Youth Mental Health Startup Cartwheel Care Raises $20M in Round Led by Menlo Ventures

Youth mental health startup Cartwheel Care Inc. has landed a $20 million Series A funding round.

The Cambridge, Massachusetts-based company offers pediatric digital mental health services via partnerships with school systems and boasts a no-waitlist system.

“Our commitment is that we will have appointments for the family within seven to 10 days of that initial referral from the school, sometimes sooner,” CEO Joe English told Behavioral Health Business.

Menlo Ventures led the round. The investment firms Reach Capital, General Catalyst, BoxGroup and Able Partners also participated. General Catalyst was involved in several other behavioral health funding rounds in 2023, most recently with the eating disorder treatment provider Equip. Late last year, a leader at the firm told BHB it would not slow its behavioral health investment efforts. 

In the school systems that partner with the startup, counselors connect students with Cartwheel Care, which can then provide one-on-one or group therapy, family support and medication support.

The company was founded in 2022 by English, Dr. Juliana Chen (chief medical officer) and Daniel Tartakovsky (chief operations officer).

Today, Cartwheel Care partners with about 50 school systems in Massachusetts, New York, Connecticut, Illinois and Rhode Island. 

Cartwheel assigns each partner school system a clinically licensed program manager to support administrators with case management, parent engagement, staff training and other daily questions. The company also includes care coordinators who help with scheduling, insurance and referrals for other services.

“We led this investment in Cartwheel because, by working directly with schools, Cartwheel enables earlier intervention, improves student and family engagement throughout care, and supports better coordination among the trusted adults in a student’s life,” Greg Yap, a partner at Menlo Ventures, said in a press release. 

The company works in-network with commercial health plans and state Medicaid plans.

“By combining funding from school districts and health insurers, we’ve helped superintendents ensure the long-term financial sustainability of these services,” Tartakovsky said. “We believe our model will become a blueprint for districts across the country on how to build a long-term school-community partnership, especially as school budgets tighten with the expiration of federal COVID relief dollars.”

Cartwheel Care joins a growing pack of startups focusing on pediatric care and/or engaging with schools to deliver behavioral health care. Daybreak Health announced in August that it would expand its services to a new age group. That company raised a $13 million funding round the same month. Bend Health came out of stealth mode earlier in the year with a $32 million funding round and made other moves through 2023. Somethings also landed a $3.2 million round this year.

Each company points to the shortage of youth-specific mental health services and the worsening state of youth mental health in the U.S. Recent CDC data show that about 40% of high school students persistently feel sad or hopeless, while about a third say their mental health is poor. These measures are elevated compared to ten years ago, the data show.

As many as 165 million Americans live in areas the federal government designates as mental health provider shortage areas.

“We’ve reached a tipping point in a mental health crisis that is overwhelming parents, schools, and community-based providers,” Steve Kupfer, partner at Reach Capital, said in the release. “Through care coordination, parent engagement, and a versatile team of licensed clinicians, Cartwheel will provide indispensable relief to communities across the country.”

Reflecting on the experience of raising the round, English said there is “both an excitement about and an apprehension towards schools as a partner in a channel.”

Investors and clinicians recognize schools’ centrality in children’s lives and the collective lives of communities. And, schools are often not considered for tech and service innovations, despite the broad accountability they face and the amount of sub-clinical mental health services they are expected to provide, he said.

In its first year, Cartwheel Care didn’t have an outbound sales function; its growth so far came from word of mouth among neighboring districts. Further, it’s year-round engagement in establishing partners jived well with school system budgeting cycles.

“That organic excitement from schools … is one of the most exciting things to investors, particularly health care investors that have not broken into schools as a channel or partnership to date,” English said.