Rachel McCrickard of Motivo Health

[00:00:00] Making Waves in Health Tech is a podcast about health, equity and innovation. Throughout this podcast series, the founders we interviewed have had two important things in common. The first is that their startups are purpose driven and grounded in helping others.

[00:00:17] And the second is that these companies tackle inequities so everyone has a fair and just opportunity to thrive. And you know what? Today is no different. Today we'll meet Rachel McRickard. As a young therapist, she needed to clock thousands of hours of clinical supervision while working with patients.

[00:00:34] Therapists need to do this in order to get licensed. The problem? It was very difficult to do as you'll soon hear. It wasn't just a problem for individuals seeking licensure. America is facing a mental health epidemic and we do not have enough mental health professionals to meet needs.

[00:00:51] In California, forecasts predict that there will be 11% fewer psychologists, licensed clinical social workers and licensed marriage and family therapists than needed as well as 41% fewer psychiatrists. Rachel founded Motivo Health with the idea that she can use technology to deliver excellent clinical supervision.

[00:01:09] Going back to what I said about California, in just a few years, 5,000 new therapists receive supervision through Motivo. I'm Jana Boachie and I'm Ida Martinez from the California Health Care Foundation. Our foundation is a strategic investor in health to the first startups.

[00:01:26] Everyone is deserving of health, but not everyone has a fair chance at it. We are highlighting innovations that make healthcare accessible and affordable. Let's meet Rachel and learn how she built her company. Hi Rachel, thank you for joining us today. We're really excited to talk to you.

[00:01:46] We're here to learn more about you, Motivo and the work you're doing in California and across the country. Tell us a little bit about Motivo. What is it and what problem are you trying to solve?

[00:01:57] I started Motivo to solve a problem that I experienced on my own road to licensure as a therapist. So I'm a licensed marriage and family therapist and in the field for a number of years.

[00:02:08] And when I was working towards my license, getting clinical supervision was difficult for me. I'm from a rural area of North Georgia. I actually went to school in California but moved home to my rural North Georgia town

[00:02:23] and the closest clinical supervisor was about a two hour drive away and supervision had to be in person. I spent several hours of my week each week driving back and forth to my clinical supervisor's office

[00:02:36] in order to get the hours that are required to become a licensed therapist. Clinical supervision is very similar to residency for a doctor. New therapists are required to meet with another therapist who's called their clinical supervisor once a week for two years after licensure.

[00:02:53] It's required. You have to find someone to supervise your hours. You also have to pay that person to provide you with supervision and historically it had to be in person. So you had to go and find someone within your local area who met the requirements

[00:03:07] to supervise you and then pay them for an hour of supervision each week. The idea for Motivo came when I saw that state started changing their rules to allow supervision virtually and I thought that would have made it so much easier for me

[00:03:20] when I was in the car driving back and forth to Atlanta to get to the closest clinical supervisor. I created Motivo to be a solution for people in rural and underserved areas who didn't have an access to a clinical supervisor in person

[00:03:34] and are able to do it virtually now. It's really cool to hear about your personal lived experience as you develop Motivo especially because I can't imagine driving two hours. That's so long. So I would say that with what you're building,

[00:03:50] I feel like that resonates with a lot of therapists that are going through the licensing process. Tell us a little bit more about the business model for Motivo. How does Motivo get paid? It's a marketplace model. So we have about 1200 clinical supervisors who've we vetted

[00:04:07] and make sure that they're providing high quality clinical supervision in their state and then we connect behavioral health organizations or individual clinicians to the clinical supervisor. So they come to our site, they filter down by what kind of clinical supervisor they want, maybe an LCSW in California

[00:04:26] who specializes in working with children and adolescents doing DBT therapy so they can get very granular in the kind of supervisor that they want to meet with. They start meeting with them through our platform. We pay the supervisor as an independent contractor

[00:04:41] and then take a rate, a cut of each session. So Motivo is making some really big inroads in California. My understanding is that you're currently working with all 58 counties in California. So congratulations for that. That's a huge accomplishment. Talk to us about that.

[00:05:00] How are you working with the counties? Well I would say we have the opportunity to work with all 58 counties. So what we have done is we've gone through the process with California Mental Health Services Authority,

[00:05:13] which is the kind of vendor governing body of all county mental health offices. So every all of the 58 counties have a mental health office that are serving kind of the safety net provider of the community for people with no insurance or low insurance or Medicaid,

[00:05:30] Medi-Cal, they're serving a significant part of their communities mental health issues. So we have a contract with CalMesa as their sole clinical supervision provider. So then what that allows counties to do is to say, oh, we don't have enough clinical supervisors on staff here to meet this need.

[00:05:50] We're going to contract with Motivo and supplement the supervision that we have with some of their great supervisors. So we're working actually today with probably about, I would say like 15 of the California counties

[00:06:04] but in any county office in California would be able to work with us as well. And they don't have to negotiate the contract. That's already been done for them by CalMesa. That's a huge win for Motivo and such a big benefit for the state of California.

[00:06:20] Yes, and honestly CHCF was a huge piece of that as well. We got introduced to the CalMesa team by CHCF about a year ago. So this team was instrumental in helping make that happen. And just for our listeners, this is something that I learned recently.

[00:06:37] California law requires over 100 weeks of supervision at two hours per week, something like that. And 3,000 clinical hours to qualify for an LCSW or LMFT licensure. Yep, and that's pretty standard across the country. That's about what it is. It's about 3,000 hours of face-to-face client time

[00:07:00] about 200 hours of supervision and you can't do it faster than two years. So you can't get it in a weekend and go to a course and get all your clinical supervision hours. It has to be spread over the length of two years. California is pretty specific about it.

[00:07:16] You have to have one hour of supervision for every 10 patients you see. I think it's important to say that 57% of therapists who get a master's degree in counseling never make it through the licensure process. So while this was like a struggle for me in a rural area,

[00:07:34] it's a struggle also for more than half of the number of therapists who are coming through the field. It's not kind of just like a minor convenience site. That's something I would want listeners to know.

[00:07:46] It's really impacting the ability of clinicians to make it through the very last mile to their licensures. They've gone to grad school, got into a master's degree, graduated and now they're on their own to find a clinical supervisor.

[00:08:00] And if they can't do that or if they can't afford it, then they leave the profession. We're losing over half of the available supply of therapists before they even get started. You know, I'm curious to hear a little bit more about the challenges that you've experienced

[00:08:24] while building Motivo and how you overcame them. You know, one is just being a first-time founder. There's a reason that investors often like to invest in founders who have built companies before. You can sometimes see on LinkedIn they're like two exits or three ex-founder.

[00:08:44] The reason for that is because when you're learning how to do something like grow a company, the learning curve is so incredibly steep. Every single thing that I'm doing, I'm mostly doing it for the first time. I'm hiring a finance lead, figuring out our go-to-market strategy, fundraising.

[00:09:02] All of those things are things I didn't learn in grad school as a therapist and that have just been something that I've had to learn by doing it and usually learn by doing it wrong and then adjusting something and then trying again.

[00:09:16] So that has been a really big challenge but also like a real, I would say, edifying challenge because I've really enjoyed the challenge of, wow, this is exciting. This is something I've never done before but like learning how to do it is really exciting.

[00:09:31] On the fundraising perspective, it's been hard to convince investors that this is a big enough market opportunity. When you think about venture capital, they're usually looking for like, how are you going to become a billion-dollar company?

[00:09:47] What's your plan to become a unicorn and have a really big exit that returns, 10x returns to our shareholders? And Motivo is solving a really important problem in a very specific field and while it does have this great potential to return great returns to our investors,

[00:10:08] it often looks deceptively small I guess I would say. It looks like it's smaller than it actually is but then when you really drill down to it, you realize that there's 50,000 new therapists that are coming into the field each year and half of them aren't making it through.

[00:10:24] So there's plenty enough to build a big business off of but in the early days that really hindered us from raising capital because oftentimes they would think, oh, that's a niche problem. It doesn't sound like it's that big of a deal.

[00:10:37] Rachel, I really do appreciate you sharing a lot about your challenges when it comes to fundraising and it's interesting to me because as a new investor, myself, it's interesting to hear other investors say that the market of behavioral health supervision is a niche

[00:10:52] because what I am struggling to understand is that some investors are failing to see the broader impact if their business does not get licensed because it affects the access to mental health services for the communities that we serve.

[00:11:09] And it's really interesting to hear your story about how you have to align with the right investors or align with the investors that are also impact focused and mission related because as it is, we're dealing with the workforce shortage

[00:11:24] and as it is, the access to mental health services is very difficult at this moment. Equity and race are key factors that are affecting workforce shortages and health outcomes. The third of Motivo's supervisors identifies a person of color.

[00:11:53] How is Motivo succeeding at helping organizations meet their diversity goals with black and Latino supervisors? Yeah, you know, it's a really important one. Historically, the way that these companies have provided clinical supervision is they kind of tack it on to the job description

[00:12:12] of another licensed person at the company. It's the clinical director or really just any licensed person. They'll be like, okay, you take on some supervisees and kind of do it off of the side of your desk.

[00:12:25] The challenge with that is one, those people then aren't able to bill for their services. So it was taking them kind of away from their patient time. So there's a revenue implication of them not providing therapy and instead providing clinical supervision, which is not billable.

[00:12:41] But I would say, you know, the larger piece is that you're using a co-worker to provide clinical supervision to oftentimes appear. And that has, you know, a separate set of difficulty brings on some different challenges. A lot of times supervision when it's being conducted internally by the organization,

[00:13:04] people are spending a disproportionate amount of time talking about administrative issues or, you know, productivity or billable time. They're not really spending time talking about their patients. They're not spending time talking about like learning clinical skills, studying for the licensure exam, that sort of thing.

[00:13:22] So I think this diversity element is another big piece of that. You don't want to just learn from whoever happens to be available to supervise you. Best practices would be learning from someone who meets the clientele that you're looking to serve.

[00:13:38] So if you're serving the Hispanic population and you really want to know more about culturally specific things or even to receive supervision in your first language, all of those things are available through Motivo. You can find the right supervisor who understands your demographic background as a therapist

[00:14:01] or the demographic background of the patients that you're seeking to serve. So we've seen just a lot higher satisfaction rate in terms of supervision, what time is spent discussing and how people are feeling like they are growing as a clinician during supervision because of that.

[00:14:19] You know, I'm curious, Rachel, you know, one of the questions that I have for you is understanding the impact because I think one of the, you know, the metrics or one of the impactful things about Motivo is that it can reduce time and cost of licensure.

[00:14:34] Say, for example, from three and a half years to two and a half years and then also from $74 to $55 per hour on average. I'd be curious to hear a little bit more about the impact that Motivo has had.

[00:14:47] Yeah, I was just actually pulling up some of those numbers as you started to ask me that question. So I'll share some. 83% of the people that we serve live in a mental health professional shortage area.

[00:14:59] Since our creation, we've provided over 147,000 hours of clinical supervision and we've helped 5,086 new clinicians receive their licensure, which is really exciting. And then, you know, 37% of our supervisors are BIPOC as Ildesad and then 29% of our supervisors are LGBTQ,

[00:15:22] which means that we are, you know, really focused on bringing a workforce into the field that accurately represents the world that we live in.

[00:15:30] We've talked to a number of entrepreneurs and there's something about the work that they do that really excites them that is a driving force behind their passion. What is that driving force? What makes you so passionate about the work that you do?

[00:16:04] I mean, it's that piece of solving the shortage of mental health providers. That's the piece that keeps me up at night. That's what makes me keep going even, you know, when I get tired.

[00:16:14] So many people don't have the opportunity to do the kind of work that they're good at, but then also like makes a positive difference in the world.

[00:16:24] You know, there's a lot of people who just they're doing their work, but maybe the things that they're doing that they really care about, what they have to do as hobbies or something outside of their time.

[00:16:33] So I feel just really lucky and I know my team feels the same way that we get to spend, you know, hours and hours of our week working on a problem that really impacts humanity.

[00:16:45] It's making sure that we have enough mental health providers in our country to serve the many people who need and want therapy.

[00:16:54] That feels like a very worthy goal and it's something that we're excited to have, you know, our investors, our board, our employees and the supervisors who have joined forces with Motivo. It's great to have so much support in that way.

[00:17:10] There are a lot of entrepreneurs out there who are developing companies for the greater good. They want to have a social impact. And there's always this challenge of how do you take a company that's doing good work and also make them profitable?

[00:17:26] How do you manage that or balance that? Interested in how you approach that? You know, I'll say that it's been a refreshingly recent to the conversations in the investor world.

[00:17:43] You know, I mean there was if you follow the trends around, you know, venture capital, what are they investing in at what multiples? What are the valuations out there? All these things that I did not know about when I was just a therapist.

[00:17:56] But if you follow that, you know, we've come out of several years of kind of a growth at all cost mindset. Doesn't matter how you're delivering care. Doesn't matter the quality of care you're delivering.

[00:18:08] It just matters, you know, how much money you're making and what that says, you know, from a stock price or from a valuation of the company perspective.

[00:18:17] But we've had a bit of like a, you know, kind of come to Jesus moment in the last year or so where that has really changed and valuations dropped significantly and investors really began focusing on who has a true legitimate path towards profitability.

[00:18:36] And we've just very well positioned there. So we've been careful about how much money we've raised. We've been prudent about how we've invested those dollars to make the most impact on the company. Investors are going to ask you, what else can your product do?

[00:18:53] What other things can you tack on to the solution you already have to make it bigger and bigger and bigger? And then I think a lot of products then eventually look like Frankenstein, you know.

[00:19:04] They have the one core mission, the one core problem they set out to solve. But then they have all these other things that they're trying to like make additional money and kind of strengthen, you know, their revenue numbers.

[00:19:15] And I think that Motivo, and we've had the support of our investors and board in doing this has been very focused on clinical supervision. That's what we do. That's the problem that we solve and we're going to do it better than anybody else does.

[00:19:28] And we're going to really write the manual on how to deliver great clinical supervision. And that has benefited us well because again, it means we haven't raised a whole lot of money at super high valuations.

[00:19:40] We've invested our cash appropriately for the most part and we'll be cash flow positive in the next couple of years. So that feels good. And it was kind of by accident. I didn't really set out to do it like that. It just kind of happened for us. Congratulations.

[00:19:57] That's so awesome to hear. Now I'm very curious, what do you think is next for Motivo? How are you thinking about the future? I think there's still a lot of work for us to do within our own core space.

[00:20:10] We have 150 customers today serving mostly community mental health organizations, you know, FQHCs, treatment centers, that sort of thing. But you know, there's like over 15,000 of these across the country.

[00:20:24] There's just only even more need for more providers as, you know, the stigma related to seeking mental health care lessons and lessons. So I think I'm most excited to just continue on with what's working in terms of like what I see out on the landscape for Motivo.

[00:20:42] I think it's being more of the front door into the profession. So you need a clinical supervisor when you get started, but you also need a job. You need a place to collect those 3,000 hours of patient time.

[00:20:55] And oftentimes people come out of school and they're confused about where to go, what to do, you know, where to work. You'd think that the university helps them with that, but they don't that much. They're focused on the education process.

[00:21:08] They're not focused on like helping people land in a great job for them. I think that that's a natural extension for Motivo. How can we introduce new graduates to the employers that we work with in a way that, you know, fills their open positions,

[00:21:24] but then also helps boost the number of clinical supervision hours we're providing as well? I'm just amazed, Rachel, that you didn't come from a business background. You were trying to launch your own career and that out of that you came up with this idea, a solution,

[00:21:55] and that you've launched a company now that's really making an impact. That takes a lot of courage. What advice do you have for people who may have an idea but may not know how to implement? Aren't sure if they want to go that route.

[00:22:16] Curious to hear your thoughts. Thanks for saying that. That's so kind. I mean, I like totally failed college algebra. So yes, there's like no math skills to speak of over here.

[00:22:27] And I would say, you know, that in way of a piece of advice is bringing on the best people that you can find for your team is a huge piece of what's making Motivo successful. It's also an unrealistic ask of new entrepreneurs.

[00:22:43] You don't have the money to pay top talent. You don't even know where to find them usually. So the journey is, it's tough.

[00:22:52] It's tough because you have to do things that you're not good at for a pretty long time before you get big enough in order to hire like great talent.

[00:23:03] Paul Graham talks about this trough of sorrow that you start the company and there's a lot of enthusiasm in those early days. Maybe you have like a demo day or a pitch or something like that. Everybody's like, this is so cool that you've started this.

[00:23:16] And then you go into a season of the trough of sorrow, which I absolutely did where it's like nothing's moving. You know, not enough people are finding out about it. No one cares. You can't raise money.

[00:23:27] You know, all of those things and getting through that time is very difficult. I think the best advice is to make sure that you have a scalable idea and then to determine what to do next based on that.

[00:23:41] Because you could have a great idea that isn't going to scale to millions of dollars and that's okay, but you shouldn't raise money if you don't have an idea that can't scale to like millions and millions of dollars.

[00:23:52] You know, so you have to kind of be very realistic about what's the problem that you're trying to solve. Is there enough people that need that? Is there anybody else that's already doing it? That's going to be pretty hard to overtake.

[00:24:05] You have to really get honest with yourself for see as best you can, whether or not your company has the ability to scale to as large as it would need to in order to payback investors.

[00:24:18] I think that's a very kind of brutally honest, I would say perspective is that not all good ideas are going to make great companies. They just aren't 90% of startups fail. That's not because they were bad ideas usually. It's mostly usually because they weren't scalable ideas.

[00:24:35] Well, thank you for joining us. It was so awesome getting to know you and to learn more about the company, your vision for the future, the impact that you're having. We had a great time. Thank you.

[00:24:47] I really appreciate that even though Rachel had millions invested into her company and major contracts, she describes her growth model not in monetary terms, but as a social good. Yeah, there's value and then there's value.

[00:25:07] And I'll say that representation really does matter because I love that Motivo has supervisors that identify as LGBTQIA and people of color, which reminds me of a conversation that I had with one of my closest friends who I'll say is a black woman therapist.

[00:25:23] She was also facing these barriers and obtaining licensure. And I just wish she had Motivo to help her. I think it's important to point out that what sets Motivo apart from many other tech startups is her steady vision. Rachel is completely dedicated to expanding clinical supervision.

[00:25:43] She understands that this is a huge need and she's there working with a laser focus to get everyone who wants the career in mental health care licensed.

[00:25:52] With her dedication and the good work of the Motivo Health family, I'm very optimistic that we can increase the number of licensed mental health providers in California and across the country. I want to give Rachel a special shout out for keeping it real. It's not easy.

[00:26:08] Starting a health tech startup has its challenges and sometimes some startups don't make it all the way through. But she was candid and generous with her advice. So Rachel, thank you so much for that. To our listeners, if you found today's story helpful, please share with others.

[00:26:26] It takes all of us to end health inequities and to ensure everyone in our communities can thrive. I think that's a great place to end it. Thanks again, Ilda. Thanks, Janet. Today's program was produced by Zosia Warpale and Brace Norma of Mission Boom. Audio engineering by Zosia Warpale.

[00:26:55] Music composed and performed by Cameron King Horne. The California Health Care Foundation helps Californians with low incomes get the health care they need. Learn more at chcf.org.