Investment into mental health technology has boomed, reaching £580 million in 2019, according to a study by early stage investor Octopus Ventures.
The research, based on analysis of the latest Pitchbook data, shows an almost five-fold increase in mental health tech investment in the last six years, rising from £120 million in 2014.
Octopus says this trend is down to corporates increasingly prioritising workplace mental health and relying on digital solutions to manage the issue.
Researchers tracked total deal count in the sector, which has more than tripled from 30 deals in 2014 to 105 last year.
The data also shows that funding rounds are increasing in size, with the average raise equating to £1.92 million in 2019, compared to only £660,000 in 2014.
Despite this, mental health is still nascent in relation to the overall digital health market. Around £2.04 billion has been invested in the sector over the last six years, just 15% of the total £13.7 billion raised by digital health companies.
The report highlights that the UK mental health tech start-up sector received only £21.27 million of investment out of the £580m global total last year.
WHY IT MATTERS
Approximately one in four people in the UK will experience a mental health problem each year, according to mental health charity Mind.
Although investment has increased, Kamran Adle, early stage investor at Octopus Ventures, said the venture capital industry could do more to address mental health difficulties.
“There is a huge opportunity for the UK to be a leader in this space and we are already working with companies in our portfolio that are tackling this issue, such as Big Health,” he said.
THE LARGER CONTEXT
The investment trend accelerated in 2016, when Big Health, maker of digital therapy solution Sleepio for insomnia sufferers, announced a £9 million funding round.
In 2018, Compass Pathway announced a £25 million funding round to help the company develop innovative care pathways and therapies within mental health.
Stress reduction app Calm announced a £22 million fundraise in July 2019, having achieved unicorn status at the beginning of the year, when it raised an additional £70 million.
ON THE RECORD
Peter Hames, CEO of Big Health, said: “We're proud to be helping millions back to good health through our digital therapeutics Sleepio and Daylight, and encouraged that investors are increasingly recognising the potential of technology to tackle the mental health crisis.
“Whilst the increase in investment is welcome, we hope investors do more in helping to address one of the foremost public health issues not only in the UK, but across the globe.”