Although #BellLetsTalk day is behind us, we do not want to forget about the importance of maintaining our mental health and being aware of those around us. For us, this includes our investee companies, both past and present. It can be easy to get lost in the day to day operations, so we feel it is very important to check in on the entrepreneurs of our companies. This great article was written by Jennifer Williams of Genesys Capital.
As investors, we are continually checking in on the health of our portfolio companies, but when was the last time we checked in on the health of our entrepreneurs—more specifically, the mental health of our entrepreneurs?
Despite being incredibly smart, driven and extremely resilient, entrepreneurs are more vulnerable to mental health challenges. Stigma and isolation can often prevent entrepreneurs from seeking help.
Fact: 30% of founders report suffering with depression. This rate of depression is four times that of the general population (reported at 7%). And that is just the beginning—entrepreneurs have a ten-times higher incidence of bipolar disorder, 49% report having a mental health condition, 29% have ADHD, 27% have anxiety, and 72% report having mental health problems themselves or in their immediate family. Source: Are Entrepreneurs “Touched with Fire”?
Ask any founder, “how are you doing?”. Their response will likely be, “great”, followed by a largely positive report about company performance and growth expectations.
In reality, often the picture isn’t so rosy. Relationships with co-founders and colleagues may be tense, an approaching milestone is looming heavy, and finances are strained. All of this creates mounting stress and anxiety.
The high intensity work environment for entrepreneurs along with the expectation that they are “always on” gives little space or opportunity to check-in with oneself. As investors who are supporting these startups in all aspects of their operations, we should give some consideration to supporting the mental health of the founders, and provide an opportunity to check in.
When we think about the impact of depression on entrepreneurs, we think about media reports of lives lost to suicide. The unfortunate truth is that entrepreneurs have a 50% higher chance of attempting suicide then the average population. But burnout and suicides are the outlier. There are far more entrepreneurs dealing with the impact of depression while running startups and leading teams, in many cases this can lead to performance issues, leadership issues, lack of motivation and poor team work.
What’s particularly interesting is that VCs are backing more mental health tech companies than ever. And, as an industry, we should also be supporting this trend at an organizational level. According to White Star Capital, the amount of venture capital dollars deployed in mental health tech deals was projected to almost triple in 2018 compared to the year prior (2018 projection: $793m, up from $322m in 2017). An example of a deal in this space is Calm, a meditation and sleep app which raised a $27 million Series A funding in June 2018.
As VCs put more investment dollars behind companies operating in this space, we should also be supporting our entrepreneurs and educating ourselves about the impact of poor mental health on our portfolio companies.
Fortunately, we are beginning to see a shift as firms implement support for mental health and wellness.
One such example is Silicon Valley-based VC firm Felicis Ventures, which is comitting 1% in addition to invested capital to spend on coaching and mental health, and the hope is that this will help eliminate the stigma of founders seeking help and provide them with access to support.
As investors, we have a real responsibility to care, especially with rates of anxiety and depression increasing. As an industry, we are working closely with the population who are most acutely affected, and we should be doing more to support positive mental health and eliminating the barriers for founders to seek support.
If you have a story to tell about the actionable ways your investment firm is prioritizing mental health, contact us to share it. Join the conversation today by using hashtag #BellLetsTalk.