Meditation app Calm cuts 20% of staff as Covid mental health boom cools
A meditation app founded by a British entrepreneur has cut 20% of jobs as the Covid-fueled boom for mental health technologies cools.
Mindfulness app Calm, founded by Michael Acton Smith, will cut 90 jobs amid a broader tech downturn.
Calm, headquartered in San Francisco, has developed an app that claims to reduce stress and improve sleep through meditation exercises. He hired celebrities such as Matthew McConaughey, Cillian Murphy and LeBron James to voice his audio guides. Users pay £28.99 per year to use its tools.
Calm and other mental wellness apps have grown rapidly in recent years as anxiety levels have risen during the pandemic.
However, analysis for The Telegraph by SensorTower, which monitors mobile app usage, estimates downloads have fallen 30% in the past 12 months as Covid pressures ease.
David Ko, chief executive of Calm, informed staff of the layoffs on Thursday, The Wall Street Journal first reported.
“Unfortunately, today we are reducing our overall workforce by 20%,” he said in a note. Insiders told the newspaper that the macroeconomic climate forced the company to cut costs.
“While some of you will be affected, you will all be affected. I can assure you that it was not an easy decision, but it is especially difficult for a company like ours whose mission is focused on health. mental health and well-being at work.
Calm was launched by Mr Acton Smith in 2012 and raised $75m (£61m) in 2020, valuing it at $2bn. Investors include Salesforce co-CEO Marc Benioff and celebrities Harry Styles and Ashton Kutcher.
The pandemic has sparked renewed interest in mental health apps that let people relax, meditate or get guidance remotely while stuck indoors.
However, as the world has opened up, some experts have questioned their effectiveness over individual counseling. There are thousands of mental health apps available for download, but little oversight on how useful they are.
Mental health apps raised a total of $5.5 billion in 2021, according to analysts at CB Insights, but funding levels fell 60% in the first three months of 2022.
In a review of 57 mental health apps, psychologists found that two-thirds were developed without any input from the mental health profession.
Mozilla security researchers also said that mental health apps show a “disturbing lack of concern for user security and privacy.” Last month, more than 70,000 emails destined for the virtual mental health service FeelYou were discovered by security researchers.
The calm confirmed the job cuts.