The mental health pandemic is a serious issue affecting millions of Americans. Sadly, fewer than half the people who experience mental health depression get treated for it because of the stigma associated with it. The good news is that things are beginning to change with programs like Mental Health Awareness Month.
In addition, tech startups are also stepping up by working with employers to provide much-needed relief for people suffering from mental health in the workplace. Angel investors and venture capital (VC) firms have also taken notice. Equity funding in mental health startups reached a record $575 million in funding in the second quarter of 2022 alone, surpassing the prior quarterly record by over 60%, according to data from research firm CB Insights. Global digital health funding reached $7.1 billion during the same period.
In May, health tech startup Circles raised $16 million in funding to stop the mental health pandemic. This week, Alma, a membership-based network for mental health care providers, is the latest startup in the space to receive VC funding.
New York-based Alma was founded in 2018 by Oscar Health veteran Harry Ritter, M.D. to make mental healthcare simple, accessible, and affordable to all. The startup connects patients to in-network therapists and also equips those providers with much better tools to run their practices. At the beginning of the pandemic in early 2020, Alma pivoted to virtual care support to meet the surge in demands from people suffering from pandemic-induced mental problems.
Yesterday, Alma announced it has raised $130 million in Series D funding to “continue building a system that champions clinicians and opens up access to mental health care,” Alma founder and CEO Ritter said in a statement. The round, which brings Alma’s total funding to $220 million, was led by Thoma Bravo with participation from Cigna Ventures and existing investors like Optum Ventures and Tusk Venture Partners.
“By centering therapists at the forefront, Alma is creating a sustainable business model that helps providers accept insurance, grow their private practice, and reach more people seeking care. Over the past year, we scaled our services to offer in-network mental health care in all 50 U.S. states, helping people find much-needed care during their greatest moments of need,” said Alma founder and CEO Dr. Harry Ritter.
Since its inception four years ago, Alma has been helping providers meet the rising demand for mental health care by giving them the support and infrastructure they need to accept insurance and run their small businesses. For example, when providers join Alma, they gain access to insurance support, teletherapy software, automated billing and scheduling tools, and a vibrant community of clinicians that come together for education, training, and events. The startup has helped several therapists manage their practices and contract with insurers.
“I’m grateful to Alma for creating an incredibly welcoming environment for therapists and giving us a space of belonging in a field that can feel isolating,” said Alma member Manuela Mage, LCSW. “Whenever I have a question or an issue I’m wrestling with, I know that I can go to Alma’s community hub and get advice and diverse perspectives from therapists that have dealt with the same issues. It’s also a relief to know that Alma handles the insurance billing and claims management so I can focus on helping my clients navigate challenging moments in their lives.”
Over the past 12 months, Alma scaled its network over 3X to 8,000 mental health providers that are licensed to practice in all 50 states. As Alma grows, the company remains committed to nurturing a diverse community of clinicians that are able to serve clients across the country. Almost 40 percent of providers in Alma’s network self-identify as Black, Hispanic/LatinX, or Asian. They speak over 40 languages, ranging from American Sign Language to Cantonese.
“Alma’s unique provider-first approach to mental health care allows providers to deliver high-quality patient care while also making it as easy as possible for them to start and grow their practices,” said Ross Devor, a Partner at Thoma Bravo. “Alma is providing tremendous value to key ecosystem participants: increased access for patients, insurance and billing support for providers, and valuable, diverse networks for payers. We look forward to leveraging our significant software and healthcare sector expertise to support the company’s continued growth.”
“Earlier this year, Alma joined Evernorth’s behavioral health network and we continue to be impressed with their shared vision to bring high quality, affordable mental health care to the customers we serve,” said Tom Richards, global leader for strategy and business development at Cigna. “With this investment in Alma and their growing network, we can accelerate how we drive access to diverse in-network therapists, allowing our customers to access care when and where they need it most. We believe that Alma is well positioned to make this a reality and look forward to supporting their efforts to expand access to care with this innovative model.”