The hidden cost of being a founder

If I were to pick one thing that unites the global tech scene in terms of culture I would point to the respect and reverence accorded to startup founders.

After all, creating your own company is an ambition many of us harbor. It can bring with it unparalleled freedom, a lasting legacy, prestige, wealth and the ability to do good. Across social and traditional media the feats of founders big and small are lauded for their genius on a daily basis. Many entrepreneurs go to great lengths to showcase their backbreaking hard work and eye-popping success. An outsider would be forgiven for believing that every founder is living the dream as a result of their talent and toil.

Of course, as with nearly every image projected online, the reality is quite different. There is a seldom talked about price of being a founder — the impact on one’s mental health.

A recent study by the National Institute of Mental Health found that 72% of entrepreneurs are directly or indirectly impacted by mental health issues. This compares to 48% of the general population. The damage can also affect loved ones — 23% of entrepreneurs report that they have family members with problems, which is 7% higher than the relations of nonentrepreneurs.

I am in no way a mental health expert. But what I do know from both my own experience and speaking to scores of business owners I work with is that being a founder is an inherently lonely job. Pressure is high and uncertainty pervades every decision. Fear of failure is ever present. Unaddressed, these issues can take a serious toll.

The unpalatable truth is that the situation appears to be getting worse. A similar study conducted in 2015 by Dr. Michael A. Freeman found the rate of mental health issues among founders to be lower — at 50%. While comparing different research pieces is inexact, we only need to look at how the global recession has damaged many companies and how working from home has contributed to feelings of isolation, to know that the environment for startups has got harder this year. Added to this mix is how social media continues to promote an unhealthy fetishization of hustle culture and founding myths.

A number of founders have told me that they have constant feelings of inadequacy and guilt when they compare themselves to the startup gurus who celebrate working 24/7, are constantly selling, raising money or making their millions. They feel they should be working harder or be doing better — just like all the people they read about.

So how do we address this? The first step is talking about it. This means having an environment where we can be honest that not everything is always fine. Speaking to a fellow founder, not about commercial concerns, but about personal worries can be revelatory. I’ve seen it happen in our community. It’s like an “Emperor’s New Clothes” moment.

The myth of the bulletproof, genius, hustling founder can disappear in a puff of smoke as people suddenly realize they are not alone. They find that the concerns, anxieties and uncertainties they feel are almost universal.

Experienced founders can provide invaluable support to people new to the startup scene. They can share their experiences, both failures and success, and reveal some of their coping mechanisms. I would strongly advise founders who are experiencing some of the worries I’ve outlined to actively seek out advice from both their peers and potential mentors — much in the way they may seek out commercial guidance.

Next, we need to address how we tackle the culture and myths around being a founder. Business owners need to know that many of the extraordinary “success stories” they see celebrated online are exactly that — extraordinary.

Similarly, those that promote the principle that working all hours is the only way to be successful are at best talking about what works for them, and are at worst, engaging in a performance to achieve attention. We need to think carefully about how we respond to these posts. There is a fine line between being supportive and enabling unhealthy or damaging behavior and philosophy.

After all, success in the startup scene is all relative. For some owning a small business that makes them a decent income with a good work-life balance is the goal. For others, it is simply being able to do what they love in the way that they want. Very few will get the exit that makes them a millionaire, and an infinitesimally small minority will build the next Facebook. I cannot stress enough how important it is for founders to keep their aims and ambitions in perspective and ignore the noise they hear online.

More broadly, the industry, including the media, does need to get wiser about how it views and represents founders. For example, a pervasive myth is that some of the biggest tech companies in the world started in garages with no money, then through the genius and sheer bloodymindedness of their founder they were grown into a massive corporation.

The reality is that the vast majority of these tech companies benefited from substantial seed capital from family or connections almost from day one. These founders were also quickly surrounded by highly talented people who did a lot of the heavy lifting and, whisper it, a truckload of good luck. In short, the idea of the superhuman founder perpetuated in the industry is, in nearly all cases, nonsense.

In a similar vein, there are also issues around how we frame success and failure.

Success, as I’ve mentioned earlier, is nearly always couched in the most basic numerical terms. The “unicorn” label is bandied about so often that many people fail to realize that it’s simply a valuation that a few investors have given a company. It does not reflect whether the business is actually successful in the traditional sense, i.e., making money. Generally, the startup scene celebrates and idolizes founders who make big exits or achieve “unicorn status” — less is spoken about the thousands of SMEs that employ people, develop and patent new tech, make a tidy profit and pay taxes.

With failure, there is an altogether different problem. The startup scene downplays failure as par for the course. It is, on the face of it, one of the industry’s great virtues. It enables people to try without fear of embarrassment. However, in practice, it can actually minimize real-world fears nearly all founders have. Failure cannot just be brushed off if you’ve devoted years of your life, spent a lot of money and have staff who rely on you. By simply thinking of failure as part of the process we cannot address and talk about this real source of concern in an open way. “Fail fast” only works for those who can afford it.

Individually, these issues may seem like nothing but white noise and the cure for suffering founders may simply be to get off social media. Unfortunately, it isn’t that simple. Social and traditional media is amplifying startup culture, not creating it. The same tropes are on display at every tech conference and meetup. To fit in, the founder is expected to be a fearless, genius visionary. Deviation from this norm, such as by displaying vulnerability around mental health, is by inference, failure.

Despite its shortcomings in relation to diversity, the startup scene is generally one of the most progressive, collaborative and open industries in the world. These virtues are ideally suited to tackling the reluctance to discuss mental health and creating the network of support that ensures people don’t suffer alone.

To make this happen, we need to dispense with the myths and hagiography around being a founder and be more honest about what the reality of running a business actually entails.

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