SonderMind, a digital mental health company, is acquiring Mindstrong’s remaining technology assets in a deal that will end the latter company’s six-year run in the mental health space.
The deal was finalized on Wednesday, according to both companies. Terms were not disclosed.
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The acquisition comes after Mindstrong stopped providing service to patients on March 10. Mindstrong closed its Menlo Park, California headquarters, according to a Worker Adjustment and Retraining Notification notice filed in January.
SonderMind will hire about 20 of Mindstrong’s employees. The remaining 100 workers will lose their jobs.
“This is sort of the final chapter for the Mindstrong care business,” said CEO Michelle Wagner, who will not have a role at SonderMind.
Mindstrong was founded in 2017 by Dr. Tom Insel, former director of the National Institute of Mental Health, and in its six years received $160 million in funding from venture capital firms such as General Catalyst and ARCH Venture Partners. Started as a company that would use biomarkers to detect mental health conditions, it evolved to treat mental health through smartphone-based therapy and other services.
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Wagner said it became too difficult to navigate macroeconomic pressures and deliver on new profitability expectations from investors.
“It’s hard to get to scale,” Wagner said. “It is hard to incorporate measurement on a personalized basis because we are human and we’re all quite different in how we operate, especially in behavioral [health].”
SonderMind, which connects users with licensed therapists, said the deal will help it better quantify improvements in mental and behavioral health. The Denver-based company said Mindstrong’s technology will allow it to inform clinician care and treatment decisions, while developing custom care plans for patients between visits.
According to CEO Mark Frank, SonderMind’s goal is to integrate more clinical data into its care plans as the company studies patient outcomes. The acquisition will aid in development of treatment planning tools and monitoring between sessions.
“What we’re trying to do is improve outcomes and make those outcomes be able to be objectively measured and then defined,” Frank said. “In a year, two years, or in three years, when you…ask what differentiates SonderMind, we can just point to numbers.”
The deal follows SonderMind’s $10 million acquisition in November of Total Brain, an app that can assess and measure brain function and mental well-being.
Other digital mental health companies are looking for acquisition targets amid a tumultuous economy. In September, Headspace Health, the Santa Monica, California-based digital mental health ‘unicorn,’ acquired Shine, a wellness and mental health app. That move preceded Headspace’s acquisition of Sayana, a mental health and wellness company providing personalized care.
This story first appeared in Digital Health Business & Technology.
Source : Modern Healthcare