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Veteran Bay Street financier and entrepreneur Sam Duboc’s telemedicine startup MindBeacon Holdings Inc. has filed to go public on the Toronto Stock Exchange amid a surge in demand for digitally delivered health services during the pandemic.

The five-year-old Toronto company, which provides mental health therapy over the internet through its Beacon service, revealed in a securities filing late Monday it plans to raise $50-million by selling an as-yet undetermined number of shares for between $7 and $8 each. TD Securities and Credit Suisse Securities are leading the offering, which was first reported by The Globe and Mail last week. Bloom Burton & Co. and Canaccord Genuity Group Inc. are also part of the underwriting syndicate.

Toronto telemedicine company MindBeacon looks to go public on TSX as demand surges during pandemic

MindBeacon set out this year to raise $30-million from private investors but shifted course to raise a larger amount from public investors given the strong performance of technology stocks, including the successful TSX initial public offering of Nuvei Corp. and Dye & Durham Corp. MindBeacon had previously raised $38-million from backers including Green Shield Canada, Manulife Financial Corp., and Telus Ventures.

Widespread sheltering at home during the pandemic has translated into significant growth for companies that deliver online health care, prompting a rush of investment into the sector. Canada’s two largest telemedicine service providers, Dialogue Technologies Inc. and Maple Corp., have each raised tens of millions of dollars this year from investors including Sun Life Financial Inc., Caisse de dépôt et placement du Québec, Power Corp. of Canada’s Portag3 Ventures, and Loblaw. Dialogue has also explored going public. Shares of TSX-listed Well Health Technologies Corp., which also provides virtual health care services, have more than quadrupled this year.

Mr. Duboc co-founded private equity firm EdgeStone Capital Partners, as well as Air Miles parent LoyaltyOne Co., and has previously served as chair of the Business Development Bank of Canada.

He has also been open about his past struggles with depression. In a letter included with MindBeacon’s prospectus, Mr. Duboc explained how the sudden death of his brother in 2011 led him to become “deeply depressed” and struggling to find a good therapist and feeling “stigma and discomfort with each appointment.”

Mr. Duboc wrote he and his spouse Claire, who co-founded MindBeacon, “feel that mental healthcare should be more accessible, and this idea started our journey that eventually led to MindBeacon.”

The Dubocs teamed up starting in 2015 with CBT Associates, a private Toronto provider of cognitive behavioural therapy to treat people with mental health issues, including anxiety, depression and post-traumatic stress disorder – a form of treatment that Mr. Duboc has said helped him. They later formed MindBeacon to develop a digital service for patients to access practitioners remotely. CBT co-founder Dr. Peter Farvolden is chief science officer.

MindBeacon’s services are provided by Telus Corp., Rogers Communications Inc. and Maple Leaf Sports and Entertainment Ltd., among others, to their employees. Insurers including Blue Cross, Manulife, Green Shield Canada and SSQ Insurance have sponsored free access to online clinical psychologists through Beacon during the pandemic.

MindBeacon told prospective investors earlier this year that it expects revenue in 2020 to double to $9.4-million from 2019 levels, according to an investor document obtained by The Globe and Mail. It is forecasting revenues will more than double again in each of the next three years. In the company’s prospectus, it noted revenues in the nine months ended Sept 30 were $6.6-million, close to double levels in the same period a year earlier

The company is looking for funds to expand its care offerings, hire sales and marketing staff, expand to the United States and beef up its data analytics and artificial intelligence capabilities.

If the offering generates strong demands, some existing shareholders — including Telus — could sell part of their stake, the document states.

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