Spring Health, a startup offering mental health benefits to employers, recently closed a $190 million series C round, including both equity and debt. The deal would give the startup a $2 billion valuation, making CEO April Koh the youngest woman to lead a multibillion-dollar company.
Spring Health, like many of its peers, offers its services as a benefit to companies. It currently has 150 clients, including large firms PepsiCo, General Mills, Bain, and Instacart.
The company offers therapy, coaching, care navigation, and an app with guided wellness exercises. It markets its services either as a supplement to EAPs or a replacement for them entirely.
What makes it different, Koh said, is the group of employers Spring Health names as its clients. Rather than starting with wealthy tech firms, she said the startup focuses on companies with all kinds of socioeconomic backgrounds and health needs.
“That’s a pitfall some digital healthcare solutions can fall into, really catering to only those classes that can afford premium services,” she said.
Kinnevik led the series C round, and investor Christian Scherrer will join Spring Health’s board of directors.
Koh said the company chose Kinnevik for its digital health expertise — it’s an investor in Teladoc, VillageMD and CityBlock — and because of its emphasis on diversity and impact.
“There were multiple investors who put down term sheets, some with even higher valuations than the one that we chose, but we chose Kinnevik because we thought they would be the best long-term partner for us,” she said.
Spring Health also gained a strategic investor in Guardian Life, which offers life, disability and employee benefits. Since so many of the claims Guardian processes are either directly or tangentially related to mental health, they plan to integrate Spring Health’s services so that when a claim is triggered, employees have access to it, Koh said.
She plans to put the new funds toward three objectives:
- Expanding Spring Health’s global presence. It’s currently in 200 countries today, Koh said.
- Integrating its family mental health solutions. While Spring offers pediatric mental healthcare, parental coaching and relationship counseling, Koh said more members were asking for these services to be integrated, so that they could go through meditation exercises together or oversee their child’s care.
- Investing into its own workplace mental health. “We’ve invested so much energy and time into other employers, but we want to start to do that for ourselves,” she said.
Spring is one of several fast-growing startups in an increasingly competitive landscape. Investors are pouring record amounts into behavioral health startups, and employers are increasingly receptive as the Covid-19 pandemic has put a spotlight on mental health.