Recently, the IPO (Initial Public Offering) market has become interesting to a large number of completely new investors who have not even been participants in the stock market. There is one big reason - profitability. The average return after the lock-up period is 40.5%, which corresponds to 162% annual in dollars (excluding commissions and personal income tax). In this article we will discuss the key details of Talkspace IPO: the history of the company, when is Talkspace IPO date, Talkspace IPO price and everything you should know to make a decision whether to invest in it or not.
Talkspace is psychology and mental health taken to another level. It was founded in 2012 by Oren Frank and Roni Frank. They came up with an idea to make psychological help more accessible to people after they went through couples therapy themselves and it saved their marriage. The big idea led all the way to Talkspace IPO and made them a billion dollar company.
Mental health is increasingly recognized as an essential need nowadays. Last fall, a third of psychologists said they are seeing more patients since the start of the pandemic, according to the American Psychological Association. Unfortunately, many people can’t afford proper help or waited for too long to find an expert and make an appointment. Why not make it simpler by going online? So they firstly came up with a platform for group treatment but developed into a service with online and mobile therapy available through video, phone calls or even just messaging.
It has a lot of advantages as all online services but two most important ones are time and money. Talkspace eliminates commute time and scheduling hassles and saves money while receiving high-quality care. Win-Win for everyone.
Was it the right time to ask the question 'When is Talkspace going public?' Probably not, because the company sourced money from regular venture firms. In 5 years Talkspace received investments of $24.5 million from Spark Capital, SoftBank(you may remember this poor fund from WeWork article), Norwest Venture Partners. In August 2019, the company raised $50 million Series D funding and entered into a partnership with Optum, subsidiary of UnitedHealth.
Pandemic strengthened Talkspace’s positions on the market since people’s levels of anxiety and depression rose, and with lockdowns face-to-face sessions were not possible. And we were anxious when is the Talkspace IPO date? Company’s revenue and number of clients, especially in the B2B segment was growing rapidly and to nail this success there was just one puzzle missing - Talkspace IPO 2021. They filed for IPO at the end of 2020 and 6 months later we knew Talkspace IPO date and price.
Talkspace’s Public Listing Key Data and IPO Date
IPO Date: June 23, 2021
Share price: $8.90
Valuation at IPO: $1.4 billion
CEO: Douglas Braunstein (interim)
Category: Healthcare Stocks
Among the choices of Talkspace going public, it’s management chose the most popular way for the IPO - via Special Purpose Acquisition Company(SPAC). In essence, you merge with an already public company and become public too as opposed to a traditional IPO where you bear all expenses to become listed. In the case of Talkspace it was a merger with Hudson Executive Investment Corp. Talkspace stock IPO date was on 23 June, 2021 and the stock symbol is (quite predictable) TALK. Some might ask ‘Why is Talkspace publicly traded on NASDAQ not NYSE?’ For a regular investor, just like us, there is no difference. Also the company didn’t choose - it’s SPAC was traded on that market before the merger.
Talkspace stock IPO price rose from $8.9 per share in the beginning of the trading day to $9.19 at the end. 3% growth is not an impressive result, but not bad. The company had approximately 152 million shares outstanding. The bad times were yet to come.
The second quarter in 2021 was rather disappointing for investors, the company reported loses of $30.4 million, compared to $6.46 million in the same period in 2020. Even though they have seen a 74% revenue increase YoY, almost 6 months after Talkspace IPO date shares sank 55%.
Why suddenly everyone became so bearish after the Talkspace stock IPO?
So What About Investing In It?
IPO gave $250 million in growth capital which the company has to spend wisely.The main problem of the company is tight competition on this not-yet-shaped market. Talkspace has an advantage of coming first and having a reputation of the global leader. However, its competitors such as BetterHelp, Headspace Health and Brightside might have bigger marketing budgets. This is a challenge for the company.
But on the bright side (pun intended), there is also a big shortage of specialists in this field: currently there are 30 psychologists for every 100 000 of the population in the US. Demand is growing, supply is short. And Talkspace has taken its fair share and became a popular ways for people of all backgrounds to access the therapy they need, including the stars such as singer Demi Lovato and swimmer Michael Phelps.
As of September 2021, over 2 million people have used Talkspace, and over 75 million lives were covered for Talkspace through insurance and employee assistance programs or other network behavioral health paid benefit programs.
Oren Frank, co founder and former CEO of Talkspace, said “As a public company, we believe we will be able to further enhance access to high-quality mental health services, lowering cost and improving clinical outcomes at scale." Sounds very promising, except for the fact that Oren and Roni have resigned from their positions in Talkspace this November.
Is Talkspace a public company?
Yes, the company has gone public this year in Jun 23, 2021when it had a merger with a Special Purpose Acquisition Company(SPAC) Hudson Executive Investment Corp. You can find it under the stock symbol TALK on NASDAQ.
How much does Talkspace worth?
Before the IPO, the company’s net worth was around $100 million but during the IPO process it received additional $250 million. The current valuation of the company is the same as the market cap which is $339 million.
What is Talkspace’s business model?
Talkspace has a subscription-based business model. It offers monthly subscriptions to the services of the platform ranging from $260 to $396 per month.