Headspace and Ginger, two app-based digital mental health companies that work with employers and health plans, plan to merge into a combined company called Headspace Health, the companies announced Wednesday.
Financial details of the merger were not disclosed.
Santa Monica, Calif.-based Headspace sells a meditation and mindfulness app, while San Francisco-based Ginger sells access to on-demand mental healthcare, including behavioral health coaching via text message and video-based telehealth visits with therapists and psychiatrists.
Headspace has raised $215.9 million since it was founded in 2010. Ginger, also founded in 2010, has raised $220.7 million.
As a combined company, Headspace Health will have a valuation of $3 billion, according to the companies.
Headspace Health will cover nearly 100 million lives through more than 2,700 employer and health plan customers, as well as its direct-to-consumer business.
“Through this merger, we can uniquely tackle the full spectrum of mental health needs—from prevention to clinical care—all from one integrated platform,” said Ginger CEO Russell Glass, who will serve as Headspace Health’s CEO after the merger closes, in a statement.
Headspace CEO CeCe Morken will maintain her role as CEO of the Headspace division and will also serve as president of the combined company.
While teletherapy apps have traditionally been a cash-pay industry, employers, insurers and even government agencies are now striking contracts with companies that say their products can help reduce burnout, stress, anxiety and depression symptoms as a way to meet heightened consumer demand and improve employee retention.
Such digital mental health companies are part of growing telehealth and mobile health app subsectors within the broader digital health category, which raised $4.3 billion and $1.4 billion, respectively, in 2020, according to data compiled by Mercom Capital Group. Digital health companies as a whole raised $14.8 billion last year, up 66.3% year-over-year.
Other digital mental health companies include competitors like Calm, another meditation app that’s raised $218 million to date, and Talkspace, a digital therapy company that went public through a merger with a special-purpose acquisition company in June.
Headspace and Ginger’s merger is expected to close in 2021’s fourth quarter.
Source link : https://www.modernhealthcare.com/technology/headspace-ginger-form-digital-mental-health-company-valued-3b
