Scoop: Healthcare Startup Slingshot AI Raises $30 Million from A16z

Investors are clamoring to support AI startups across a variety of industries, and mental health care is no exception.

Slingshot AI, which launched this year to build multilingual models for behavioral health, just raised about $30 million in a new funding round led by top VC fund Andreessen Horowitz, according to three people with knowledge of the deal.

Two sources said the round valued Slingshot at more than $100 million.

And the startup drew so much investor interest that the round led by A16z wasn’t enough. Menlo Ventures quickly followed the round, according to two of the people, investing its own money in Slingshot shortly after the round closed. The startup was valued at $220 million after Menlo Ventures’ investment, according to one of the sources familiar with the deal.

The funding rush is emblematic of Silicon Valley’s gold rush to support AI in all its iterations. Mental health is a huge opportunity for investors to embrace the new technology—the U.S. mental health market has reached about $115 million this year, according to Precedence Research.

Slingshot AI’s founders already have deep VC connections. One of the co-founders, Daniel Reid Cahn, is the brother of Sequoia Capital partner David Cahn. The startup’s other co-founder, Neil Parikh, founded mattress brand Casper in 2014.

Slingshot, Andreessen Horowitz and Menlo Ventures did not respond to requests for comment for this article.

One investor who did not participate in Slingshot’s funding round said he sees the potential for Slingshot’s technology to fill gaps in mental health care as labor crises in the sector grow. More people are seeking mental health care, exacerbating existing shortages of therapists and leaving desperate patients on long waitlists.

Based in New York and London, Slingshot launched its first model in May — an AI advisor that users can talk to and receive advice from, just like they would from a human therapist.

The startup says patients can communicate with the AI therapist, called Ash, by speaking or typing into the app at any time. The app will also remember patients’ previous conversations to help users solve problems over time and achieve their goals.

Slingshot isn’t the first automated advisor to hit the market. It follows in the footsteps of Woebot, an AI-powered chatbot that has raised about $123 million to date, including a $90 million Series C round in 2021. The company also received FDA breakthrough device designation for its chatbot, which is intended to be used as a treatment for postpartum depression.

But mental health care is complicated, and there are many opportunities for things to go wrong when AI is used to manage human emotions. The National Eating Disorder Association’s AI chatbot was removed last year after the bot gave some users harmful advice, such as suggesting patients significantly reduce their calorie intake.

Many people have also begun using general-purpose generative AI models, such as OpenAI’s ChatGPT, to supplement their mental health needs, with varying degrees of success.