Digital mental health for young people will increase to $26 billion

The data suggests an insatiable and growing demand for digital youth mental health services.

The digital mental health sector will reach $26 billion by 2027 and has already seen a 15-fold growth rate over the past 4 years, according to a new report from Telosity by Vinaj Ventures.

Vinaj Ventures, the seed investment arm of innovation and investment advisory firm Vinaj Ventures, is focused on supporting scalable youth mental health solutions.

The Telosity report positions its forecast on the rapid growth of mental health investment opportunities in the recent past. Venture capital investments in youth mental health businesses have increased from $59 million in 2018 to $871 million in 2021, according to documents provided by Telosity.

“While the youth mental health market is young, the needs are great,” said Anish Srivastava, partner at Telosity by Vinaj Ventures, in a press release. “The need for technology solutions couldn’t be greater.”

Overall, Telosity estimates the investment opportunity in behavioral health technologies will grow to $132.4 billion by 2027.

Telosity received financial support from Pivotal Ventures, a Melinda French Gates company, to produce the report.

But why digital mental health?

Youth mental health has been deteriorating in the United States for years, and many digital mental health services point to this as an opportunity and a need that needs to be addressed.

From 2005 to 2017, the rate of depression among teenagers rose from 8.7% to 13.2% and from 8.1% to 13.2% among young adults, according to a study.

The same study found that rates of severe psychological distress and suicidality increased by 71% among young adults from 2008 to 2017.

The coronavirus pandemic – which has isolated many of their schoolmates among other challenges – has made the situation much worse.

Up to 17% of adolescents (4.1 million) have experienced a major depressive episode in the past year, a sharp increase from 2019 results, according to the 2020 National Survey of Drug Use and health.

The Telosity report indicates that every dollar invested in the prevention and early detection of mental illness addiction generates savings of $2 to $10 in health, criminal and juvenile justice costs and low productivity.

It also says the United States is facing “the highest rates of teenage sadness reported to date and alarming rates of young people struggling with anxiety, stress, depression, loneliness, and suicide.” “.

The youth mental health hotline Youthline has seen an increase in engagement in the era of COVID-19.

According to the report, tech-focused businesses and services can cater to “young digital natives” at scale.

“Technology is a great leveler, democratizing access to care and enabling much-needed resources to reach a wider population,” Srivastava said.

The report also highlights the flood of investment in digital health in general and digital mental health in particular in recent years.

“In 2020, there were no deals > $50 million, while in 2021 there were 5 deals from 4 companies,” the report said. The report highlights funding rounds from Elemy, GoGuardian, Akili and Cortica.

Other major trends in the broader digital mental health services market cited in the report include overall cost of care, significant increases in demand, stigma associated with receiving mental health services, shortage mental health clinicians and struggles to find a “fit” with mental health. suppliers.

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