Y Combinator and Foundation Capital-backed meditation app Simple Habit has been acquired by Alpine Investors-backed wellness marketplace company Ingenio. Because of this deal, Simple Habit will rebrand itself to Sleep Reset — eponymous to a sleep-focused app it launched last year.
Simple Habit was founded by Yunha Kim in 2016 with the aim to be the “Netflix of Meditation.”. The company got $12.5 million in total funding from various investors, including Y Combinator and Foundation Capital. The app boasts more than 5 million users.
Last year, Kim launched Sleep Reset as she saw that while only 10% of content on Simple Habit was related to sleep, it brought in 70% of engagement. The new paid app was developed in partnership with experts from the University of Arizona, the University of Minnesota and the Stanford University Sleep Medicine Center to develop its program. It took a no-pill approach and brought Cognitive Behavioral Therapy for Insomnia (CBT-I) in an app form. Users who subscribed to the app got a dedicated coach to improve their sleep.
Kim told TechCrunch that since the launch last year, more than 8,000 users have paid for the app. She said that with $155,000 in revenue last month, the app is set to clock $1.86 million in its first year. She also said that the company has improved sleep and habit logging on the app and doubled the number of sleep coaches since the launch.
“In the nine months since we came out of beta, we’ve more than doubled our subscriber base and our revenue. We’ve made updates to our program which have driven increased engagement and our efficacy data remains very strong, with the average program graduate reporting over an hour more of sleep per night, and 53% less time needed to fall asleep,” she said.
Ingenio has a rather intriguing curve as a company. It was founded as Keen.com in the 90s — a platform to connect users to psychics for readings. In the 2000s, the company rebranded itself and launched the personal guidance platform Ingenio and sold it to AT&T. In 2013, it was sold to San Francisco-based Alpine Investors.
Since then, it has acquired multiple media properties like Horoscope.com and Astrology.com. In 2021, Alpine spun off Ingenio with a continuation fund. The company has a blog post that says Apollo is an investor, but there are no details in the post (Apollo owns Yahoo, which owns TechCrunch). When asked about Apollo’s investment, Ingenio pointed to an Alpine press release about the single-asset continuation vehicle for the company, which doesn’t mention Apollo.
Bryan Leppi, Ingenio’s Chief Corp Dev Officer, told TechCrunch over an email that the company is acquiring Simple Habit to bolster its holistic wellness portfolio. He mentioned that Simple Habit — which has more than 90,000 active users — will continue as a product and Kim will join Ingenio’s advisory board.
“Simple Habit will continue as a stand-alone product as well as a further wellness content layer for Ingenio’s global brand footprint. The meditation and audio wellness content from Simple Habit may be added to apps like Keen to expand access to healthy habit formation and balanced lifestyles,” Bryan said.
Ingenio or Sleep Reset didn’t comment on the size of the deal.
Kim said that Sleep Reset as a company will focus on better personalization for different kinds of sleep problems with advice from sleep experts on the team.