Hi friends,

The UK is a big and important market for mental health companies.

For some, it’s their home market. For others, it’s one of their first steps in international expansion.

But what do you need to succeed in the UK?

It requires much more than a compelling product. To start, you need to understand how the NHS works, how your product fits into a system already stretched to breaking point and how you can build a GTM motion that matches the timelines and economics of this market. But there’s a lot more too…

In Chapter 1 of our UK Market Series with Ushma Baros (Commercial Director at Big Health), we defined the size of the UK mental health market, showed you a market breakdown, taught you about the structure of the NHS and laid out the main commercial options that mental health companies can pursue. 

Yes, this market is going through some change - the UK government recently decided to ‘abolish’ NHS England - but many of the fundamentals of the market will remain unchanged.  

Today, we want to get even more tactical, sharing the four questions you must ask yourself if you want to succeed as a mental health business in the UK. 

To do this, we caught up with a bunch of experienced founders, investors, and insiders who’ve done it before, sharing their top tips on what you need to win in the UK market. 

In today’s article, we’ll help answer these four questions:

1. Do you know the role you want the UK to play in your broader strategy?

2. Do you deeply understand your UK buyer and the budget line you’ll fit into?

3. Do you have a GTM model that can succeed in the UK?

4. Are you positioned to use the UK’s strengths to compound value?

Let’s get into it.

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On May 7th, I’ll be hosting an exclusive event for THR Pro members, sharing an advanced preview of our research on "How People Are Using AI For Their Mental Health?". We’ve had over 400 responses to our survey and there’s lots of interesting insights to share.

If you’d like to join, sign up to become a member of THR Pro. 

As a Pro member, you’ll also be joining a community of founders, executives and investors, all passionate about improving population mental health.

Let’s start by helping you decide if you want to compete in the UK market - and if so, what role you want it to play in your broader strategy.

1. Do you know what role you want the UK to play in your broader strategy?

We should be upfront here, succeeding in the UK is difficult.

So before you commit to this market, you need to be crystal clear on the role it will play in your broader strategy and make sure that the juice is worth the squeeze.

There are three kinds of “juice” you can get from the UK market. Understanding this helps define the role this market can play for you.

Revenue: The UK is a large market, approximately £16B per year.
Many European companies see the UK as a significant revenue opportunity. US businesses that decide to expand internationally will often enter the UK as their first market and use it to deliver incremental revenue. Yes, the US market is about five times bigger, but after that, the UK is one of the largest mental health markets, especially in the Western world.

Credibility: Some businesses don’t plan to make much money in the UK, but to use the credibility of their success in this well-respected market to land more profitable deals in other geographies.

Limbic is a good example.

Kooth is another. For decades, the UK accounted for the majority of Kooth’s revenue. This year, it accounted for just 27% thanks to their expansion in the US. They could never have landed their US contracts, however, without the credibility built in the UK.

Impact: There are a lot of people in the UK (sixty-eight million to be precise), and many of them need better mental health solutions. If you are a UK founder, it’s natural to want to provide impact for the people of your home nation, and that drive should not be ignored.

Of course, these three types of value do not have to be mutually exclusive. But founders should be very clear on which kind of value they are primarily pursuing in the UK and ensure that it is reflected in how they approach the market.

Founders should also make an assessment of the quantum of value they think they can generate in the UK and weigh that against the difficulty of succeeding in this market.

Here are some helpful questions to help you determine how much value you can generate and the level of difficulty that you will face in the UK.

Value: We can assess the level of value using the three categories we defined above.

• Revenue - do a straightforward assessment of the revenue you think you can generate by asking questions like:

  • How many users need your solution? 

  • Do you have willing buyers? Do they have existing budgets and line items for your solution? How big are those budgets? (more on this below)

  • What price are these buyers paying for solutions like yours?

• Credibility - assess the value you can generate through credibility by succeeding in the UK:

  • To what extent will your success in the UK/NHS impact the decision-making of future buyers? Do they care??

  • Will your strategy in the UK allow you to build that credibility? 

• Impact - understand the scale of the impact you can have based on the size of the population in need and the relative benefits of your solution compared to existing solutions in the UK:

  • How many users need your solution?

  • How good are their existing solutions? 

  • To what level can you improve outcomes above those existing solutions?

Difficulty: How hard (and expensive) will it be for you to generate that value in the UK market?

• Clinical evidence base: How much additional clinical evidence will you need to generate to convince your buyers?

• Regulatory complexity: Is your product regulated (it probably will be)? What approvals are required? Do you have a clear and tested pathway to acquire those approvals?

• GTM complexity: How hard will it be for you to reach and convince buyers? How long will the sales cycle be? Do you already have a UK network or team that understands NHS culture, processes, and sales nuances?

• Operational complexity: What will you need to do to ensure successful adoption post-launch? What additional team members do you need? How many?

• Investment requirement: Given your answers to these questions, what level of investment will be required? 

“That’s a great framework, but how do I get accurate answers to these questions?”.

I hear you. 

As straightforward as it may sound, my primary recommendation is to work with people who’ve done it before. Natalie Pankova, (Managing Director of ZINC Deeptech Ventures ) agrees with me, and it’s something that also came up in my recent conversation with Pooja Sikka (GP of the Innovations in Mental Health Fund). The NHS can be murky waters for foreign teams; having local experience to guide you through these questions will be highly valuable.

How do investors think about the role of the UK market for mental health business?

The UK on its own is not a big enough market to support venture-scale returns.

Of course, investor perspectives alone shouldn’t guide your decision-making, but if you need to raise capital from them to fund your growth, you should take this into consideration. UK businesses seeking venture investment should therefore ensure they have a clear path to larger, international markets (i.e., the US).

Going through this process should give you a clear answer to the level of value the UK can generate for your business, the role it can play in your broader strategy, as well as the level of difficulty and resources required to succeed. 

Tangible tips:

• Be clear on the type of value you want to generate in the UK and the role you want it to play in your broader company strategy.

• Assess the level of value you can generate with your solution in this market.

• Assess the level of difficulty and investment required to succeed in the UK.

• Use this information to decide if you should enter the UK and the kind of strategy you will need to pursue.

• Get outside support from people who’ve done it before to validate your hypotheses.

2. Do you deeply understand your UK buyer and the budget line you’ll fit into?

There are three important facts you need to know about the UK mental health market.

1. The NHS pays for 90% of mental healthcare.

2. The NHS isn’t one buyer - it’s made up of multiple organisations with different responsibilities, priorities, budgets, and procedures. 

3. Despite their best efforts, the NHS has limited headspace for innovation. They are under huge demand and cost pressure. Just look at the data on wait lists for mental health services…

   

   NHS data on mental health waitlists

So, how do you assess the commercial potential for your product in the UK?

Step 1: Be sure you know your buyer is

Socrates advised us to “know thyself”.

I’m advising you to “know thy buyer”.

This is good advice in all mental health markets, but even more so in the UK.

To do this, ask yourself:

• Where in the system does your product create value?

• Who currently feels the pain that you solve?

• Who controls the budget that benefits from that problem being solved?

For example:

• If you're helping reduce emergency admissions, your buyer is likely a local NHS Trust or ICB (Integrated Care Board) responsible for urgent and emergency care.

• If you're supporting GPs to manage low-acuity mental health cases more effectively, your buyer might be a PCN (Primary Care Network) or an ICB mental health lead.

• If your tool supports improved access or improved outcomes for a specific population (e.g. young people), look to local commissioners who have targets and funding tied to those groups.

A great shortcut is to look at who currently pays for the type of service you’re trying to improve or replace. If your innovation reduces wait times for therapy, find out who pays for talking therapies (in most cases, ICBs or subcontracted Talking Therapies providers). If your product supports discharge planning, your buyer could be a Trust trying to hit its flow targets, or a place-based partnership coordinating between health and social care.

It’s worth noting here that mental health tech companies have only really seen sustained, national-level reimbursement in Scotland. 

Payers in England have historically been non-national. So even though NHS England is being ‘abolished’, it’s not like they were a national payer for any mental health tech anyway.

You can find more inspiration for finding the right buyer in Chapter 1 of our UK Market Guide.

Step 2: Identify the relevant budget line

Once you know who might buy your product, the next step is to figure out if they can actually fund it.

To do this, ask yourself:

• Is there an existing service line you could replace or enhance?

• Is your innovation mandated or incentivised by national policy or targets?

• Could you unlock new funding through improved performance?

To get this intel, you can:

• Talk to buyers - ask what budget would be used to fund your solution.

• Find friendly operators in the system who can tell you how similar solutions are funded.

• Learn from peers and competitors. What budget line are they using? How did they get there?

You want to make sure there is a clear budget line aligned with your solution. This is critical.

Step 3: Pressure-test your assumptions

Once you've picked your likely buyer and budget, test it out to ensure it is not just isolated to one region or buyer. You want to avoid putting effort to gain traction in one area, only to find it’s not repeatable in any other areas of the market.

Talk to people in similar roles across different regions. Ask how they'd see a product like yours being funded. You can also engage a former NHS operator or procurement advisor to validate your approach (yes, this can be worth paying for).

If you’ve got the right investors or networks (like the IMH fund for example), lean on them. Smart investors can open doors and sanity-check your assumptions. You don’t want to get this wrong.

Prepare to meet high standards

The NHS has a high bar. Their role as a payer-provider means they demand high levels of clinical efficacy, data and informational governance standards, as well as cost-effectiveness. If you can’t meet these standards, your sales efforts will fail.

Avoid scrambling for scraps

NHS buyers have a lot on their plates. Unless your solution is clinically effective, demonstrates clear ROI at an acceptable cost, and your buyer has a clear and proven budget line to pay for it, you should not expect consistent uptake across the UK market. 

Companies that have successfully scaled in the NHS avoid hoping for scraps (e.g. targeting the elusive annual ‘underspend’ or one-off innovation budgets being targeted by every type of company). Instead, they find a clear budget line that they are aligned with.

A note on non-NHS buyers

Our advice is to focus primarily on the NHS and find a clear buyer and budget line. But Michael Young, CEO of Lindus Health, has some alternative advice;

If you can find a private buyer (employers, insurers or even consumers) that you can sell to, you may be able to avoid the headaches of dealing with the NHS.

Just remember, you’ll be missing out on 90% of the market…

Tangible tips:

• Map your target buyer: is it a Trust, an ICB, or a national service?

• Understand what budget line your solution fits into and whether there is a precedent for funding innovations with that budget.

• Understand the financial, clinical and operational benefits that are delivered by your innovation and where they fall in the system.

3. Do you have a GTM model that can succeed in the UK?

To succeed in the UK, your Go-To-Market strategy must answer three important questions:

1. Is your pricing aligned with a system that is under significant cost pressure?

2. Are you prepared for long sales cycles (even longer than you might expect)?

3. Do you have a bulletproof plan to drive adoption?

1. Pricing

The NHS is under significant cost pressure. You must ensure that you can price your product at a level that is acceptable to these cost-constrained buyers and that you deliver real cost savings. 

You also need to ensure that your business model and UK operations are aligned with this pricing and allow you to make money from your contracts. Flow Neuroscience had this early realisation, allowing them to adapt their business model in a way that made their devices cheap enough for the NHS to adopt. 

One way to do this is to think about the ‘minimal viable team’ that can serve this market. This typically looks like a small mix of people comfortable wearing multiple hats, covering sales, implementation and marketing. Perhaps it includes an ex-clinician who understands how to wrangle clinical data systems, or an ex-project manager from the NHS who’s willing to turn their hands to both sales and implementation. People from the system help navigate the cultural nuances critical to making a sale and implementing successfully (but anyone who says their relationships will get you immediate sales might be overestimating their leverage over a highly complex system).

2. Sales Cycles

You’ve heard the NHS is slow - but I’m sorry to tell you, it’s even slower than that.

Sales here aren’t just long; they’re deeply fragmented and full of friction. What looks like interest or momentum can easily stall as decisions bounce between departments, and meetings that only happen monthly.

Clinical trials provide a good parallel for the sales process in the NHS. What could take four weeks to set up in the US could take four to twelve months in the U, as agreements are bounced from department to department within a Trust and reviewed at meetings that happen once a month. 

Even high-potential products with inbound interest and positive pilots can take years to get commissioned:

Traditional sales playbooks won’t cut it either - SDRs, email sequences, and direct marketing tend not to work in the UK, where clinicians treat their NHS email as their spam folder.

You need a clear value proposition and reassurance for the many stakeholders who will be involved in the sales process (clinical, finance, data/information governance, legal, procurement, at a minimum). This requires you to have as much clarity on your clinical trials data as it does on the latest procurement laws.

Even when you’re moving at what feels like a snail's pace across multiple stakeholders, it might still feel fast for the NHS, where each of these teams is handling multiple priorities.

The NHS is a multi-stakeholder market where shaping demand is part of the job:

3. Adoption

A signed contract is just the start of your journey to success in the UK.

In a world of long sales cycles and low price points, your success hinges on adoption. Clinicians need to use your tool, patients need to benefit, and the system needs to see results. If not, you risk being cut at the next financial review.

That means building a rock-solid implementation plan before the contract is signed - one that includes training, communication, and as little disruption to existing workflows as possible. Ask yourself:

• How are you making adoption easy for clinicians?

• What data are you collecting to prove your impact?

• Can you fund internal NHS project support to lead the rollout?

This is especially true for pilots. If you’re running a free trial to build your business case, you’re investing your own resources, and success depends on proving results and navigating the internal machinery to convert them into a paid contract.

Renewal and growth won’t come from a great slide deck. They’ll come from making yourself indispensable. One of the best ways to achieve this is by hiring a team that is exceptional at execution and managing NHS partnerships.

Tangible tips:

• Build a ‘minimum viable team’ that includes a deep understanding of the NHS as well as clinical and implementation expertise 

• Implementation is critical to the financial success of your GTM, not an afterthought. Partner with the NHS on co-design, training, and data sharing.

• Identify champions on the ground who will drive adoption, and find ways to support them (clinically, logistically, financially) over the long term.

4. Are you positioned to use the UK’s strengths to compound value?

Don’t worry, there’s more to the UK than long sales cycles and price pressure. The market actually has some valuable opportunities available to mental health startups that you can’t get in other countries. 

Data advantage.

The NHS offers a rare example of a healthcare system with cradle-to-grave, population-level data linked through a unique patient identifier (e.g. the NHS number in England).

While the system has faced criticism for being fragmented and siloed, there is a strong and growing commitment to using health data safely to advance research, improve system efficiency, and deliver better patient outcomes. The founders I’ve spoken to find they are able to do a lot with the data available to them from the NHS.

A great example is OpenSafely (headed by Ben Goldacre of ‘Bad Pharma’ fame), which publishes unbelievably helpful and granular primary care medicines data via OpenPrescribing. 

So, how does this data matter to you, and how can it help you grow in the UK? The answer is to treat every potential contract as an opportunity to build your evidence base. 

Your evidence base is a baseline expectation for a sale, and you can agree with NHS partners that you will collect feedback and system impact (e.g. qualitative for the first six months, quantitative after 12 months) as part of your implementation plan. This means that you’ll continuously build local evidence, case studies and content that can contribute to peer-reviewed publications.

You’ll need the right expertise to plan and collect the right data, and it’s worth investing in this (ideally covering sales, R&D and marketing all at once). This evidence will not only be helpful in the UK, but in other markets as well. 

Distribution advantage. 

Whilst multiple national, regional and local layers add challenges for innovators trying to sell their solutions, they also present opportunities for scale. 

National mandates - to change workflows, to adopt new treatments, to incentivise certain activities - are communicated at multiple levels, and some innovations have thrived by aligning with these changes made consistently across the NHS. Equally, the NHS can be a strong distribution partner, which is why it is critical to get implementation right. 

Once you are embedded into clinical practice and workflows, you have a significant moat. Mapping the network of decision-makers and influencers in the NHS - from think tanks to Royal Colleges - has its benefits, as you can build your brand with clinicians and build familiarity in multiple forums. These ‘coalitions of change’ have a compounding effect over time, as your innovation becomes part and parcel of how the NHS works.

Outcome moat. 

Finally, combining your data and distribution advantage creates a third, powerful moat - an outcome moat.

If your product is tied to a clear budget line and you can use NHS data to show how well it works for patients, clinicians, and the system, it becomes very hard for the NHS to ever rip it out. Recent procurement changes reward defensibility and value. Building clinical defensibility and demonstrating cost-effectiveness makes you the natural choice for commissioners, raising your LTV and reducing churn risk. 

Tangible tips:

• Ensure you have a clear data strategy - publish early, iterate fast and build peer-reviewed content to support future sales.

• Look for national mandates you can leverage and embrace the NHS as a distribution partner.

• Embed your solution into clinical workflows

• Foster coalitions of change within the ecosystem to support your long-term success

Cracking the UK mental health market isn’t easy-  but for the right business, it can provide significant value, either as a meaningful revenue generator or as a stepping stone in credibility to larger, more profitable markets. 

If you can align your product to a clear need, prove ROI to a specific buyer, and invest in building long-term credibility through adoption and outcomes, you can embed your product in the NHS with strong competitive moats. 

The UK won't reward speed, but it will reward those who do the hard things well.

That’s all for this week. Many thanks to Ushma for writing this article with me and to all the experts who contributed their insights.

If you want more of this kind of content (market guides, best practices, how-tos, etc.) let me know. Just reply to this email.

Keep fighting the good fight!

Steve

Founder of The Hemingway Group

P.S. feel free to connect with me on LinkedIn