FIRST DOWN
Headspace + Ginger Merge to Make a Mega Mental Health Startup
This week, leading digital mental health startups Headspace and Ginger announced that they are merging, as demand for digital mental health services spikes. Barring any regulatory concerns, the new entity will operated under the brand Headspace Health, and sport a $3 billion valuation and more than 800 employees.
As a refresher, Headspace is a digital health platform that provides guided meditation sessions and mindfulness training. The decade-old LA-based startup has raised more than $200 million in venture funding to-date. For its part, Ginger is an on-demand mental health company providing around-the-clock access to emotional support via coaching, therapy, and psychiatry. The decade-old SF-based startup has also raised more than $200 million in funding to-date.
The past year has put a strain on everyone's collective mental well-being. As of January, more than 40% of all U.S. adults reported symptoms of anxiety disorder or depression. And as we have written about at length on the 2-Minute Drill, it also produced record-setting investment into startups looking to increase access to mental health services through technology. In fact, nearly $1 billion was invested by venture investors into mental health startups in 2020 alone, which represents a 112% increase compared to 2019. And according to Crunchbase, investors have pumped more than $1.8 billion into global startups focused on mental health in the first half of 2021 alone.
As a combined company, Headspace Health will look to expand beyond just mindfulness, and into a full-spectrum offering of virtual mental health support that includes behavioral health coaching and video-based therapy. And perhaps more impactful, it will look to expand beyond just direct-to-consumer, and include corporate and Medicaid offerings.
(more here)
Bonus Coverage: membership-based network for mental healthcare providers Alma raised $50 million this week to help practitioners leverage technology to more easily operate their businesses and accept insurance coverage (here). We last covered them on the 2-Minute Drill here.
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SECOND DOWN
Vine Founder's New Viral NFT Project Is Brilliant (or Crazy)
The co-founder of the pioneering mobile short-form video platform Vine--Dom Hofmann--is back with a new, viral, and blockchain-based set of building blocks for fantasy gaming called Loot that is either brilliant, crazy, or perhaps both.
Last Friday, via Tweet, Hofmann dropped a new open-source NFT project called Loot, which programmatically randomly generated strings of text that name various types of "adventure gear" with names like "Divine Hood" or "Necklace of Enlightenment." No images, no stats, no instructions of what to do with these strings of text...no anything -- just randomized strings of text organized into a total of 8,000 bags of Loot. All "items" were available for free on the OpenSea and Etherscan marketplaces, with buyers only needing to pay for the "gas" that powers the Etherium-based transactions.
In short, it is manufactured scarcity within an "adventure" subculture of a set of randomly-generated digital text-based descriptors of items. But what is fascinating is that the crypto-community jumped onboard and began leveraging their collective creativity to actually assign value to what was really just a random set of 0s and 1s. It's like starting with a glass slipper or a sword that is embedded in stone, and then telling the universe to go out and create stories around these items. And better yet, once that glass slipper is used in a story called "Cinderella," whoever owns that slipper can then take it with them and insert it into a new story about a soccer player who wins the World Cup playing with a magical glass slipper on her foot (I want a share of the profits for whoever goes out and makes this movie!).
What happened next is pretty amazing. Hofmann released all but 333 of the "bags" of loot, and they were all snapped up nearly instantly. Within 5 days, Coindesk reported that the Loot bags were resold for $46 million and had a market cap of $180 million. Remember, this is a randomized string of text that describes a nonexistent virtual item. As of Friday, the cheapest Loot bag on OpenSea was selling for $75,000!
On the one hand, you can say this is a prime example of peak NFT bubble. But on the other hand, it's been incredible to see what this simple release has spawned (cool thread here). From artworks that provide digital renderings of the items to guilds, to adventure stories being created by the community around the items, and more, it's a fascinating experiment in creating an outsourced and decentralized adventure universe--and hints at a future of where the next Marvell Universe could emerge from. What remains to be seen is whether the crypt-community will continue investing in the ecosystem, or is really here for the quick flip of monetary value. Here's hoping to the former, and seeing where this goes.
(more here)
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THIRD DOWN
Forget the Grinder, Compound Foods Brews Up Bean-less Coffee
The past decade has seen a massive influx of investment into leveraging science and technology to reimagine the foods we eat, and how foods are produced. From alternative proteins like Beyond Meat and Impossible foods, to cell-curated proteins like Upside Foods and Wild Type, to organic sprays like Apeel Sciences that increase shelf life of produce, technology is playing an ever-larger role in the food production process.
One of the key reasons there is so much interest in disrupting the food production supply chain is the environmental impact that industrial food production has on the planet. From rainforest devastation to produce palm oil to the methane from beef production, to water consumption for crops, and so much more, the environment is beginning to buckle under the strain of needing to feed a rapidly-growing global population.
So if we can leverage technology to replace beef, chicken, or fish with plant-based products, why not take a look at reimagining how coffee is created. Why coffee? Well, first off, over 80% of Americans consume coffee daily, and the market is approaching a half trillion dollars globally. But what many consumers are unaware of is that coffee is the fifth-most polluting crop in the value chain.
Enter Compound Foods, a year-old San Francisco-based startup that uses synthetic biology to create coffee without coffee beans. Much like alternative protein companies aim to mimic the taste of the proteins they are replacing, Compound Foods has spent countless hours examining at the molecular level what makes coffee taste and smell like coffee, and finding ways to replicate the end-product without the coffee beans--or the chain of production required to produce your daily cup of joe.
The startup is still early, but this week announced a new $4.5 million seed round of funding from a syndicate of early-stage funds and angel investors. With the new funding, Compound Foods hopes to nail down the formulation and invest in scaling up the brand for a soft launch by the end of the year.
(more here)
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FOURTH DOWN
Callin Calls Up $12 Million For Social Audio Tools
As live audio continues to gain traction, a host of new startups have emerged to provide audio creators with tools to help them record, edit, and share the content being created. The latest startup to build tools for this booming trend is social podcasting app Callin. Callin was founded by Axel Ericsson and former CEO of Yammer and COO of PayPal, David Sacks, and this week announced a fresh $12 million Series A round of funding from Sequoia, Goldcrest, and Sack's own venture fund Craft.
Recorded audio is certainly nothing new, but what is new, is the boom in live, interactive audio and a new category of audio content that doesn't necessarily require the same level of production and sound quality expected of professional podcasts or audiobooks. The whole social audio movement exploded onto the scene last year with the launch and meteoric rise of Clubhouse--and then the dozens of copycats that immediately followed. We'll save the debate around audio as a feature vs. live audio as a social graph for another time, but what is clear is that much like YouTube provided a home for non-professional recorded video to thrive, there is demand for non-professional social audio to find a more permanent home.
Callin's goal is to combine the benefits of live social audio and recorded podcasting into one seamless experience. Today, millions of hours of live audio content on platforms like Clubhouse disappear into the ether as soon as words are spoken on the app. On the other end of the spectrum, there are highly-produced podcasts like The Joe Rogan Experience or Call Her Daddy that are produced in studio, edited and refined, overlaid with effects, etc etc. And while most ephemeral live audio content should stay ephemeral, there is a lot of great quality live social audio content that creators would like to record, edit, and package for distribution. And today, none of the social audio platforms make that easy.
Callin steps in and provides a similar live social audio interface, but then layers on recording and a suite of tools to help creators edit content and publish to listeners like a recorded podcast. Tools include transcription, text-based editing, and the ability to export to other podcast players. But one thing that Callin hopes will set it apart is the fact that when the recorded audio is played back within the app, listeners have access to more robust features such as clicking on the profiles of the various speakers and browsing their other interests and contributions.
For now the app--and live social audio in general--are still in their infancy. But what is clear to all is that there is a need for a simple tool to help audio creators capture, edit and distribute their content more effectively, and if a tool can do this in a way that feels like magic, then there will be a large and growing audience of creators willing to pay for the service.
(more here)
Disclosure: Crossover is an investor in Clubhouse.
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EXTRA POINT
Athletes + Entertainers in Tech: Eight Sleep
This week, Miami-based sleep technology company Eight Sleep announced a new star-studded $86 million round of funding at a nearly $500 million valuation. This brings the seven-year-old startup's total funding to more than $162 million.
For those unfamiliar with Eight, the startup makes a suite of physical products designed to improve sleep through personalized temperature, smarter data, and patented technology. Products range from thermo-regulated mattresses to temperature-changing mattress covers, to a breathable pillow and a suite of sleep aids and supplements.
If it seems like you're hearing a lot about sleep technology lately, it's probably because you have. The sleep technology market is estimated to be roughly $30 billion in size, and other high-profile companies like Oura ($148m raised) and Apple (the new watch) have been making headlines as well.
Eight's core products are the mattress (retails for nearly $3,000 for a queen), and the smart cover (starts at $1,720). So they ain't exactly cheap. But if they are effective and help you increase health and productivity, perhaps they are a steal. According to Eight, customers using their products, fall asleep up to 32% faster, get up to 20% more deep sleep and experience 30% fewer mid-night wake-ups and up to 30% fewer tosses and turns.
Eight is also part of broader suite of technology products focused on quantifying health using a combination of sensors, data science and machine learning. And by focusing on technology, Eight hopes to avoid the comparisons to once-hot mattress startup Casper, which once flew high with a $1 billion valuation, but currently trades at around $220 million as a public company. With the new funding Eight plans to invest in building out more technologies that contribute to getting a good and effective night's sleep.
Athletes + Entertainers involved include: MLB stars Alex Rodriguez, Kris Bryant and J.D. Martinez, and entertainer Kevin Hart.
(more here)
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