Talkspace’s Co-Founders Exit After Disappointing Q3 Results

Talkspace has revealed that its co-founders, Oren Frank and Roni Frank have both stepped down from their respective executive and board roles. Oren Frank had served as the company’s CEO, while Roni Frank was the company’s Head of Clinical Services.

Both will stay on as Strategic Advisors to the board to provide continuity and strategic direction over the next six months.

Talkspace Chairman Doug Braunstein will step in as interim CEO to fill the hole at the top of the behavioral telehealth company’s org chart while executive recruitment firm Korn Ferry searches for a permanent replacement.

Braunstein has taken over as interim CEO on the heels of lower than expected growth and profitability numbers since its public market debut in July 2021. Last quarter, net revenue was $26.4 million, a 23% year‐over‐year increase but still below expectations partly due to fewer new user acquisitions in the direct‐to‐consumer business.

In the company’s earnings call, Braunstein stated that the company’s board and management have been disappointed that it hasn’t gotten started as a public company “in the manner that we had hoped for.” He also added that Talkspace’s board and management had multiple conversations about a management succession plan over the past five months.

In the wake of Oren Frank and Roni Frank’s departure from Talkspace, the company has scrapped its guidance for 2021 and its guidance for early 2022.

Moving forward, Braunstein listed the area the company will focus on and improve. These areas include optimizing synergies between B2B and B2C in the funnel, improving how the company operates and optimizes its network, optimizing investments in the company’s brand for the long-term, and doing a better job prioritizing and rolling out new products.