Our crisis of loneliness, the new bet investors are going after

After the prominent Israeli businessperson Benjamin Gaon was diagnosed with kidney cancer, his son Boaz Gaon and his family spent years by their father’s side. Gaon, known as Benny, had been diagnosed with additional forms of cancer, and died in 2008 from a type of leukemia.

His father had access to top doctors, but the younger Gaon felt a deep lack of social support from people who had been in his shoes. That experience served as the inspiration for the startup Wisdo Health, which helps people join groups, connect with others they can relate to, and find resources like therapists.

Not long after founding the startup, Gaon shared his vision with famed venture capitalist Marc Andreessen.

Within a couple of minutes, Gaon recalled Andreessen saying: “Oh, so you’re in the loneliness market.”

He hadn’t heard it put that way before, but that’s just what Wisdo was trying to tackle. It was notable to Gaon at the time that Andreessen — “one of those investors who’s known for seeing where the market is going” — appeared to have pinpointed loneliness as its own market.

In January, Wisdo closed an $11 million Series A funding round. Anne Wojcicki, the founder of 23andMe, was involved in the round led by Israeli entrepreneur Marius Nacht. (Andreessen Horowitz, which Andreessen cofounded, was not an investor.)

Wisdo is a small company, but its funding reflects a wider focus unfolding across healthcare, tech, and finance.

Loneliness, which US Surgeon General Vivek Murthy declared an epidemic in a public advisory in spring, and the associated risks — among them depression, anxiety, dementia, and premature death — have grown more palpable in recent years. The isolation that resulted from the pandemic exacerbated this crisis. Murthy’s advisory in May referenced recent surveys of US adults that found half of respondents reported experiencing loneliness.

Loneliness has more recently become a topic of discussion among investors. It is, in essence, taking shape as an investment thesis.

Investors are looking to fund startups and services that offer solutions they say could help people and save companies money in the long run. In the US, employees’ work absences tied to the stress they feel as a result of loneliness cost employers an estimated $154 billion annually, and older adults’ social isolation accounts for some $6.7 billion of excess Medicare spending annually, the surgeon general said.

Startups such as Wisdo, Pyx Health, Peoplehood, Meeno, and Humans Anonymous are drawing investor dollars, primarily from venture firms. Betsy Hoover, founder of the venture firm Higher Ground Labs, told Insider that promising young companies are seeking to be part of the solution, and the space is still nascent. More-established companies including Bumble and Meetup are meanwhile touting themselves as playing a role in fighting the loneliness epidemic.

Each startup is aiming to address the loneliness epidemic in its own way. Some work within the healthcare system to help identify those who might be at risk of loneliness, while others seek to facilitate in-person interactions.

Gaon recently compared developments in addressing the loneliness epidemic with social networks and the gig economy launching in the past two decades, with a verve among people building new things.

“At least from where I’m standing, I see that type of energy, that innovation, in companies who are trying to solve loneliness and turn back the clock on what happened to human relationships in the past two decades,” he said.

Investors are looking to capitalize on companies that want to help people experiencing loneliness, a state that can be so crippling and consuming that it fills even those of us surrounded by family and friends with dread. Welcome to the era of social and relational health — terms the surgeon general and companies use to describe what people must nurture to lead healthy lives — as a service.

In 2017, Rylie Sarabia was diagnosed with bipolar disorder and told her parents that she was experiencing overwhelming loneliness. That moved her parents, Cindy and Anne Jordan, who had sold their first healthtech company years before, to found the Arizona company Pyx Health. “Ultimately, addiction took her life,” Cindy wrote in an essay last year. “But, like too many others, Rylie’s addiction was deeply rooted in her core struggle: chronic loneliness.”

Health-insurance plans use Pyx and its algorithm — a matrix of peoples’ healthcare histories and data, such as whether they live alone — to identify policyholders who appear at risk of experiencing loneliness. It makes care recommendations, and staff serve as contacts for people seeking support, such as companionship, and help navigating the healthcare system.

This summer, a healthcare-focused private-equity firm in Minneapolis, TT Capital Partners, announced that it made a majority investment in the company. Dawn Owens, the CEO of TT Capital Partners, said it’s not enough that a business may seem like it could be helpful when seeking solutions to the loneliness epidemic.

“You have to have proven results and performance and a return on investment,” and Pyx is seeing that, Owens said. The firm and Pyx declined to specify the size of the investment.

While Pyx is tackling loneliness as an offering alongside institutional healthcare practices, Julie Rice and Elizabeth Cutler, the SoulCycle founders who sold their spinning-class giant to Equinox in 2011, are trying to address the market through community building. Their brainchild, the New York startup Peoplehood, operates guided in-person and online group conversations with up to 20 participants. It’s something like a group therapy session, with the goal of improving peoples’ connections with one another.

Peoplehood is now starting to work with other companies’ management teams to offer ways employees can better collaborate, get to know each other, and ultimately increase productivity. Rice declined to specify how much money Peoplehood had raised, though the startup has taken investment from the consumer-focused venture firm Maveron, which has backed brands such as Allbirds and Everlane.

“I remember being in rooms with SoulCycle, and people saying, ‘But how are you going to scale a human experience?’ And I think that people cannot underestimate our need for human experience,” Rice said.

One key dimension of the loneliness epidemic is living physically apart from people who care about you. Founders like Phil Levin are looking to help friends and family live closer together. His startup, LiveNearFriends, launched in the summer. He previously helped get another community business off the ground: Culdesac, a Khosla Ventures-backed startup that built a car-free, walkable neighborhood in Arizona.

Levin left Culdesac in 2021, and his new project is an app that alerts people when homes become available nearby, aiming to help users coordinate living close to each other. LiveNearFriends is now fundraising beyond friends and family, Levin said. So far, he’s seeing heightened interest from groups including people with young children who want their friends and family close by and recent graduates who miss the connectedness of college.

Some companies in the space meanwhile incorporate artificial intelligence into their business models around loneliness. Last week, an AI-powered loneliness-focused startup called Meeno, founded by former Tinder CEO Renate Nyborg, announced that it had raised $3.9 million in seed funding from Sequoia Capita, AI Fund, and NEA. “The loneliness crisis is bigger, and more urgent, than anything I’ve worked on before,” Nyborg wrote in a blog post.

“I believe AI companions won’t be about single-player mode only — humans chatting with AIs, and AI replacing human friendships — but AI companions will act as matchmaker and social facilitators between people,” investor Hugo Amsellem said. He’s invested in Ava, an OpenAI-backed company in France that created a digital-avatar friend and is moving toward a dating experience where Ava helps you along.

Startups in this space are using new formats. The app Humans Anonymous has raised $3.1 million of pre-seed funding led by Looking Glass Capital, General Catalyst, and Backend Capital. Nate Tepper, the founder and CEO of Humans Anonymous, launched the company after attending Alcoholics Anonymous meetings.

He set out to emulate aspects of the sessions he found most impactful: anonymously sharing your experiences with people in your shoes, he wrote on X. The format is anonymous audio spaces where people can speak or listen in, and the app’s most popular communities include those for people experiencing loneliness and anxiety, Tepper said.

Humans Anonymous has some 200,000 members, largely in their teens and early 20s, and TikTok is its top channel for user acquisition.

“The investment was more broadly under the thesis of mental health,” Adam Besvinick, the CEO of the venture firm Looking Glass Capital, said. “The idea that people going through a shared event, career path, or life stage would have a deeper level of empathy for someone else who was in that same place, rather than if I had anxiety and I heard a healthcare professional discussing anxiety.”

Skepticism is permeating all the investor interest and founder enthusiasm. Can tech be part of a solution to a problem as complex as loneliness, especially when it has helped exacerbate it?

An internal 2018 study by Facebook, now called Meta, found that some 36% of users reported feeling lonely in the past month, according to documents leaked to reporters by the Facebook whistleblower Frances Haugen. Bloomberg last year said that internal researchers “acknowledged that Meta’s social networks could be exacerbating loneliness instead of alleviating it.” The tech giant “wants to address the problem but doesn’t know how,” the outlet added.

Studies have found that decadeslong declining attendance in religious and faith-based groups, labor unions, and local clubs — which have long been local ways of bringing people together — coupled with the rise of online communities, is another factor at the heart of the loneliness epidemic. That reality is part of what drove Higher Ground Labs to invest in Peoplehood, Hoover said.

“There is innovation to do here, and I think it is possible to do it with a for-profit lens,” Hoover said, referring broadly to the loneliness epidemic. “In fact, we have to do it that way. I think part of what got us into this mess is the way that online communities have been imagined and built, which ended up being isolating and harmful. But we can imagine it differently. Market solutions are part of what got us into this, and so they do need to be part of what gets us out of it.”

Alexa von Tobel, the founder and managing partner of the early-stage venture-capital firm Inspired Capital, has made a series of investments with connection and loneliness in mind, including in Hopscotch, a company that connects families and their children with mental-health care. Inspired debuted a thesis in 2020 that identified loneliness as a key focus for the firm to invest in.

“When you’re investing in something where there’s somebody suffering, you have to be really thoughtful that the mission and alignment of the company’s revenue and success models actually match the success of the customers,” von Tobel said. “It matches all companies where alignment to the customer is critical. I don’t think of it as any different than other companies.”

David Spinks, a consultant and author who helps companies build communities and several years ago sold a business he founded to the events- and community-focused company Bevy, believes in the potential for companies setting out to reduce loneliness. Like others Insider interviewed for this story, he also wonders which companies and products will make a difference.

“It’s almost like the plastic-bottle industry selling us recycling,” he said, referring to companies broadly. “Social-media apps cause a problem and then sell us the solution at the same time.”