Following the Lunar New Year, an exceptionally profitable company is charging into the capital markets. Tangji Medical, a star player in the weight-loss sector renowned for its non-invasive endoscopic minimally invasive therapy that helps people lose weight without medication, surgery, or injections, has submitted an IPO application to the Hong Kong Stock Exchange. Industrial and Commercial Bank of China International and Caitong International are serving as joint sponsors. If successful, this would mark the debut of the first endoscopic weight-loss company on the Hong Kong exchange.
Founded in 2016 and headquartered in Hangzhou, Tangji Medical was established by Zuo Yuxing, a former gastroenterologist at a local hospital. Through his work, Zuo regularly encountered patients with obesity and diabetes. Although a doctor, he did not advocate for complete reliance on drug therapy, believing that diabetes is closely linked to obesity. He aimed to develop a new treatment to alleviate patient suffering.
Zuo, considered a maverick in the medical field, conceived an innovative idea: using endoscopy to simulate the physiological effects of gastric bypass surgery, thereby achieving weight loss and metabolic improvement. Simply put, the technique redirects food to bypass part of the small intestine, reducing nutrient absorption and regulating gut hormones to promote weight loss. This bold vision led Zuo to dive into entrepreneurship, hoping to free diabetes and obesity patients from their struggles.
This novel weight-loss approach astonished venture capital and private equity firms focused on technology and healthcare. Investors were surprised that a transformative new technology emerged from a determined, "ordinary" entrepreneur driven by his dream. Capital poured in rapidly, with prominent domestic institutions such as Baidu Ventures, Dingxin Capital, ZJU Friend, Langmafeng Venture Capital, Chengdu Venture Capital, and Guolian Investment participating in over ten funding rounds for Tangji Medical. The company's valuation surged more than 25-fold within a few years, stunning the medical and weight-loss industries.
Even more impressive is its profit margin. The company maintained a gross margin of 78.7% in 2025, surpassing that of pop toy retailer Pop Mart (70.3% in the first half of 2025) and approaching the level of premium liquor giant Moutai, a favorite among middle-aged consumers. Despite its impressive margins, Tangji Medical faces financial challenges. As of the end of September 2025, its debt-to-asset ratio reached 136%. The firm urgently needs capital infusion from public market investors to expand its market presence and revenue scale to turn its fortunes around. This Lunar New Year heralds the arrival of a highly profitable IPO.
Amid a wave of listings by prominent companies on the Hong Kong exchange, a weight-loss IPO is making its mark. The Hong Kong IPO market continued its strong momentum from 2025 into 2026. By late February, over 147 companies had submitted listing applications to the Hong Kong Stock Exchange. Most of these firms operate in globally trending hard tech sectors, such as AI-focused companies like Biren Technology, Zhipu AI, and MiniMax, fueling market excitement.
Third-party institutions are optimistic about Hong Kong IPOs. UBS, Deloitte, and PwC predict that the total funds raised through Hong Kong IPOs in 2026 will not fall below HK$300 billion, potentially ranking among the top three globally. The booming Hong Kong market primarily benefits VC/PE firms and entrepreneurs. According to analysis by the research arm of investment media, over 60% of companies newly listed on the Hong Kong exchange in 2025 had VC/PE backing. These investors recorded over RMB 58.2 billion in paper exits. Sequoia China, a leading VC firm, was among the biggest winners, also backing the potential "first humanoid robotics stock" eyeing a listing this year.
While VCs and PE firms reap profits, entrepreneurs are soaring to new heights. A Baidu Wenku report noted that due to robust IPO and "A+H" share activity in 2025, mainland China added 70 new billionaires, bringing the total to 470, ranking second globally. This growth is primarily driven by technological innovation and consumption upgrades, with 98% of these billionaires being entrepreneurs concentrated in AI, genetic technology, new energy, and new consumer sectors. Consequently, entrepreneurs yet to list are striving to go public in 2026 to create wealth.
Interpreting the term "wealth creation" through an AI lens suggests "ordinary individuals achieving success through entrepreneurship and listing." However, among the hard tech IPOs queuing in Hong Kong, few founders fit the "ordinary" label. MiniMax founder Yan Junjie gained fame early, holding a Ph.D. from the Institute of Automation, Chinese Academy of Sciences, and conducting postdoctoral research at Tsinghua University's Computer Science Department. After working at SenseTime, he embarked on entrepreneurship as an established tech figure. Zhipu AI founder Tang Jie was a professor at Tsinghua's Computer Science Department before starting his company. Biren Technology founder Zhang Wen comes from a privileged background, holding a J.D. from Harvard University, an MBA from Columbia University, and previously practicing law in the U.S. These entrepreneurs can hardly be considered "ordinary" in the conventional sense.
In the venture capital world, success for "ordinary" individuals is challenging. The VC/PE mantra of "betting on the person" often prioritizes founders with "top" academic credentials, professorial status, technical expertise, or executive experience at major firms. Yet, exceptions exist. Tangji Medical's founder Zuo Yuxing exemplifies the "ordinary" entrepreneur achieving a remarkable turnaround, proving the adage: "One must have dreams; what if they come true?"
Zuo's background lacks the glitter of figures like Yan Junjie, Tang Jie, or Zhang Wen. Nonetheless, he developed a groundbreaking IPO that addresses weight-loss difficulties for diabetes and obesity patients, stunning the industry. Public records indicate Zuo graduated from Baotou Medical College and worked as a gastroenterologist at a district hospital in Baotou. During his years in practice, he encountered numerous patients whose diabetes was triggered by obesity. Initially following conventional treatment by prescribing medication, he observed that patients relying solely on drugs struggled to improve their condition. Moreover, exercise-based weight loss proved difficult for obese individuals, who often cannot work out like others and face weakened immunity with reduced food intake. This realization prompted Zuo to leave his medical career.
He subsequently spent a significant period in the medical device industry, learning how external tools could aid obesity treatment. Over about 15 years, Zuo transitioned from physician to technical developer, passionately pursuing his dream of alleviating patients' weight-loss challenges through medical technology. In 2016, armed with 15 years of technical experience and his own scientific methodology, Zuo moved to Hangzhou to establish Tangji Medical. Reportedly, he chose Hangzhou for its status as a hub for internet companies and influencers, home to a large sedentary population with limited exercise—precisely the user profile Tangji aims to transform.
Zuo maximized learning by doing. He independently developed China's first "gastric bypass stent system," securing related patents and becoming the technology's pioneering inventor in the country. In Hangzhou, Zuo encountered "traffic and capital," inspiring him to promote endoscopic weight-loss technology. The concept of losing weight without drugs, surgery, or injections sounds almost mystical. If scalable, this technology could potentially revolutionize the weight-loss industry.
For VC/PE firms, "betting on the person" is secondary to "betting on returns." While healthcare typically involves long cycles, with companies often burning cash, incurring losses, and repeating the cycle until IPO before gradually profiting, Tangji Medical intersects with new consumption by applying medical technology to weight loss, significantly shortening the cycle. Crucially, it taps three hot trends: technology, healthcare, and consumption. In 2018, just two years after its founding, Tangji Medical secured funding. Zuo's pioneering technology gained recognition from capital associated with Zhejiang University, such as ZJU Friend, part of Zhejiang University Yuanzheng Holding Group. ZJU Friend's investment strategy focuses on startups by Zhejiang University alumni or firms with strong technical barriers. Public records do not indicate Zuo pursued further studies at Zhejiang University later, suggesting he impressed "Zhejiang University-affiliated" capital purely with his innovative technology. Backed by this endorsement, Tangji Medical rapidly advanced.
How heated is Tangji Medical in the primary market? Objectively, within the weight-loss sector, which often lacks strong capital appeal, Tangji Medical is likely the only company to have secured over ten funding rounds. The core strategy in weight-loss typically involves storytelling, leveraging traffic, and selling products. Tangji Medical stands out with its pioneering technology, attracting nearly 20 renowned VC/PE firms across more than ten funding rounds to join the endeavor. Among these, Baidu Ventures made multiple bets. While Baidu emphasizes AI investments, its interest in weight-loss technology may stem from addressing obesity issues prevalent among internet professionals.
So, how does the "gastric bypass stent system" facilitate weight loss? According to Tangji Medical's subsequent IPO prospectus, it is "the first Class III innovative medical device in China approved for digestive endoscopic treatment of obesity." The technical principle involves using an endoscope to place a stent in the duodenum, altering food passage to reduce excess nutrient absorption and improve insulin resistance via the gut-brain axis, achieving synergistic weight loss and metabolic improvement. Many attribute obesity to inactivity and overeating, but Zuo believes it stems from poor metabolism, particularly in obese and diabetic patients. The technique's marvel lies in enabling weight loss without medication, surgery, or injections—being minimally invasive, reversible, and promoting quick recovery.
As internet, live-streaming e-commerce, and AI trends intensify, Tangji Medical's investors grow more excited, targeting solutions for "industry professionals' health crises." With another global AI surge in 2026, secondary markets are chasing trends, while primary market VC/PE firms focus on AI investments. Tangji Medical senses its IPO opportunity has arrived. It recently submitted a prospectus to the Hong Kong Stock Exchange, aiming to become the "first endoscopic weight-loss stock."
Financial data reveals that in the first three quarters of 2025, the company generated revenue of RMB 20.863 million, a year-on-year increase of 554.83%. This growth rate likely surpasses the stock price gains of many internet and AI companies in the domestic secondary market during the same period. More striking is the gross margin, maintained at 78.71%, with gross profit reaching RMB 16.42 million. However, the company remains deeply loss-making, reporting a net loss of RMB 54.942 million. As earlier noted, it is a rare case in the venture circle of a firm with over 78% gross margins yet still incurring losses. Where do the losses stem from? According to the prospectus, Tangji Medical's losses root from "revenue scale being too small to cover expenses." In the first three quarters of 2025, total core operating expenses (R&D, sales, administrative) amounted to approximately RMB 69.76 million, over 3.3 times its revenue. R&D costs constituted the largest portion, soaring to RMB 32.54 million, exceeding 150% of revenue. The "gastric bypass stent system" is still in the phase of expanding indications, requiring continuous investment in clinical trials and new product development. In other words, it hasn't escaped the cycle.
Beyond losses, the company's greatest risk is "teetering on the brink of insolvency." As of September 2025, total assets stood at RMB 77.751 million, while total liabilities reached RMB 106 million, resulting in negative equity (net debt of approximately RMB 28.388 million) and a debt-to-asset ratio exceeding 136%. A common benchmark for corporate health is a liability ratio below 70%; Tangji Medical significantly exceeds this. Whether it can help patients overcome obesity remains uncertain, as the company itself is "ailing." The Hong Kong IPO represents both an opportunity and a "lifeline." With support from public market investors, Tangji Medical could achieve capital scaling, expand revenue, and transform its own fate while helping more obesity and diabetes patients change theirs. So, are you optimistic about Tangji Medical's Hong Kong IPO journey?
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