Intrepid investors started dabbling in mental healthcare over the past few years as part of a broader digital health funding boom, but many remained wary. Celebrity endorsements, like Olympic swimmer Michael Phelps’ campaign with virtual therapy startup Talkspace, started to chip away at the long standing stigma, while mindfulness apps like Calm offered meditation sessions at the click of a button. But it was the Covid-19 pandemic and collective psychological fallout that finally mainstreamed mental health.
In 2019, around 11% of U.S. adults reported experiencing symptoms of anxiety or depression, which skyrocketed to 42% by December 2020. By year-end, venture investors poured a record-setting $1.5 billion into mental health-related startups. “When the pandemic hit, there was a two-week pause,” says Lisa Suennen, a longtime healthcare investor who leads the venture fund at the law firm and consultancy Manatt, Phelps & Phillips. “And then everything went crazy.” Read More