Prosus to Target Online Care Startups for Elderly After Pandemic

(Bloomberg) -- Prosus NV is looking to expand its portfolio of health-care companies, in particular platforms that focus on the elderly, taking advantage of rising demand caused by the coronavirus outbreak.

The international e-commerce giant plans to expand on its pre-pandemic investment in a U.S. company called Honor that helps match home-care agencies to patients, Larry Illg, chief executive officer of Prosus’s Ventures division, said in an interview. The San Francisco-based startup raised $140 million in October in a fresh round of funding from new and existing shareholders including Prosus to accelerate growth.

“We have another investment in the pipeline that will hopefully come through in a few weeks,” said Illg, without naming the target. Prosus sees health care as having a similar potential to the company’s larger food delivery and online-education sectors, which have become cornerstones of the group’s strategy due to their ability to be transformed by internet technology, he said.

The Covid-19 pandemic has increased demand for all manner of health products and services, with care for the elderly and vulnerable a particular focus. Tencent Holdings Ltd. and SoftBank Group Corp. are among other tech giants to have invested in health-care companies in recent months, with the latter leading a $100 million September investment in a software startup that predicts problems for patients with heart conditions.

Customer Service

In the pre-pandemic world, the elderly-care market had some of the worst customer-service satisfaction of any industry, according to Illg, something he said internet companies are in a position to fix.

“It’s hard to imagine nursing homes in the way that they were pre-Covid,” he said. “The sector is going to change, and if we see other opportunities we can invest in those with more confidence.”

Prosus has about $4.3 billion in cash and is on the lookout for acquisitions, the Amsterdam-based company said last week. Deals to have eluded the group since its 2019 spin off from South Africa’s Naspers Ltd. include an $8 billion battle for Just Eat Plc, which was eventually won by Takeaway.com NV, while eBay Inc.’s classifieds business was acquired by Norway’s Adevinta ASA for $9.2 billion.

“The Just Eat opportunity for us was more about what we planned to do with the company, versus what we were buying,” Illg said. “We didn’t want to pay Just Eat shareholders for work we had to do.”

The coronavirus has sped up the behavioral shift of people sourcing the likes of food and education online rather than in shops and colleges, and something similar can happen with health, the executive said.

“Education, food, health care are just growing like gangbusters,” said Illg. “What happened with Covid is almost like you hop into a time machine and get to see what consumers will demand from these platforms in the future.”

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