A Rare Pandemic Silver Lining: Mental Health Start-Ups

Using teletherapy, metrics and matching algorithms, entrepreneurs are focusing on addressing aspects of the mental health care system that they view as broken.

Ariela Safira was on a mission. Shaken by the attempted suicide of a friend during her freshman year at Stanford University in 2013, Ms. Safira sought to understand the opaque mental health care system. She soon learned of the shortage of qualified therapists and, even where they are more plentiful, of the hurdles to obtaining care. Although a computer science and math major, she eventually enrolled in a clinical psychology graduate program at Columbia University.

But she kept coming back to a fundamental view: that there is often a mismatch between need and services, an essential supply-and-demand question. “It’s very difficult to start and keep up a therapy business,” Ms. Safira said. “It’s a 10-person job, not a one-person job, from marketing yourself, doing your own financing and managing your own rent. But even before you get to a place where you manage all those things, what’s so challenging is making a name for yourself so that people want to go to you.”

And so, in 2019, she founded Real Therapy, a small business designed to tackle mental health and overall wellness by easing access and offering a range of services to answer clients’ needs.

Driven by personal experience — and further motivated by the pandemic, which has caused an increase in anxiety and depression among the general population, including among young adults — entrepreneurs like Ms. Safira are focusing on addressing aspects of the mental health care system that they view as broken. They seem undeterred by the complicated nature of that system: a byzantine insurance process, a wide range of provider types, and elusive fits between patient and therapist.

“It’s a crowded space,” Alex Katz, the founder of Two Chairs, which opened its doors with a single clinic in San Francisco in 2017, said of the mental health start-up scene. Nonetheless, he said, “because the problems are massive, we need a lot of great companies working in innovative ways to address the different populations, diagnoses and delivery of care.”

Mr. Katz, another Stanford graduate, began working at Palantir, the data analytics and software company, but sought to understand mental health services when his partner “was going through a tough time in her life.” He eventually quit his job and began to tap into his network of friends and family to understand the mental health care system.

He soon learned that one of the system’s biggest challenges was matching a therapist with a patient, something he thought technology could solve. Yet, after interviewing clinicians, he chose to start a physical clinic, rather than a virtual one. In trying to raise funds for his fledgling business, “I joke that I had three strikes against me: I was a first-time, solo founder of a bricks-and-mortar company in health care.” But from its inception, Two Chairs has relied on technology, using a frequently updated proprietary algorithm to match client and therapist after a prospective client’s first intake meeting.

Although both Ms. Safira and Mr. Katz initially focused on in-person care, with virtual therapy as a long-term goal, they had no choice but to change direction once the pandemic hit. Ms. Safira and her small team quickly had to shift from the Manhattan space they carefully designed and renovated, but never opened, to go completely remote. Within eight long days, she produced a remote platform to provide five types of services, largely group-oriented (one-on-one sessions will wait until the in-person location opens). Mr. Katz — whose company had grown to seven locations in the Bay Area, with a new one set to open in Los Angeles next year — also made the decision in March to continue his business by going fully virtual.

Because both had planned, eventually, to offer remote services, they already knew that the efficacy of remote sessions was already proven. David Mohr, the director of the Center for Behavioral Intervention Technologies at Northwestern University’s Feinberg School of Medicine, who has studied the issue, said that researchers had long found that teletherapy could be as effective as in-person therapy.

“There are no substantial differences in outcomes between remote and face-to-face” therapy, he said, adding that a remote option can solve issues of distance and time constraints that often discourage people from seeking therapy. (Dr. Mohr, through his work at Northwestern, is the principal investigator for IntelliCare, a university program that provides pre-therapy tools for anxiety and depression.) Practitioners have been resistant to this change, but the pandemic has forced their hands.

“We are at an inflection point,” he said. “There is a greater acceptance of the use of technology in mental health care, while at the same time there is a tremendous decrease in the stigma” that had been associated with emotional problems.

Like Ms. Safira, it was personal experience that propelled Kyle Robertson to explore a platform for virtual therapy. The son of a psychiatrist and therapist, Mr. Robertson had difficulty finding help in dealing with his own depression and anxiety while a student at Wharton School of the University of Pennsylvania. He said his parents were hands-off but “definitely pushed early on for making sure that there was integration across medication and therapy,” which they all viewed as sometimes lacking in current practice, whether remote or in-person (only psychiatrists can prescribe medication).

After running a beta test of roughly 100 users at the end of 2019, he co-founded Cerebral in 2019. His timing, of course, proved prescient, and he has secured significant venture funding as well an uptick in clients throughout the year.

As with Two Chairs, Cerebral clients can schedule individual therapy, though group sessions are not yet available. The platform asks clients to keep track of their symptoms and report them monthly. Those responses can trigger a notification to the clinician to alert them if there is any worsening of conditions. If someone doesn’t respond, then someone on the team will reach out to check in, Mr. Robertson said.

All three companies seek to provide access quickly — the first interviews can be the same day after a client has signed up, in an effort to pre-empt mental health emergencies. The goal, Mr. Robertson said, is for new clients to speak to someone “within 10 minutes, something we’re able to do with a network of clinicians across geographies.” (Some of the regulations regarding licensing have been relaxed during the pandemic to enable telemedicine across all specialties, not just mental health care.)

And though these providers must comply with the stringent privacy laws that govern medical care, they are able to use data that they gather to analyze outcomes. “It’s been hard to aggregate data and use it in an effective way in the past,” Mr. Robertson said. “Many therapists are in the equivalent of mom-and-pop shops who don’t have the resources, or the time, to analyze the data.”

The three entrepreneurs are all working with insurance companies to have their services covered. Ms. Safira said that clients could use funds in their health savings or flexible spending accounts, and Mr. Robertson is negotiating with insurers. Mr. Katz said that while his company’s services have been out of network, “we will begin working with insurance companies more broadly in 2021.”

Their platforms welcome all ages. Mr. Robertson says that though some older clients seem less comfortable with the remote format, there are many who adapt.

Ultimately, all three companies hope to connect clients with the right type of therapy and to possibly contribute to the understanding of how to make a match.

“There’s not much research on how to make a match, but there’s a lot that speaks about the importance of the alliance” between therapist and patient, Mr. Katz said. “At the end of the day, if you form a great bond, the quality of care is so much higher.”

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