Breakthrough is bringing mental health services online, reducing the barriers to effective treatment

By Editor December 18, 2012

Breakthrough logoA Q&A with Breakthrough founder and CEO Mark Goldenson. The Redwood City, California–based company was founded in 2009 and has raised a total of $900K in Seed funding.

SUB: Please describe Breakthrough, and the value proposition you bring to mental health.

Goldenson: We help people find and talk to great mental health providers online through live videoconferencing. Sixty-eight million Americans have a mental illness but two-thirds do not get treatment, even though about 70 percent of people with a mental illness recover when treated.

The four main barriers to care are high costs, low access, stigma, and the difficulty of finding a good fit provider. What we are so excited about is that online counseling and telepsychiatry can help reduce these barriers.

It can catch mental illnesses early to reduce ER visits and hospitalizations, each of which cost the system thousands of dollars. It can let people get care from great therapists and psychiatrists at almost any time and from almost anywhere. It also lets people avoid the stigma of the waiting room and get care at home, at work, or wherever they feel comfortable.

SUB: Who are your target users?

Goldenson: Our focus is people with mild to moderate mental conditions, stress and relationship issues. Our patients tend to be 20-to-40 years old and comfortable with technology, though we’ve seen people across demographics. Some of them are even in nursing homes with on-site staff who take care of the technology.

SUB: Who do you consider to be your competition?

Goldenson: Online counseling and telepsychiatry is a fragmented market with a lot of individual providers and small companies. The products tend to be hard to use, aren’t highly secure or legally compliant, and don’t invest much in generating awareness. It’s a hard space to enter but there’s a lot of room to innovate.

SUB: What differentiates Breakthrough from the competition?

Goldenson: Our main differentiation is that we have done the hard work to sign major insurance companies that market and cover care on Breakthrough. For example, we have signed Magellan, the largest mental health insurer, which is covering Breakthrough for their two million members in California. That means patients only pay their co-pay, if anything at all, instead of the $100-plus per hour that they would pay out-of-pocket for online care elsewhere.

We also have a mix of veteran technology entrepreneurs and health care executives. Our COO was the CEO of Cigna’s mental health group and CMO of United Behavioral Health. Our Chief Medical Information Officer is a psychiatrist with 31 years of experience and oversees the largest psychiatric group in Northern California. Our lead engineer was the co-founding engineer of BabyCenter and has won three Webby awards. I conducted four years of psychology research at Stanford, worked as a Product Manager at PayPal, and have been leading startups for 15 years. This kind of experience helps us understand our market well, constantly iterate the product, and sign contracts faster.

SUB: What was the inspiration behind the idea for Breakthrough? Was there an ‘aha’ moment, or was the idea more gradual in developing?

Goldenson: My two main passions since high school have been Internet entrepreneurship and health, especially mental health. I did years of peer counseling with teens, studied neuroscience in college, and seriously considered becoming a neurologist or psychiatrist.

I learned I prefer entrepreneurship but I’ve always wanted to start a company at the intersection of Internet technology and health, which I think is becoming a ripe area for innovation. Telepsychiatry was the opportunity that really stood out to me.

There wasn’t an ‘aha’ moment, but I did about three months of research on the idea before starting the company and I was getting more excited each day.

SUB: How did you come up with the name? What is the story behind it?

Goldenson: I wanted a name that had positive connotations and evokes the trust that we must earn for such a sensitive experience. Our team brainstormed over a hundred names and Breakthrough was the clear leader. It took four months of negotiating with the previous owner but he liked our mission and we were able to buy it at a fair price about two weeks before we launched at TechCrunch 50.

SUB: What have the most significant obstacles been so far to building the company?

Goldenson: Signing insurance companies. It has taken us years, but it’s definitely been worth it and will be very hard for others to duplicate.

SUB: You recently revealed that you’ve raised $900K in Seed funding. Was this recent funding, or was it raised over a longer period of time?

Goldenson: It was over two tranches. Fundraising for online health care is still hard for most companies since few investors understand both the Internet and health care.

SUB: Do you plan to raise additional funding in the near future?

Goldenson: No, we are now well-funded and can focus on growth.

SUB: How does the company generate revenue or plan to generate revenue?

Goldenson: The insurance companies pay us to access our network. We don’t charge patients or providers any fees, though in the future, we may charge providers a small fee for the value we bring them.

SUB: What are your goals for Breakthrough over the next year or so?

Goldenson: We expect to sign several more insurance companies and launch in more states by the end of next year. We have a model that works for patients, providers, and the insurers, so now it’s just time to scale it.

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