Want to be a more Holistic Healthcare Company? Add some Ginger

Want to be a more Holistic Healthcare Company? Add some Ginger

I was startled when Headspace and Ginger, an on-demand mental health platform, joined. After all, Ginger just acquired $100 million in Series E funding a few months ago, and CEO Russell Glass underlined the necessity of integrating into employer-sponsored health insurance the last time I spoke with him. To me, Headspace’s meditation app is about as close to direct-to-consumer as you can go, so what business did Ginger have with it? Isn’t that a lot of fragmentation?

There is precedent, according to a bevy of health tech investors and techies, and further consolidation and commodification in mental health are on the way. I enjoy learning new stuff!

Headspace has been pursuing clinical validation for mindfulness for quite some time, as we highlighted at Twitter Spaces about the merger. That endorsement could help it sell its new employee benefits package and compete with Calm, its main competitor. Headspace can now provide a more holistic approach to mental health by combining with an on-demand mental healthcare platform like Ginger. For those unfamiliar, Ginger focuses on assisting people in obtaining treatment when they require it, ranging from text-based support to real-time escalation to trainers. But what does this mean beyond the headlines? Following the Spaces, I had a few primary takeaways.

First, the merging of Headspace and Ginger could show us what a comprehensive and integrative approach to mental health could look like in the best-case scenario. According to Chrissy Farr of Omers Ventures, some patients may benefit from a variety of therapies that change over time. From meditation to texts to Zoom counseling sessions, the business is growing so that customers have more alternatives when it comes to mental health treatment. Second, as the behavioral health industry matures, elements of it will get commoditized. This was discussed throughout the talk. It’s no longer sufficient to simply link a user with an expert.

How can platforms better match nuanced patients with nuanced options? According to Deena Shakir of Lux Capital, it’s more than holistic; it’s integrative.

Finally, 2021 is all about consolidation, and digital health is no exception. According to Alyssa Jaffe of 7WireVenture, serious mental diseases account for 80% of the cost and complexity in mental health, yet 80% of companies start with lower acuity care. Beyond non-acute diseases, the newly combined firm could grow more acquisitive in what it seeks to solve.

The rest of the newsletter will cover fintech’s allies, edtech’s transformation into SaaS, and a must-read LatAm deep dive. As always, you can show your support by following me on Twitter @nmasc_, I upload all of my work every week. We talked about how to finance startups Ramp and Brex are developing into their enormous valuations on Equity this week. Within days of each other, Ramp raised money at a $3.9 billion valuation, while Brex announced the establishment of a $150 million debt venture business.