Private equity firm Patriot Capital has announced a growth capital partnership with behavioral health provider Turnwell Mental Health Network.
Dallas, Texas-based Turnwell is an integrated mental health group that provides behavioral health care for individuals with mental health disorders. It is particularly focused on serving patients in underserved markets.
It operates “multiple” freestanding outpatient clinics in Arizona and Montana. Its services include mental health counseling, primary care, and patient and family education. She also offers psychiatric services, including medication management, TMS, ketamine and Spravato.
The company, which does not list the exact number of locations on its website, plans to put the new capital toward expansion.
Turnwell has partnered with numerous behavioral health providers. In February, for example, based in Arizona Scottsdale Institute of Mental Health and Wellness announced that it was joining the Turnwell network.
Mental health is a hot spot for investment this year. In fact, 60% of behavioral health insiders reported that mental health was the most attractive investment target, according to a Behavioral Health Business Survey.
Additionally, survey respondents ranked treating underserved populations as the biggest opportunity for the industry in 2023.
This isn’t Patriot Capital’s first behavioral health investment. In September, the middle-market PE firm invested in Global Behavior Education Alliance, an autism-focused provider that offers assessments, applied behavior analysis (ABA), counseling services, therapy and educational support.
In 2021, Patriot Capital sold Mentor Network Services to D&S Community Services, a provider of residential and community services for individuals with intellectual and developmental disabilities.
Along with Patriot Capital, several others private capital firms are paying attention to the behavioral health space. Looking back, 2022 was the second best year for behavioral health transactions on record, with M&A advisory firm The Braff Group reporting at least 201 offers.
“It’s hard to find many sectors of the economy that exhibit the same tailwinds and growing acceptance as behavioral health,” said John Hennegan, founding partner of private equity firm Shore Capital, during a behavioral health business webinar. “We’re just seeing a decrease in stigma and increased acceptance from older generations, to a younger generation that has grown up in an environment where behavioral health is something they’re comfortable talking about and using services.”
