Investing & Startups| April 26, 2019
Meru Health raised $4.2M to invest in app targeting depression and anxiety
Meru Health, a mental health oriented digital clinic, announced April 25th it is has raised $4.2M in Series Seed financing from Freestyle Capital, Bonit Capital, Y Combinator, Lifeline Ventures and IT-Farm.
Meru Health, a Y Combinator 2018 company, now part of the Texas Medical Center TMCx Accelerator in Houston, has produced a licensed-clinician-supported, mobile phone-based digital therapeutic solution, called Ascend, to treat depression and anxiety.
Anxiety, a big problem others tried to tackle
Up to 40 million Americans are battling anxiety and worry annually, so the need for health solutions is huge.
Depression costs employers an estimated $44 billion each year in lost productivity. Although depression is a lead cause of disability, about half of employees with depression are untreated. Since treated patients get better, the key is provide employees with better access to effective care. That’s Meru Health’s point of entry. Its mental health Digital Clinic was developed to improve access to and compliance with mental health treatment.
Meru Health is not the first to tackle the problem; others have tried to help patients with anxiety and related disorders with AI powered solutions.
Digital therapeutics startup Big Health, which designs, develops and deploys web and mobile-based applications that deliver personalized behavioral medicine, a few months back launched a mobile app that could battle anxiety.
The app, called Daylight, uses scientifically proven techniques based on cognitive behavioral therapy (CBT) to address feelings of worry and anxiety.
Notable attempts were made even before Daylight.
Last November, the five-minute meditation app, Simple Habit, announced it raised $10 million in a series A funding round, led by Foundation Capital. The capital was to be invested into a further expansion of Simple Habit’s library of more than 1,500 guided meditation sessions.
Simple Habit helps reduce stress daily sessions lasting only five minutes. Short meditations and audio therapy coming from world-class experts help busy people cope with daily stress. Various conditions such as sleeping problems, morning anxiety, getting over a breakup, are used to create more than 1,500 sessions to relieve patient stress.
Founded in 2016, Simple Habit is now the number one rated meditation app in the app store on iTunes and boasts 37,000 five-star reviews.
Another example of a revolutionary solution is that offered by New York-based virtual healthcare startup Izzy Care. Offering affordable services anchored by AI is how Izzy Care wants to change healthcare.
The virtual healthcare company said its services include managing chronic medical conditions, treating colds, coughs, or rashes, dealing with depression or anxiety, handling stress from work or relationships, and tailoring personal diet and exercise plans.
How does Meru Health’s solution work?
Meru Health is a quickly accessible digital clinic for greater mental health with remote therapists and psychiatrists, an anonymous peer-group and a 12-week digital therapeutic treatment program. Meru’s program consists of continuous remote clinician support, at-home therapeutic lessons and practices (e.g., cognitive behavioral therapy and mindfulness) as well as sleep medicine and nutritional psychiatry for a complete solution to healing depression and anxiety.
Results from a clinical trial to test Ascend were published online in JMIR earlier this year. Peer-reviewed data from 117 Finnish patients revealed the Meru Health intervention works. This therapist-supported, mobile phone–delivered treatment for depression is feasible and associated with reduced depression symptoms. According to the specialists, validation of these results using a controlled study design is needed to establish the evidence base for the Ascend intervention.
The researchers found depression symptoms significantly decreased in patients who were close to 80% of the program completion rate. The trial also determined that a higher number of days of practice significantly predicted lower residual depression symptoms, and that greater group chat use predicted reduced depressive symptoms. Developing design features that enhance daily practice and group chat use will be a future challenge.
How will Meru Health invest the new funds
Meru Health will use the newly acquired funds to make additional clinical validation possible, and ensure the pushthrough to health systems and large employers across the U.S.
Investors seem to have complete faith in the team they are supporting.
“Having met with scores of mental health startups over the last year, it was Meru’s full stack hybrid approach plus Kristian and his team’s dedication that spurred Freestyle’s decision to lead Meru’s seed. The clinical validation from a large peer-reviewed study plus impressive execution with Fortune 100 companies sealed the deal and made us confident that Meru Health’s solution will be attractive to employers and health plans and deliver for users. They’ve built a great solution, assembled an experienced team and engaged some of the most prestigious healthcare systems to test the technology. We are so excited to be working with Meru Health as they tackle one of the biggest health issues in the country,” said Josh Felser, founder of Freestyle Capital.
Meru Health works with employers, health systems and health plans, the aim being to reach as many patients as possible, via employers who have a unique outcomes-based business model. The company has initiated pilot programs in two Silicon Valley Fortune 100 companies. Currently, a clinical trial is also underway with Stanford and the Veteran’s Administration.
“All of us at Meru Health are excited to have Freestyle and the other esteemed investors join our seed round. This financing comes at a time of important company milestones and will enable us to continue on our growth trajectory,” said Kristian Ranta, co-founder and CEO of Meru Health. “The publication of the results of a 117-person clinical trial of the Meru Health digital therapeutic program demonstrating high completion and compliance rates with a significant reduction in depression provides important evidence points for our approach. We are currently running a clinical trial with Stanford and the Veterans’ Administration and we are also in active discussions with several health plans and insurers.”
About Freestyle Capital:
Founded in 2009, Freestyle Capital is a San Francisco based boutique venture capital firm focused on early stage investments. Partners Josh Felser, David Samuel and Jenny Lefcourt are all serial founders using their real-world operational experience to provide hands on guidance to tech entrepreneurs. The company invests in market leaders in all verticals – consumer, marketplaces, enterprise, SaaS, B2B and B2C companies, as for instance Airtable, Intercom, Patreon, BetterUp and Narvar.
About Meru Health:
Meru Health is a digital clinic for greater mental health with remote clinicians (licensed therapists & psychiatrists), anonymous peer-group and a 12-week digital therapeutic treatment program. Meru’s program consists of continuous remote clinician support, at-home therapeutic lessons and practices including cognitive behavioral therapy & mindfulness, as well as sleep and nutrition coaching. Meru Health has offices in Palo Alto, California and Helsinki, Finland.