Brightline, a mental health startup focused on youth and families, disclosed that it had laid off 20% of its employees, last week. 

The company, based in Palo Alto, California, US, has announced its second round of layoffs in recent months. The latest layoff, announced last week, will affect 20% of the company's workforce. The previous layoff was announced in November 2022 and also impacted 20% of the workforce.

Brightline's recent decision to lay off 20% of its workforce is part of a larger trend of layoffs in the behavioural health industry that occurred towards the end of 2022, with a particular concentration in startups and technology-focused companies.

As per a media report, a spokesperson from Brightline stated that the company reduced its corporate positions to make room for more clinical and patient-focused roles. Social media posts indicate that the job cuts affected positions related to user experience, human resources, technology, and operations.

“This decision was not taken lightly, and although incredibly difficult, it will ultimately allow us to better serve our clients and provide even more families with the mental healthcare support they deserve,” the spokesperson said in an email.

According to data from Crunchbase, Brightline has raised approximately $212 million in venture capital funding since its launch in 2019.

The company had stated to Behavioural Health Business in November that the layoffs were intended to ready the company for what was ahead. Since then, the company has encountered financial difficulties, a decline in venture capital investment in digital health, and ongoing indications of deteriorating behavioural health indicators among young Americans.

Trilliant Health's analysis reveals a surge of 107% in eating disorders and 44% in depression cases among pediatric patients. While there is already a shortage of behavioural health providers, the shortage is even more acute for pediatric providers.

This year, the company expanded its leadership team by bringing on Myra Altman as the new chief clinical officer in April. In addition to layoffs, the company is dealing with other challenges. 

One of these is the Clop ransomware gang's hack of Fortra's GoAnywhere file transfer software, which occurred during a mass ransomware attack in January according to a TechCrunch report. 

Brightline has confirmed that it was affected by the breach and notified patients of the incident on April 7th. According to the Maine attorney general's office, approximately 27,742 individuals were impacted by the breach.