Talkspace's Series C round rakes in $31M, will expand online therapy

By Jeff Lagasse
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Update: A previous version of this post included out-of-date information from an older draft of Talkspace's press release. 

Online therapy company Talkspace is now flush with $31 million in new financing. Qumra Capital, an Israel-based growth stage fund, led the Series C round and was joined by existing investors Norwest Venture Partners, Spark Capital, SoftBank, Compound Ventures, and FirstTime. Erez Shachar, a managing partner at Qumra Capital, will join the Talkspace board of directors.
 
Looking to knock down barriers for treatment seekers and attract new clients in the process, Talkspace plans on using the investment to accelerate its growth. Founded in 2012, Talkspace has made it its mission to make accessing mental healthcare more affordable and convenient, creating a nationwide network of professional therapists numbering in the thousands. About 70 percent of Talkspace’s clients have never had therapy before.
 
When compared to traditional therapy, Talkspace said its clients report higher satisfaction in areas such as convenience, affordability and getting help when needed.
 
“This round comes at a time when Talkspace is experiencing dramatic growth,” said Oren Frank, CEO and co-founder of Talkspace, in a statement. “More people than ever are using our platform for their mental health needs and reporting higher satisfaction than traditional therapy. The additional funding gives us the opportunity to build upon our momentum. We have built a consumer-grade Behavioral Health Platform and proven its efficacy and superior efficiency. We’re now ready to expand and scale our offering into the commercial healthcare markets. We appreciate the vote of confidence from our investors as we profoundly change the way mental health care is delivered.”
 
“With tens of thousands of clients every month, Talkspace has shown extraordinary innovation in an otherwise traditional market,” said Erez Shachar, managing partner at Qumra Capital, in a statement. “Beyond Talkspace's strong growth, we see a huge opportunity to prove that technology cannot only make our material needs more accessible, but is also an excellent fit to help far more complicated, emotional and personal needs. Roni and Oren Frank have successfully married technology with the very fundamental need of almost everyone for accessible and affordable professional behavioral care.”
 
Talkspace raised its Series A round in 2015 and Series B round in 2016. The company has now raised a total of $60 million in funding.

The company has not been without controversy. In December 2016, it was accused of a number of ethically questionable practices in an extensive investigative piece published by The Verge; citing internal memos and emails and numerous interviews with anonymous therapists on the platform, the Verge reported that Talkspace monitored conversations between therapists and patients, required therapists to insert scripts into their chats promoting Talkspace services, and didn't have a comprehensive or adequate plan for handling situations where patients -- who are anonymous on the platform -- were in danger. Talkspace CEO Oren Frank, who largely declined to comment in the article, wrote a lengthy response on Medium denying most of the charges.