$HEC $TALK Talkspace in an online and mobile therapy company founded in 2012 by Oren and Roni Frank

☘️ It is set to generate $ 125m in sales in 2021, growing 69% and scoring 64% gross margins

An easy thread 👇
👤 It now counts 46,000 active members, 2,650 providers and has already served 2m members

🩺 The app enables its 1m users to schedule consultations online, have virtual meetings with licensed therapists and track treatment progress
Talkspace claims that 44% (vs 25% for alternatives) of its users experience clinically significant change with its solutions after 8 weeks

🔥 80% of users found Talkspace to be as effective or more effective than traditional therapy
The company relies on high-profile spokespeople such as Michael Phelps and Demi Lovato

🥇 And ranks first in terms of consumer awareness when compared to MD Live, Teladoc and Better Help
Is it betting that users demand more accessible, convenient and affordable care

✅ It claims that 80% of Talkspace users return for a second visit, versus 44% for in-person visits
Great! But what is the market saying?

🌐 Talkspace sees its TAM reaching $ 588B by 2025, growing 3.5% each year from 2019 levels

🇺🇸 In the USA only, the market is worth $ 73B and set to reach $ 90B by 2025
To grow, Talkspace is chasing corporate accounts where it follows a land & expand model

💼 To date, it has covered over 39m users through its corporate offering, up from 2m in Q4 2019
On the financial side, sales are expected to grow 94% over the 2019 - 2020 period and reach $ 74m

💸 Gross profit is expected to reach $ 47m and gross margins to grow from 51% to 63% in 2020
Looking forward, the company expects sales to reach $ 285m by 2023 and gross margins to stay constant at 62%

📈 The firm expects an EBITDA-positive year by 2022 and to grow EBITDA margins to 15% by 2023
$HEC is the SPAC taking Talkspace public - the deal values the company at 11 times its 2021 sales

💰 $250m of growth capital is expected to reach the balance sheet
👇 Bottom Line 👇

📈 At a $ 1.4B enterprise value, the $HEC SPAC offers a reasonably priced entry into the virtual care segment

📈 Talkspace is set to grow by 69% in 2021 while preserving gross margins and achieving profitability by 2023
📉 The online therapy space is competitive (BetterHelp, Headspace, Calm) and competitors are little differentiated

✅ We stay on the sidelines for now and wait for the merger to close

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