When Headspace merged with the on-demand mental health care platform Ginger, I was surprised. After all, Ginger raised $ 100 million in Series E funding just a few months ago – and the last time I spoke to CEO Russell Glass, he stressed the importance of integration into plans. health costs paid by the employer. To me, Headspace’s meditation app is about as straightforward as it gets to the consumer, so what business has Ginger had to do with it? Fragmentation, a lot?
It turns out that there is a precedent, and according to a large number of investors and health tech techs, there is more consolidation and commodification to come in behavioral health. I like to learn things!
As we discussed in a Twitter Spaces on Fusion, Headspace has been pursuing clinical validation of mindfulness for some time. This validation could help him introduce his somewhat new benefits package and compete with his closest rival, Calm. By merging with an on-demand mental health care platform such as Ginger, Headspace can now offer a more holistic approach to mental health. Ginger, for those who don’t know, specializes in helping people access care when they need it, from text-based assistance to escalation to real-time trainers.
But beyond the news, what does this mean? There are a few take out I had after the Spaces. First, at the best of times, the merger of Headspace and Ginger could show us what a holistic and integrative approach to mental health could look like. As Chrissy Farr of Omers Ventures said, some patients might use a combination of approaches that vary over time. The industry is changing so that users have more options when it comes to mental health care; from meditation to texts through Zoom therapy sessions. Second, and this came out throughout the chat, parts of behavioral health are going to become mainstream as the industry grows. From now on, it is no longer sufficient to connect a user to a specialist. How do platforms more thoughtfully link nuanced patients to nuanced options? It’s more than holistic, it’s integrative, says Deena Shakir of Lux Capital.
Finally, 2021 is all about consolidation – and that includes digital health. Alyssa Jaffe of 7WireVenture noted that 80% of the cost and complexity of mental health is related to severe mental illness, but 80% of startups start with less acute care. The new combined entity could become more acquired in what he aspires to address, now, beyond the non-acute conditions.
In the rest of the newsletter, we’ll cover the friendly enemies of fintech, edtech turning into SaaS, and a must-see deep dive in Latin America. As always, you can support me by following me on Twitter @nmasc_, where I post all my work throughout the week.
For the love of fintech
On Equity this week, we talked about how fintech startups Ramp and Brex are doing in their massive valuations. The conversation erupted because Ramp raised funds at a valuation of $ 3.9 billion, while Brex announced the launch of a $ 150 million venture capital firm within days of each other.
Here’s what you need to know: Ryan Lawler and Alex Wilhelm looked at the diverging merger and acquisition strategies of Brex and Ramp to better understand how to differentiate themselves in business management.
Of the history :
While Ramp seems primarily interested in providing clients with a detailed view of the company’s finances for the sake of controlling costs, many of the big Brex announcements and initiatives have recently focused on helping small businesses – especially e-commerce sellers – faster access to cash flow through payments.
Personal finance for startups:
Hiring is (still) difficult
I wrote two stories this week that highlight two realities regarding the hiring landscape today. First, I reported that the Flockjay tech bootcamp had cut at least half of its workforce as it moved away from its original placement goal. Second, Workstream raised $ 48 million for its text-based recruiting platform for hourly workers.
Here’s what you need to know: Flockjay’s entire premise was to help non-tech workers break into tech through sales jobs. Its recent pivot to a B2B SaaS tool tells us how difficult a work placement can be, even in high-demand roles such as sales operations. A day later, Workstream raised funds for their hourly worker recruiting software. The $ 48 million Series B explains how employers facing high turnover are willing to spend money on recruiting tools that meet candidates where they are, which can be their cell phones.
While one story tells us that recruiting is a difficult business to do on a large scale, another shows that existing gaps still require special attention.
Dear seedlings, take note:
TechCrunch Disrupt is less than a month away. And I am shaken.
Use “Mascarenhas20”For a sweet discount code when purchasing your ticket. It’s a series of candid speakers and questions without BS. But, in case you need more conviction on why it’s worth attending, check out this:
The best choices of the press room
Extra Crunch favorites
Finally, a friendly reminder that it is still difficult for most people to raise capital these days. The boom, my friends, is uneven.
See you next week,