Gympass has taken another step to boost its recently-launched mental health platform, Wellz. The corporate wellness unicorn has announced the purchase of Vitalk, a São Paulo-based healthtech active in the corporate mental health prevention and training space.
Although the transaction values were not disclosed, we are talking about an acquihire transaction: the deal foresees the incorporation of Vitalk by the Gympass operation, to then accelerate the growth of the Wellz brand, with services such as individual therapy sessions and group, on-demand content and clinical monitoring.
“We are bringing in an expertise we did not have before, which is the combination of artificial intelligence with a human journey through chatbots and digital knowledge, complementing our strong professional base”, said Gympass cofounder João Barbosa, in a statement.
Consistent growth
Founded by US entrepreneur Michael Kapps in 2019, Vitalk ended 2021 with a positive performance in Brazil, surpassing 220,000 individuals covered. With clients such as mining firm Vale, Johnson & Johnson and GSK, the startup works closely with the HRs of the companies in monitoring and promoting the mental health of employees.
The startup does this by monitoring burnout, stress and anxiety rates, training leaders, promoting talks with psychologists and providing awareness materials for employees. The company does not disclose numbers, but says it has seen an average revenue growth of 30% month-on-month and reached the mark of 250,000 downloads of its app.
To top it off, the firm received an investment of 24 million Brazilian reais ($5 million) in a series A round led by Vox Capital. The round was led by funds Goodwater Capital, Valor Capital, the family office of the Moll family, of healthcare conglomerate Rede D’Or, and Greenrock.
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A noteworthy detail is that this is the first M&A deal within the Valor Capital Group portfolio, a move that confirms a trend recently listed by Startups for 2022: the consolidation of investments supported by fund managers. At the end of last year, healthtech Alice incorporated Cuidas. Both companies had Kaszek as a common investor.
Expanding Gympass
The purchase of Vitalk reinforces Gympass’ position as a full platform for employee wellness solutions, going well beyond its initial idea of being, er, a gym pass service – and possibly expanding Wellz into its other international markets beyond Brazil.
“Michael [Kapps] and his team are bringing a world-class digital solution with deep clinical expertise and product experience. We are excited about the synergies and value [Vitalk] can contribute to us”, said Rogério Hirose, head of new business at Gympass.
The purchase is not the brand’s first move in the mental health space. In 2020, the company entered into a partnership with US firm Calm, integrating the meditation app created by the San Francisco firm into its offering. The mental health movement was Gympass’s response to the changes in behavior brought about by the social distancing measures brought about by Covid-19.
In addition, the company recently had a capital boost. In June last year, it raised $220 million in a series E round led by SoftBank, General Atlantic, Moore Strategic Ventures, Kaszek Ventures and Valor Capital Group. In a press release at the time, the company highlighted that the funds would be invested in “growing its presence in the US, improving the product experience and continuing to expand in categories such as digital fitness, mental health and nutrition”. With the investment, the company practically doubled its valuation to US$ 2.2 billion.
Founded in Brazil, but since 2017 with its headquarters in New York, Gympass has operations in Brazil, Mexico, Chile, Argentina, USA, Germany, Spain, Italy, Ireland and the United Kingdom. The company has large clients such as Santander, Unilever, Accenture and McDonalds.
