New York City-based telepsychiatry provider Talkiatry made a major splash in the venture capital-backed behavioral health space on Tuesday, securing a significant $130 million funding round. This latest funding is one of the largest in recent memory for the sector and positions Talkiatry as a key player in the evolving field of telehealth and psychiatric care. The round, which includes both equity and debt financing, was led by the prestigious venture capital firm Andreessen Horowitz. The funds will primarily be used to scale up Talkiatry’s value-based care offerings—a model that focuses on improving patient outcomes while controlling costs.
The funding round also saw the participation of Perceptive Advisors, and Banc of California provided the debt financing. This sizable investment marks a pivotal moment for the company, which has quickly grown to provide psychiatric care across the United States and continues to expand its reach with notable payer partnerships.
Talkiatry’s Growth and Expansion
Founded in 2019, Talkiatry has made significant strides in just a few short years. The company currently operates in 43 states, employs over 300 psychiatrists, and is in-network with over 60 payers, including major health insurance companies such as Aetna, Blue Cross Blue Shield plans, United Healthcare, Cigna, and Humana. Talkiatry proudly claims that more than 70% of commercially insured individuals have access to their services through their health plans. This widespread network access is a testament to the company’s success in forging robust partnerships with leading healthcare payers.
Talkiatry’s telepsychiatry platform was launched in 2020, during the pandemic’s early days, and has since seen rapid growth. One of the core differentiators of Talkiatry is its focus on maintaining an in-network model, ensuring that patients have easy access to covered care. This sets Talkiatry apart from many other behavioral health telehealth companies that emerged during the pandemic. While many of these companies rely on contractor-based models, Talkiatry has chosen to hire physician-level providers as W-2 employees, ensuring a higher standard of care and continuity for patients.
The Focus on Value-Based Care
Talkiatry’s primary objective is to provide high-quality, accessible psychiatric care that improves patient outcomes while controlling healthcare costs. The company has made strides in demonstrating the effectiveness of its value-based care model, which links compensation to the quality of care provided rather than the volume of services delivered. This model has gained traction, particularly in psychiatric healthcare, where the outcomes-based approach offers a way to monitor the impact of treatments over time.
In a recent announcement, Talkiatry revealed that its value-based care program in collaboration with a leading national health plan resulted in impressive outcomes: a 68% reduction in hospitalizations, 32% fewer emergency department visits, and a savings of $700 per month in overall health spending. These results underscore the effectiveness of Talkiatry’s approach to psychiatric care, and further cement its reputation as a leader in the industry.
Scott Kupor, managing partner at Andreessen Horowitz, praised the company’s efforts, stating, “Talkiatry has mainstreamed outcomes-based psychiatric healthcare and risk-based payment models. The company has built a reputation for providing affordable, high-quality treatment for psychiatric patients while creating robust partnerships with a continually-expanding payer network.”
Continuing to Lead Innovation
Since its inception, Talkiatry has been focused on revolutionizing psychiatric care, leveraging telehealth to break down barriers and increase access to mental health services. The company has set itself apart by focusing on in-network care, a strategy that not only ensures patients have more consistent access to care but also makes psychiatric services more affordable and integrated into the broader healthcare system.
In January 2023, Talkiatry announced an expansion of its services to include age-specific care programming for seniors, an important step in broadening its patient base and addressing the unique mental health challenges faced by older populations. This expansion further demonstrates the company’s commitment to providing specialized care tailored to the specific needs of different demographic groups.
Funding Success Amid a Downturn in Behavioral Health Investment
The $130 million funding round is significant not only because of its size but also due to the timing. The venture capital-backed behavioral health investment market has seen a sharp decline in recent months, with investments in the sector dipping significantly compared to the peak years of 2021. However, as evidenced by this funding round, investors are still interested in supporting more developed, proven startups like Talkiatry that are already demonstrating success and scalability in the market.
Some other notable companies that have secured large funding rounds recently include Two Chairs, a hybrid therapy provider that raised $72 million, Grow Therapy, a virtual platform for therapists that raised $88 million, and Pelago, a B2B addiction treatment provider that raised $58 million. These companies, like Talkiatry, are focused on improving access to high-quality behavioral health care, but each offers its own unique approach to delivering services.
Advocating for Telehealth in Psychiatry
Talkiatry has also been an active advocate for maintaining the telehealth flexibilities that were introduced during the pandemic, particularly when it comes to controlled substances. In a statement, Talkiatry’s CEO Robert Krayn and Chief Medical Officer Dr. Georgia Gaveras voiced concerns over the Drug Enforcement Administration’s (DEA) proposed rollback of telehealth-initiated prescriptions for controlled substances. This flexibility, which was extended during the pandemic, has made it easier for telehealth providers to prescribe necessary medications for psychiatric conditions, and many, including Talkiatry, have pushed the DEA to consider creating a special registration process for telehealth providers to continue prescribing controlled substances on an exclusively telehealth basis. This remains a hot topic within the telehealth and behavioral health communities, with many organizations advocating for the preservation of these policies to ensure continued access to care.
Looking Ahead: The Future of Talkiatry
As Talkiatry continues to expand its offerings and deepen its payer partnerships, the latest funding round will allow the company to enhance its value-based care programs and scale its operations to reach even more patients. Talkiatry’s innovative approach to telepsychiatry, in-network care, and value-based care delivery positions it as a major player in the evolving mental health landscape.
With this new infusion of capital, Talkiatry is well-positioned to continue providing affordable, accessible, and high-quality psychiatric care to individuals across the country. As the mental health space continues to grow, Talkiatry’s emphasis on outcomes, cost savings, and scalable care delivery makes it one of the most exciting companies in the field today.
If you or someone you know is in need of psychiatric care, Talkiatry’s telehealth platform offers convenient access to experienced providers across the United States. To learn more about their services and how they are shaping the future of psychiatric care, visit Talkiatry’s website today.
