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Mental Health platforms are the fastest-growing type of marketplace company in the country.
That’s according to the fourth Andreessen Horowitz (a16z) “The Marketplace 100” report, a ranking of the tech companies facilitating commerce, often termed platform companies.
“The fastest growing category? Mental health, by a long shot,” the report reads.
The report finds that mental health platform companies — such as Alma, Headway and Path Mental Health — have seen spending on their platforms increase by about 275% in 2022 year-over-year.
Mental health, a subcategory of the larger health and wellness category, was far and away the type of platform company that saw the most significant growth in consumer spending.
Four mental health platforms appear on the list of 100 platform companies with the largest gross merchandise volume (GMV). A16z partnered with the data company Consumer Edge to establish the list. A16z based the list on anonymized, aggregated credit and debit card transactions. The destination of freshman indicated the first time a company is included on the list:
— Headway, No. 56
— SonderMind, No. 80
— Alma, No. 82, Freshman
— Path Mental Health, No. 90
“There’s big money in mental health, particularly for marketplace companies that help consumers navigate the perplexing insurance policies governing many therapy practices. Four companies on this year’s list help patients find in-network providers,” the report states.
The report cites U.S. Centers for Disease Control and Prevention, which finds a three-fold increase in mental distress symptoms in 2021 compared to 2019. It also finds that platform companies in the mental health space are making it easier for patients to find and access providers that are right for them in terms of cost, insurance coverage and therapeutic fit.
The first wave of therapist platforms from 2010 to 2015 was focused on cash payments, while the present generation is focused on securing in-network partnerships with payers. Cash pay rates vary widely across markets but can cost hundreds of dollars per session.
“While the general trend for mental health marketplace spend has been rising, there is some seasonal activity,” the report states. “Like gym memberships, spending on mental health marketplaces spikes in the first quarter (specifically, in January), then falls back into a more normal growth trend for the rest of the year.”
Mental health platforms have seen huge interest from investors and payers.
Earlier in the year, Headway reportedly raised $100 million and became the first behavioral health unicorn of 2023. The company previously raised $100 million through a Series B round. It expanded to California, the largest state in the nation, in October 2022. It also secured, in 2022, a deal with CareFirst BlueCross BlueShield to support and supplement its therapist network.
In December 2022, the mental health platform Grow Therapy announced it would expand into 22 states after landing $80 million in Series B funding.
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