Aussie digital hypnotherapy startup Mindset Health has secured US$5 million ($6.7 million) in funding as it scales its tech solution to anything from IBS to menopause.
The Melbourne-based business is headed up by brothers and co-founders Chris and Alex Naoumidis, who are working on building out a portfolio of digital therapeutic apps using hypnosis-based techniques to tackle underserved health conditions.
Its pilot product Nerva focuses on irritable bowel syndrome (IBS), and launched into the market in mid-2019. It now has some 10,000 users paying for the app, Alex Naoumidis tells SmartCompany.
The funding comes from US funds Banana Capital and Fifty Years, as well as from local VC Giant Leap and US angel investor James Beshara.
It will fuel a period of growth for the Aussie startup, as it develops a suite of new solutions tackling additional health concerns.
“We partner with researchers and experts to take their work and commercialise it and deliver it,” Alex Naoumidis tells SmartCompany.
Nerva is based on research by Dr Simone Peters, who found through clinical trials that for some IBS patients, hypnosis therapy can be equally as effective as a change in diet.
The founder admits that when he talks about hypnosis he’s still frequently met with rolled eyes and scepticism, but people tend to change their attitude when the founders start to talk about the science, research and academics behind their products.
“That’s why our company is so focused on building evidence,” Naoumidis says.
“The bar of credibility is so much higher.”
Being ready to discuss the findings from studies and having PhD partners on hand helps get around some of the misconceptions around hypnosis, he adds.
“It’s not what you see on TV. It’s not magic, it’s not mind control. It’s a state of focused attention and absorption.”
“The next meditation”
This isn’t the brothers’ first foray into business together. The pair previously launched fashion-sharing platform Covet, teaching themselves to code in the process.
“We weren’t technical, but we knew we had to become technical,” Naoumidis says.
After six months of working on Covet, a mentor asked them if it was truly something they wanted to spend the next 10 years on.
“We realised we weren’t passionate about it,” he admits.
They started looking for something they could really get stuck in to for the long term, and when they came across hypnosis and the crossover of psychology and physical health, they were hooked.
“Could we turn hypnosis into the next meditation?”
This funding will allow Mindset Health to build out its team, which is set to grow from 15 people to 35, to add engineers and general managers for new programs and products.
The founders are hoping to develop apps to support people with depression and chronic pain, and for people going through menopause.
“We’s taking what we’re doing with Nerva and then replicating that,” Naoumidis says.
Ultimately, the overarching vision for the founders is to “empower 1 billion people to improve their health by unlocking the power of the mind,” the founder adds.
The brothers envision a world where all digital therapeutics use an element of hypnosis to amplify their effectiveness.
It’s a goal that goes beyond one Melbourne business, he explains. Mindset Health is trying to create a more holistic view of healthcare, normalising alternatives to drugs and behaviour change in managing symptoms for a range of conditions.
“We’d love to be the ones to spearhead it, but we don’t want to be the only company that’s focused on unlocking how you can use your mind in healthcare,” Naoumidis says.
“That’s smaller than what we want to be.”