Relaxation app Calm raised said Wednesday it has raised $88 million in its second funding round, valuing it at $1 billion.
TPG Growth led the Series B round, which included investments from Creative Artists Agency as well as existing investors Insight Venture Partners and Ashton Kutcher's Sound Ventures. Calm has now raised $116 million. The company will use the money to expand internationally and invest in more premium content.
Calm quadrupled its revenue in 2018, putting the company at a $150 million annual revenue run rate. The app says it has more than 40 million downloads worldwide and "well over" 1 million paying subscribers. Some of Calm's content is free, while some of it is available only to subscribers.
"Mental health was something people didn't really talk about until recently. Something is changing really dramatically. There's a societal shift of people taking care of their minds and being more interested in sleep and self care," co-founder and co-CEO Michael Acton Smith said in an interview.
Calm started in 2012 as a meditation app and has grown into a guide for sleep and relaxation. It and fellow meditation app Headspace have harnessed consumers' growing interest in and willingness to invest in their mental health and wellness.
More Americans are meditating than ever. About 14 percent of adults said they meditated in 2017, a threefold increase from 4.1 percent in 2012, according to a report from the Center for Disease Control and Prevention's National Center for Health Statistics. The study did not collect any information on what drove the increases, but researchers told CNBC cellphone apps may have contributed to the increase.
In addition to meditation, Calm has found a niche in sleep. It said Wednesday its sleep stories, which are essentially adult bedtime stories, have surpassed more than 100 million listens. It has teamed up with celebrities like Matthew McConaughey, Stephen Fry and Leona Lewis to narrate the stories.
Smith said Calm wants to expand to other countries in other languages.
"America is only 4.5 percent of the total global population, so there are a lot of other people that can enjoy the product and help the company grow," he said.
Calm is the top grossing health and fitness app and 20th overall on iOS, according to App Annie, an app market data firm. Headspace is the seventh-highest grossing health and fitness app and 103rd overall on iOS, App Annie said.
Headspace has raised a total of $75 million. In June 2017, the company confirmed it was valued at $320 million. It currently generates more than $100 million in revenue per year.
Correction: This article was updated to correct inaccurate information provided by Headspace about when it was valued at $320 million.
-CNBC's Ari Levy contributed to this report