Prioritising mental health within startup and VC culture
Let’s face it, in the startup and VC world, every day can bring a new set of challenges. This is why many of us are drawn to the industry in the first place – it’s a high stakes space where mere ideas can turn into multi-billion global businesses, amassing considerable wealth for both entrepreneurs and their investors.
But the massive upside of this world comes with its downsides – and the stress, uncertainty, instability that startup life brings can be emotionally and psychologically taxing. One day you’re on the path to becoming a unicorn; the next, you’re on the brink of failure. It’s incredibly important we equip ourselves with the right tools to navigate the ‘rollercoaster ride’ of startup life. While the startup and VC world undeniably fosters a high-performance culture, it doesn’t have to come at a cost to our wellbeing. At Pi Labs, we want to break down the stigma surrounding mental health and failure as well as open up and normalise conversations around these topics.
In an environment that naturally creates high pressure situations, and with large amounts of capital at risk, it’s unsurprising that mental health issues can be prevalent in the startup community. I recently came across a stat which said that in 2015, 72% of entrepreneurs suffered from mental health concerns. I can only imagine that this stat is now much higher coming out of a pandemic in which many mental health issues were heightened. Now, with a potential downturn on the horizon, these stats may shoot even higher making the topic of mental health all the more important and timely.
Other stats on this topic are equally worrying. I recently read that 50% of entrepreneurs have reported feeling lonely, with their loneliness even impacting their performance. Forbes has called depression among entrepreneurs an “endemic.”
Clearly, we need to make wellbeing, community, and connection more of a priority within our industry. VCs, who are usually attuned to the commercial challenges their entrepreneurs are facing, should also have their fingers on the pulse of their emotional wellbeing. After all, being a successful VC is partly about IQ, but I’d argue it’s more about EQ. I’d say that VCs that can connect with the entrepreneurs they’ve backed on a human level are far better placed to be trusted mentors and advisors. Is there a correlation between EQ and VC fund performance? Perhaps, one for our research team to explore further…
Open and honest conversations
Working at a startup or VC can be a rewarding but a challenging and lonely environment. I believe that leaders need to cultivate a safe space in which their teams can have honest and open communication around mental health. This applies to a VC for the CEOs they have backed, a CEO creating a safe space for his senior leadership team, and so forth, thereby creating a ‘virtuous cycle’ of openness on mental health.
These open conversations also enable us to understand how everyone is truly feeling (about their work, the brand they represent and work/life balance), and from there, the right steps can be taken. One such measure is leadership coaching, to which I believe (from personal experience) that everyone in the team including – and especially – founders, should have access. The benefits of having a designated coach to speak to, in a private confidential environment, shouldn’t be underestimated.
At Pi Labs, we make sure that everyone on our team has access to confidential support should they want or need it. Each month, everyone in our team is offered 1-1 time with a mental health coach – no topic is off limits, and everything is 100% confidential. There is an opportunity for regular check-ins and follow-ups as well. This is something we put in place during the pandemic and uptake for these sessions has continued since.
In addition, as part of our annual Growth Programme, we’ve introduced a weekly “Cohort Circle”, an informal session for teams to come together and share their updates and what has gone well for them, as well as what has been less successful. I’d like to see more of these types of open forums for honest conversation and connection between members of the startup community. Not everything is going to be ‘sunshine and lollipops’ (as an American investor friend of mine put it), and it’s OK to talk about setbacks and failures. I’m a firm believer that failure makes us all stronger, and it’s something to be discussed openly and shamelessly.
Taking a sustainable and long-term view
Alongside communicating, we should consider the approach we take to our work. Adopting a sustainable view of performance is a key foundation to supporting employee mental health. Wellbeing and high performance should not be mutually exclusive concepts. While understanding the short-term pressures that many VCs and startups face, leaders should try to recognise that prioritising wellbeing and adopting a long-term view will safeguard their team into the future, and result in long-term, sustainable performance vs. a short burst of high performance followed by burnout and disengagement.
At Pi Labs, we pride ourselves on staying positive and resilient in the face of adversity, while also understanding that it’s ok not to be ok. I try my best to foster a culture in which our wins and losses are discussed in equal measure without judgment or expectations. For this reason, I don’t expect the team to put on a brave face when things go wrong.
We work hard on this culture not only within our team, but also across our network, especially in our role as investors for our portfolio. We support the holistic health of founders by providing dedicated mental health sessions as well as access to a growing support network of mentors, coaches, and expert advisors, and best of all, other founders who have been down the startup journey before. We take a healthy approach to our work-life balance and ensure everyone has time for rest, being with family and friends, exercise, and doing the things that make us happy. During the pandemic, we hosted sessions for the Pi Labs team and our portfolio companies to learn techniques, such as breathwork, meditation and yoga, to integrate into their work life to improve their physical and mental health, performance and emotional wellbeing.
I certainly don’t have all the answers on this important subject but I’ve been proud of the steps we’ve been able to take over the last few years. I believe that as investors, we have a responsibility to drive change from inside the industry ourselves. Ultimately, what VCs do matters. We are curators of networks in which we stand at the centre. The concentric rings of this network include our founders, our mentors, and the employees in our portfolio companies. If we as VCs set the right example, I expect the mindset change to ripple outward through our network…driving change in the wider startup sector.