Marigold nets $11M for SUD peer support
Substance use peer support startup Marigold Health raised an $11 million Series A led by Rock Health and Innospark Ventures, CEO Shrenik Jain tells Erin exclusively.
Why it matters: The raise is Rock Health's first as lead investor, and comes amid an addiction crisis aggravated by problems getting treatments to those most in need.
Zoom in: Commonwealth Care Alliance, Wavemaker360, Stand Together Ventures Lab, Epsilon Health Investors, Koa Labs, VNS Health Plan and KdT Ventures participated.
- Funds will help the company hone its tech and expand beyond Delaware, Rhode Island and Massachusetts to four additional states by the end of next year.
- Jain declined to say when he foresees Marigold raising a Series B.
How it works: The Boston-based company offers a peer support program for people struggling with and in recovery from substance use disorder (SUD).
- Marigold's program includes one-on-one coaching from a certified peer specialist and 24/7 access to text-based support groups in its app.
- The app uses natural language processing to flag when someone brings up a health need requiring additional support, such as a lack of access to housing or food, or an interest in applying for Social Security Disability Insurance (SSDI).
- The app also highlights key themes from people's discussions for coaches to bring up in their sessions, such as someone saying their daughter plays a vital role in their recovery.
- Marigold partners with primary care clinics, substance use treatment providers and health plans, including those serving Medicaid and Medicare.
Flashback: Marigold in 2022 collected a $6 million seed.
Between the lines: Medicaid has since 2007 allowed states to use funds to pay for peer support services, and the Centers for Medicare and Medicaid Services (CMS) considers peer support an evidence-based intervention.
- Several recent studies — including those published in the Harm Reduction Journal, the American Journal of Preventive Medicine and Psychiatric Services — conclude that peer support plays an important role in treatment and ongoing recovery for substance use disorder.
- To hasten the use of peer support in behavioral health amid an ongoing provider shortage, the U.S. Department of Health and Human Services in 2023 issued new national model standards for peer support certification.
What they're saying: Jain sees Marigold's program working both as "a low-intensity, consistent wraparound for people in outpatient care" and a tool for people who are medically complex, especially in cases where referrals to traditional in-person programs such as Alcoholics Anonymous are considered tedious or impractical.
- "We believe strongly that it's the right thing for the world and the right time to build a large business around peer-based support writ large, starting in substance use disorder," says Rock Health general partner Bill Evans.
The big picture: Marigold's raise is the fourth in the virtual substance use treatment space in the last four months.
- Recent sector tailwinds include the post-pandemic rise of telehealth and a heightened awareness of evidence-based addiction treatments like peer support.
State of play: Several virtual and hybrid providers of treatment for substance use disorders — including opioid use disorder (OUD) and alcohol use disorder (AUD) — have raised later-stage funding this year.
- Virtual addiction treatment provider Boulder Care in May raised a $35 million Series C.
- Digital substance use treatment company Pelago in March closed a $58 million Series C.
- Hybrid addiction treatment provider Eleanor Health in February raised an unlabeled $22.23 million.
