Waterdrop Inc. raised money, presumably many people have donated tens of millions of money on this platform.

In the first three quarters of this year, about 420 million people in China donated 55.4 billion yuan to nearly 2.7 million patients on Waterdrop Inc. 's platform, with an average of 131.9 yuan per person.

Waterdrop Inc., the operator of Waterdrop Inc. 's platform, has successfully gained popularity and gathered a large amount of traffic since it launched "Waterdrop Inc. Love chips" (later renamed "Waterdrop Inc. chips") in 2016. To this end, Waterdrop Inc. launched the insurance brokerage business and the third-party patient recruitment platform, which made the business larger and larger, and finally successfully landed in the US stock market in May last year.

Recently, Waterdrop Inc. released three quarterly reports, a report card with an obvious positive trend.

Make a strong turnaround and narrow the year-on-year decline in revenue

Waterdrop Inc. 's three quarterly reports can be summed up as follows: a substantial reduction in various expenditures has improved profitability, while the main insurance business is still facing the dilemma of sluggish growth. Overall, Waterdrop Inc. 's report card improved, which pushed the company's share price up 13.66% on Dec. 6.

According to the three-quarter report, Waterdrop Inc. achieved revenue of 772 million yuan (RMB) during the reporting period, down 0.9% from a year earlier and an increase of 10.1% month-on-month. We compared the revenue performance of Waterdrop Inc. Company in a single quarter since the first quarter of 2021, and found that from the third quarter of 2021 to the second quarter of 2022, Waterdrop Inc. 's revenue declined seriously compared with the same period last year, and the month-on-month growth rate was also dragged down. the reason is that the country was hit by the epidemic at that time, and the slowdown in consumer demand for insurance led to unprecedented pressure on the industry.

Judging from the year-on-year and month-on-month growth in revenue, Waterdrop Inc. 's revenue in the third quarter of this year has picked up and returned to the level of the first half of 2021, of which the year-on-year growth was almost positive.

At the level of net profit, Waterdrop Inc. made a strong turnaround in the third quarter, with a net profit of 169.6 million yuan, compared with a loss of 477 million yuan in the same period last year. As for the ability to reverse losses, it is due to Waterdrop Inc. 's "austerity".

In the third quarter of last year, Waterdrop Inc. thought it was time to reduce operating costs and expenses to make a profit as the company improved the operational efficiency of the platform and achieved greater economies of scale.

To this end, Waterdrop Inc. continued to maintain a low level of expenditure in the third quarter of this year on the basis of continuously reducing operating costs in previous quarters. During the reporting period, Waterdrop Inc. 's operating costs and expenses were 639.6 million yuan, a sharp drop of 50.5% compared with the same period last year. Among them, Waterdrop Inc. mainly reduced its marketing expenses, with sales and marketing expenses falling sharply by 82.4% to 137.9 million yuan during the period compared with the same period last year.

Although Waterdrop Inc. 's overall income has picked up while reducing marketing expenses and other expenses, the growth momentum of the company's insurance business has been weakened by this.

During the reporting period, Waterdrop Inc. expanded its insurance product portfolio from 454 at the end of June this year to 536 at the end of September. However, these measures are also difficult to stop the downward trend of insurance business income.

In the third quarter, the company's insurance-related business income was 693.5 million yuan, down 8.6% from the same period last year, mainly due to the decline in insurance brokerage income.

Therefore, whether the future operating efficiency and economies of scale can support Waterdrop Inc. to achieve sustainable profitability is still open to question. In the case of substantial reduction in marketing expenses, Waterdrop Inc. 's insurance business may still face some resistance to growth.

Waterdrop Inc. raised a loss-making public welfare project.

Waterdrop Inc. chip is Waterdrop Inc. 's start-up business, and it is also an important platform for Waterdrop Inc. to expand its market popularity.

Waterdrop Inc. Company is through Waterdrop Inc. Insurance and Waterdrop Inc. to raise the first "serious illness fund-raising + life insurance" model, supplemented by the patient recruitment platform, so as to achieve the expansion of business.

Before 2022, Waterdrop Inc. did not charge patients for fund-raising and took the route of pure public welfare.

While collecting donations for seriously ill patients to help, Waterdrop Inc. 's chips are often questioned as "black money". In August this year, the news in the market that "Waterdrop Inc. 's fund-raising agency took up to 70%" made Waterdrop Inc. Company involved in a storm of public opinion.

Shen Peng, CEO of Waterdrop Inc. Company, once responded that Waterdrop Inc. chip not only did not collect handling fees, but had cumulatively subsidized more than 100 million yuan in payment channel fees, and Waterdrop Inc. was established to continue to subsidize Waterdrop Inc. 's operation by other business profits of the company.

However, as Waterdrop Inc. 's daily operation requires a large amount of expenditure, in order to reduce losses, Waterdrop Inc. began to try out the "crowdfunding service fee" in April this year.

Starting from April 7 this year, Waterdrop Inc. stopped fully subsidizing the relevant fees and began to charge a service fee of 3% of the amount raised, with a maximum amount of 5000 yuan per event. Waterdrop Inc. said: taking into account the specific circumstances of each case, Waterdrop Inc. chips may selectively subsidize the service fees of some patients in extreme need.

In the third quarter of this year, Waterdrop Inc. raised a service charge of 59 million yuan, but this did not make a profit. In the current period, the operating cost of the crowdfunding consultant team is 63.7 million yuan, and the service fee income raised by Waterdrop Inc. is not enough to cover the operating cost, so the loss of the business is inevitable.

Although it is not easy for Waterdrop Inc. to make a profit, Waterdrop Inc. is not the ultimate goal for Waterdrop Inc. company to make a profit. The fund-raising platform raised by Waterdrop Inc. has gathered a large number of patients, so drug companies will be interested in cooperating with them; on the other hand, Waterdrop Inc. can use these patients to carry out precise marketing to transfer users to its Internet insurance platform, giving the company the opportunity to cooperate with insurance companies.