of France’s startup success stories.

Founded in 2013 by Stanislas Niox-Chateau and his three co-founders, the software firm helps healthcare providers with administrative tasks, especially bookkeeping and administration.

Instead of having to contact practices directly, patients can use Doctolib to check availability and book a medical appointment online.

In a world where we put everything online, this may seem like a new trend, but in the slow, data-sensitive, bureaucratic healthcare industry, software and even any that can hope to simplify complexity and free up time is a welcome change.

Doctolib is free for patients. Doctors pay a monthly fee of €139 ($151; £120) to use the basic product, with various add-ons and upgrades available. There are also separate packages for hospitals and other doctors such as physiotherapists.

Already operational when the pandemic hit, Doctolib benefited from the sudden influx of telemedicine, and partnering with the French government to facilitate the announcement of the Covid-19 vaccine made for the company to become a household name in France.

The firm says it covers almost all French citizens, and was worth around £5bn at its last financial period in March 2022.

But replicating that success in other markets has proven challenging.

Doctolib expanded to Germany in 2016, but after eight years in the German market, the company has just started to gain traction.

Of the 900,000 healthcare providers and 80 million patients registered to use Doctolib, the Germans are responsible for 200,000 providers and 19 million patients.

Adapting the French central system to the German federal system was the first of many obstacles that tested the platform’s flexibility.

“There is none [one] Entering the German market,” says Nikolay Kolev, managing director of Doctolib Germany.

Each of Germany’s 16 states was a different market that the firm had to adapt to.

However, the problems that initially made it difficult to get off the ground in Germany also protected established companies and made it difficult for new competitors to pose much of a threat.

Dr Carol von Wildhagen, a medical doctor and healthcare business partner at Caesar VC in Munich who previously led the German arm of Platform24, a Scandinavian telemedicine provider, says systems are already closed in practice. they are also a major barrier to entry.

“Companies that make and sell many, many, many [practice management systems] they are built as fortresses, so it is very difficult to connect any third party software to the exercise doctor software. That makes it very difficult to deliver quality to the doctor,” he says.

“I can see how officials who were developing custom information systems would be worried … they could break down quickly because their systems are old, they look old, they’re old, they’re not easy to use, and they’re can be replaced by something cloud-based that focuses on user experience.”

“I think that the advantage of the home field always plays a big role in the European start-up area”, says Liam Boogar-Azoulay, who founded the French bilingual blog, Rude Baguette, in 2011, and now is the co-founder of Waypoint AI.

“Germans like to buy German companies and I think that cannot be overstated. It is the same in almost every country,” says Mr. Boogar-Azoulay.

Perhaps part of the reason for the silence about non-German companies, and the reluctance to embrace digitization in general, is the belief that only a local company will understand Germany’s desire for excellence of data protection.

Doctolib’s 2022 announcement of French data encryption startup Tanker may be a move to put data security-conscious minds at ease.

But Mr Kolev does not believe that data protection is the reason why the German system is slow to change.

“Security and privacy as much as possible should be our foundation if we really want to develop this industry. So I don’t think data privacy is a problem in the German healthcare market. I think it is more fax machines.”

He is not kidding. A 2023 survey by the German digital advocacy group, Bitkom, found that 82% of German companies still use fax machines regularly. In most cases, fax is the way to share medical information.

Increased digitization has been on the German national agenda for a long time. The German National Association of Statutory Health Insurance Physicians estimates that health care practices spend about 61 days a year on paperwork alone.

Doctolib transitions from paper to digital services.

“[Outdated tech is] not an insurmountable problem. It’s just an obstacle to adopting a child,” says Mr. Boogar-Azoulay.

“I think that having the tails of the French and having the market behind them, they will be able to throw the problem for a long time. It does not have to work well. They can lose money in the German market for years 10 just to remove that barrier of fax machines.”

And it’s easy to see why Doctolib is willing to invest heavily in making their German operation work. As Mr. Boogar-Azoulay points out, the market opportunity is “crazy”.

With Germany’s population of 84 million aging and the shortage of doctors growing, the health system needs extensive reform to ease the pressure and restore Germany’s reputation for prosperity.

The latest statistics available show that Germany will spend €495bn on health in 2023, about 13% of its total GDP. Germans visit the doctor 9.6 times a year, more often than other Europeans.

In 2022, German primary care doctors saw a weekly average of 254 patients, where their French counterparts saw around 114, UK doctors saw 110.

The lessons learned from the expansion to Germany are reflected in the way Doctolib approached the Italian market in 2021. Although the number of Italian users is still low, Doctolib found the Italian competitor Dottori.it that got the first place in the market.

And what about crossing the channel?

“The UK is really interesting. But as I said, Germany, France and Italy alone are 55% of the European healthcare market. So if you’re in a good position there, it’s already half the rent,” said Mr Kolev.