Digital health firm Lyra enters unicorn territory after fundraising

Digital health startup Lyra Health has raised $110 million in fourth-round financing, raising its value above the $1 billion threshold for the first time since it was founded five years ago.

California-based Lyra provides mental health care services that employers can include in health care plans for their staff, and already features companies like eBay, Uber and Genentech on its customer roster.

Its platform connects employees to mental health professionals and supports them through treatment with coaching, medication management and self-care tools.

The $110 million Series D comes just a few months after a third-round fundraising that brought in $75 million, and brings the total amount raised by Lyra to $292 million.

Lyra says it is now pitching at revenues of around $100 million this year, boosted by what chief executive and cofounder David Ebersman describes as more interest than ever from employers looking to invest in better workforce mental health as the coronavirus pandemic rumbles on.

“In a normal year, companies generally wait until Jan. 1 to launch new health care benefits,” he writes in a blog post published this week which notes that the number of employers covered by its customers had doubled in the past year.  

“This year has been different. Many companies have decided their employees need better mental health services right now.”

Since the start of the COVID-19 crisis, Lyra has added 800,000 members, takings it tally to around 1.5 million.

The Series D was led by Addition and also included Adams Street Partners and existing investors, and the cash injection will be used to invest in new services such as Lyra Blended Care for conditions like depression and anxiety.

Ebersman describes the service as “teletherapy…that pairs video therapy sessions with personalised digital tools based on cognitive behavioural therapy (CBT).”

Blended Care was shown to reduce depression and anxiety symptoms in six weeks in a 385-subject study published in the Journal of Medical Internet Research last month.

“I believe we will look back on 2020 as a turning point in our collective recognition that the mental health status quo is not good enough,” says Ebersman, in a reference to data the company generated with the National Alliance of Healthcare Purchaser Coalitions in July which suggested that  83% of US employees are experiencing mental health issues.

“Too many people in need don’t have easy access to potentially life-changing treatment, “ he adds. The same National Alliance survey of 1,200 workers found that one in four said their employer does not support their mental health at all.

Image by Joakim Roubert from Pixabay

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