Late-stage digital behavioral health companies may once again see the public markets as a potential exit, according to an analysis by PitchBook.
In its annual outlook report, the research and data outfit points to the 2025 IPOs of Hinge Health and Omada Health as examples of the public markets “cautiously reopening” to venture capital-backed companies with enough gravity to attract interest from institutional investors.
It also highlighted two behavioral health companies to watch in 2026: Spring Health and Headspace.
These two companies have raised hundreds of millions of dollars. Spring Health has raised $466.5 million, while Headspace has raised $320.9 million, according to Crunchbase. In its most recent funding round, Spring Health raised $100 million.
Spring Health is a virtual mental health provider. It offers employee assistance programs (EAPs) and mental health benefits for employers and health plans. Headspace offers digital mental wellness and virtual therapy offerings. Its therapy offerings were previously limited to B2B clients. In June, it announced a D2C therapy offering.
The stability of the B2B lane will be key for those looking to jump into public markets in 2026.
“We expect other B2B2C platforms to lead the next wave of IPOs over the next 12 to 18 months, even as we expect few listing announcements heading into the holiday period and gear up for JPM week in January,” the report states. “These companies and other healthtech startup leaders are increasingly ROI-driven and partnership-oriented, reflecting a shift among payors and employers toward outcomes-based contracting and sustained engagement rather than simply adding point solutions for a fuller benefit roster.”
The report also states that Spring Health has hired a head of investor relations with experience at public companies. It does not name that profession. For Headspace, the report notes a key difference between it and Hinge Health.
Hinge Health, a digital physical therapy company, has succeeded by staying in its lane as a point solution. Headspace, once a meditation app, merged with Ginger.io, a digital therapy provider, in October 2021 to create a wider range of mental health services. The move toward a more robust clinical offering prompted the brief rebrand to Headspace Health, which was undone in 2023.
“Notably, [Hinge Health] competitor Sword Health is charting a different course, recently expanding into mental health to position itself as a more holistic platform,” the report states.
Sword Health has been open about its IPO ambitions, discussing the prospect of going public in 2028 along with the addition of its mental health offering in June.
Apart from emphasizing the need for more medtech IPOs in 2026, the report highlights key forces that may define the year.
It notes that the federal government’s elimination of Affordable Care Act individual health plan subsidies and the increased difficulty of getting and staying on Medicaid will likely shift more health costs to the private commercial health insurers, further driving the cost of private health insurance even higher. On top of potential action by the federal government to address runaway costs in that market, the payer world will likely try to tamp down costs by redoing rates for health care services.
This, in turn, will further inspire the job-eliminating adoption of automating technologies such as AI-powered chatbots in health care providers’ back offices as organizations seek relief from costs and ever-growing administrative burdens on clinicians.
“Given these overall pressures, we expect provider-based administrative layoffs will be meaningful in 2026 as AI workflow automation begins to be deployed at scale,” the report states. “This begins with ambient AI scribing technologies, coupled with AI clinical and decision-support capabilities and AI workflow agents, including revenue cycle management (RCM) agents.
“Combined, these tools will reduce administrative burden and support, improve physician and practice efficiency, and relieve physician burnout through ROI and administrative staff reductions.”