Training the Weird

https://www.usv.com/writing/2024/01/training-the-weird/

We are entering a new age of consumer fun and function. AI is going to supercharge both the utility and entertainment of consumer products, introducing new form factors and experiences that feel made for me. As Jared wrote recently, we are ready for the weird. Models trained on our own data and tailor-made for our own needs will shape this next generation of breakout software. Whatever the specific use case– social networks, games, chiefs of staff, personal stylists, study companions, romantic relationships, financial advisors, healthcare co-captains–the ability to quickly ingest our data with enough signal and scale to seamlessly personalize results is a critical step. 

Getting users to do setup “work” has generally been difficult, even when that work may pay off. The web is littered with abandoned carts from sign up pages full of fields. Netflix learned early on that tailoring the algorithm off of what we watch, even if that means initially the content isn’t as personalized, is a better approach than keeping that tedious preference funnel they started with. The best new products are likely to figure out how to make that data collection both easy and, ideally, a fun part of the experience instead of an upfront cost. The two options to do this seem to be:

  1. Make all my personal data seamless and portable. As Plaid has done for financial services, we need a robust enablement layer that creates the data network for consumer applications. The easiest way to jumpstart new personalized products requiring training would be to connect and move my data from existing sources with high signal (email, messaging, socials, browsing, fitness apps, etc.) This requires trust in the new product I am trying, fast utility that makes that user “give” worth it, and, primarily, ecosystems open enough to allow for those connective tissues to form.

It also increasingly favors an ecosystem where controls over data sit with the person and not the platform. Albert outlined this idea a bunch of years ago when he wrote a post imagining what the internet would look like if we all had the right to be represented by a bot. Right now, accessing and sharing, let alone protecting, our personal data is too difficult by design. Changing it will require a combination of pressures: technology pressure that makes this data portability easy; regulatory pressure on the systems that currently control it; and consumer pressure with users actually asking for it and knowing what they want to do with it. There really hasn’t been enough we could do with most of our consumer data, even if we had better access to it. But, now, the applications that will demand this are getting closer. We can imagine using our existing data from our email, browsing, search, swiping, or transacting to train a personal model, get the most fun and useful apps up to speed on us quickly, and create faster and better fun and utility.

  1. Make collecting training data super fun, repeatable, and useful so the “investment” feels both “buttery” and like utility. If in web 2.0 training comes from the breadth of my social graph, in AI-driven consumer it will come from the depth and relevancy of my personal data. The success of the party isn’t driven by the guest count but the experience of each guest, even if some applications will both enable better social engagement over time and also be improved by it. With a cold start data challenge instead of a cold start social graph challenge, builders are incentivized to create depth and consistency of use and engagement rather than sheer scale of signups. Think: Tinder teaching addictive swiping or Hunch’s addictive questions back in the day. The best new products will invent new forms of engagement to collect the most and highest quality data in the most fun and novel ways. 

We’re ready for the weird but we are also ready for the market and behavioral shifts that support the weird: open systems of moving data around for user-controlled and determined training and retention-obsessed applications committed to that intersection of fun and utility. 

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Daybreak’s Series B

https://www.usv.com/writing/2023/08/daybreaks-series-b/

Over the last several years, USV has built out both our thesis and portfolio around tackling the mental health crisis. Our investments have broadly broken down into three groups:

  1. Broadening access to care by making it easier to find, receive, and pay for. Businesses like Brave Health are completely changing the ability for patients to access care, often for those who need it most. Patients can receive high quality outcome-driven care where they are, when they need it, and have it seamlessly covered by insurance including Medicaid.
  2. Expanding options for types of care. As new modalities like psychedelics become validated and important options for care, we are looking to platforms like Journey Clinical that allow therapists to learn about and adopt new modalities with their patients.
  3. Supporting mental health that doesn’t look like mental health. Increasingly, as with all of healthcare, we know mental health needs to be treated proactively and not just reactively. We’ve been thinking about new platforms and products that can promote and foster mental wellbeing through connection, fun, engagement, or community, and often at a much lower price point than traditional care. Platforms like Mindset create scalable and fun ways to build this behavior into daily routine. 

As our understanding about the state of mental health has deepend, we’ve continually returned to the outsized impact on children and the critical moment we are in for adolescent care. The perfect storm of COVID-19 isolation, global instability, the looming climate crisis, and economic rockiness has made the statistics skyrocket. 16% of kids in the US had at least 1 major depressive episode in the last year. 60% of kids who report having major depression do not receive treatment.  

We believe that the mental health crisis for kids is at a precipice moment. Care is quickly becoming an essential, expected, and, hopefully soon, required need for kids–first for those currently struggling and then, eventually, for all children. In this, schools are poised to play a unique role in helping students and working toward solving the crisis of adolescent mental health. They are often best positioned to identify students who need help and are incentivized in wanting them to succeed. Schools and educators know that mental health is critical for both attendance and performance. But the practitioner shortages have made in-school treatment always challenging and often impossible. On average, there is 1 psychologist for every 1,200 students in a school. Treatment is hard to find. 

USV has built a significant and exciting portfolio of education-related investments effectively without investing in businesses that sell into schools. However, as we dug into adolescent mental health, the urgency in confronting the crisis, and both the people and budget best situated to help solve it, we discovered that this market was unique in the role schools and districts are playing. Administrators repeatedly articulated putting resources to students’ mental health as a top 2 concern (either right before or after the intense teacher shortage they are currently facing.) And so we came to believe this is a market where this channel must play a primary distribution role and is advantaged in doing so as an efficient business model. 

That belief brought us to Daybreak. Alex and his team have built what is quickly becoming the leading pediatric mental health platform, working with the existing infrastructure in schools and districts to help the students that need it most at the right moment. Right now, that means students who are currently suffering from mental health issues. Soon, that will also mean scalable products that can help all students proactively. The Daybreak product isn’t just a stop gap–the course of care creates meaningful outcomes, personalized treatment plans, and is easily managed by the students, schools, and parents to work together. The outcome-driven approach has attracted health insurers to work with the platform, too, maximizing access and allowing extension of care. Daybreak works with both Commercial and Medicaid plans and already has more than 9M lives covered. The team has also realized that who is supplying the care–the quality, diversity, accessibility, and reliability of the providers–is of paramount importance for efficacy and has developed unique supply channels at a critical moment in a supply constrained market. 

Daybreak already works with more than 60 U.S. school districts including many of the biggest in California, Oregon and Texas, and others across the country that will be activated in time for the new school year. We are excited to partner with Alex and the Daybreak team in their Series B as they continue to become the go-to trusted brand and partner to districts in providing this care and support. 

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