Headspace Health has acquired Shine Inc. to add greater diversity to the wide-ranging digital mental health company.
Santa Monica, California-based Headspace Health on Thursday announced its deal to acquire the mobile mental health company focused on inclusion. About 80% of the Shine team identifies as Black, Indigenous or as a person of color. Additionally, Shine’s self-guided content is geared to marginalized groups, according to a report by Axios Pro.
The financial terms of the acquisition were not disclosed.
“After six years of building Shine, we’re thrilled to join Headspace Health to scale the urgent work of closing the equity gap in mental health – something [co-founder Naomi Hirabayashi] and I have often felt first-hand,” Marah Lidey, co-founder and co-CEO of Shine, said in the announcement.
Headspace Health offers wellness, meditation, coaching, therapy and psychiatry services. In October 2021, it merged with on-demand digital mental health platform Ginger.io in a deal that valued the combined enterprise at $3 billion.
Headspace Health’s reach extends to over 100 million people in 190 countries, and it maintains an enterprise book of business that includes 3,700 clients, according to the company. Some of these include Starbucks, Adobe and Delta Air Lines.
Lidey and Hirabayashi founded Shine in 2016. Since then, Shine has reached 6 million people and has captured over 45,000 paid subscribers, as well as over 90 enterprise customers, according to the company.
Its B2B product is called Shine at Work.
Lidey and Hirabayashi will assume leadership roles on Headspace Health’s product and marketing teams, respectively, moving forward.
Headspace Health’s strategic focus
In the case of Shine, Headspace Health was already working on bolstering its diversity, equity, inclusion and belonging (DEI&B) strategy across the organization, CEO Russell Glass told Behavioral Health Business in an email.
As part of that mission, the company sought to build “a diverse, global workforce that reflects the diversity of our communities,” Glass said.
Headspace Health has likewise been working to invest in cultural competency training for its care providers and internal team members while bolstering content that supports the mental health of underrepresented communities, he added.
Ultimately, the company wants to grow into a business capable of “fostering a place of belonging for all,” Glass explained.
“By acquiring Shine now, we’re able to significantly advance these DEI&B efforts by bringing on an experienced and talented team that seamlessly aligns with our vision, mission and values, and has been doing similar work for the past six years,” the CEO continued.
Growing the business
Headspace Health — combined with Ginger’s total – has raised more than $430 million, according to Crunchbase. Headspace originally launched in 2010.
Similar to its acquisition of Shine to deepen its DEI&B strategy, Headspace Health recently deepened its AI and robo-chat capabilities when it acquired San Francisco-based startup Sayana Inc. in January.
Contextually, its purchase of Shine comes at a time of operational strife for many digital health companies.
The mental wellness app Calm announced it would ax 20% of its workforce in August. Hybrid mental health provider Foresight Mental Health nearly folded before landing a new CEO and a secret round of funding. In June, digital mental health and medication management company Cerebral and digital health tech company Circulo both announced layoffs.
While he did not want to discuss financials, Glass told BHB his company is fortunate to be expanding and hiring during such a time.
“We don’t comment specifically on many of our financials, but Headspace Health is fortunate to be in a position today that allows us to continue to hire in a targeted way across departments, as well as pursue select M&A to help build out and scale specific, strategic areas of our business,” he said in the email.
The reversal of fortunes for several digital health companies comes as the coronavirus pandemic inspired investors to pour billions into the space, especially for behavioral health companies, facilitating swift tech startup-inspired growth.
That funding wave has receded in the first half of 2022, presenting a sort of comeuppance for those who scorn applying the growth-at-all-costs ethos of Silicon Valley startup culture infiltrating mental health.
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