Hi Akash! Yep, I think Mind Ease’s ability to attract users is certainly an important factor! I think of it as Mind Ease’s counterfactual ability to get users relative to other apps (for example, since Mind Ease is impact-driven, they could offer the app for free to people living in low-income countries which profit-driven competitors are not incentivized to do) as well as Mind Ease’s counterfactual impact on users compared to a substitute anxiety reduction app (for example, data in the cost-effectiveness analysis section of Hauke’s report pointing Mind Ease potentially having a stronger effect on GAD-7 anxiety scores compared to Pacifica, a popular alternative, as well as the general rigor of their approach).
The active user estimates were modeled in TPP’s full report on Mind Ease. We provide a high-level overview of the data that was considered in the full report, which “included Mind Ease’s background and plans (including offering a free or discounted version of the app to low/middle income countries), historical downloads and active users, competitors, and financial details.” The report leveraged Lionheart’s business analysis, and based on my knowledge of information such as Mind Ease’s historical user figures and strategic options like offering the app for free to certain populations, I think the report’s user growth projections are reasonable (and those projections are only for the 25% “success” case).
As a reference point for the 25% chance of success, it’s possible that many people’s views on startup success are shaped by headlines like “90% of startups fail.” However, the criteria for the startups that are included in the numerator and denominator of such success calculations can greatly affect the final number. Funded startups have higher success rates than one might expect. In our footnote on startup base rates which you may find interesting, “Funded ventures had a 76% survival rate (to 2010) and 27% “success” rate (exit or >75 employees).” The 25% success rate aligns very closely with the 27% success rate of funded ventures gaining over 75 employees or getting acquired in the study we cited. The study findings align with other research/reports I am familiar with.
To add two additional points to Brendon’s comment.
The 1,000,000 active users is cumulative over the 8 years. So, just for example, it would be sufficient for Mind Ease to attract 125,000 users a year each year. Still very non-trivial, but not quite as high a bar as 1,000,000 MAU.
We were happy we the 25% chance of success primarily because of the base rates Brendon mentioned. In addition this can include the possibility that Mind Ease isn’t commercially viable for reasons unconnected to its efficacy, so the IP could be spun out into a non-profit. We didn’t put much weight on this, but it does seem like a possibility. I’m mentioning it mostly because it’s an interesting consideration with impact investing that could be even more important in some cases.
Thank you, Brendon and jh! A few more thoughts/questions below. Feel free to ignore any that are not super relevant or that would take a very long time to address.
My understanding is that most popular apps (e.g., Headspace, Calm) offer free versions to people [including people in low- and middle-income countries]. I suppose MindEase would have an edge if it offers the full (premium) version for free, but it still seems quite difficult to compete with highly popular apps like Headspace/Calm. What do you think? And has this model of offering an app for free in low- and middle-income countries worked for any apps in the past?
The Pacifica study that Hauke cites compares counseling alone to counseling + Pacifica. This seems like a comparison that would underestimate the effect of Pacifica. (It seems rather impressive that an app is able to have any effect above and beyond therapy, and I would imagine its standalone effect to be larger). Furthermore, I don’t think Pacifica will be Mind Ease’s main competitor—Headspace and Calm appear to be much more popular than Pacifica (here and here), and they also focus on mindfulness/relaxation. Are there any estimates of Mind Ease’s counterfactual impact relative to Headspace or Calm?
Is the business analysis by Lionheart publicly available? (Apologies if you said this somewhere in your post).
Thank you for the info about startups! I’m still a bit skeptical about the mental health app space in particular; are there any statistics about the percentage of funded health/mental health app startups that succeed?
These are great points! FYI, jh is Jonathan Harris who runs TPP.
I’ll preface my response by saying that I’m not an expert in this area; Will and I mostly focused on the impact investing side of things, and Hauke or someone on the Mind Ease team could likely provide a better response.
My understanding is that most popular apps (e.g., Headspace, Calm) offer free versions to people [including people in low- and middle-income countries]. I suppose MindEase would have an edge if it offers the full (premium) version for free, but it still seems quite difficult to compete with highly popular apps like Headspace/Calm. What do you think? And has this model of offering an app for free in low- and middle-income countries worked for any apps in the past?
I think that Headspace and Calm may not be the right reference points since they’re not designed to tackle anxiety and depression, whereas Sanvello (formerly Pacifica) is. Headspace and Calm strike me more as “mindfulness apps” versus “mental health apps.” For instance, it doesn’t look like Mindspace and Calm feature any CBT exercises, whereas Sanvello does. I have paid access to Calm via my employer, and while I haven’t used it much, it looks like all it has are guided meditations. Reviews of Headspace and Calm support my initial impression and mention that they just have guided meditation and music. I expect that evidence-based practices specifically designed to target certain mental health conditions are significantly more efficacious than guided mindfulness meditations.
This distinction might’ve made it so that this Psychology Today review from 2019 mentions Sanvello as “the most popular” mental health app, ignoring Headspace and Calm. Regarding competition, it mentions that Sanvello has 2.6 million registered users, which is smaller than Headspace and Calm but still seems significant. It seems like other apps, including ones I’ve never heard of, have also been able to get decent user counts. For example, Moodpath reached 1 million downloads in 2019. Regardless of whether Headspace and Calm are competitors, Sanvello and other apps would still need to be competed against. Unlike other industries, like network effects with social media, I don’t think that the major mindfulness/mental health apps have enough of a moat to prevent other competitors from emerging.
My understanding is that Headspace and Calm offer their vast majority of their content behind a paywall. The Headspace review I linked to suggests free users get access to one-third of a “Basics” (introductory meditation) course before they need to pay.
What constitutes releasing an app for free as “working?” It’s commonly known that free apps get many more downloads and are the vast majority of apps on the iOS and Android app store, so I would expect that this would be a very effective user acquisition strategy (but perhaps not an effective monetization strategy, hence the social impact angle).
The Pacifica study that Hauke cites compares counseling alone to counseling + Pacifica. This seems like a comparison that would underestimate the effect of Pacifica. (It seems rather impressive that an app is able to have any effect above and beyond therapy, and I would imagine its standalone effect to be larger). Furthermore, I don’t think Pacifica will be Mind Ease’s main competitor—Headspace and Calm appear to be much more popular than Pacifica (here and here), and they also focus on mindfulness/relaxation. Are there any estimates of Mind Ease’s counterfactual impact relative to Headspace or Calm?
Sanvello (Pacifica) was likely selected because it is the most efficacious competitor in the same space. I’m not sure about how Hauke utilized the study findings in his report and his reasoning for doing so, so I’ll have to defer to him on this. I’ll let him know about your question!
It’s worth pointing out that the report uses a very conservative counterfactual user impact estimate that is much closer to Foster’s estimate than Hauke’s estimate due to “principles of robust decision making under uncertainty.”
Is the business analysis by Lionheart publicly available? (Apologies if you said this somewhere in your post).
It is not! TPP has not publicly released information containing private data from Mind Ease, which includes the business analysis and Foster’s report. That’s why the section on Mind Ease user data is not included in Hauke’s report.
Thank you for the info about startups! I’m still a bit skeptical about the mental health app space in particular; are there any statistics about the percentage of funded health/mental health app startups that succeed?
There isn’t too much information out there on startup success rates, and I’m afraid I’m not familiar with success data specifically about mental health apps!
Just to add that in the analysis we only assumed Mind Ease has impact on ‘subscribers’. This meanings paying users in high income countries (and active/committed users in low/middle income countries). We came across this pricing analysis while preparing our report. It has very little to do with impact but it does a) highlight Brendon’s point that Headspace/Calm are seen as meditation apps, and b) that anxiety reduction looks to be among the highest Willingness To Pay / high value to the customer segments into which Headspace/Calm could expand (e.g. by relabeling their meditations as useful for anxiety). The pricing analysis doesn’t even mention depression (which Mind Ease now addresses following the acquisition of Uplift). Perhaps because they realize it is a more severe mental health condition.
Hi Akash! Yep, I think Mind Ease’s ability to attract users is certainly an important factor! I think of it as Mind Ease’s counterfactual ability to get users relative to other apps (for example, since Mind Ease is impact-driven, they could offer the app for free to people living in low-income countries which profit-driven competitors are not incentivized to do) as well as Mind Ease’s counterfactual impact on users compared to a substitute anxiety reduction app (for example, data in the cost-effectiveness analysis section of Hauke’s report pointing Mind Ease potentially having a stronger effect on GAD-7 anxiety scores compared to Pacifica, a popular alternative, as well as the general rigor of their approach).
The active user estimates were modeled in TPP’s full report on Mind Ease. We provide a high-level overview of the data that was considered in the full report, which “included Mind Ease’s background and plans (including offering a free or discounted version of the app to low/middle income countries), historical downloads and active users, competitors, and financial details.” The report leveraged Lionheart’s business analysis, and based on my knowledge of information such as Mind Ease’s historical user figures and strategic options like offering the app for free to certain populations, I think the report’s user growth projections are reasonable (and those projections are only for the 25% “success” case).
As a reference point for the 25% chance of success, it’s possible that many people’s views on startup success are shaped by headlines like “90% of startups fail.” However, the criteria for the startups that are included in the numerator and denominator of such success calculations can greatly affect the final number. Funded startups have higher success rates than one might expect. In our footnote on startup base rates which you may find interesting, “Funded ventures had a 76% survival rate (to 2010) and 27% “success” rate (exit or >75 employees).” The 25% success rate aligns very closely with the 27% success rate of funded ventures gaining over 75 employees or getting acquired in the study we cited. The study findings align with other research/reports I am familiar with.
To add two additional points to Brendon’s comment.
The 1,000,000 active users is cumulative over the 8 years. So, just for example, it would be sufficient for Mind Ease to attract 125,000 users a year each year. Still very non-trivial, but not quite as high a bar as 1,000,000 MAU.
We were happy we the 25% chance of success primarily because of the base rates Brendon mentioned. In addition this can include the possibility that Mind Ease isn’t commercially viable for reasons unconnected to its efficacy, so the IP could be spun out into a non-profit. We didn’t put much weight on this, but it does seem like a possibility. I’m mentioning it mostly because it’s an interesting consideration with impact investing that could be even more important in some cases.
Thank you, Brendon and jh! A few more thoughts/questions below. Feel free to ignore any that are not super relevant or that would take a very long time to address.
My understanding is that most popular apps (e.g., Headspace, Calm) offer free versions to people [including people in low- and middle-income countries]. I suppose MindEase would have an edge if it offers the full (premium) version for free, but it still seems quite difficult to compete with highly popular apps like Headspace/Calm. What do you think? And has this model of offering an app for free in low- and middle-income countries worked for any apps in the past?
The Pacifica study that Hauke cites compares counseling alone to counseling + Pacifica. This seems like a comparison that would underestimate the effect of Pacifica. (It seems rather impressive that an app is able to have any effect above and beyond therapy, and I would imagine its standalone effect to be larger). Furthermore, I don’t think Pacifica will be Mind Ease’s main competitor—Headspace and Calm appear to be much more popular than Pacifica (here and here), and they also focus on mindfulness/relaxation. Are there any estimates of Mind Ease’s counterfactual impact relative to Headspace or Calm?
Is the business analysis by Lionheart publicly available? (Apologies if you said this somewhere in your post).
Thank you for the info about startups! I’m still a bit skeptical about the mental health app space in particular; are there any statistics about the percentage of funded health/mental health app startups that succeed?
These are great points! FYI, jh is Jonathan Harris who runs TPP.
I’ll preface my response by saying that I’m not an expert in this area; Will and I mostly focused on the impact investing side of things, and Hauke or someone on the Mind Ease team could likely provide a better response.
I think that Headspace and Calm may not be the right reference points since they’re not designed to tackle anxiety and depression, whereas Sanvello (formerly Pacifica) is. Headspace and Calm strike me more as “mindfulness apps” versus “mental health apps.” For instance, it doesn’t look like Mindspace and Calm feature any CBT exercises, whereas Sanvello does. I have paid access to Calm via my employer, and while I haven’t used it much, it looks like all it has are guided meditations. Reviews of Headspace and Calm support my initial impression and mention that they just have guided meditation and music. I expect that evidence-based practices specifically designed to target certain mental health conditions are significantly more efficacious than guided mindfulness meditations.
This distinction might’ve made it so that this Psychology Today review from 2019 mentions Sanvello as “the most popular” mental health app, ignoring Headspace and Calm. Regarding competition, it mentions that Sanvello has 2.6 million registered users, which is smaller than Headspace and Calm but still seems significant. It seems like other apps, including ones I’ve never heard of, have also been able to get decent user counts. For example, Moodpath reached 1 million downloads in 2019. Regardless of whether Headspace and Calm are competitors, Sanvello and other apps would still need to be competed against. Unlike other industries, like network effects with social media, I don’t think that the major mindfulness/mental health apps have enough of a moat to prevent other competitors from emerging.
My understanding is that Headspace and Calm offer their vast majority of their content behind a paywall. The Headspace review I linked to suggests free users get access to one-third of a “Basics” (introductory meditation) course before they need to pay.
What constitutes releasing an app for free as “working?” It’s commonly known that free apps get many more downloads and are the vast majority of apps on the iOS and Android app store, so I would expect that this would be a very effective user acquisition strategy (but perhaps not an effective monetization strategy, hence the social impact angle).
Sanvello (Pacifica) was likely selected because it is the most efficacious competitor in the same space. I’m not sure about how Hauke utilized the study findings in his report and his reasoning for doing so, so I’ll have to defer to him on this. I’ll let him know about your question!
It’s worth pointing out that the report uses a very conservative counterfactual user impact estimate that is much closer to Foster’s estimate than Hauke’s estimate due to “principles of robust decision making under uncertainty.”
It is not! TPP has not publicly released information containing private data from Mind Ease, which includes the business analysis and Foster’s report. That’s why the section on Mind Ease user data is not included in Hauke’s report.
There isn’t too much information out there on startup success rates, and I’m afraid I’m not familiar with success data specifically about mental health apps!
Just to add that in the analysis we only assumed Mind Ease has impact on ‘subscribers’. This meanings paying users in high income countries (and active/committed users in low/middle income countries). We came across this pricing analysis while preparing our report. It has very little to do with impact but it does a) highlight Brendon’s point that Headspace/Calm are seen as meditation apps, and b) that anxiety reduction looks to be among the highest Willingness To Pay / high value to the customer segments into which Headspace/Calm could expand (e.g. by relabeling their meditations as useful for anxiety). The pricing analysis doesn’t even mention depression (which Mind Ease now addresses following the acquisition of Uplift). Perhaps because they realize it is a more severe mental health condition.