Synopsis
Despite the magnitude of the problem, risk money has largely eluded mental health startups in India, a sector that receives limited public money. According to data sourced from industry tracker Traxcn, Indian startups in the sector raised $20 mill...
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Why mental health startups haven't yet taken off in India
ETtech
Illustration: Rahul Awasthi
Synopsis
Despite the magnitude of the problem, risk money has largely eluded mental health startups in India, a sector that receives limited public money. According to data sourced from industry tracker Traxcn, Indian startups in the sector raised $20 mill...
By Apoorva Mittal, ETtechLast Updated: Sep 02, 2021, 08:16 AM IST
Mumbai: Risk capital has largely eluded mental health startups in India, though the trend seems to be reversing, albeit gradually.
Indian mental health startups cumulatively raised only $20 million between 2016 and 2020, data sourced from industry tracker Traxcn showed. In the United States, risk investors invested $556 million into mental health startups in 2020 alone, as employers and insurers are key stakeholders in paying for mental health services there. However, the good news is that funding for the sector in India as of August 18 has touched $10.74 million, a five-fold jump from all of last year, as the Covid-19 pandemic brought discussions about mental health to the forefront. Kanika Agarwal, who recently kicked off a funding round for MindPeers, an on-demand behavioral healthcare platform, says: “A typical comment that I get (from investors) is that -- we know it is in huge demand, we know people are suffering, but we don't have the conviction that mental health can scale.”
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Why mental health startups haven't yet taken off in India
ETtech
Illustration: Rahul Awasthi
Synopsis
Despite the magnitude of the problem, risk money has largely eluded mental health startups in India, a sector that receives limited public money. According to data sourced from industry tracker Traxcn, Indian startups in the sector raised $20 mill...
By Apoorva Mittal, ETtechLast Updated: Sep 02, 2021, 08:16 AM IST
Mumbai: Risk capital has largely eluded mental health startups in India, though the trend seems to be reversing, albeit gradually.
Indian mental health startups cumulatively raised only $20 million between 2016 and 2020, data sourced from industry tracker Traxcn showed. In the United States, risk investors invested $556 million into mental health startups in 2020 alone, as employers and insurers are key stakeholders in paying for mental health services there.
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However, the good news is that funding for the sector in India as of August 18 has touched $10.74 million, a five-fold jump from all of last year, as the Covid-19 pandemic brought discussions about mental health to the forefront.
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Kanika Agarwal, who recently kicked off a funding round for MindPeers, an on-demand behavioral healthcare platform, says: “A typical comment that I get (from investors) is that -- we know it is in huge demand, we know people are suffering, but we don't have the conviction that mental health can scale.”
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Scaling up
Scaling up is at the root of the issue.
For years, mental health startups that aimed to connect patients with mental health professionals have failed to scale up. Investors told ET that funding has funding had been a constraint because of the few qualified professionals in the sector. The stigma associated with mental health challenges is that mental health issues are hard to identify and easy to dismiss.
“When we are raising money, we don’t just have to tell them (about) the problems in the world, we also have to tell them why the existing players’ strategies did not work,” Agarwal, who moved to India last year from Singapore after founding and scaling up a digital marketing agency, said. The 29-year-old founded MindPeers in January 2020.
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