Subscribe to the Crunchbase Daily

With the news cycle churning out updates on the latest COVID-19 developments, the uncertainty about how long the pandemic will last and inevitable economic effects, some people are turning to meditation apps to clear their head. And in turn, some popular apps are making the services free or curating them for certain groups.

Los Angeles-based meditation app is offering free services and guides to help people and specific groups cope with stress by introducing Headspace for Healthcare Professionals, Headspace for Work and Headspace for Educators.

Headspace for Professionals, for example, gives all health care workers in a public health setting in the U.S. free access to Headspace Plus through the rest of the year, according to a blog post from the company. The workers will be able to access the subscription with their National Provider Identifier (a 10-digit identification number) and email address.

Headspace for Workers and Headspace for Educators offer free access to collections of meditations for teachers and other members of the workforce.

Headspace last raised $53 million in February for its Series C round, which was led by . The startup’s other backers include and , according to Crunchbase data.

Other players

The meditation apps Calm and Simple Habit also are introducing free services. Calm, which is backed by investors including and , has put together a curated selection of free resources. Users can pick from sleep meditations, meditations for kids, practices to find ease and more.

Simple Habit is introducing new meditation collections specifically geared toward coronavirus–topics including self-care, mindfulness for kids at home, mindful communication with family and easing fear, according to the company.

“We recognize that many people are now being required to stay home, resulting in loss of income and financial uncertainty,” Simple Habit CEO Yunha Kim wrote in a . “As a response to this macro change, starting today until the end of April 2020, we’ll offer free Simple Habit premium memberships to all people who are financially impacted by this difficult time and can no longer afford to pay. If you’re struggling or in need, we’ll take care of you.”

Illustration:

Subscribe to the Crunchbase Daily

’ Kia Kokalitcheva.

led the equity financing, which included participation from new investors and (the global investments and partnerships arm of The Times Group of India). Existing backers , and also pitched in.

The Series C round brings Santa Monica, Calif.-based Headspace’s since its inception in 2010 (was it really founded a decade ago?!) to $168.2 million, according to Crunchbase data. The company declined to disclose at what valuation the latest round was raised. It closed on a $36.7 million in June 2017.

To rise above the hype around meditation, Headspace claims to be “the most science-backed digital mindfulness product in the market.” As an example of that, the company says it’s currently in progress on over 70 clinical research studies with institutions such as and .

Over the years, it’s branched out from its consumer app into different product lines including “Headspace for Work,” its B2B segment that counts , , and among its 600 enterprise customers. It’s also offering “Headspace Health,” an effort to integrate mindfulness into health care. In general, the company says its goal is to help its users apply mindfulness to improve their health via content around stress, anxiety, sleep and focus, among other things.

Growth

Since its founding, Headspace said it has experienced over 62 million downloads in 190 countries and has more than 2 million paid subscribers.

In addition to growing its direct-to-consumer business,Headspace says it will continue to invest in its Headspace for Work segment, which has seen its revenue double year over year from 2017 to 2018 and most recently in 2019. It also plans to continue putting money into its health care segment. I’ve reached out for more specifics regarding its financials and will update this piece if I get them.

In 2019, the company launched localized versions of the app in French and German, and appointed former executive as head of its European division to lead expansion in that region. Also last year, Headspace launched in Latin American Spanish and Brazilian Portuguese. It expanded into Asia through strategic relationships with partners such as The Times of India. The company plans to use its new capital in part to continue expanding internationally.

Investors talk

, founding partner of blisce/ said, Headspace’s aim with its offerings “resonates deeply with blisce/’s core belief that it is possible to both ‘Do Good’ while also building a strong business with sustainable growth.”

, CEO of of India, notes that Headspace co-founder began his mindfulness journey as a monk in India, and as such, he is “excited to bring things full circle through” a strategic partnership.

Of course, Headspace is not alone in the meditation app space. Last February, announced the close of an $88 million Series B round that propelled it into unicorn status with a $1 billion valuation. In July, it announced a $27 million extension to that round.

Blog Roll Illustration:

Subscribe to the Crunchbase Daily

Companies like and have plastered billboards around cities touting their promises, and while mattresses have been in the limelight with Casper’s recent IPO, a slew of other products are cropping up in what’s been coined as the “Sleep Economy.”

The “Sleep Economy”

“I think there’s much more awareness around the power of sleep and the impact of lack of sleep,” said Eric Hutchinson, co-CEO of , the parent company of mattress brands including and DreamCloud.

The “sleep health” industry is estimated to be worth between $30 billion and $40 billion, and has historically grown about 8 percent each year, according to a 2017 report from consulting firm

The industry can be split into three categories: ambience modification (mattresses, pillows, curtains, lighting, etc.), routine modification (things like sleep monitors, meditation, smart alarm clocks) and therapeutic treatment (sleep aids, apnea treatment devices, surgery, etc.), according to McKinsey.

“Sleep in general is at a premium right now,” co-founder and CEO Mike Grillo said in an interview with Crunchbase News. “I think the notion that you could purchase a product that is demonstrated to improve your sleep is very attractive to people. It’s an easy first step.”

Gravity Blanket raised more than $4 million through a Kickstarter campaign in 2017. In addition to its signature weighted blankets, it offers products like weighted sleep masks, aromatherapy pillows, and a CBD line with melatonin and chamomile.

Most of the sleep product market in the past has been filled with pharmaceutical products, sleep aids like Ambien, Grillo said. But he expects to see more physical products that aren’t pharmaceuticals or mattresses gaining traction with consumers.

And with new markets (and potential products) comes inventiveness and fresh startups.

Gravity Blanket is pushing forward with new products and will be coming out with a line of cooling sheets, weighted apparel and a sleep serum in collaboration with a beauty company in the future.

“The mattresses have given birth to this direct-to-consumer economy … but the emergence of companies like and have made wellness really en vogue,” Grillo said. Meditation apps have also attracted venture dollars, with Calm raising about in funding, according to Crunchbase, and Headspace bringing in about.

Gravity sees itself more in the space of wellness than the home space, Grillo said, and the company has collaborated with Calm for a line of weighted blankets, which includes a one year subscription to the meditation app.

Resident co-CEO Hutchinson pointed to other secondary products like pillows, sheets and adjustable bases as a growing opportunity. They’re replaced more frequently than a mattress, which typically has a life of eight to 10 years, but also important for a good night’s sleep.

The rise of the internet made information more accessible, and made “shopping for mundane products enjoyable” Hutchinson said.

And what better market than sleep-deprived consumers ready and willing to pay for some help.

Illustration Credit:

�� �� �� �� �� �� Follow Crunchbase News on����&��

But what about those other companies that mature more gradually? Is there such a thing as slow and successful in startup-land?

To contemplate that question, Crunchbase News set out to assemble a dataset of . We looked at companies that were founded in or before 2010 that raised large amounts of capital after 2015, and we also looked at companies founded a least five years ago that raised large early-stage funds in the last year.��(For more details on the rules we used to select the companies, check “Data Methods” at the end of the post.)

The exercise was a counterpoint to a dataset we did a couple weeks ago, looking at characteristics of the fastest growing startups by capital raise. For that list, we found plenty of similarities between members, including a preponderance ��of companies in a few hot sectors, many famous founders, and a lot of cancer drug developers.

For the late bloomers, however, patterns were harder to pinpoint. The breakdown wasn’t too different from venture-backed companies overall. Slower-growing companies could come from major venture hubs as well as cities with smaller startup ecosystems. They could be in biotech, medical devices, mobile gaming, or even meditation.

What we did find, however, was an interesting and inspiring collection of stories for those of us who’ve been toiling away at something for a long time, with hopes still of striking it big.

Pivots And Patience

Even youthful startups have been known to make a major pivot or two. So it’s not surprising to see a lot of pivots among late bloomers, who have had more time to tinker with their business models.

One that fits this mold is , provider of a popular meditation app. The company, founded in 2010 by a British-born Buddhist monk with a degree in circus arts, started out as a meditation-focused events startup. But it turned out people wanted to build on their learning on their own time, so Headspace put together some online lessons. Today, Santa Monica-based Headspace has millions of users and has raised $75 million in venture funding.

For late bloomers, the pivot can mean going from a model with limited scalability to one that can attract a much wider audience. That’s the case with Headspace, which would have been limited in its events business to those who could physically show up. Its online model, with instant, global reach, turns the business into something venture investors can line up behind.

Sometimes Your Sector Becomes Hip

They say if you wait long enough, everything comes back in style. That mantra usually works as an excuse for hoarding 80s clothes in the attic. But it can also apply to entrepreneurial companies, which may have launched years before their industry evolved into something venture investors were competing to back.

Take , the vacation rental management provider. The company has been around since 2009, but it began raising VC just a couple years ago amid a broad expansion of its staff and property portfolio. The Portland-based company has raised over $140 million to date, all of it after 2016, and most in a $103 million October round led by technology growth investor .

, which was acquired by Salesforce earlier this week, also took a long time to take venture funding. The Chicago-based provider of business-to-business e-commerce software launched in 2009, but closed its first VC round in 2015, according to Crunchbase records. Prior to the acquisition, the company raised about $30 million, with most of that coming in just a year ago.

Meanwhile, some late bloomers have always been fashionable, just not necessarily as VC-funded companies. , a clothing retailer that specializes in button-down shirts that look good untucked, had been building up its business since 2011, but closed its first venture round, a Series A led by VC firm Kleiner Perkins, last June.

Slow Growing Venture-Backed Startups Are Still Not That Common

So yes, there is still capital available for those who wait. However, the truth of the matter is most companies that raise substantial sums of venture capital secure their initial seed rounds within a couple years of founding. Companies that chug along for five-plus years without a round and then scale up are comparatively rare.

That said, our dataset, which looks at venture and seed funding, does not come close to capturing the full ecosystem of slow-growing startups. For one, many successful bootstrapped companies could raise venture funding but choose not to. And those who do eventually decide to take investment may look at other sources, like private equity, bank financing, or even an IPO.

Additionally, the landscape is full of slow-growing startups that do make it, just not in a venture homerun exit kind of way. Many stay local, thriving in the places they know best.

On the flip side, companies that wait a long time to take VC funding have also produced some really big exits.

Take , the provider of workplace collaboration tools. Founded in 2002, the Australian company waited eight years to take its first VC financing, despite plentiful offers. It went public two years ago, and currently has a market valuation of nearly $14 billion.

The moral: Those who take it slow can still finish ahead.

Data Methods

We primarily looked at companies founded in 2010 or earlier in US and Canada that raised a seed, Series A or Series B round sometime after the beginning of last year and included some that first raised rounds in 2015 or later and went on to substantial fundraises. We also looked at companies founded in 2012 or earlier that raised a seed or Series A round after the beginning of last year and have raised $30 million or more to date. The list was culled further from there.

Top Image Credit: