Oren Frank used to be an advertising executive. Then came a spat with two of Israel’s most powerful men: business tycoon Nochi Dankner (who’s now in prison after the collapse of his empire) and Rafi Ginat, who has held many jobs in the Israeli media but is best-known for his consumer-protection TV show “Kolbotek.” Frank was fired, for which he now says he’s happy. Otherwise he wouldn’t have created his business in the United States with his wife Roni. He doesn’t do advertising any more. “I left, telling myself it would be better to wash dishes than to work in advertising – which creates dependencies and sells things to people that they don’t need,” he says.
- Israeli-founded TalkSpace raises $31m for online psychotherapy
- Two Israeli startups raise nearly $100 million in capital
So in 2012 you decided to launch a startup that would sell people what they do need?
“Yes – to take psychological counseling online.”
With Talkspace’s “Therapy for all,” users gain access to licensed therapists through the website or their smartphone. Based on the information they provide, users are matched with a psychotherapist, or pick one from a list created by an algorithm. At about $40 a week it’s not free, but it’s 25 to 33% of the cost of conventional therapy, Frank says. It’s not only the price that is lowered: so are obstacles of convenience, finding an appropriate therapist – and embarrassment.
After much testing and gatherings, the Franks realized the most successful product on their site at the time arose because they made a mistake in English: “We wrote ‘Customer Support’ instead of ‘Customer Service’ on the site,” Frank says. “A lot of people wrote 700 words on this form. We said, ‘Let’s try to do therapy in writing.’ We call it Messaging Therapy.”
Why get into this? You’re not a therapist yourself.
“No, but Roni and I have a history of personal and couples therapy. I really value treatment, and it helps a lot of people. In fact, following our couples therapy, Roni – who was a software developer at Amdocs – left it and went to study psychology.”
The Franks had two daughters and making a living was difficult, but they believed in their startup. They moved from Manhattan to the suburbs. “My mom thought I was out of my mind,” Frank relates. “I told her change is good and that’s what I wanted to do.”
But you didn’t invent online therapy.
“There were attempts in the late 1990s, but it didn’t take off. Our fundamental assumption was that therapy is good, and helpful, but it’s accessible to only about 2 to 3% of the population.”
A luxury item.
“Right. You need time and money, and to be willing to go to therapy. Or at least you have to be suffering enough. Suffering is a powerful driver to seek help. The problem is that only 10 million Americans go to therapy out of a population of 300 million, and most stop after one session. We thought about what we could do to bring it to more people. The words we wrote on the napkin were ‘Therapy for everyone. No money at all.’”
“That’s what we wanted. Of course, it’s borderline impossible, because the health-care market is not the most efficient. It’s sclerotic and corrupt. Therapy in the United States costs $150 an hour, which works out to more than $7,000 a year, and insurance companies do everything in their power not to reimburse. The price is a serious obstacle.”
What are some other obstacles?
“People worry they’ll find out about it at work, for instance.”
Why should they?
“Most people go to therapy after work. In Manhattan it’s OK to say I have an appointment with the psychologist, but elsewhere in the U.S. it isn’t necessarily like that. Some employers think that if their employees go to a psychologist, it indicates he isn’t that stable, and people worry it will hurt their prospects.
“Another obstacle is finding the right therapist for you. It’s like dating – a matter of chemistry. The problem is that today, everything is anecdotal, based on recommendations from friends or family, not professional matching.”
It’s hard to make the time, travel, find a babysitter, etc.
“Right, it isn’t easy. Come once a week at three o’clock on Wednesday and we’ll talk for an hour – that’s a model created in Vienna in the days of horses and carriages. Not to mention couples therapy, which requires even more complicated planning.”
Patients make perfect
You wanted to change the market.
“We reached two assumptions: That we had to find a different model for therapy and disseminating knowledge; and that it’s best to start with the customers, the patients – not the insurance companies and HMOs. They have no interest in changing and they’re very slow and heavy. These are corrupt systems, violent, bad. They aren’t evil: it’s just that their business model is bad, squeezing people. It’s a trap and nobody has any interest or political power to change.”
The Franks lived tight, but now their shares are worth money (on paper). Their business is still a startup, though. They take salaries from the company, Frank explains.
They made mistakes en route: “We thought the solution to lowering prices is virtual group therapy by video, or audio, for seven people at a time. But nobody came. We burned up a lot of money on that. It was a crisis,” he says.
“Yes. We ran out of money and thought of giving up, closing the company. Later, we recruited the psychiatrist Irvin Yalom as an adviser.”
How did you find him?
“I found him in San Francisco, and it took a long time before he agreed to help. I told him the story – first by email, then we spoke on the phone and I flew to meet him. He wasn’t young any more, so why take a risk and join a venture like this?
“To his credit, he was open and he tries to operate by the rule of ‘What helps is therefore good.’ He’s an impressive man, smart and sharp. Finally, he visited New York, came to meet Roni and I, spent two hours at our home and we convinced him to join.” Yalom owns a little bit of stock in the startup, Frank acknowledged.
And then you reached the product you have today. Correspondence with a psychologist.
“Yes, today, most human communication is done in writing – by email, WhatsApp or by regular texting. One advantage is that written communication isn’t in real time. Everyone answers when convenient, even close friends. It taught us to control our time.”
It’s all by texting?
“You don’t have to. It can be done by phone or video chat, but the vast majority is via our smartphone app.”
That’s quite different from a 50-minute meeting once a week.
“On average, in our service people communicate with their therapist twice a day, five days a week. In terms of time and words, it comes out pretty much like an hour’s talk a week.”
Who writes more, the therapist or the patient?
“On average, the patient writes 20% more than the therapist.”
In therapy, part of the therapist’s role is to listen and nod.
“True. We don’t have that but there are digital equivalents. We teach our therapists to write ‘Keep on going,’ ‘I’m here,’ ‘I’m listening,’ etc.”
It must be exhausting for psychologists to answer all day long.
“We define in advance that therapists work five days a week. Many actually prefer to work on weekends because it’s on top of their private clinic. In any case, they don’t have to be constantly available.”
But doesn’t communicating your mental agonies by WhatsApp or whatever service impair the quality of therapy?
“No. In a sense, it’s even better that you’re treated all week, all the time. But what surprised me most was the issue of stigma.”
What do you mean by that?
“It turns out that people feel much more comfortable talking to machines than to people. Something about the distance allows them to speak freely.”
Is that what the therapists report?
“Yes, people open up much more quickly. It’s easier to sit in the living room at home at night and write what weighs on their hearts. Maybe the act of writing has an effect – it’s harder to lie, you think more beforehand. You edit yourself a little.”
When a potential customer first calls, he’s answered within two minutes, to undergo initial diagnosis and matching with a therapist, Frank explains. In 80% of cases, therapy starts that same day, while in conventional therapy the first meeting may be scheduled weeks ahead – by which time about a third of potential clients have given up, or felt better on their own, he notes.
Matching is based on questions and the person’s preferences – for instance, a male or female therapist, age, etc. The algorithm comes up with several options out of their pool of about 2,000 therapists. Potential patients can view videos of them and see that it’s a real person, Frank says. They confine the therapists’ photos to black and white, uniform format, to diminish the option of choosing by look.
It isn’t that they’re changing the paradigm of therapy: What matters is trust between therapist and patient, Frank says.
How do they know the therapy is working? One sign is an increase in the use of positive words, he explains.
Talkspace has treated about 500,000 people so far and – in contrast to regular therapy, where at most the therapist usually scribbles a few lines, nothing more – everything here winds up being recorded.
The result is that the startup has a great deal of data, which it can study itself, to learn about the efficacy of its therapists and the mutuality between therapists and patients. “If, for instance, a patient types 1,200 words and the therapist responds, ‘OK, have a great day,’ clearly it isn’t working,” Frank observes.
Is that data for sale?