Investors Put $15M Bet on SMI-Focused Startup Amae Health

Los Angeles-based Amae Health announced Thursday the close of a $15 million Series A round.

The less-than two-year-old-startup seeks to unify disparate parts of the health care system that treat those with serious mental illness (SMI). It offers behavioral health, physical health and supportive services.

“Our mission at Amae Health is to provide lifelong, adaptive care that addresses both the immediate and long-term needs of our patients, and this new funding will be instrumental in scaling our operations and enhancing our data-driven precision medicine platform,” Sonia Priscilla García, co-founder and chief product officer at Amae Health, said on LinkedIn.

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Amae Health will use the funding to open locations in new markets, the company said on LinkedIn. Those markets will be in North Carolina, Texas, New York and Ohio, a company representative told Behavioral Health Business.

The company has also partnered with the tech firm Palantir Technologies Inc. (NYSE: PLTR) to “develop a precision medicine platform for psychiatry.”

Quiet Capital, a venture capital firm, led the round. New investment came from Healthier Capital, Baszucki Group and Mike Volpi, managing partner of Index Ventures. The round also included unnamed angel investors. The company’s seed round investors participated: Bling Capital, Virtue, 8VC and Able Partners.

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“The road to redefining mental health care is filled with challenges, but with the unwavering support of our team, investors, and the broader healthcare community, we are making significant strides towards better patient outcomes and fundamentally changing the way SMI is treated,” García said.

The company also focuses on establishing value-based care contracts with payers. Often, treating SMI requires providers to account for, if not take on directly, non-clinical aspects of health. Garcia said at a BHB VALUE conference in 2023 that this holistic approach to care is necessary when treating patients but is not enabled by the fee-for-service paradigm.

“Care that is driven by financial reimbursement is not designed to solve a problem, and it’s designed to continue the cycle of reimbursement,” she said.

The Amae Health model is inspired in part by the U.S. Department of Veterans Affairs mental health intensive case management program. That includes an integrated team of psychiatrists, social workers, peer support, health coaches and primary care physicians.

It was founded in 2022.

Amae Health will be working on several research endeavors. These include an upcoming study with the University of California-Los Angeles and Apple Inc. (Nasdaq: AAPL) to explore digital sensing with those with SMI.

Venture capital funding for behavioral health has waned significantly since a boom period in 2021. Still, some startups have managed to raise capital. Investors are much more savvy and conservative in the high-interest rate environment, especially after the 2021 funding boom. 

Late-stage investment rounds by Pelago ($58 million), Two Chairs ($72 million) and Grow Therapy ($88 million) demonstrate investors are interested in business and clinical models that differentiate themselves in a meaningful way. These examples and the overall slowdown in all health care venture capital investment also show that the market will be less tolerant of companies and executive teams that don’t produce meaningful care/operational or financial outcomes.

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