John Kirwan's mental health app gets heavyweight support
The Accident Compensation Corporation and Pathfinder has invested more than $2 million in workplace wellbeing platform Mentemia in an effort to reduce mental health injuries.
Wednesday, May 26th 2021, 6:54AM
by BusinessDesk
Mentemia is designed to help employees build mental health literacy and improve their wellbeing in a personalised way.
The product was built by mental health campaigner John Kirwan and entrepreneur Adam Clark, and is used by companies such as Fletcher Building, Chorus and Kiwibank.
The Accident Compensation Corporation (ACC) said the investment was in the $2m-to-$15m range its Impact Fund targets, and said it does not disclose further investment details.
However, the Companies’ Office shows the investor as having an 11.5% stake in the app, while Pathfinder KiwiSaver – which invested $800,000 – has a 3.2% stake.
If both investors were offered the same terms, that would mean ACC paid approximately $2.6m and would value the business at about $24m.
Mentemia’s chief executive Adam Clark said the company would spend the new investment expanding its engineering team and investing more in sales and marketing to grow the business.
Impact Fund advisor George Adams said the for-profit platform was an attractive investment with a “compelling growth strategy globally.”
“There is significant market opportunity in employee health and wellness that is undergoing positive disruption due to technology solutions,” he said.
Mental health burns 5% of GDP
The investment comes from ACC’s $50m Impact Fund which aims to improve health and safety in the workplace while also providing a strong investment return that reduces levies for accident cover.
Adams said ACC covered $65m of costs related to direct mental health injuries in the workplace last year, as well as $312m of costs for mental health injuries as a result of physical injuries.
ACC hopes that Mentemia will help employers “embed a wellbeing-first culture” that will lead to better productivity and less time lost to injuries.
“Improving mental health and wellbeing can help bring down injury rates, speed recovery and reduce the cost in ACC claims,” Adams said.
Mental health is the primary cause of lost working days and productivity loss in most Westernised countries and supporting good mental health has benefits to businesses and workers alike, he said.
A report by the Victoria Institute of Strategic Economic Studies found serious mental illness cost the NZ economy $12 billion in 2014. That’s equal to 5% of gross domestic product and would be more than $16 billion in 2020.
Looking to make an impact
ACC’s Private Markets team said it welcomes interest from organisations and funds with investment proposals that improve health, safety and wellbeing.
Adams told BusinessDesk the pipeline of mid-sized impact investments suitable for the ACC fund was limited in NZ, although there were many startups and early-stage ideas around.
“When you have a $50m fund it is hard to make an impact with an investment of a couple hundred thousand dollars,” he said.
Pathfinder KiwiSaver’s $800,000 investment is approximately 1% of its funds and follows a string of investments in renewable energy, healthcare, social housing.
Chief executive John Berry said KiwiSaver providers were increasingly moving into private equity investment because of the potential for delivering higher long-term returns.
“Kiwi investors now want great financial returns and positive social impact. The large providers are not delivering on this,” he said.
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