Global investment in mental health? Now is the time

October 10, 2024Poor mental health is an issue that affects nearly everyone at some point in their lives, yet people across all contexts and geographies still struggle to find and access the support they need. Today, on World Mental Health Day, we want to share news about a new Coalition dedicated to catalyzing the investment required to address mental health globally.

The McKinsey Health Institute (MHI) has joined the African Venture Philanthropy Alliance (AVPA), Clinton Global Initiative, Kokoro, and Wellcome to form the Coalition for Mental Health Investment (CMHI) with the bold vision that within a generation, investment in mental health will match the scale of global need.

Mental health challenges comprise about 15 percent of the total disease burden yet receive only 1 to 2 percent of global health financing, contributing to an estimated $200 billion annual financing gap, as per the recent report from United for Global Mental Health. This crisis is most acute in low- and middle-income countries where 80 percent of the world's populations live–and where care is often nonexistent.

"In many African languages the word depression doesn't even exist," shares Frank Aswani, CEO of AVPA. "This means that communication and strategies around mental health in Africa should be contextualized. We need to channel more investment to tackle this challenge especially as we deal with growing issues like youth unemployment. And we can't do this alone—as Africans or as philanthropists. Like any social challenge on the continent, considering the declining aid and stretched philanthropic and limited fiscal resources, we need to see how to bring private capital into this space."

The world's attention was captured by the pandemic and the significant mental health distress that many felt, and a number of companies responded by applying new technologies to help manage these long-standing problems. Between 2020 and 2022, venture capital investment in mental health tech start-ups increased fourfold compared to the previous four years, and 2021 alone saw the creation of nine new mental health unicorns.

"What gets us excited is that we're not starting from scratch here. There are numerous effective science-based solutions but they're not being implemented and sustained at scale," explains Erica Coe, a partner and global coleader of MHI. "We have seen very successful market-shaping and scaling efforts in other sectors, such as climate change and poverty eradication. We're pushing for a similar moment—and movement—in mental health."

The Coalition will work together to build a stakeholder network and support large-scale mental health investments using innovative mechanisms that are not only good for the well-being of society, but financially viable and attractive to both public and private sector funders. "Traditional philanthropic funding is great, but it's often short-lived. By bringing in different types of capital, including private and institutional funding, we aim to achieve more sustainable financing," says Kana Enomoto, a partner and director of Brain Health at MHI.

Each Coalition partner brings their distinct expertise and network to the table. MHI has the unique ability to work across the full spectrum of stakeholders. "We are drawing from our deep expertise and foundational research in brain health, and our other practices—such as private equity and investment, public and social sectors, consumer products, and our AI, analytics, and tech capabilities— to learn from and build on what works across other markets," said Erica.

The Coalition will share inspiring examples of the impact that evidence-based interventions can have on people's lives, along with the business cases and financial potential of such programs. The goal is to widen the aperture so that funders can see that investment, especially in low- and middle-income countries, can yield financial benefits as well as societal return.

It will also bring together philanthropic, public, and private capital to pilot financing innovations that derisk investing in mental health. These could include social impact bonds, outcome-based funding, and blended-finance models.

"We will also aim to amplify efforts to integrate mental health initiatives with existing funding streams, such as humanitarian efforts, education, climate adaptation, as well as other areas of health—including women's health and heart health, due to their intersection with mental health," outlines Erica.

The Coalition formally launched last month at the Clinton Global Initiative Annual Meeting, with a powerful reception to its vision.

"Everyone recognizes that the time to scale the action on mental health financing has more than arrived," reflects Chelsea Clinton, co-chair of the Coalition. "It is so encouraging to see that leaders from across the world and from different backgrounds and contexts want to be part of the action and part of the solution with us."

From Meckensey website

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