Today there are between 10,000 and 20,000 mental health apps for managing various mental health conditions for the user. However, monthly user retention rates of mental health apps are only around 3.3%. Further, only 2–3.4% of all mental health apps available in app stores have expert validation of clinical trials, randomised control trials, or real-world research. To address these gaps, we identified the following drivers of user well-being and engagement with mental health apps: clinical validation, design-centredness, research evidence and use of sensing technologies for well-being. We use a mixed methods approach in developing and testing a novel mental health app in a large organisation. We interviewed 10 mental health and medical practitioners, to validate our approach in developing a companion app for stress and anxiety management. Next, across three studies, we report findings on user preferences and needs for mental health apps (Study 1), in-app behavioural and activity patterns (Study 2) and managing user well-being and designing effective digital well-being interventions (Study 3). Expert feedback indicated the need for an effective user-centric mental health app aligned with the therapeutic process and overall recovery goals. In Study 1, we found high prevalence of stress in the respondents with stressors including work, family, parenting, career, finances etc. A total of 35% users reported requiring an effective mental health app to manage these stressors, with key features such as journaling, mood monitoring and relaxation. Study 2 reported the impact of daily stress and emotion on productivity among registered app users. In-app activity trends showed distinct usage patterns across different app features. The key themes identified from the thematic analysis in Study 3 further support the app’s technology and design as key drivers for improving well-being and engagement. Based on expert feedback on mental health apps, research evidence and three user studies, we present the development, testing and validation of a novel well-being companion app to manage stress and anxiety. The app was found to be effective for users to manage their stress based on novel game and sensing-based activities within the app. Future roll-outs with further capabilities in the app for roll-out in other contexts are planned.