The Chicago-based startup has combined with an established player to form what it hopes will be an industry juggernaut.
Regroup Therapy, an innovative startup that uses technology to fill gaps in mental health coverage, has merged with established industry player InSight Telepsychiatry.
Regroup founder David Cohn will stay on at the combined company as chief growth officer, along with other Regroup executives who will be in senior roles.
Terms of the deal were not disclosed, but it creates the largest company in long-distance psychiatry, Cohn said. Mt. Laurel, N.J.-based InSight got into the mental-health business as a brick-and-mortar provider but moved into telehealth.
Cohn declined to provide specific financials but said the deal creates a combined company that will have triple the revenue of Chicago-based Regroup and about 150 employees. The merger will not result in layoffs.
Cohn, who founded the company in 2011, says Regroup merged with InSight to bulk up ahead of what he sees as a consolidation wave.
Regroup had signed up both public and private customers, from correctional facilities to insurers, looking to offer mental-health services. It specialized in scheduled psychiatry appointments, delivered via secure video chat.
InSight had developed an on-demand service to provide services to patients on an as-needed basis, something Regroup’s customers were seeking, Cohn said. “On-demand is a winner-take-all business. They got ahead of this.”
InSight also has a direct-to-consumer business. InSight, founded 20 years ago, took its first outside investment last year from private-equity firm Harbour Point Capital.
Regroup is backed by investors including local venture funds OCA Ventures, OSF Ventures, Impact Engine, Wasson Enterprise, HBS Angels, Hyde Park Angels and Further Fund.