That, at least, was the trend following the onset of the COVID-19 pandemic. Total annual U.S. mental health spending, estimated at around $280 billion in 2020, rose sharply in subsequent years across age groups, boosted in part by the rise of telehealth platforms.

These days, more than one-fifth of American adults receive mental health treatment in a given year, per a recent federal government estimate. Much of that comes in the form of one-on-one therapy.

Founders and investors in the space have taken notice. Funding to mental health-focused startups surged beginning in 2020, with large rounds going to companies developing telehealth offerings, AI-enabled platforms and services targeted to specific groups, such as teenagers or the elderly.

Yes, investment in mental health startups has tapered off since the 2021 peak. Nonetheless, we’re still seeing steady deal flow and big rounds getting done, as evidenced in the chart below:

Startups focus on covered care

One unifying theme for the largest investments this year is an emphasis on providing mental health care that is covered by insurance.

This was a core talking point for New York-based Talkiatry, a psychiatric care startup that in mid June picked up $130 million in the largest mental health financing this year. The round consisted of a combination of Series C equity financing led by Andreessen Horowitz and debt financing from Banc of California.

In its funding announcement, Talkiatry noted that it works in-network with providers that extend coverage to a majority of privately insured Americans. The startup, as its name implies, also focuses on connecting patients with psychiatrists who are able to both provide therapy and prescribe medications when needed.

New York-based Grow Therapy, which landed $88 million in a Sequoia Capital-led Series C this spring, also pitches itself as a provider of covered mental health care. The startup offers an online platform to match people with therapists who work with their insurance plans.

Meanwhile, Brightside Health, which closed on a $33 million Series C in March, markets its mental health offering as “affordable help, with or without insurance.” The San Francisco-based company provides online therapy for anxiety and depression, works with most major insurers, and also offers fixed monthly pricing for those who self-pay.

The right match

Investors are also backing good-sized rounds for startups honing screening tools and targeted services to match people with therapists best-suited to their needs.

Among these is San Francisco-based Two Chairs, which offers a platform run with its proprietary algorithm to help match the  right therapist with a patient. The company closed this spring on a $72 million Series C round that was a mix of debt and equity.

Boston-based InStride Health, which secured $30 million in Series B funding in March, is more narrowly focused. The 3-year-old company offers outpatient care for pediatric anxiety, considered the most common mental health disorder among kids and teens.

Backpack Healthcare closed a $14 million Series A in May and is also focused on pediatric mental health. The startup has a particular focus on extending mental health care to children and families covered by Medicaid, who have previously faced limited options.

What not to do

While recently funded startups hope to set an example of the right approach to mental health care, they can turn to predecessors for a lesson on how to do it wrong.

For this, they can look to Done, a seed-backed telemedicine startup whose CEO and clinical president were arrested last month for an alleged fraud scheme involving the drug Adderall.

Founded in 2019, Done describes itself as an online platform specializing in psychiatric care for ADHD, or attention deficit hyperactivity disorder. Per the U.S. Department of Justice, the company “exploited the COVID-19 pandemic to develop and carry out a $100 million scheme to defraud taxpayers and provide easy access to Adderall and other stimulants for no legitimate medical purpose.” (Done has said it disagrees with the charges.)

A couple years earlier, another funded startup, Cerebral, came under investigation over charges that it prescribed Adderall and Ritalin for ADHD without properly screening patients. The company was also recently fined $7 million over its privacy practices. Cerebral raised over $460 million in 2020 and 2021 from SoftBank and others, but has not secured fresh financing since.

Therapy demand still drives deals

Even with a mixed track record in mental health investing, venture backers still see opportunity in the space as demand for therapy and treatment remains strong, with continued high levels of unmet needs.

For now, focus areas of the most recently funded startups, which include extending covered care and targeting underserved populations, look like a sensible approach. We’ll stay tuned to see how effectively they continue to scale.

Related Crunchbase Pro list:

• US Mental Health Startup Funding

Illustration: Dom Guzman

Klarity became the latest accounting-related startup to raise big in the sector. The San Francisco-based company raised a $70 million Series B led by Nat Friedman and Daniel Gross and included participation from Scale Venture Partners, Tola Capital, Picus Capital, Invus Capital and Y Combinator — per a report in The Information.

No valuation was released.

Not surprisingly, there is an AI angle to Klarity. The company uses AI to help process data in contracts and internal records, eliminating the need to do it manually. The new cash will be used to add to its 130-person staff. The company is on pace  to triple that number this year, per the report.

Big rounds

Just in the past several months the accounting tech sector — perhaps not the sexiest or most talked about in the startup world — has seen some pretty big fundraises.

Copenhagen-based accounting platform provider Ageras raised an $88 million round led by Investcorp in April.

Before that, accounting workflow automation tools developer FloQast, locked up a $100 million Series E financing led by Iconiq Growth, and audit automation provider DataSnipper raised $100 million led by Index Ventures.

Just as in the case of Klarity, AI plays a role in most of those big rounds as startups are looking to apply the technology to help automate or expedite some of the tedious tasks in accounting.

The funding action is not dissimilar to what is going on in other often overlooked industries, such as the legal sector, where startups using AI continue to rake in big bucks.

Related Crunchbase Pro list:

• Accounting-Related Recently Funded Startups

Related reading:

• Accounting Startups Continue To Tally Up Funding
• AI Will Be Doing More Accounting If Startup Investors Have Their Way
• Eye On AI: Legal Tech Funding Getting AI Upgrade

Illustration: Dom Guzman

This is a weekly feature that runs down the week’s top 10 announced funding rounds in the U.S. Check out last week’s biggest funding rounds here.

The top five raises this week came from sectors that have seen good heat recently. Biotech/healthcare and cybersecurity dominated the run of big rounds this week, with a few AI startups also seeing good-sized checks. After a few slow weeks, megadeals seem to be back, as four companies locked up nine-figure rounds.

1. Marea Therapeutics, $190M, biotech: This big biotech round is actually the combination of two rounds. Marea Therapeutics, a clinical-stage biotechnology company developing medicines for cardiometabolic diseases, launched with $190 million in a combined Series A and B financing. The Series A round was led by Third Rock Ventures — where the startup was incubated — and the Series B round was co-led by Forbion Capital Partners, Perceptive Advisors, Sofinnova Investments and VenBio Partners. The company didn’t split out the rounds, so we record it as one and it tops the list this week.

2. Huntress, $150M, cybersecurity: Maryland-based Huntress became the newest cybersecurity unicorn after it raised a $150 million Series D at a $1.5 billion-plus valuation. The new round was led by Kleiner Perkins, Meritech Capital Partners and existing investor Sapphire Ventures. The startup focuses on security services for small business to small enterprise customers — an often overlooked sector in cyber as many companies chase Fortune 500 companies. Huntress currently is realizing more than 70% year-to-year revenue growth for the past two years as it continues to “approach $100 million in annual recurring revenue.” Founded in 2015, Huntress has raised nearly $310 million, per Crunchbase.

3. Talkiatry, $130M, healthcare: Mental health is a growing concern. Just 31% of adults believe their mental health is “excellent,” a 20 percentage point drop from 2004. New York-based psychiatric care startup Talkiatry locked up a $130 million raise — a mix of equity and debt financing — led by Andreessen Horowitz to try to improve those numbers. The startup offers a national mental health practice that provides in-network psychiatry and therapy, trying to help the 60% of adults in the U.S. with a diagnosable mental illness who go untreated every year. Founded in 2019, Talkiatry has raised $245 million, per the company.

4. Semperis, $125M, cybersecurity: Huntress’ big round wasn’t the only one in security this week. Hoboken, New Jersey-based Semperis secured $125 million in growth financing — a mix of equity and debt — from J. P. Morgan and Hercules Capital. The new round reportedly values the company at $1 billion. Semperis provides a variety of security services, including protection for the Microsoft directory service. Founded in 2014, the company has raised nearly $500 million, per Crunchbase.

5. Elion Therapeutics, $81M, biotech: More than 150 million people suffer from serious fungal infections around the world, resulting in approximately 1.7 million deaths annually. A New York-based biotech raised big this week to try to lower those stats even as such infections have become more virulent. Elion Therapeutics, which focuses on the treatment of life-threatening invasive fungal infections, raised an $81 million Series B led by Deerfield Management and the AMR Action Fund. This is the company’s first announced round, per Crunchbase.

6. CesiumAstro, $65M, space: Austin, Texas-based CesiumAstro, a developer of space communications technology, closed a $65 million Series B+ round led by Trousdale Ventures. Founded in 2017, the company has raised more than $185 million, per Crunchbase.

7. Genspark AI, $60M, artificial intelligence: Palo Alto, California-based Genspark AI, an artificial intelligence search startup, raised $60 million led by Lanchi Ventures at a reported $260 million post-money valuation.

8. (tied) Daydream, $50M, ecommerce: New York-based Daydream, an AI-powered search platform for the retail industry, launched with a $50 million seed round co-led by Forerunner Ventures and Index Ventures.

8. (tied) Iambic Therapeutics, $50M, biotech: San Diego-based Iambic Therapeutics, a clinical-stage biotechnology startup developing therapeutics using an AI-driven discovery platform, closed a $50 million Series B extension led by new investors Mubadala Capital and Exor Ventures. Founded in 2019, the company has raised nearly $233 million, per Crunchbase.

8. (tied) You.com, $50M, artificial intelligence: Palo Alto, California-based You.com, an AI-enhanced search engine developer, reportedly is finishing up raising a $50 million Series B. Investors were not named. Founded in 2020, the company has raised $95 million, per Crunchbase.

Big global deals

The biggest round of the week came from a big-named Indian startup.

• Indian grocery delivery startup Zepto raised a $665 million round, doubling its valuation to $3.6 billion.

Methodology

We tracked the largest announced rounds in the Crunchbase database that were raised by U.S.-based companies for the seven-day period of June 15 to June 21. Although most announced rounds are represented in the database, there could be a small time lag as some rounds are reported late in the week.

Illustration: Dom Guzman

The largest new entrant was xAI, which raised $6 billion and officially joined The Crunchbase Unicorn Board in May 2024. The company was valued at $24 billion. 

So far this year, around 50 new unicorns have joined the board, adding close to $100 billion in value.

In addition, several companies already at unicorn valuations raised billion-dollar funding rounds at higher values. This includes CoreWeave, Scale AI, Wiz and Wayve. CoreWeave was valued at $19 billion, almost 8x its 2023 valuation of $2.4 billion, due to demand for its AI- driven data center infrastructure.

Unicorn exits

The majority of unicorn exits this past month were below their last private values.

Hangzhou-based Zeekr, an electric vehicle company, went public on the NYSE at a $5.2 billion value. Zeekr was last valued in 2023 at $13 billion. And Bengaluru-based insurance provider Digit Insurance listed at a $3 billion value on the BSE and NSE exchanges in India, $1 billion below its 2022 valuation.

Global investor Permira acquired a majority stake in Israeli unicorn BioCatch, a biometric intelligence company, for $1.3 billion. This was the single exit above its last private value, a secondary financing in 2023 which valued BioCatch at $1 billion.

API security company Noname Security, based in Palo Alto, California, was acquired by public cloud security company Akamai Technologies for $450 million, well below its $1 billion valuation from 2021. And Israeli parking app Pango acquired London-based ride hailing app Gett for $175 million, a steep discount from its 2018 value of $1.5 billion.

Here are the new unicorns in May by sector.

AI

• Elon Musk‘s xAI, a 1-year-old foundation model company based in Burlingame,  California, raised a $6 billion Series B funding at a $24 billion value. Participants in the round include Valor Equity Partners, Vy Capital, Andreessen Horowitz, Sequoia Capital, Fidelity, Prince Alwaleed Bin Talal and Kingdom Holding Co. among others.
• Bay Area-based WEKA, a data platform for AI workloads, raised a $140 million Series E funding from existing investors. Valor Equity Partners led the funding for the 10-year-old company, which valued WEKA at $1.6 billion.
• London-based Builder.ai, a no-code AI powered app developer, raised a $250 million Series D led by the Qatar Investment Authority. The 8-year-old company announced a partnership and equity financing from Microsoft earlier in May.

Web3

• Los Angeles-based Farcaster, a decentralized social network built on Ethereum, raised a $150 million Series A. The funding to the 3-year-old company was led by crypto investor Paradigm, with participation from a16z crypto, Haun Ventures and Union Square Ventures among others, valuing the company at $1 billion.
• Humanity Protocol, a blockchain unique identity platform using biometrics, raised a $30 million seed funding led by Kingsway Capital. The company, which was founded less than a year ago, was valued at $1 billion.

Financial services

• Los Angeles-based Altruist, a digital wealth management service for wealth advisers, raised a $169 million Series E led by Iconiq Growth. The 5-year-old company was valued at $1.5 billion.

Data and analytics

• San Francisco-based Sigma Computing, a cloud analytics platform incubated at Sutter Hill Ventures, raised a $200 million Series D. The funding for the 9-year-old company was led by Avenir Growth Capital and Spark Capital, and valued Sigma at $1.5 billion.

Related Crunchbase unicorn queries

• The Crunchbase Private Unicorn Company List
• New unicorns in 2024
• New unicorns in 2023
• Unicorns in the U.S.
• Unicorns in Asia
• European unicorns
• Unicorns from LatAm
• Emerging unicorn leaderboard
• Exited unicorns

Methodology

The Crunchbase Unicorn Board is a curated list that includes private unicorn companies with post-money valuations of $1 billion or more and is based on Crunchbase data. New companies are added to the Unicorn Board as they reach the $1 billion valuation mark as part of a funding round.

The unicorn board does not reflect internal company valuations — such as those set via a 409a process for employee stock options — as these differ from, and are more likely to be lower than, a priced funding round. We also do not adjust valuations based on investor writedowns, which change quarterly, as different investors will not value the same company consistently within the same quarter.

Funding to unicorn companies includes all private financings to companies that are tagged as unicorns, as well as those that have since graduated to The Exited Unicorn Board.

Exits analyzed here only include the first time a company exits.

Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.

Illustration: Dom Guzman

Clarification: This story has changed since its original publication: Builder.ai also joined The Crunchbase Unicorn Board in May 2024.

I will not dive into how to calculate them as it is widely available information, the benchmarks are also available and periodically change. Instead I will focus on when they should be used and under what conditions one may be more important than the other.

Each provides unique insights into a company’s revenue health and helps shape strategic decisions. Knowing when to focus on GRR vs. NRR can profoundly influence your business strategy and performance.

When to focus on GRR

Core customer retention: GRR is vital for assessing the retention of your core customer base, excluding the effects of upsells or cross-sells. This metric is particularly crucial for companies in early stages or transitioning to a subscription model, as it measures the loyalty and satisfaction of existing customers, providing a clear picture of baseline retention rates.

Service stability assessment: For essential or subscription-based services, such as utilities or basic memberships, GRR is indispensable. It measures how many customers maintain their core services, ensuring the stability of the primary revenue stream and aiding in churn prevention.

Incentivizing customer loyalty: By prioritizing GRR, companies can align their sales and customer success teams with the goal of retaining customers, fostering long-term relationships, and reducing churn. This focus helps build a loyal customer base that serves as a stable foundation for long-term growth.

When to focus on NRR

Revenue growth maximization: NRR is crucial when aiming for overall revenue growth from the existing customer base. It includes expansion revenue from upsells, cross-sells and renewals, providing a comprehensive view of revenue health, especially important for mature companies seeking to maximize growth opportunities.

Promoting upsells and cross-sells: Companies looking to boost revenue from current customers should prioritize NRR, as it encourages sales teams to explore expansion opportunities. This focus can drive revenue growth through enhanced customer value and increased average customer spend.

Balancing acquisition and retention: While new customer acquisition is essential, NRR highlights the importance of maximizing revenue from existing customers. Tracking NRR ensures a balanced approach between gaining new customers and expanding relationships with current ones, optimizing overall revenue performance.

Incorporating both GRR and NRR into your business strategy as well as to your  sales and support KPIs should provide a holistic view of revenue dynamics, ensuring a balanced approach to growth and customer retention.

 Itay Sagie is a strategic adviser to tech companies and investors, specializing in strategy, growth and M&A, a guest contributor to Crunchbase News, and a seasoned lecturer. You can connect with him on LinkedIn for further insights and discussions.

Illustration: Dom Guzman

This is a weekly feature that runs down the week’s top 10 announced funding rounds in the U.S. Check out last week’s biggest funding rounds here.

Last week’s slowdown continued, as big rounds were hard to come by this week. One big AI round likely helped boost dollar figures — and interest — but aside from that large funding, rounds dried up. It was a holiday week, so that could be a reason — or maybe VCs’ checkbooks are cooling off after a strong start to the year when it came to nine-figure rounds.

1. xAI, $6B, artificial intelligence: Elon Musk’s generative AI startup, xAI, officially announced its long-awaited fundraise — making it the second-most-valuable generative AI company in the world behind only competitor OpenAI. The $6 billion round included investment from the likes of Valor Equity Partners, Andreessen Horowitz, Sequoia Capital and Fidelity Management & Research Co., among others. The new funding values the company at $24 billion post money, well behind OpenAI’s $86 billion valuation but well ahead of the $18 billion generative AI startup Anthropic is now valued at after its last raise. The xAI round had been rumored for months. The company was announced just last July and released its ChatGPT competitor, Grok, last November, and introduced its latest AI model, called Grok-1.5, just earlier this year. Grok is trained off data from another Musk-owned company, X, formerly Twitter.

2. Solutions by Text, $110M, fintech: Paying bills has gotten dramatically easier in the past few decades thanks to online and mobile payments. However, a Dallas-based startup has taken it a step further. Solutions by Text is exactly what it sounds like, and the startup locked up a fresh $100 million of funding this week. The raise is a mix of equity and debt, although the exact ratio was not disclosed. Edison Partners and StepStone Group co-led the equity portion. The startup allows its customers the ability to conduct an array of financial services over text, including loan origination, collections and bill payment. Founded in 2008, the company has raised $145 million, per Crunchbase.

3. Frore Systems, $80M, mechanical engineering: One aspect of AI that is likely to see more funding is some of the technologies on the periphery that make it possible. Frore Systems secured an $80 million Series C led by Fidelity Management & Research Co. The San Jose, California-based startup has developed a solid-state active cooling chip — AirJet — that allows users to leverage AI even on the edge of networks or on edge devices. Since AI applications generate more heat than many devices can handle, the chip allows them to remain cool and not lose performance. Founded in 2018, Frore has raised $196 million, per the company.

4. Mavenir, $75M, network software: Mavenir may look familiar on this list to some. After raising $250 million in 2022, the network software provider locked up another large tranche of money, closing a $100 million round led by Siris Capital Group about a year ago. The Richardson, Texas-based company was at it again this week, raising a $75 million investment from “an existing investor,” according to the company. Mavenir builds cloud-native software that allows enterprises and service providers to manage complex networks without relying on older telecom hardware such as routers and switches. This allows customers to scale operations more quickly on the cloud and without the expense of equipment. Founded in 2005, the company has now raised $1 billion, per Crunchbase.

5. CinRx Pharma, $73M, biotech: This week’s top biotech round isn’t as big as it is on most weeks, but that follows the general trend. CinRx Pharma closed a $73 million round from undisclosed investors. The Cincinnati-based firm has a diverse portfolio of companies developing a variety of medicines and therapies. In early 2023, one of its former portfolio companies — CinCor Pharma — was acquired post-IPO by AstraZeneca in a deal worth $1.3 billion upfront. Founded in 2015, CinRx has raised $176 million, per the company.

6. BabylonChain, $70M, blockchain: Palo Alto, California-based BabylonChain, a developer of security protocols for decentralized systems, completed a $70 million round led by Paradigm. Founded in 2022, the company has raised $103 million, per Crunchbase.

7. (tied) Squared Circles, $40M, consumer: Los Angeles-based Squared Circles, a consumer-focused studio incubating consumer brands, closed a $40 million Series A funding round led by L Catterton. Founded in 2020, this is the firm’s first disclosed fundraise amount, per Crunchbase.

7. (tied) Transcend, $40M, privacy: San Francisco-based Transcend, a data privacy platform, raised a $40 million Series B funding led by new investor StepStone Group. Founded in 2017, Transcend has raised nearly $90 million, per the company.

9. Gameto, $33M, biotech: New York-based Gameto, a biotech firm dedicated to women’s health, raised a $33 million Series B led by Two Sigma Ventures and RA Capital Management. Founded in 2020, the company has raised $73 million, per Crunchbase.

10. Reibus, $30M, industrial: Atlanta-based Reibus, an independent metals marketplace, raised a $30 million round in a combination of equity and debt from existing investors including Canaan Partners and Nosara Capital. Founded in 2018, the company has raised nearly $132 million, per Crunchbase.

Big global deals

No company came close to raising what xAI did. The biggest round outside the U.S. came from a Nordic country.

• Sweden-based Cloover, which provides embedded energy solutions to facilitate a successful energy transition, raised a seed round worth approximately $114 million.

Methodology

We tracked the largest announced rounds in the Crunchbase database that were raised by U.S.-based companies for the seven-day period of May 25 to May 31. Although most announced rounds are represented in the database, there could be a small time lag as some rounds are reported late in the week.

Illustration: Dom Guzman

School is nearly out and summer’s almost here. A lot is going on in most people’s lives, so let’s take a look at a few intriguing startups that raised cash this month that may have escaped your notice.

This month the rounds included everything from added support for cancer survivors to leveraging your car for credit. Let’s take a look.

AI parenting

Depending on who you talk to, AI can solve everything. But can it solve the problem of making sure your kids are watching what they should on the internet?

Well maybe — at least that’s what one Nashville, Tennessee-based startup is promising. Angel AI Co., which has created an AI platform that it says provides an “age-appropriate” internet experience for children between 5 and 12 years old, raised a $4.75 million seed round led by Cortical Ventures this month.

Angel AI says it uses large language models, natural language processing, speech recognition and other tech to generate age-appropriate answers to children’s questions and deliver what the company calls compelling but safe content and entertainment.

The platform has the ability to learn and understand the child over time, and will provide video and audio options at their comprehension level to help them learn.

Angel’s content is also free from advertisements and includes a parent insight portal — which can inform parents about their children’s interests.

Making it rain

One of the things humankind still has not figured out is how to control Mother Nature.

Nevertheless, an El Segundo, California-based startup is giving it a try when it comes to rain.

Rainmaker Technology raised a $6.3 million seed round from a large group of investors that included Long Journey Ventures, Champion Hill Ventures and Garry Tan. The startup aims to develop cloud seeding techniques — a weather modification tool discovered last century that seeks to introduce ice nuclei to clouds and cause, well, rain.

Cloud seeding can work, but the question has usually been how well it works. It also has been in the news recently.

Rainmaker hired its first engineers this year and now seems poised to get out into the field later in 2024 — and make it rain.

Fighting obesity

More than 2 in 5 adults — 42.4% — have obesity in the U.S., so clearly it’s a problem.

However, it also can be complicated due to the many reasons for it. Startup Phenomix Sciences is trying to bring some clarity to the problem. The Menlo Park, California-based biotech firm locked up a $5.5 million Series A this month from investors including DexCom, LabCorp and Health2047 as it tries to bring data intelligence to the treatment of obesity.

The startup, born out of the Mayo Clinic, says it has developed a phenotyping test that gives insights into genetics to determine an individual’s cause of obesity. The test is already in use by obesity treatment providers in the U.S. and identifies obesity subtypes of the disease caused by the interaction of genes and the environment.

These different phenotypes can include things like emotional hunger or hungry gut — defined as when someone eats a full meal but feels hungry soon after. Knowing the phenotype can allow for a better treatment.

Along with its Series A, the company also secured a $1.8 million National Institutes of Health research grant.

Obesity is serious and can be caused by many things. Knowing the root of a specific patient’s problem can lead to a better outcome.

Care for cancer survivors

Beating cancer is hard. However, sometimes dealing with beating cancer can be hard too.

OncoveryCare, formerly VivorCare, locked up a $4.5 million seed round this month led by .406 Ventures to launch its cancer survivorship care model.

The Boston-based startup’s virtual care model for cancer survivorship equips patients with a care team of survivorship-trained clinicians, and initial areas will be toxicity management, mental health support, navigation and care planning, and preventative care. The first regional rollout will serve Tennessee to start, in partnership with Tennessee Oncology, also an investor.

The population of cancer survivors is growing rapidly in the country, expecting to double between 2008 and 2030 to 22 million, according to the company. It’s critical to offer those survivors help as they fight fatigue and anxiety, and deal with complex screenings and monitoring — especially coming off the toughest battle of their lives.

A credit car?

While many people take getting a credit card for granted, it can be difficult for many people who have low credit scores or have struggled to build a credit history.

Dallas-based Yendo closed a $150 million debt financing led by i80 Group to try to help those people — using something many already have.

While some folks may not have a strong credit history, they have a car. Yendo provides a vehicle-secured credit card, allowing consumers to tap into the equity of their cars to get up to $10,000 of revolving credit. A person’s credit line increases proportionally as they pay down their auto loans each month.

The card also is available to customers who do not yet own their vehicle but choose to refinance their auto loan through Yendo.

The company’s card currently is available in 40 states across the U.S. and hopes to expand with the fresh funding.

For many, their car is their most valuable asset. Being able to access credit by leveraging it makes sense.

Illustration: Dom Guzman

The prevailing venture-funded model, in contrast, offers little cinematic eye candy. Rather, the focus is mostly on startups where people in treatment message and video chat with care providers and use apps to track prescriptions.

Visual appeal aside, there’s plentiful funding to bolster this smartphone-driven vision. Addiction-focused virtual care startups have pulled in hundreds of millions for business models largely based on building offerings scalable enough to meet the massive demand for treatment.

Much of the funding activity is quite recent.

Just last Tuesday, Portland, Oregon-based Boulder Care, a provider of long-term, virtual care offerings for people with substance abuse disorders, pulled in $35 million in its latest venture round. The 7-year-old startup offers prescription meds and an online support infrastructure to help recovering opioid users and alcoholics.

The same day, Nashville-based Wayspring, a provider of clinical and peer support to people with substance use disorder, announced it had secured a minority investment led by CVS Health Ventures. Previously, 12-year-old Wayspring had raised more than $116 million in known venture funding.

Recent funding recipients

For a bigger-picture view of where investment is going, we used Crunchbase data to aggregate a list of 14 addiction treatment-focused companies funded in the past few quarters.

Altogether, companies on our list have raised $810 million in reported funding to date. That includes CVS’ recent investment in Wayspring, reported to total $45 million.

Demand-wise, it’s not hard to see why startups pitching scalable addiction treatment would find a receptive investor audience. Among Americans who need substance abuse treatment, it’s estimated that more than 40% do not receive care, per a survey from the National Council for Mental Wellbeing.

Commonly, people forgo care because they don’t have access. Per the survey, more than 80% of adults who did receive substance use care had trouble obtaining it. Cost is a major factor, along with a lack of treatment facilities, in particular for rural areas and metros with high substance abuse rates.

Funded startups are taking on both the cost issue and, with virtual care, addressing the shortage of local treatment facilities.

Among them is the largest disclosed funding recipient on our list, Pelago. The New York-based company, which operates a digital clinic focused on substance abuse, closed on a $58 million Series C in March, bringing total funding to date to $137 million.

Pelago is founded on the premise that substance use is a treatable chronic condition. It markets itself to employers as a potentially lower-cost treatment option for tobacco, alcohol, cannabis and opioid use disorders.

Medication-based treatment

Medication is also a core part of the business model for many funded virtual clinics.

Boulder is a particularly strong proponent, positing that although medication-based treatment works for addiction, only about 10% of those who could benefit have access to it. The startup says it most often prescribes buprenorphine medications, used to treat opioid addictions, as well as drugs to treat alcohol abuse.

One advantage of the digital clinic approach in this regard is that patients don’t fall out of touch with care providers when they relocate. Since treatment is digital, one only needs a smartphone to video, chat and message with providers.

That said, none of us lives entirely in the digital world. Even among virtual care providers, it’s common to connect patients overcoming addiction with in-person support groups.

So, it looks like those basement gathering spots with their tepid coffee and heated conversations will still have a place in the recovery process after all.

Related Crunchbase Pro query:

• Recently-Funded Startups Tied To Addiction Treatment

Related reading:

• Affect Raises $16M As Addiction-Related Financings Hold Strong
• More Startups Founders Are Tackling Addiction: Here’s Where The Money Is Going
• Startups Get Hip To Hypnotherapy
• Psychedelics Provide New Frontier For Venture Funding, But Nuances Prevail

Illustration: Dom Guzman

Although venture funding seems to be stagnating, more and more startups seem to be having an easier time securing really big funding rounds — that seemed to dry up last year — from investors.

Rounds of $100 million or more — or megadeals — have exploded this year, as U.S.-based startups have collected 115 such rounds through mid-May, per The Crunchbase Megadeals Board. That is a 58% spike compared to the 73 megadeals raised last year at this time.

Of course, that is well off the number of nine-figure rounds raised in 2021 and 2022, when nearly 280 such rounds were raised by this time each of those years.

Still, considering the overall VC market in 2024, the large number of megadeals seem out of place.

Where is the money going?

One of the things that stands out about the startups that have raised rounds of $100 million or more this year is the variety of sectors they have emerged from. From gaming (Epic Games) to food delivery (Wonder) to quantum computing (PsiQuantum), investors have continued to spread large checks around.

While most would think such a list is AI-dominated, it is not. In fact, only 11 U.S.-based startups with a main AI classification have raised such rounds this year — with AI cloud infrastructure startup CoreWeave leading the way, after locking up a $1.1 billion round led by Coatue earlier this month.

Instead it’s actually biotech and healthcare lapping the field when it comes to megadeals, with such startups rising a whopping 38 so far this year.

That includes April’s biggest round: Xaira Therapeutics coming out of stealth and announcing it had secured more than $1 billion of committed capital from lead investors Arch Venture Partners and Foresite Capital — both of which jointly incubated the company. Xaira is the latest — although likely best-funded — startup to try to use AI models to find new drugs.

Cybersecurity also has had its share of big $100 million-or-more rounds this year, as 10 such raises went to startups in the sector. The largest was cloud security startup Wiz, which recently raised $1 billion at a $12 billion valuation — the biggest cybersecurity round of the year globally thus far.

The money flows in

As one can see from the rounds above — all happening in the past 45 days — the pace of such big deals have seemingly gathered speed as the year has continued. While January was slow, February saw the start of the $100 million-plus round pickup.

The numbers do seem out of place in the current venture market, but likely can be explained.

Since overall venture numbers have remained steady, even declining slightly, investors clearly are taking money from possible other late-stage growth deals, and perhaps even some early-stage deals. It wouldn’t be possible to take enough money out of seed-stage deals to make a dent when it comes to nine-figure rounds.

Nevertheless, the influx of megadeals this year seems to show investors are again willing to bet big on companies in which they see significant potential.

By the end of last year, investors had participated in 210 rounds of $100 million or more. It seems VCs and strategics are well-ready to shoot past that number this year.

Methodology

The numbers in this story pull data from The Crunchbase Megadeals Board, including the single industry it assigns each round. The board tracks only U.S.-based startups.

Related reading:

• The Crunchbase Megadeals Board
• The Crunchbase Unicorn Board
• Global VC Funding Isn’t Slowing, But It’s Not Growing Either, April Numbers Show

Illustration: Dom Guzman

The big names came out strong with their checkbooks last month.

The top five firms investing in U.S.-based startups were a who’s who of venture: Sequoia Capital, Khosla Ventures, General Catalyst, Lux Capital and Founders Fund. Those five firms made a combined 46 investments in U.S. startups in April.

In fact, April’s totals were a high for each firm this year.

As one would suspect, these firms didn’t just lead the pack in terms of deal volume, but also took part in some of the biggest rounds of the month. Let’s take a look at some of those deals.

General Catalyst, 10 deals

The Cambridge, Massachusetts-based firm was one of three that made 10 investments into U.S.-based startups last month. That’s the most deals for General Catalyst in one month since last November.

The firm led Collaborative Robotics’ $100 million Series B and took part in Ramp’s $150 million round that valued the startup at $7.65 billion (actually, every firm on this list took part in that round).

General Catalyst also went heavy on the AI investing route with deals for the likes of cyber company Andesite AI and research startup Symbolica AI.

Khosla Ventures, 10 deals

Similar to General Catalyst, Khosla made the most deals last month with U.S. startups since last October when it completed 11 deals.

Also similar to General Catalyst, it took part in the rounds for Collaborative Robotics and Ramp (which it actually co-led). Khosla also participated in Varda’s $90 million Series B. The San Francisco-based startup manufactures pharmaceuticals in space in microgravity that may not be cost-effective to make on the ground.

Sequoia Capital, 10 deals

The last of the trio of firms that made 10 deals last month is Sequoia Capital. The VC giant has not done that many deals since before 2023.

Sequoia also went big. The firm participated in the Collaborative Robotics and Ramp deals. It also participated in the gigantic $1 billion raise by Xaira Therapeutics, a startup at the intersection of AI and biotech.

Finally, it co-led enterprise browser developer Island’s big $175 million Series D with Coatue that valued the company at $3 billion — doubling its last valuation from less than a year earlier.

Founders Fund, 8 deals

Founders Fund is next on the list with eight deals done last month. That’s more than it has done all year with U.S. startups, with only five investments through the first three months.

Last month’s Founders Fund deals included co-leading the Ramp deal and taking part in Rippling’s $200 million round that valued the San Francisco-based startup at $13.5 billion.

Founders Fund also led a $175 million investment for San Francisco-based Cognition, which valued the startup at $2 billion. The 6-month-old startup has developed an artificial intelligence–powered coding assistant called Devin.

Lux Capital, 8 deals

New York-based Lux rounds out our list. The eight announced deals matched its total for the first three months of the year.

It also took part in the deals for Collaborative Robotics, Ramp, Varda and Xaira, while co-leading a $32 million venture round for digitized documents startup Ripcord.

Also notable:

• FJ Labs, Lightspeed Venture Partners, GV and 8VC 1 all came in next on the list with seven deals apiece.
• Khosla Ventures led the way in terms of the most led or co-led deals last month with six, followed by General Catalyst with five.
• Arch Venture Partners once again led the list for number of rounds led or co-led with the highest dollar amounts, leading or co-leading three rounds that in total were worth almost $1.4 billion. Of course, the firm’s biggest deal was co-leading Xaira Therapeutics’ massive $1 billion-plus raise with Foresite Capital.
• Y Combinator was the top investing incubator and accelerator once again last month, with an astounding 111 deals in April following its most recent demo day.

Methodology

This is a list of investors which took part in the most rounds involving U.S.-based startups. It does not include incubators or accelerators due to the fluctuations their investment numbers can have.

Illustration: Dom Guzman