We Are All Going Crazy
How technology will enable a new wave of startup companies to make tele-behavioral health better than in-person therapy
There’s an old story in technology circles about how at the dawn of television, people didn’t know what to do with it, so they basically put a radio show on television. A person sitting behind a desk talking into a microphone. But television held so much more promise and eventually it achieved its ultimate application, Game of Thrones. With all of the recentel reciente interest in tele-health, it’s ironic that we are still basically putting a doctor on a video streamcorriente and declaring victory. It’s still radio. And so it is with tele-behavioral health — you lie on your own couch instead of the therapists couch, but otherwise it’s essentially the same.
We Can Do Better
So what is tele-behavioral health’s higher calling? Most people think of tele-health as a less expensive, more convenient compromise to an in person visit. But what if it could be even better than in person? Behavioral health symptoms and episodes can come and go, think manic-depression, anxiety, or suicidal thoughts. One advantage of tele-behavioral health is its potential to address problems in the moment. Anxious or depressed late at night? Someone’s available to chat or talk right when you need it. Having suicidal thoughts? A two week wait to see your therapist won’t do. Technology has so much more potential than putting a clinician on video, and we can do better.
A $16 Trillion Problem
Behavioral healthcare is neglected worldwide. We have stigmatized treatment badly — we have historically thought of it as something for “crazy people”. Yet around 2 billion people experience mental health problems each year. Only half the people in the US needing treatment get it, and one third globally. In poorer countries the number is much lower. Lack of treatment leads to unnecessary emergency care, incarceration, medical comorbidities and lost productivity, which threatens to become a $16T cost to society by 2030. More than heart disease, nearly twice as much as cancer!
So we are all “going crazy” if we continue to stigmatize behavioral healthcare and people go untreated. It’s an enormous opportunity, both an economic one and a societal one to bring accessible, affordable and effective behavioral healthcare to market. With a global pandemic bearing down on us, even more people need help and solutions to our behavioral health challenges become increasingly valuable. Increasingly, entrepreneurs are realizing this and applying some of the most sophisticated and disruptive technologies available, to the problem.
As an investor who backs mission-driven founders leveraging breakthrough innovations in science and technology to address the world’s biggest challenges, I believe that technology can do better than basic tele-behavioral health. Better Ventures backs companies actually improving upon in-person care and lowering the barriers to access — warrior queens and dragons in front of the television camera.
The First Wave: Tele-Behavioral Health
First, let’s cover what’s already happening. There’s been quite a bit of innovation in behavioral health over the last 5 to 10 years and a few companies have emerged as leaders. Companies like Ginger, Talkspace, Lyra and AbleTo (acquired by United Healthcare for $470M) leverage the power and ubiquity of mobile computing to deliver behavioral health any time, anywhere over video and chat. Calm (Sequoia backed and valued at $1B) and Headspace, have brought affordable meditation and mindfulness to the masses. Even leading general tele-health providers like Teledoc and Doctor on Demand have gotten into the behavioral health game.
Together, these companies comprise the “First Wave” of modern behavioral health innovators. They’ve eliminated the stigma of “going to the therapist” and they’ve lowered the price tag, considerably improving access, particularly for low and middle income communities. These companies make a big improvement on the old system, but they are just the start, so we need to build on this success. For more on the current behavioral health landscape check out these great posts here and here.
The New Wave: Beyond a Therapist in Your Pocket
A handful of emerging companies are building on the success of the early innovators in tele-behavioral health — pushing the promise of technology further.
Startups are leveraging scientific breakthroughs in artificial intelligence, novel sensor technologies, voice computing, virtual reality, psychedelic drugs and remote monitoring to challenge the very nature of behavioral therapy, push the envelope in search of the Game of Thrones, something altogether better than in-person therapy or basic tele-therapy.
Here are a few New Wave companies grouped by the technologies they leverage
Artificial Intelligence — Better and Cheaper
Behavioral health offers artificial intelligence a chance to really shine. Its ability to learn from huge data sets and apply those to people seeking care promises both much lower cost and better care.
Woebot: Lowers the marginal cost of talk therapy to near zero. It’s an AI chat bot for mental health founded by a Stanford behavioral scientist. Research shows that while 70% of people prefer a human therapist for positive topics, the majority of people prefer a robot for negative topics. But the big news here is that it’s free. Woebot and others are bringing the cost of Cognitive Behavioral Therapy (CBT) way down and thereby improving access. Other noteworthy companies in this category include X2AI and Wysa. Woebot raised $13M from NEA, AI Fund and Jazz Venture Partners.
Ellipsis: applies artificial intelligence to voice, creating a voice biomarker for depression and anxiety. Like Feel (below), it’s quantifying emotional state, inter-twining physiological and behavioral health. Ellipsis calls it the first speech-based vital sign for depression and anxiety. It’s machine learning algorithms can detect emotional state after just a few minutes of listening to a person speak, just like a thermometer measures your body temperature. The implications of this could be vast, particularly given that voice computing is becoming ubiquitous in our lives. Other noteworthy companies focused on voice biomarkers include Kintsugi, Sonde, Clarigent and Neurolex. Ellipsis raised $4M from Khosla Ventures, City Light Capital and Generator Ventures.
Low Cost Hardware and Novel Sensors Enable New Capabilities
Feel: an emotion sensing wristband and health advisor. It quantifies your emotional state–behavioral health meets physical health. It can tell when you’re stressed or depressed from your biometrics and enables appropriate intervention. While Feel is still a young company, the notion of integrated biometrics and behavioral therapy is game changing. Not only can it help people get what they need when they need it but it can track progress and help to identify conditions affecting behavioral health. For more on ongoing care outside the clinic, see my recent Continuous Health post. Feel raised $6.2M from Felicis, SOSV and Anthemis Group.
Prescription Digital Therapeutics — Alternative to Drugs
One of the criticisms leveled at the behavioral health industry is that medication is over prescribed. Recent advances in technology coupled with the FDA’s willingness to approve. Digital therapeutics raise the possibility of drug-free treatments for behavioral health challenges.
Pear Therapeutics: is the first FDA approved prescription digital therapeutic (PDT) for chronic insomnia with the potential to replace or augment medications like Ambien which are controlled substances and, while they help people get to sleep, they can lower the quality of sleep. Pear’s Somyrist uses Cognitive Behavioral Therapy for Insomnia (CBT-I) to achieve clinically proven improvement in insomnia severity, time to fall asleep, and time awake at night. Other noteworthy companies in the sleep category are Sleepio, which works with employers to help employees sleep better, and NightWare, which leverages Apple Watch to treat nightmares associated with PTSD. Pear also has a substance abuse PDT, reSET. Raised $64M and is privately valued at $494M.
Quit Genius: a prescription digital therapeutic breath sensor and mobile app to manage addiction. The company started with smoking and has expanded to vaping, alcohol and substance abuse. They sell to employers as a wellness benefit. Blow into the pen-like sensor device to track your progress on the mobile app, then consult one-on-one as needed with an advisor to access CBT. Quit Genius also offers nicotine replacement (gum) and financial incentives for making progress. 53% of users quit smoking. Quick Genius has helped 60k people to quit smoking. What makes this novel is the continuous measurement nature of the product. Instead of seeing a smoking counselor every two weeks to lie about your progress and eventually drop out, you manage your behavioral health in the moment, with precise measurement, intervention and guidance when you need it. You even get paid for success. Raised $14M from Octopus Ventures, Merck, Venus and Serena Williams and Y Combinator.
New Applications for Psychedelic Drugs Offer Hope for Hard to Treat Conditions
Compass Pathways: a biotech company leveraging psychedelics. It’s developing a psychedelic drug called COMP360 to treat clinical depression. Other companies are targeting ADHD, epilepsy and anxiety with psychedelics. While most drugs treat the symptoms of behavioral problems, one advantage of psychedelics is that they have the potential to change the way the brain processes memory and information, treating the disease directly. Other companies in this space include MindMed, Entheogenix Biosciences and DemeRx. Compass Pathways has raised $139M from Founders Fund and psychedelics-focused ATI Life Sciences.
Third Wave: Integrated Behavioral and Physical Care
The New Wave companies above have the potential to take behavioral health to the next level, where it’s better than in-person therapy. Even then, behavioral health is something separate from physical health, silo’d in our health systems, where we employ different types of clinicians, operate separately, bill separately, diagnose and treat differently and ultimately mis-manage our health.
There is a perverse comorbidity cycle playing out in healthcare. One third of people with chronic illness also have depression. And when universal screening is performed on chronically ill patients, the incidence of depression is as high as 70%. Causality can go either direction — a cancer diagnosis can cause depression, or depression might cause back pain or insomnia. Sadly, our health system treats people differently depending on which silo they are in. That’s not what we need. We need to be treated like whole people, the brain being one more organ needing care.
One company which appears to be getting this right is Quartet Health. Here’s a quote from their website: “Physical and mental health are intrinsically linked, yet treatment continues to be silo’d and mental healthcare remains inaccessible, unaffordable, and stigmatized. That’s where we come in — through technology and services we effectively integrate mental healthcare to improve patient health, quality of life, and cost of care.”
Hallelujah! Quartet enables “collaborative care” and “total health”. Maybe that’s why they have attracted $147M in venture investment from Google Ventures, Polaris Partners and Centene. But Quartet is a care coordination company sorting out the messy connections between physical and behavioral caregivers, and not a fundamental rewrite to integrate behavioral and physical care from the ground up. What the world really needs, beyond care coordination is a fundamental rewrite from the ground up, but that’s not something I’ve seen a startup doing ( if you see it let me know!).
In the end, behavioral health needs to be so deeply interwoven with physical health that it’s indistinguishable. There is an enormous opportunity for startups to blend the two disciplines– with point solutions and with full stack models. We want to back startups bridging this gap or erasing it altogether.
Wave Riders— We Invest In Second and Third Wave Companies
Better Ventures investing at the forefront of these trends in behavioral health. Wave two and three companies which are going beyond lower cost, improved access and convenience to address hard-to-serve specialty areas, provide better care than is available off-line and to integrate behavioral and physical health seamlessly.
Our healthcare system is antiquated, expensive and ineffective. It was built at a time when behavioral healthcare was taboo. Norms are changing, and our next generation of societal leaders is beginning to embrace behavioral health treatment as necessary and important. So let’s build the next generation of healthcare startups together, let’s address harder to serve areas and improve upon care, let’s recognize that behavioral and physical health are inseparable, let’s fulfill the promise of and let’s fulfill the promise of science and technology to build the Game of Thrones of behavioral health together.
