Digital mental health company Meru Health announced Thursday it had raised $38 million in a Series B funding round.

The equity and debt financing round was led by Industry Ventures, with participation from Bold Capital Partners, Freestyle VC, FMZ Ventures and Leksell Social Ventures along with financing provided by J.P. Morgan.

The latest round builds on an $8.1 million Series A  from last year and a $4.2 million seed round from 2019. 

WHAT IT DOES

Meru provides a 12-week online treatment program for depression, anxiety and burnout guided by a therapist. Users also get access to a wearable biofeedback device that measures heart rate variability and helps them train their breathing practices.

The company also offers a coaching service for people with mild depression and anxiety to prevent symptoms from worsening.

“We were so impressed with the team’s commitment to addressing a pressing societal and market need with best-in-class clinical evidence and data,” Fanni Fan, vice president at Industry Ventures.

“We also found Meru Health's new coaching solution very exciting. Meru Health is essentially serving members across the continuum by bringing preventive care to mental health. No one else is doing that. We think there is tremendous potential here.”

WHAT IT’S FOR

Meru said the capital will be used to speed the company’s growth nationwide, increase partnerships with employers and payers, and expand its coaching program.

MARKET SNAPSHOT

Digital mental and behavioral health investment is booming so far this year. A Rock Health report found mental health was the number one clinical focus for investments in the first half of 2021, bringing in $1.5 billion. 

Other companies in the mental health space include Ginger, which recently announced plans to merge with meditation app Headspace, Modern Health and Unmind.

The need for mental healthcare also increased during the COVID-19 pandemic. A report from the Centers for Disease Control and Prevention found that 40% of U.S. adults said they were struggling with mental health or substance abuse in June 2020. 

ON THE RECORD

“I can’t emphasize enough that we are in a mental health crisis right now,” Meru CEO and founder Kristian Ranta said in a statement.

“COVID-19 has left tens of millions of depressed and anxious people in its wake, and without effective treatment, the outcome could be tragic. Solutions like Meru Health are essential to bringing those people back to a fully functioning state where they feel empowered to take care of their own mental health. We’re incredibly proud of the work we’re doing.”