Finally! More leaders in the venture space are thinking about sustainability throughout the entire capital stack.
It’s a new era for venture capital. After witnessing more females and people of color attain GP status, we are now seeing VCs are vocally championing founders’ well-being. Micro funds are thriving and LPs are placing bets on an assortment of experiments on how to maximize returns.
Venture Capital Is Listening …
GPs are helping their founders make mental health a valued asset, and many speak from personal experience. Crosscut MD Brian Garret wrote, “many founders don’t address self-care until their ambition or their idea is affecting their health and well-being in real, sometimes irreversible ways.” Today, the firm announced that they are re-investing their own fees to promote their founder’s mental health.
Crosscut is not alone. Freestyle Capital last week announced a similar initiative. Freestyle MD Josh Fesler spoke openly about loneliness and stress, and the fund has partnered with the Hoffman Institute and Meru Health to support Freestyle’s founders.
Felicis was one of the early standouts in the movement, gifting 1% of capital to founder coaching and mental health in 2018. Shortly after that, Atlas (formerly AlphaBridge) built an entire firm off the belief that founders thrive when they are not being pushed at a burnout pace.
Alexis Ohanian calls the fetishization of overworking “Hustle Porn.” Many ascribe the rise in mental health issues to both the misuse of technology and an excessive hustle culture practiced by many startup founders.
MiLA Capital starting thinking about mental health deeply with our first investment. The company, Sentio, was started because the CEO, George Eleftheriou, had privately battled mental illness, and believed technology could assist in reversing the harmful effects.
MiLA Capital, like Crosscut, partnered with Evolution to offer coaching to their founders. In less than two weeks, MiLA is hosting 50 CEOs in Yosemite for a three-day retreat. The goal is to assist founders to invest in themselves and uncover how to become a successful transformational leader. Founders will learn how to navigate negativity, build emotional intelligence, create a template of positive thought and behavior that can influence desirable outcomes. In addition, founders will have the opportunity to work with business experts to explore pressing leadership issues, such as recruiting, burnout, governance, and culture. As one attendee recently shared, “Professional development is something that I’ve de-prioritized to get [my company] to where it is today.”
It’s Not Just About Founders
Founders are a starting point. According to Cigna, three in five Americans are lonely, and the working environment plays a critical part of that mindset. Working with founders to solve their personal challenges will have a trickle-down impact in their organizations, as employee well-being will become top of mind as well.
The year 2020 will be remembered as the milestone year when startup founders focused on the positive emotional, mental, and physical well-being of themselves and their people, recognizing that this foundation is actually a hack for the traditional financial metrics of success.