Our Investment in Cognito: Integrated, Effective, Affordable Mental Healthcare for Canadians

Helping Canadians get better faster, reducing the impact on employers, society and our hospital system

Standup Ventures is incredibly proud to announce our investment in Victoria-based Cognito Health’s $2M Seed Round, alongside friends at Garage Capital, Graphite Ventures, Spring Impact, and Simplex Ventures.

Cognito was cofounded in 2021 by a team of clinicians and mental health advocates alike. After experiencing problems accessing quality treatment for mental healthcare in Canada firsthand, growth expert CEO Armon Arani set out to build a solution. Joined by Dr. Francois Muller and Dr. Marlene Muller, physicians who have dedicated their careers to supporting the mental health of Canadians, Cognito Health was born.

What Actually Works

A personal anecdote —in a previous life, before I ever thought about venture capital (or had taken a single business class actually), I studied psychology and neuroscience at McMaster, focusing my research in mental health. Many other bright and bushy-tailed students who studied these subjects alongside myself are extremely familiar with a well-known study called STAR*D.

Published in 2008, this study wasn’t just famous because of the size (it was the largest and most consequential antidepressant study ever conducted, costing $35M!) The research was highly publicized, and looked at the effectiveness of sequences of treatments for the actual remission of depression — rather than using one single treatment, or solely with respect to symptom reduction.

STAR*D demonstrated a few interesting things:

• In order to achieve remission from depression (vs. just symptom abatement), patients likely require multiple treatments (such as medication AND psychotherapy). When using more than one treatment, remission jumped from about 33% to 67%.
• CBT (Cognitive Behavioural Therapy) can be as effective as medication alone for the treatment of depression.

Since this study was published, and especially in recent years, research has only continued to demonstrate the importance of therapy used in conjunction with medication in order to help individuals struggling with their mental health actually get better in a permanent way. Research also underpins the importance of a nuanced, iterative, and holistic approach.

Unfortunately for Canadians, access to mental health support of this nature has thus far been limited.

The Status Quo for Canadians is a Huge Problem

In Canada, 8,633,500 individuals reported a mental health disorder in 2022 — or ~23% of the population (mood disorders increased 20% in just one year).

This isn’t surprising given how few Canadians are able to access the support they need. Research from 2018 cited 43% of individuals with mental health needs stated their needs were not fully met.

Drilling down into the data a bit further paints a more fullsome picture. Medication needs were met more than 85% of the time, at least partially. But needs for counselling and therapy were met only 50% of the time.

78.2% of Canadians who were unable to access support cited personal circumstances, which included categories such as “could not afford to pay,” and, “insurance did not cover it.” This isn’t surprising given the average price of $150+/session (at 1 session/month ~3% of the median Canadian households take home pay) and the frequently cited benefit of $500/year of mental health coverage for folks who have private insurance with their employer (an amount that covers just 2-3 therapy sessions).

More recent research from 2022 shows even more concerning data. Only 48.8% of individuals who met the criteria for a mental health diagnosis talked to any health professional at ALL in the previous 12 months, 79% did not access a counsellor, and 89% did not access a psychologist. Only 32% spoke to a GP.

Public healthcare does not cover counselling or therapy as a treatment for in Canada unless it is done by a medical doctor (and the waiting list for psychiatrist referrals is extraordinarily long, with this resource usually being reserved for the most serious of cases).

Given what we know from STAR*D and the robust and broad base of research since, therapy is a critical part of the equation for mental healthcare that actually works, and Canadians need a way to access it in an affordable way.

But it’s hard to make approaches that include therapy more affordable for several reasons.

• First, there’s a supply and demand problem in Canada. A lack of therapists and counsellors means that individuals often have long waitlists to see someone (4+ months in Ontario). There is a cost to waiting too —without timely treatment, an individuals mental health can become worse — creating a more painful, expensive, and at times irreversible problem for individuals and their employers.
• Second, it’s hard to reduce the price-point of therapy because the cost of the service is simply a function of a therapist’s time.

Competitive digital platforms either therefore offer access to therapists (at a higher than direct, often prohibitive price-point), or support individuals with acute access to a clinician for diagnosis and/or medication (usually a single session + medication).

But cost is not the only problem. In the needs-based study, 38% of the highest income group reported their mental health needs were not fully met.

Integrated medicine is not covered in Canada — meaning that individuals with complex conditions are often left navigating their care on their own. And care navigation is hard! Patients often don’t know where to start, and if they do start, any friction or difficulty in the process makes it hard to follow-through with coordinating appointments and referrals until they get better.

Family physicians are often therefore the point of care for individuals experiencing a mental health challenge (with treating anxiety and depression being some of the most common reasons for an appointment), but they are both limited in capacity and feeling increasingly under equipped to provide adequate support. And with the scarcity of counsellors and prohibitive costs of therapy, they are often left with only one option, to offer a prescription.

And that’s if the individual even has access to a family doctor in the first place (1 in 5 do not). When they don’t, individuals are left managing their care pathway on their own — hacking together a collection of in-person meetings, expensive platforms, and prescriptions with no end date. As opposed to other chronic health conditions, follow-through is particularly hard for mental health patients due to the impact of the disorders on motivation and energy — further underpinning the importance of guidance and support.

The Solution: Cognito Health

Cognito was designed to solve this complex problem at it’s core — offering an all-in-one virtual mental health treatment option that provides Canadians with a single access point for effective, affordable, and immediate mental health care.

The platform is designed to address key gaps outlined above for Canadians — combining the critical ingredients of cognitive behavioural therapy and medication with an integrated care team, all for an affordable, easy-to-cancel, monthly subscription that costs less than a single traditional counselling session.

By addressing a pain point trifecta of efficacy, access, and cost, Cognito offers a solution to a segment of the Canadian market that was previously unable to access care — something that prevented their ability to get better, and at times, caused their condition to get worse. Whether cost or friction was the barrier to accessing truly helpful care, Cognito offers an easy path to a solution that actually works.

StandUp’s Thesis

And working it is. Early data for Cognito’s approach is already demonstrating effectiveness for thousands of Canadians at rates far beyond currently available alternatives. This is because Cognito is designed to actually drive outcomes, not just abate symptoms.

Because of this, in 2022, Cognito was chosen by the Island Health Authority as a mental health treatment partner for Vancouver Island’s 800,000 residents — this partnership involves referring patients to Cognito and fully covering patient costs for access to the service.

StandUp Ventures is excited to invest in a solution where an enormous business opportunity exists because of a real, deep, and painful problem. By bringing a value therapy product to market and increasing counsellor supply, Cognito gives Canadians a holistic and effective mental health treatment option that they can actually afford — meaning more folks can get better faster, reducing the impact on employers, society and our hospital system.

Cognito is currently active in British Colombia and growing quickly, primed for rapid expansion across Canada. We are energized to support founders like Armon, Francois, and Marlene, who are so genuinely passionate about delivering genuinely effective treatment to every Canadian who needs it, and StandUp could not have stronger conviction about both the enormous business opportunity and the equally important and large opportunity to tangibly impact the future of Canadian mental health.

Look out for Cognito’s launch in Ontario later this month!

Thanks for reading,
Katie