Even before the COVID-19 pandemic, the digital mental health room was quickly expanding, but the stress and anxiety brought about by the health crisis has accelerated demand for virtual behavioural health services.

Because of the success of digital mental wellbeing startups, more people would be able to access mental wellness than before. “I believe the advantages are obvious. We will improve access to treatment by putting it at our fingertips, and we can ideally tailor it to our specific needs. “There is the ability to provide treatment that is more affordable, personalised, and accessible,” says John Torous, M.D., director of Beth Israel Deaconess Medical Center's digital psychiatry division.

In general, the digital mental health room includes direct-to-consumer applications like Talkspace and Calm, apps that are programmed for a clinician to administer, like reSET, which is used to manage substance use disorders, and mental health platforms like Ginger, Lyra Health, and Modern Health that work with employers and health plans. According to the European Connected Health Alliance, there are over 380,000 health applications available for Apple and Android operating systems, with about 20,000 of them addressing mental health.

However, given the market's rapid growth, some analysts are concerned about whether digital mental health tools can deliver on their promises.

“We really don't know a lot about how the technology operates and who it benefits,” Torous, who is also an associate professor of psychiatry at Harvard Medical School, said. “With direct-to-consumer ads and marketing, companies can exaggerate the capabilities of these apps. They'll extrapolate from a small pilot study to large populations,” said Torous, whose research focuses mainly on direct-to-consumer applications.

Some investors have expressed concern about the risks to patients posed by venture-backed digital health firms. In a blog post earlier this year, Hunter Walk, a partner at venture capital firm HomeBrew, wrote, "It's upsetting if an expense report SaaS startup goes out of business, but it's potentially devastating if your tele-therapist or addiction counsellor unexpectedly disappears because the network that employed them ran out of funds." “What happens to the clients of the mental wellness startups that fail? This is my biggest concern about the wave of mental wellness startups being funded with venture capital.

After being fired in 2019, Modern Health co-founder Erica Johnson filed a lawsuit against co-founder Alyson Watson and the organisation, alleging serious claims regarding the company she helped create. Johnson, who sued for unfair termination, revenge, and defamation, alleged that Modern Health, under Watson's leadership, misrepresented its capabilities to prospective clients and investors, such as the size of its provider network. According to the complaint, this supposed misrepresentation "endangers the lives and wellbeing" of Modern Health's patients.