People are really stressed. So much so that a company decided to tap on it to develop a business. Richard Pierson stumbled onto Headspace in 2008 when he was burned out from his career marketing Axe deodorant at a major agency. He switched to freelance, but felt so much anxiety he struggled to go out in public. A friend knew just the cure: an energetic, amiable “Jeeves” for taking care of your brain. It wasn’t a drug or a doctor. It was Andy Puddicombe, a Buddhist monk with 10 years of Tibetan monastic training across Asia. Tan, bald and athletic with a soothing Bristol accent, Puddicombe seemed like an unlikely messenger for the roughly 2,500-year-old practice.
But Pierson quickly bonded with the assured, zen guide, who dropped out of college at 22 to “find peace of mind” as a monk after losing two friends and a stepsister in sudden accidents. Pierson offered Puddicombe marketing tips for his nascent meditation business in exchange for one-on-one mindfulness training. It quelled Pierson’s anxiety, and he became just as eager as his teacher to spread the practice.
What the duo started as a meditation event business in London in 2010 has evolved into a meditation and wellness app, Headspace, with annual revenue north of $50 million and a valuation estimated by Forbes of about $250 million. Headspace, which has been downloaded more than 11 million times, has more than 400,000 paying subscribers and hip Santa Monica, Calif. headquarters complete with meditation pods, an indoor magnolia tree and swings. Headcount is expected to grow significantly from 158 to 250 next year, when the company will open its first San Francisco office and expands headquarters.
Increased happiness, compassion and better health and relationships are some of the core benefits of meditation, according to the founders and a growing body of research that supports their claim. Headspace ranked as the highest quality “mindfulness-based” iPhone app in a study in the peer-reviewed Journal of Medical Internet Research, in part because only a handful of other apps also offer training programs, such as Smiling Mind, iMindfulness and Mindfulness Daily. As the wellness market grows — mental health costs are predicted to hit $6 trillion by 2030, greater than the cost of diabetes, respiratory disorders, cardiovascular disease or cancer, according to the World Economic Forum – these digitally savvy meditators-turned-entrepreneurs are betting that people and organizations will continue shelling out a monthly subscription fee (ranging from a two-year deal for $6.24 per month to as much as $12.95 per month) as a life staple.
Since 2014, the company has been fleshing out a library of tailored “packs” on topics like relationships (patience, kindness, generosity), performance (creativity, balance, focus), cancer, chronic pain, stress, sleep, anxiety and sports, which the company spent years developing with British Olympic psychologists and athletes. The app also offers tracks for experienced meditators with less guidance and a suite for kids, building a user base with an even split of males and females, a nearly even breakdown across ages from 18 to 65 and subscribers in more than 200 countries, despite only being available in English.
It also doesn’t hurt that the app has the backing of a host of flashy investors. The startup’s $30 million Series A, which closed in July 2015, led by entertainment-focused Chernin Group, featured Breyer Capital, Jessica Alba, Jared Leto, Ryan Seacrest and LinkedIn LNKD +% chief executive Jeff Weiner. And celebrities like Gwyneth Paltrow, Richard Branson and Lebron James are vocal fans. Other buoys have been Puddicombe’s speaking tours and rising profile as a wellness guru and partnerships. Seven airlines offer Headspace on flights, and the app became Spotify’s first bundling partner in late 2016 (users of the music service in most of Scandinavia can subscribe to both apps in a bundled deal). And Headspace’s secular, simple style and cute animations help make meditation approachable.
But perhaps Headspace’s most important strength over time lies in data, which it has been using to understand what makes new users become regulars, when people zone out of tracks and how the app can become personalized to predict users’ needs. In the future, for instance, Headspace could be suggest its fear of flying pack to an anxious traveler when the app detects the user is at LAX. Jim Breyer, a longtime user and investor in Headspace, said data gives the company a key edge.
Taking a customer need and translating that into a business. One Singapore company has also developed something similar. Called Mindfi, I have already downloaded it. Meditation really works! You should try it! Ohm…
Enjoy the music