Toronto-based Kodeon announced today that it has added Montréal mental wellness platform Breethe to its growing portfolio of mobile life-improvement apps.
Breethe marks the AI-driven app publisher’s fourth and largest acquisition to date, joining a family of Kodeon apps for iPhone and Android that also includes Fitness Buddy, HealthView, and Memorado.
“It’s an excellent product, as you can see from the stats.”
“It’s an excellent product, as you can see from the stats,” Kodeon co-founder Jon Walsh told BetaKit in an interview. “For us, it was really a bullseye in terms of the category—sleep, anxiety, meditation: those are really important life-improvement categories that we didn’t have a strong presence in.”
The Breethe transaction closed earlier this month. While both firms declined to disclose the exact purchase price (which consisted primarily of cash plus some Kodeon stock), Breethe co-founder Garner Bornstein indicated that it was in the “eight-figure range.”
Kodeon was launched in late 2023 by co-founders Jon Walsh and Trevor Fencott, and COO Ben Huxley, a trio of serial tech entrepreneurs with deep experience in app development that have worked together for more than 20 years, including at Toronto-based mobile monetization and game development company Fuse Powered, which sold to Upsight in 2016, and Vancouver-based, TSXV-listed game aggregator-turned-adtech firm Ionik (formerly PopReach).
With Kodeon, they have set out to apply some of their learnings from PopReach and deploy an AI-focused rollup strategy in the crowded life-improvement app space. They have snapped up more than 30 apps since then, and layered on agentic AI to optimize and automate everything from onboarding to customer service, operations, and software development.
Walsh sees room to grow these apps by integrating them into Kodeon’s AI platform and implementing better analytics, shared services, and cross-promotion opportunities.
This transaction brings an end to Breethe’s 11-year journey as an independent company. Since its launch in 2015 by a team with a passion for meditation who had previously built and sold tech firms, Breethe has expanded into a profitable mental wellness platform that has generated over $50 million USD in total revenue and garnered 4.6 and 4.7 star ratings on Google Play and Apple’s App Store, respectively.
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Breethe did not raise any equity financing, fuelling its growth into one of the most popular apps in its category behind Headspace and Calm using its own revenue and some debt, helping more than 18 million clients globally along the way, Bornstein told BetaKit in an interview. “It’s been very rewarding,” he added.
Bornstein said Breethe initially began exploring and nearly completed a sale five years ago to an undisclosed public company, before COVID-19 derailed that deal. Instead, Breethe’s founders, which include Bornstein, Pierre Le Lann, Lynne Goldberg, and Laurence Ardouin, returned to building the business in the interim.
Last year, Breethe launched another process, finding several interested parties, but quickly deemed Kodeon the most interesting option given its business strategy and intent to “maintain the spirit of the brand,” Bornstein said. He claimed the Breethe founders asked Kodeon to up the share of equity included in the deal because they believed in Kodeon’s vision.
Kodeon has raised $8.75 million USD to date, including $5.5 million in equity from undisclosed Canadian family offices and US individuals, and $3.25 million in debt from an unnamed Canadian lender. The startup is profitable, with operating margins of more than 30 percent, and approaching eight figures in revenue, Walsh said.
Going forward, Kodeon plans to buy more profitable life-improvement apps with strong product-market fit and long track records. Walsh said the startup is open to bootstrapped or venture capital-backed businesses, and partial or full-company purchases. Kodeon plans to fund future acquisitions using its existing cash and additional equity fundraises and debt financing, including a potential Series A later this year.