Talkspace, an online therapy platform, just announced that it raised $50 million in its most recent round of funding. The round was led by Revolution Growth, a venture capital firm based in Washington D.C.
Additional participants in the latest round included: Norwest Venture Partners, a global venture capital and growth equity investment firm located in Palo Alto; Qumra Capital, an Israeli growth capital fund that focuses on investing in late-stage, technology-driven companies; Spark Capital, an early and growth stage venture capital firm located in Boston; and Compound, a New York City-based venture capital firm that invests in bleeding-edge technology being built by outliers. Each participating firm had previously funded Talkspace. In total, the company has now raised almost $110 million. Following the most recent Series D round, Frank Oren, cofounder and CEO, announced that the company is now valued in “the mid-hundreds of millions.”
Talkspace, developed by Oren and Roni Frank in 2012, provides online therapy services to individuals, including adults and teenagers, and couples. Through its website, users can text, leave voicemail messages, and/or video chat with their assigned therapists. This concept of online therapy is not new; in fact, “some historians believe it began during the 1972 International Conference on Computers when Stanford and UCLA staff used linked computers to demonstrate a psychotherapy session,” according to the Talkspace website. “This wasn’t real psychotherapy with a licensed therapist and – unlike the modern internet – was limited to that small network of computers. It did, however, at least demonstrate the idea of online therapy.” Over the next 20 years, the concept continued to develop, until 1995, when therapist Ed Needham launched Cyberpsych Counseling and charged $15 for a one-hour session. From there, online therapy continued to grow.
Since Talkspace’s inception, the company has witnessed rapid expansion, similar to that of the history of online therapy. It now works with a network of over 5,000 therapists nationwide. In the last year, as of March 2019, the platform witnessed 12,731,955 messages sent.
The additional funding coincides with Talkspace’s recent expansion; the company recently signed a deal with UnitedHealth Group’s Optum. UnitedHealth Group’s Optum is a pharmacy benefit manager and care service group. It helps employers make the most of their benefits offerings, manage population health, and manage health care finances; serves multiple federal agencies and state Medicaid and Health and Human Services agencies with solutions that help improve outcomes and reduce costs; works with health plans to achieve operational excellence, grow membership and drive consumer engagement, and improve clinical quality and manage risk; helps life sciences companies leverage real-world evidence to directly improve clinical care; helps care providers achieve better clinical and business performance and take control of the transition to value-based care; and helps keep individuals and families healthier with pharmacy benefits and health savings accounts.
This partnership is opening up a new door for online therapy. It will provide approximately five million new people with access to online therapy through health plans, employee-assistance programs, and educational organizations.
The future of Talkspace is promising as well. Oren Frank has identified numerous goals that he would like to accomplish. The CEO hopes to continue to expand commercial partnerships, like the recently established link with UnitedHealth, and hopes to expand internationally, specifically in China.
One other goal of the company is to continue to build a body of evidence that supports online therapy. According to Neil Leibowitze, the chief medical officer at Talkspace, the company is “building [the] body of evidence, publication by publication.” At a time when mental health concerns in the United States are rising, new innovative solutions are being introduced. The ongoing investigation into the platform’s effectiveness will continue to highlight the long-term benefits of online therapy. Currently, research reveals a unique set of reasons that participants may choose online platforms over traditional therapy:
- Online therapy can be less expensive, depending on the chosen plan.
- People can avoid the stigma of going into the office for therapy.
- There is no commute or inconvenience to attend a session.
- Online therapy provides a simple solution to canceling or rescheduling an appointment and even changing a therapist.
- Clients can have shorter sessions.
- Text-based therapy allows clients more time to restructure their thoughts.
The benefits of online therapy are continuing to be discovered, and with this research, digital health companies are continuing to grow. According to data compiled by Rock Health, investors put almost $8.1 billion into this sector in 2018 – up 42 percent since the previous year. With this influx in investing in this industry, more Americans are anticipated to receive the mental health care they need to live healthy lives.