Little Otter, a digital family mental health company, has secured $9.5 million in strategic funding to expand its reach with Medicaid and commercial insurance plans, the company announced on Wednesday.

San Francisco-based Little Otter supports kids up to the age of 18 and their families, with a focus on kids aged zero to six. It treats patients for a variety of needs, including depression, anxiety, self-harm, couple and marital conflict and family relationships. The company offers therapy, psychiatry and parent coaching, and patients receive tailored care plans, assessment results and progress reports. Little Otter currently operates in 15 states.

The $9.5 million fundraise included participation from Pivotal Ventures, Torch Capital, Springbank, CRV, Next Legacy, G9, Gratitude Railroad and Carrie Walton Penner’s Fiore Ventures. Little Otter has raised more than $36 million to date.

“Today’s young people face unprecedented challenges that demand a fresh perspective on mental healthcare,” said Erin Harkless Moore, director of investments at Pivotal Ventures, in a statement. “Little Otter stands out through its clinical excellence across all levels of care from mild to severe, treating both young patients and their families.”

The funding will help Little Otter advance its AI-powered platform, which will “make it even easier to connect families with personalized services, quickly triage patients, and deliver digital whole-family care,” said Rebecca Egger, co-founder and CEO of the company, in an email.

It will also help Little Otter scale to support more Medicaid and commercial members. It currently works with Independence Blue Cross, Florida Blue, AmeriHealth, Sana, Kaiser Permanente Northern California and Blue Cross and Blue Shield of Minnesota.

Digital mental health companies that target youth — like Little Otter — are becoming more common and are gaining interest from investors. In 2023, investment in digital health startups addressing youth mental health accounted for 34% of total digital behavioral health funding, up from 15% in 2018, according to a recent Rock Health report. And for good reason: more than 21% of young Americans battle a mental or behavioral health disorder, and 53% of working parents have missed work at least once a month due to their child’s mental health, according to the same report.

Other digital companies supporting youth mental health include BeMe Health, InStride Health and Backpack. While Egger didn’t mention these companies as competitors, she noted that Little Otter stands out for its focus on caring for children under six. 

“While other companies might offer just parent coaching for very young children or just generalized mental health, we combine evidence-based care with a family-centered approach, tailoring support to each family’s unique needs,” she declared.

The company has achieved some results as well, providing more than 56,000 care visits in 2024. About 85% of families see improvements in six sessions and 71% of children experience remission of symptoms after 12 sessions, according to the announcement.

Ultimately, Little Otter aims to “make mental health care accessible, effective, and tailored for families everywhere,” Egger said.

Photo: StockFinland, Getty Images