MindPal Files IPO Prospectus: A Decade of AI-Driven Innovation in China's Mental Health Sector

For a long time, the development of China’s mental health and psychological well-being sector has faced multifaceted skepticism from both the supply and demand sides.

Fortunately, mental health is now being discussed by a growing number of people, and the public’s attitude toward mental health services has become less avoidant. Practitioners’ ongoing exploration of service models has also created more viable pathways to meet user needs.

Furthermore, thanks to the increased policy-level emphasis on and promotion of mental health, public awareness of mental health services continues to deepen. The entire mental health industry has entered a new stage of development, presenting both opportunities and challenges for the many innovative enterprises in the sector.

The reason it is considered a challenge is that China’s mental health industry, as a whole, remains in a relatively early stage of development. Issues such as insufficient user awareness, information asymmetry between supply and demand, and low levels of accessibility continue to hinder the industry’s current growth.

To address these challenges, numerous practitioners have leveraged their respective strengths to explore business models encompassing online mental health service platforms and chained online psychological clinics, among other offerings. In contrast to the aforementioned models, Beijing Heart Close Friend Intelligent Technology Co., Ltd. (hereinafter referred to as “Heart Close Friend”), established in 2020, has chosen to enter the AI-plus-mental-health sector.

Hundreds of millions of people worldwide suffer from anxiety disorders, and over 100 million individuals in China experience broad-spectrum depression. A growing body of data indicates one clear fact: mental health issues have long become a challenge facing both societal and individual development.

Despite the large patient population, there are still multiple gaps in the development of China’s mental health industry given its current stage of growth.

On the one hand, there is an insufficient supply of services. According to the World Health Organization’s recommendation that “one psychological counselor per 1,000 people represents the equilibrium point for a healthy society,” China requires at least 1.4 million psychological counselors. Currently, although there are over one million certified psychological counselors in China, only approximately 100,000 are engaged in full-time or part-time work within the psychological counseling industry. With the cancellation of the national certification examination for psychological counselors, the shortage of qualified professionals is expected to continue widening.

On the other hand, there is insufficient public awareness, characterized by inadequate understanding of mental disorders and limited awareness of the need for early intervention. This phenomenon essentially indicates that science popularization and education regarding mental and psychological disorders in China are still ongoing. Enhancing public understanding and eliminating social prejudice and discrimination against patients with mental and psychological disorders remain key priorities for mental health publicity and education in China in the years to come.

Furthermore, issues such as irregular psychological counseling services and low standardization of content within the industry have, to some extent, limited public acceptance of mental health services and hindered the development of China’s mental health sector.

Driven by the numerous pain points in China’s current mental health service supply system, the industry urgently needs more high-value innovative solutions. Heart Close Friend’s adoption of an “AI + Mental Health” service model is undoubtedly one of the most viable directions at present.

So, what sparks can fly from the collision between AI and mental health? And what are the distinctive features of the innovative solutions offered by Heart Close Friend?

Although formally established in 2020, the core team of Heart Close Friend had already completed technological exploration and accumulation in AI mental health products as early as 2013. In 2017, it officially launched an online counseling platform of the same name for consumer-facing users, which has since reached and served millions of users.

Leveraging the continuous accumulation of user data, in December 2018, Heart Close Friend officially released version 1.0 of its core AI product, “Close Friend AI.” Equipped with technologies such as emotion recognition, natural language understanding, and intelligent dialogue, the product provides a range of services including 24/7 conversational support, psychological status alerts, intervention for psychological issues, and psychological state assessment.

From the perspective of the Heart Close Friend team, the continuous advancement of technology has significantly reduced the difficulty of achieving natural dialogue and interaction between humans and machines. In light of the current supply-demand imbalance in China’s mental health market, providing users with highly standardized, inclusive services through AI products clearly represents a viable solution.

To further ensure the professionalism of Miyou AI’s outputs and deliver a superior psychological support experience to users, Miyou AI has integrated extensive content resources in its product development. These include 25,000 hours of psychological video content, guidance from over 300 international psychology experts, collaborations with three major industry associations, and content partnerships with 500 specialized psychological institutions. Backed by a vast repository of psychological content and nearly 60,000 real-world case studies, this foundation not only supports the system’s continuous self-improvement but also effectively addresses users’ genuine needs.

In terms of application scenarios, given the current limitations in consumer acceptance and willingness to pay for mental health services, the Heart Close Friend team has chosen to primarily serve business-to-business (B2B) sectors, such as educational institutions and professional psychological service providers. This strategy enables indirect access to end consumers through a B2B2C model. It is reported that Miyou AI has been successfully deployed across nine major sectors, including enterprises, communities, fire departments, universities, primary and secondary schools, and psychological institutions, with its professionalism and service quality receiving high recognition.

In providing products and services to B-end clients, Heart Close Friend places greater emphasis on the tool-like attributes of its offerings. For instance, when serving professional psychological service institutions and mental health practitioners, Miyou AI provides services including psychological status assessment, one-stop management of assessment data, self-guided digital psychological interventions, self-help psychological training tools, as well as intervention and referral for high-risk populations, thereby enabling more efficient patient management.

Although the B2B market is currently the primary focus for Miyou AI’s applications, this does not mean that Miyou AI will not be directly accessible to C-end users. On the contrary, products related to “Heart Close Friend” rank highly when users conduct psychological keyword searches directly through channels such as WeChat Mini Programs and Official Accounts.

For C-end users, the 24/7 service support provided by Close Friend AI significantly reduces the time and trial-and-error costs associated with accessing care. Furthermore, the human-computer interaction model helps alleviate users’ sense of stigma to a certain extent. For users who require one-on-one consultations with psychological counselors, such services are also available through licensed counselors on the Heart Close Friend platform.

Since its inception, Heart Close Friend has been able to advance rapidly on the path of technological exploration and commercial integration, which is clearly inseparable from the support of its team.

It is understood that Dr. Tang Kaizhi, founder of Heart Close Friend, completed both his undergraduate and master’s studies at Tsinghua University, earning dual degrees in Mechanical Engineering and Computer Science. He later obtained a Ph.D. in Operations Research from Pennsylvania State University in the United States and has over ten years of experience in executing data mining and AI projects.

Dr. Tang Kaizhi, Founder of Heart Close Friend

In terms of psychological expertise, Heart Close Friend has assembled an expert advisory team comprising numerous PhDs in psychology, attending clinicians, and senior psychologists, providing substantial professional theoretical support for product development.

In terms of commercial exploration, some core team members of Beijing Heart Close Friend Intelligent Technology Co., Ltd. have more than ten years of experience in the Internet and user operation fields, which fully guarantees the project's implementation and commercial expansion.

It is precisely through the comprehensive synergy of technology, professional disciplinary expertise, and marketing that MindClose Friend AI rapidly gained market recognition after its launch, with a swift enhancement in brand reputation. In light of this, Heart Close Friend has established clear plans for its future development.

In Heart Close Friend’s upcoming development plans, the B2B market will remain the team’s primary focus. On the consumer (B2C) front, the Heart Close Friend team will also explore the development of features and products tailored to more specialized verticals, such as sleep and meditation, thereby continuously expanding its user base.

Product Development Direction: At this stage, product development in the medical field is also one of Heart Close Friend’s strategic focus areas. It is understood that Heart Close Friend has already collaborated with Grade-A tertiary hospitals to develop products for mental health diagnosis and treatment, aiming to provide users with more comprehensive mental health therapies.

In this process, Heart Close Friend will continue to strengthen and upgrade its talent pool, while also seeking to partner with more capital investors who share the same vision and possess in-depth knowledge of the mental health industry, jointly driving the growth of both the company and the sector.