The Missing Piece: Entrepreneurship & Mental Health
Why it matters and how we can take action
Speaking about mental health is stigmatized in our culture, and many people choose not to share personal struggles in the workplace. Yet, the personal and the professional are inextricably linked. We bring our bad work days home, and frequently, we bring our bad home days to work. Mental health should not be a topic confined to the personal sphere because our feelings and our well being are not confined to the personal sphere. And nowhere is this more true than for entrepreneurship.
The delineation of the personal and professional spheres is all but erased for early stage founders. Their homes are their offices. Their personal finances are invested in the company. They are expected to work far longer hours than their non-founder counterparts. All of these factors and many more create significant mental strain for founders, a strain that is not currently being addressed by our entrepreneurial ecosystem.
According to a University of San Francisco study by researcher Michael A. Freeman, startup founders are twice as likely to suffer from depression, have suicidal thoughts or undergo psychiatric hospitalization. They are also three times more likely to suffer from substance abuse.
Poor mental health is not just a personal problem, it’s also a business problem. Poor mental health negatively affects founders’ work, increases the likelihood of burnout, and strains key relationships. To put some numbers on this, Noam Wasserman, author of “The Founder’s Dilemma,” estimates that over 65% of startups fail due to conflict between co-founders. Jake Chapman, a managing partner at Alpha Bridge Partners, explains why this is significant from a financial perspective:
“If a firm were able to help even half of those companies avoid failure caused by burnout and mental strain, that would mean […] doubling the number of successful outcomes in the portfolio. Even if you’re a huge pessimist, to help change the trajectory for one out of 10 companies changes the portfolio from five winners to six. In other words, supporting founders before their “people problems” become business problems yields a 20 percent improvement in performance. Even if one were indifferent to the personal lives of the portfolio founders, they should care about founder health if they care about portfolio returns.”
In sum: Whether you care about founders, making a profit from their business, or the impact of their technology if it is commercialized, you should care about mental health.
So how can we act on this?
At an ecosystem level, there are three groups capable of creating change:
- Accelerators and Incubators
- VCs & Funders
- Founders
Entrepreneur support organization should offer access to mental health resources
Incubators, accelerators, and other organizations specialize in helping entrepreneurs bring impactful technologies to market. They offer mentorship, guidance, workshops, connections to venture capital and more — all the resources a new company needs to thrive. Now they need to step up and offer what many new founders will need: mental health support and coaching services.
These organizations should also normalize speaking about mental health early on. For example, they can host discussions on mental health and work-life balance, integrate these topics into their curriculum, and encourage mentors to make time to check-in on mental health and wellness with empathy.
VCs need to lead the way in de-stigmatizing mental health issues
In 2019, the value of VC investments in the United States totaled over 100 billion dollars. VC funding can greatly accelerate startup success, which is why VCs need to lead the way in de-stigmatizing mental health issues.
Last year, I posted on LinkedIn about the challenges I was experiencing with managing my attention deficit disorder (ADD) after the shelter-in-place order moved my work online. “I admire you for speaking up,” said my founder friend, “but I could never do that. The risk to my business is just too high.” As many founders are, my friend was concerned that speaking up about mental health struggles would raise red flags amongst the funders from whom he sought investment. This needs to change.
Investors need to commit to supporting the mental health of their founders, and they need to do so publicly. The Investor Pledge for Mental Health is a great place to start. They can also make mental health resources available for portfolio companies, and actively encourage founders to earmark part of their company budget for wellbeing and mental health support.
Founders need to be empowered to speak up
Founders are going through these experiences first-hand, which is why their testimonies can be so powerful and why we need to create the right environment for more founders to speak up.
At Activate, I am blessed to work with Ilan Gur, a founder and CEO who speaks openly about mental health and personal challenges. He has shared with us his struggles adapting to a global pandemic, juggling childcare, work and all the emotions that come with our new normal. He has shared with us his struggle to reconcile himself with the reality of racial injustice following the violent and racialized attacks across the US that caused the resurgence of the Black Lives Matter movement, and his pain that we, both as individuals and as an organization, could have been doing better. But most importantly, he has created an environment where the rest of us feel comfortable sharing too, laying the foundation for an organization that can navigate change and uncertainty with teamwork and grace.
When a founder leads by example, it transforms the experience of those they work with, both within their company and beyond. In my time working with startups and incubators, I’ve been to many startup demo days, but only once have I been to a demo day where a founder’s speech brought half of the room to tears. This is what happened when Jess Morrison, an Activate fellow and founder of AddictionAlly, took the leap to speak openly about multi-generational addiction, the impact it had on her and her loved ones, and her determination to change this narrative for others.
Not every founder will be comfortable speaking publicly about mental health, and not every founder needs to. Beginning the dialogue with colleagues, advisors, and other founders is already a big step that will help to lift stigma, create deep bonds of trust, and help founders grow support networks that can step up in times of need.
Every time we speak about mental health is a step towards greater de-stigmatization. No matter where you work, I hope you will take some time today to check in with yourself, with a friend, or with a colleague.
I look forward to the day when checking in on a founder’s mental health is normal as checking in on the health of their business.
