As schools increasingly focus on mental health, PsycApps raises seed round for US expansion TechCrunch

I’ve been following PsycApps, a startup that created the mental health gamification game “eQuoo,” since 2016, and this company—and its founder—has been nothing short of persistent in “spinning the wind.” Last we heard, it was endorsed by the UK’s National Health Service and even distributed by Unilever. And of course, the effects of the COVID-19 pandemic have only created a greater need for mental health startups.

But now it’s getting the nod from the investment community in the form of a $1.7 seed seed round from US-based Morningside Ventures.

Describing itself as an “evidence-based gamified mental health game for teens and young adults,” eQuoo is now targeting its platform at the 50% of teens and tweens who self-report struggling with one or more mental health issues.

PsycApp’s platform offers a mental health intervention game aimed at higher education institutions, many of which are now legally required to care for student mental health. And because eQuoo has gone through clinical trials, it secures contracts with schools that need that validation to offer it to students. In theory, this means that any other platform trying to do the same will face a barrier to entry in this market.

In a statement, Steven Brousseau of Morningside Ventures commented that low engagement in mental health apps is a problem, but he believes eQuoo has broken the mold: “Digital health interventions will be critical to how our society deals with the second, ongoing pandemic of mental health problems. However, designing these interventions to maximize long-term engagement and outcomes will be critical to achieving change. Silja and her team have shown robust commitment and outcome data in large clinical trials.

Clinical psychologist and founder Silja Litvin – along with co-founder Vanessa Hirsch-Angus – points out that 70% of 16- to 28-year-olds are casual gamers, which is why eQuoo has traction among young people accustomed to game mechanics.

eQuoo’s appeal to EdTech, he says, is that high schools, colleges and universities are legally required to keep their students healthy, and that increasingly means both mental and physical health. In the UK, Ofsted, the UK education regulator and assessor of schools and colleges, has made it a requirement for schools and colleges to include a ‘sustainability and personal growth program’ in their curriculum before they can achieve the top rating.

eQuoo claims it is the only Ofsted-covered tool that has clinical trials “demonstrating a positive impact on resilience, anxiety and depression in students”, it says.

Regional College and Paragon Skills are two of eQuoo’s newest customers, covering nearly 20,000 students and apprentices across the UK.

Speaking with me on a call, Litvin said the startup gained traction after moving from a short-term play to a long-term one, a move that tipped the balance for Morningside’s investment.

“We’ve done a complete reboot of the game, adding multiple stories, an in-app arcade, and an in-app chatbot that gives you feedback on your well-being. We went from five weeks to 52 weeks. We have an arcade game in the app with a lot of games and a lot of exercises that are related to mental health,” she told me.

“With this funding, we’re going to make sure it never ends.” You could potentially use the game for the rest of your life if you wanted to, which isn’t a problem because it’s also in the realm of personal growth. So it’s not just about dealing with mental health.

I told her that selling in the education market is extremely difficult, especially for startups.

She countered: “Ofsted has just published an update saying that if a school wants a full rating, it must have a product program for sustainability and personal development. We are the only evidence-based, infinitely scalable product designed specifically for this youth age group that has clinical trials to prove its effectiveness in sustainability and personal development… Schools struggle to find a program and most of the programs are not based evidence-based and not scalable like eQuoo is.”

She added that Morningside has ties to “all the major universities in the US,” which will help it expand into North America.

Litvin also added that the company had to “run on fumes” for a while before securing the Seed round: “We scaled back. We didn’t pay each other for several months. With this money, we can go into growth mode.”

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