Headspace, the US-headquartered meditation app developer that counts several corporates as investors, has agreed to merge with US-based, corporate-backed mental healthcare app provider Ginger.
The combined business will be called Headspace Health and will aim to provide a comprehensive digital platform for mental health and wellbeing services. It will be valued at $3bn, according to TechCrunch.
Russell Glass, chief executive officer of Ginger, will become the CEO of Headspace Health, while CeCe Morken will retain her position as CEO of Headspace and take up the role of president at the merged company.
Founded in 2010, Headspace operates a mobile-based platform that helps users practice mindfulness and meditation to reduce stress and improve sleep quality. It had raised $217m of total debt and equity financing prior to the merger announcement.
The company most recently secured $47.7m in June 2020 from investors including media conglomerate Bennett Coleman & Co (BCC), entertainment studio Broadway Video, talent agency WME and over-the-top media company The Chernin Group.
Crunchbase News reported the capital injection was an extension to a $93m series C round from February that year, and that it was backed by all Headspace’s series A, B and C investors.
Investment firm Blisce led the series C round and was joined by The Chernin Group, BCC’s Times Bridge subsidiary, Waverley Capital, Spectrum Equity and Advancit Capital. It came after Spectrum Equity had led a $36m series B round for the company in 2017.
Headspace raised $34m in its 2015 series A round, which was led by The Chernin Group and which included Broadway Video’s investment subsidiary, Broadway Video Ventures, as well as WME, Advancit Capital, Allen & Company, Breyer Capital, Deerfield Management, Freelands Ventures and assorted individuals.
Ginger offers a variety of mental healthcare services including behavioural health coaching, therapy and psychiatry through a mobile app. It had accumulated $220m of funding since it was founded in 2010.
The company was valued at approximately $1bn in March this year through a $100m series E round led by investment firm Blackstone’s growth equity fund, Blackstone Growth.
Advance Venture Partners, the corporate venture capital affiliate of media group Advance Publications, co-led a $50m series D round for Ginger in August 2020 alongside venture capital firm Bessemer Venture Partners.
Cigna Ventures and Kaiser Permanente Ventures, the corporate venturing arms of healthcare insurance firm Cigna and healthcare consortium Kaiser Permanente respectively, also took part in the round, in addition to undisclosed existing backers and private investor Jeff Weiner.
Kaiser Permanente Ventures had participated in the company’s $35m series C round, in 2019, which was led by WP Global Partners and which also featured City Light Capital, Nimble Ventures, Khosla Ventures, Kapor Capital and Jeff Weiner.
Kaiser Permanente Ventures may have also invested in Ginger’s $20m series B round in 2014. Its earlier backers included True Ventures, Romulus Capital and Kapor Capital.