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Summary:

In a positive sign for the emerging industry of telepsychiatry, Redwood City, Calif.-based Breakthrough has raised $5 million in a Series A round.

The therapist’s office of the future may not feature the familiar couch but a singular computer.  As we’ve covered before, more startups are working to bring mental health treatment online through videoconferencing and web chats.  But in a positive sign for the emerging industry, Redwood City, Calif.-based Breakthrough said on Thursday that it had raised $5 million in a Series A round and that it will use the money for engineering, product development and marketing.

A provider and patient speak via videoconference on Breakthrough.

A provider and patient speak via videoconference on Breakthrough.

The funding coincides with the rise of sensors, more broadband access and the growth of connected devices — all of which have helped make remote care an everyday reality.  The American Telemedicine Association estimates that 10 million Americans directly benefitted from some kind of telehealth service in the last year. And reports released in January projected that the global field would grow 53 percent this year and six-fold by 2017.

“Telehealth is not mainstream yet but it’s going to be,” said Breakthrough founder and CEO Mark Goldenson. “The biggest challenge we have now… is to spread the word so that people know this is an option for them.”

Research supports web-based therapy

Some therapists may worry about liability issues or an increased likelihood of misdiagnosis, and patients may be concerned about privacy and security online. But proponents of telepsychiatry say the internet could help bring therapy to a broader population of people who need it. Online counseling sessions are not only more convenient, they enable patients who fear discrimination from friends, family and employers to more easily keep their treatment to themselves.

And more research indicates that web therapy is effective.  For example, a study last year on 98,000 Department of Veterans Affairs patients found that live video therapy reduced hospitalization rates by 25 percent.

find provider - breakthroughSimilar to other services, Breakthrough enables users to search through lists of licensed providers, schedule appointments and conduct therapy sessions online. But its big differentiator is that it accepts insurance. According to the company, 10 percent of psychologists see patients via video but most can’t bill insurance.  For patients, Breakthrough offers a service that doesn’t rely on out-of-pocket payments and for, providers, it offers a platform to reach new patients, reduce no-shows and ensure reimbursements.

A growing online industry

Breakthrough’s new funding, which follows about $1 million previously raised by the company, was led by The Social + Capital Partnership and included First Round Capital and Great Oaks Venture Capital.

In the past few years, rivals like iCouchTherapy RxTalkTala and TalkSession have also launched, with some raising seed money for services that enable patients to discover and connect with licensed therapists and counselors without leaving their living rooms.  But Breakthrough’s Series A indicates that more investors are beginning to embrace a future of telehealth and, specifically, telepsychiatry.

In its earliest days, the company started building a network of therapists nationwide and, at one point, reached 1,300 providers across the country. But Goldenson said the company decided to scale back and take a state-by-state approach that enabled it to work with insurance companies and focus on the most invested providers who were wiling to learn the best practices for online therapy.  Goldenson declined to share the site’s user numbers but said it averages 6 sessions per user and that 73 percent of users rebook.

For now, Breakthrough only includes 30 providers in California and works with health plans including Blue Shield of California and Magellan. But the company said it intends to take an Uber-style approach to expansion and quickly scale to other states over time.

Image by wavebreakmedia via Shutterstock.

  1. Congratulations Mark & Team. This is a great milestone. More important than the raising of capital is the amazing product accomplishments you all have made recently and bringing awareness to a need our society has to help them heal. Keep the momentum going!

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