Venture Capital (“VC”) and Private Equity (“PE”) Are Harming Therapy
In recent years the fields of mental health, therapy, and behavioral care have seen a surge of investment from venture-capital (VC) and private-equity (PE) firms. On the surface this might appear to increase access and innovation. But for many therapists, clients, and the profession as a whole, the impact has been deeply troubling. Below are major ways this investment model is undermining therapy—and what we can do about it.
1. Prioritizing Growth, Not the Therapeutic Relationship
One of the core strengths of therapy is the relationship between therapist and client: trust, openness, pacing, depth. But when a VC-backed company needs rapid scale or a PE firm needs a strong exit, the system can warp:
As one industry critique states: “VC companies cannot afford to believe in psychotherapists’ ethics, values or the importance of the relationships created with clients. Such words are just ‘packaging’ in the language of these big-dollar ventures.” IMHPA+1
Therapists report increased caseload pressures, metrics that prioritize volume over depth, and shortened treatment episodes—all of which interfere with the gradual, trust-based process of therapy. ABA Insights+1
The drive for “platformization” (digital apps, bundled services, corporate networks) often treats therapy as a commodity rather than a healing practice. IMHPA+1
When the focus shifts from how well the client is understood and served to how many clients we can serve and how fast we can generate revenue, the therapeutic alliance suffers.
2. Loss of Autonomy for Therapists & Erosion of Ethical Practice
Therapists entering or employed by VC/PE-backed ventures often face constraints that conflict with clinical values:
They may be asked to adhere to rigid metrics, pre-set treatment lengths, or digital workflows designed for scalability rather than individualized care. Mentor Research Institute+1
Autonomy is diminished: hiring, treatment decisions, session length, modality choice may be influenced by business imperatives rather than client needs. Ripsy Technologies
Therapists who leave independent practice for such ventures may later find their clinical decisions are subject to corporate review, dashboards, and profit-driven KPIs (key performance indicators). IMHPA
This matters especially in trauma-informed, LGBTQ-affirming work, where pacing, safety, cultural humility, and relational depth are essential.
3. Threat to Access, Quality, and Equity in Care
While investors often frame their involvement as expanding access, the reality is more complex—and sometimes alarming.
These firms tend to attract investment in models that can scale quickly and appeal to broad markets (teletherapy apps, high-volume practices), which may leave underserved, marginalized or complex-trauma clients behind. Mentor Research Institute+1
Independent practices—especially smaller, community-oriented, culturally specific ones—find it hard to compete with corporate entities backed by VC/PE in marketing, infrastructure, pricing. This can reduce diversity in provider choice. Mentor Research Institute
Studies in other areas of healthcare show PE ownership is associated with worse outcomes (increased mortality in nursing homes, etc.). While therapy is different, the risk is that cost-cutting, high throughput, and standardization degrade care. The Guardian+1
For clients seeking culturally competent, queer-affirming, relationally oriented therapy, these systemic shifts can mean fewer real choices—and more care that’s standardized, depersonalized, or geared toward “bums in seats” rather than real healing.
4. Misalignment of Incentives: Care vs. Profit
One vital tension: doing good vs. making money. Therapy traditionally emphasizes healing, growth, reflective work; VC/PE emphasizes returns, scalability, rapid growth, exit strategy.
A key critique: “The profit-driven motives of VC firms may not always align with the healthcare industry’s objectives, leading to potential conflicts of interest between improving patient welfare and maximizing financial returns.” Mentor Research Institute+1
Therapists and clients have reported feeling like “products” in a system: marketing promises faster, cheaper therapy; but clinically the depth and duration may shrink. Reddit+1
When a VC-backed platform underperforms or fails, clients and therapists may be left with abrupt changes, closures, or loss of continuity. The exit strategy of investors rarely accounts for relational fallout. ABA Insights
In communities already marginalized (LGBTQ+, BIPOC, trauma survivors), the question isn’t just “therapy available?” but “therapy meaningful, safe, aligned with my identity?” When profit overtakes purpose, that alignment is at risk.
5. What This Means for You (as Therapist, as Client, as Advocate)
For therapists:
Be cautious when joining large VC- or PE-backed firms—ask about session length metrics, autonomy, caseload size, tenure of clinicians, and exit plans.
Maintain your professional values: relational depth, cultural humility, trauma-informed pacing don’t always align with high-volume models.
Support and network with independent, community-rooted practices that center clients and relational integrity.
For clients:
Ask questions: Who owns the practice? What are their priorities? What is the clinician’s caseload? How is quality measured?
Don’t assume “corporate” means better; a boutique practice may offer deeper alignment though fewer bells and whistles.
Know your needs: If you require longer-term, trauma-informed, identity-affirming work, ensure the practice model supports that without forcing you into “packages.”
For the field & advocates:
Push for transparency in ownership, funding models, and outcomes in mental health services.
Advocate for policy/regulation that recognizes therapy as relational work—not just commodity—and that ensures access to culturally-specific, long-term care.
Amplify voices of independent practices, culturally specific clinics, and queer-affirming therapies that resist the “scale at all cost” model.
Conclusion
The rise of venture capital and private equity in therapy and behavioral health is not an unalloyed good. While there are potential benefits—greater resource infusion, technology access, scale—there are serious, documented risks to the relational, ethical, equitable core of therapy.
If therapy is to remain a safe, affirming space for growth, healing, identity exploration and relational depth (especially for LGBTQ+ folks, trauma survivors, and marginalized communities), we must remain vigilant. We must ask critical questions about who owns care, how it’s structured, and who really wins in the end.
At the heart of therapy is trust, presence, depth, and the human-to-human connection. Anything that undermines that connection—because of profit motives, speed, scalability, or dashboards—should raise alarms.
If you’re a therapist navigating these shifts, or a client wondering where to safely seek care, remember: the model matters. The values behind the model matter. Let’s keep therapy human, relational, and healing—not just a product in an investment portfolio.