Alma Expands Mental Health Network Buoyed By $28M Series B

Mental health is a hot topic these days and venture investors have been taking note. Alma, a membership-based network for mental health care providers, is the latest startup in the space to receive venture capital funding.

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Founded by Oscar Health veteran Harry Ritter, M.D., in 2018, Alma aims to improve access to high-quality, affordable mental health care.

Typically, mental health providers do not accept insurance, and an average session can cost between $150 and $500, he told Crunchbase News.

Alma’s platform enables providers to accept insurance. It also provides a member directory, client-matching service, scheduling and billing functions, as well as education, training and a community for support, he said. In addition, Alma works with the insurance companies on behalf of the providers, which reduces session costs down to an average of $18.

“The toll of mental health has never been more significant, and there is an immediate focus for health care and the society at large,” Ritter said. “Prior to the global pandemic, we saw opioids and teen suicide, but now we are seeing more of that, as well as a wave of real pain and suffering from inadequate services. Some 60 percent of people report they are suffering from some kind of mental illness related to quarantining and the current political atmosphere.”

The company, headquartered in New York, has raised $28 million in Series B funding in a round led by Insight Partners, with participation from Optum Ventures and existing investors Tusk Venture Partners, Primary Venture Partners, Sound Ventures, BoxGroup and Rainfall Ventures. The company has raised a total of $40.5 million, which includes an $8 million Series A in 2019, led by Tusk, according to Crunchbase data.

The new funding enables Alma to expand its national network, invest in product development and increase in-network care options. It will also use the new capital to grow its team, which now includes Esther Perel, a renowned psychotherapist who is joining its clinical advisory board to support the team in developing unique training and education opportunities for Alma members, Ritter said.

Alma is currently being used by mental health providers in New York, New Jersey and Connecticut, but Ritter intends to expand across the country.

“We intend to expand the platform anywhere and everywhere,” he added. “We are rolling out new geographies in 2021 with a goal of having people in all 50 states. By focusing on the technology and support services, we can help clinicians provide better care.”

The funding also comes at a time when the number of clients seeking care through the platform rose 120 percent in the past six months, while the number of in-network sessions grew 200 percent, Ritter said.

This same demand is being felt across the industry. The behavioral health market is predicted to reach $240 billion by 2026, according to a 2019 report by Acumen Research and Consulting.

Startups in this space are also gaining attention from investors. In a list of U.S. startups working in mental health, 132 deals were venture-backed within the past five years. In fact, investors pumped $1.1 billion into these companies during that time frame, according to Crunchbase data.

One of those was mental health care benefits provider Lyra Health, which raised $187 million in Series E funding last week.

As part of the Series B investment in Alma, Ross Devor, managing director at Insight Partners and Martha Temple, former CEO of Optum Behavioral Health, will be joining Alma’s board.

Devor said in an interview that a key thesis for Insight was looking for companies exploring ways to boost technology in behavioral health.

“What drew us to Alma was that all three parties on this platform benefit: providers, patients and payers,” he added. “When we saw a unique flywheel and the size of the opportunity, it got us excited, and with Harry’s enthusiasm, it was a no-brainer for us.”

Feature photo courtesy of Alma
Blogroll illustration: Dom Guzman