Amwell, one of the nation’s largest telehealth companies, is eyeing the behavioral health sector for potential acquisitions as it looks to maintain competitive positioning beyond the pandemic surge that has driven explosive growth in virtual care. CEO Ido Schoenberg’s comments to Business Insider reveal strategic thinking about how the newly public company will expand its service offerings in a market where virtual behavioral health has emerged as a particularly attractive segment.
The Boston-based telehealth giant, which trades on the NYSE under ticker AMWL and was formerly known as American Well, connects patients with doctors via secure video connections. While Amwell has thrived during COVID-19 as virtual visits became mainstream necessities across healthcare, the company recognizes that sustaining growth post-pandemic requires strategic moves beyond just riding telehealth tailwinds.
Schoenberg’s acknowledgment that Amwell is considering M&A deals to remain competitive, combined with his specific mention of behavioral health, offers a window into how large telehealth platforms are thinking about portfolio expansion. It also signals that the telebehavioral health sector—which has seen dramatic pandemic-driven growth—may be heading for a consolidation wave as well-capitalized buyers seek to acquire platforms and capabilities they can’t efficiently build organically.
The Strategic Logic of Behavioral Health for Telehealth Platforms
When asked specifically about plans to acquire mental health startups, Schoenberg was direct: “You cannot do everything yourself. And I see behavioral health needs growing in the foreseeable future.”
This reasoning reflects several realities about telehealth platform strategy and the behavioral health market. First, the acknowledgment that “you cannot do everything yourself” represents pragmatic recognition that building behavioral health capabilities from scratch would be slow, expensive, and risky compared to acquiring established platforms with proven models, existing provider networks, and customer traction.
Telehealth platforms face classic build-versus-buy decisions when expanding into new specialties or service lines. For behavioral health specifically, building would require recruiting mental health providers, developing specialty workflows different from primary care video visits, navigating unique regulatory and billing requirements, and establishing credibility with employer and health plan buyers who already work with specialized behavioral health vendors.
Acquiring an established behavioral health platform provides immediate capabilities, customers, and credibility that organic development can’t match on relevant timelines. For a publicly traded company like Amwell facing investor expectations around growth sustainability, acquisitions offer faster paths to revenue diversification than multi-year build efforts.
Second, Schoenberg’s observation about growing behavioral health needs reflects widely shared market sentiment. Mental health and addiction challenges have intensified during the pandemic while telehealth has proven effective for delivering behavioral health services. This combination creates favorable long-term demand dynamics independent of whether overall telehealth utilization moderates as in-person care becomes more accessible.
For Amwell, adding strong behavioral health capabilities could provide countercyclical balance if primary care and specialty medical telehealth volumes decline post-pandemic. Behavioral health demand appears more durable and less dependent on acute pandemic conditions than telehealth for routine medical visits.
Amwell’s Competitive Position and M&A Capacity
Amwell went public in September 2020, raising approximately $742 million in its IPO. The timing proved fortunate, coming as telehealth valuations peaked amid pandemic-driven utilization surges. That capital, combined with access to public equity markets for future fundraising, positions Amwell to pursue acquisitions that privately-held competitors might struggle to afford.
The company competes in an increasingly crowded telehealth landscape that includes Teladoc Health (which acquired Livongo for $18.5 billion), MDLive, Doctor on Demand, and numerous smaller platforms. Differentiation through specialty capabilities and comprehensive service portfolios has become critical as the market matures beyond basic video visit functionality.
Behavioral health represents an attractive differentiation opportunity for several reasons. Many general telehealth platforms have limited behavioral health depth, focusing primarily on primary care, urgent care, and select specialties. Acquiring a specialized behavioral health platform would give Amwell capabilities that most telehealth competitors can’t easily match.
Additionally, behavioral health services complement primary care telehealth naturally. Many patients presenting for primary care visits have underlying mental health or substance use issues affecting their physical health. Integrated platforms that can address both medical and behavioral needs through coordinated virtual care deliver more comprehensive value than fragmented point solutions.
For enterprise customers like employers and health plans, comprehensive platforms that address multiple health needs through unified technology and contracting are often preferable to managing relationships with multiple specialized vendors. Amwell’s behavioral health acquisition could strengthen its competitive positioning for large enterprise contracts.
The Talkspace Context and Market Dynamics
Schoenberg’s comments come as reports circulate that Talkspace, one of the most prominent digital behavioral health platforms, is exploring a sale. Bloomberg reported that the text-based therapy company is working with advisers on a potential transaction that could value the business at up to $1 billion.
Talkspace CEO Oren Frank acknowledged to Behavioral Health Business that acquisition interest in the company has intensified: “Interest in acquiring the company is not new—and as demand for telehealth services has grown dramatically over the months of the COVID-19 pandemic, that interest has grown with it.”
Talkspace’s reported billion-dollar valuation and multiple suitors indicate robust buyer appetite for established digital behavioral health platforms. The company’s pandemic-driven growth has been substantial—a spokesperson told BHB in March that user volume had increased 65% year-over-year while B2B inquiries jumped 150%.
Whether Amwell specifically pursues Talkspace remains speculative. The company’s size, valuation, and high profile might make it too expensive or complex for Amwell’s first behavioral health acquisition. However, Talkspace’s market process validates the strategic thesis that large telehealth platforms and other buyers see significant value in acquiring proven behavioral health capabilities.
Beyond Talkspace, numerous smaller behavioral health startups could be attractive targets for Amwell. Companies focused on specific populations (adolescents, seniors), particular conditions (anxiety, depression, addiction), or specialized modalities (cognitive behavioral therapy platforms, psychiatry-focused services) might offer strategic fits at more digestible valuations than market leaders.
What Amwell Might Look for in a Target
While Schoenberg didn’t specify acquisition criteria, his comments and Amwell’s strategic positioning suggest several characteristics the company likely values in potential behavioral health targets.
Proven telehealth-native delivery models would be essential. Amwell wants capabilities that integrate naturally with virtual care rather than traditional in-person providers attempting digital transformation. Platforms built from inception around remote delivery would fit more seamlessly than trying to acquire and transform traditional behavioral health providers.
Substantial provider networks matter for serving enterprise customers at scale. Acquiring a platform with hundreds of licensed therapists, psychiatrists, and other behavioral health clinicians across multiple states provides immediate capacity that building organically would take years to achieve.
Technology platforms that integrate well with Amwell’s existing infrastructure would ease implementation. While Amwell could operate acquired behavioral health services as semi-autonomous business units, eventual technology integration typically creates operational efficiencies and better user experiences.
Enterprise customer relationships and B2B experience would be valuable. Amwell primarily serves healthcare organizations, employers, and health plans rather than direct-to-consumer markets. Acquiring platforms with existing B2B contracts and enterprise sales capabilities would align better than consumer-focused startups requiring business model pivots.
Clinical credibility and outcomes data would differentiate quality platforms from the many behavioral health apps and services that lack rigorous evidence. Platforms demonstrating measurable outcomes through published research or validated measurement systems would bring credibility that supports premium positioning.
The Broader Telebehavioral Health M&A Wave
Amwell’s potential entry into behavioral health acquisition hunting, combined with Talkspace’s reported sale process and the sector’s pandemic-driven growth, suggests telebehavioral health may be entering a consolidation phase.
Several categories of buyers likely are evaluating opportunities. Large telehealth platforms like Amwell and Teladoc want behavioral health capabilities to round out service portfolios. Health insurance companies seek to control behavioral health delivery and costs. Technology companies view behavioral health as an attractive healthcare entry point. Private equity firms see growth opportunities in a fragmented market with favorable fundamentals.
This buyer diversity creates favorable conditions for digital behavioral health companies considering exits. Multiple buyer types with different strategic rationales competing for limited high-quality assets tends to inflate valuations and provide founders with options around cultural fit and post-acquisition vision.
However, not every behavioral health startup will attract acquisition interest. Buyers will likely focus on platforms with substantial scale, proven unit economics, defensible competitive positions, and pathways to profitability. Small platforms with limited traction, consumer-only models dependent on expensive marketing, or offerings that compete directly with acquirers’ existing capabilities may struggle to generate buyer interest.
The potential M&A wave also faces timing questions. Are valuations peaking along with pandemic-driven usage, creating optimal exit windows? Or will behavioral health demand and telehealth adoption sustain at elevated levels, making current valuations reasonable rather than inflated? These questions influence both buyer willingness to pay and seller decisions about transaction timing.
Implications for the Behavioral Health Ecosystem
If large telehealth platforms like Amwell aggressively pursue behavioral health acquisitions, the impacts will ripple through the ecosystem in several ways.
Independent behavioral health telehealth platforms may face pressure to scale rapidly or seek acquisitions themselves before buyer attention shifts. The potential for lucrative exits could attract additional venture capital to the space, funding more startups and intensifying competition.
Traditional behavioral health providers could see increased competition from well-capitalized telehealth platforms with superior technology, marketing resources, and distribution through enterprise partnerships. This might accelerate provider adoption of telehealth and force investment in digital capabilities.
Patients could benefit from improved access as large platforms invest in expanding provider networks and improving user experiences. However, consolidation also risks reducing innovation as independent startups get absorbed into larger organizations with less entrepreneurial cultures.
Employers and health plans might welcome comprehensive platforms offering integrated medical and behavioral telehealth from single vendors, simplifying contracting and administration. But they also risk reduced negotiating leverage as consolidation creates larger, more powerful vendors.
Clinicians working for acquired platforms might gain from better compensation, benefits, and career development at larger organizations. However, they might also experience more bureaucracy and less autonomy than at entrepreneurial startups.
Looking Ahead
Schoenberg’s comments represent just one data point, but they come from the CEO of a major public telehealth company with capital and strategic motivation to expand beyond current capabilities. Whether Amwell completes a behavioral health acquisition in coming months remains to be seen, but the company’s exploration signals broader market dynamics around telebehavioral health consolidation.
For behavioral health startups, the message is clear: large, well-capitalized strategic buyers are interested in the space and see long-term growth opportunities worth pursuing through M&A. This creates potential exit opportunities but also intensifies competitive pressure as larger players enter the market.
For the behavioral health field broadly, the entry of major telehealth platforms through acquisitions could accelerate virtual care adoption, improve technology sophistication, and expand access. However, it also raises questions about how consolidation affects innovation, competition, and whether corporate-owned platforms maintain the mission-driven focus that many behavioral health organizations prioritize.
As 2020 closes and the industry looks toward 2021, telebehavioral health appears poised for significant M&A activity. Amwell’s potential participation as a buyer represents just one piece of what could be a much larger consolidation wave reshaping how mental health and addiction services are delivered in an increasingly digital healthcare landscape.
Whether Schoenberg’s hint translates to actual deals—and what those deals might look like—will become clearer in coming months. For now, his comments serve as a public signal that behavioral health acquisition season may be opening, and companies with growth capital are shopping.
