When Ezra Galston was spinning up Starting Line, a Chicago-based venture capital fund, the pressures of raising “almost broke” him. And that was with his wife, a licensed therapist, and his own therapist in his corner.
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So when Galston picked himself back up and finally closed the $17 million fund, he promised that a core tenet of the venture capital firm would be to offer a series of subsidies for every entrepreneur in the portfolio to take care of their mental health.
The subsidies can be applied to a range of services, “as long as it’s something focused on forced introspection and personal growth [or an] outlet where entrepreneurs can really be transparent about the struggles they’re going through,” Galston told Crunchbase News.
Galston’s Starting Line is part of a small, but growing, cohort of venture capital firms that explicitly offer mental health services for their portfolios. As programs roll out across the country, some investors are finding different ways to support the holistic health of founders, from subsidies to in-house therapists.
In 2018, Dasha Maggio, a partner at Felicis Ventures, launched the firm’s 1 percent program. The premise was simple: Felicis Ventures will commit 1 percent on top of every first check it writes in non-dilutive capital for “founder development services.”
“Money talks, I think, and it’s one thing to say yes we support you, etc. It’s another thing to say, we are committing money out of our own budget and giving you the choice of how to invest in yourself as a founder,” she said in an interview with Crunchbase News.
Since starting the program, Maggio’s had a “growing but nascent resource database’ saying it’s all about ‘breaking down the barriers,” she said.
And while the program was inspired by two years of surveying founders, per Forbes, Maggio said she continues to learn new lessons, as the firm is on its sixth fund. Maggio declined to share statistics around usage of the capital committed to mental health. She did say, “we can very confidently say that it is driving impact.”
One founder spun up a circle of colleagues for a mini-founder support group with a trained facilitator. Another used the funds for a therapist. Others have hired life coaches.
Life coach is the exact kind of job that Sarah Gaines, an entrepreneur and Yogi, is betting could be her next full-time gig.
In December 2019, Gaines ended The Y Society, a Boston-based platform for women professionals, and pivoted to being a life coach for entrepreneurs as a side gig. She charges a flat rate of $5,000 for her programs, a high value, she said, so her “clients know they’re making an investment in themselves.”
“I want to help mission-based entrepreneurs find more joy, more time and more clarity so they can show up for themselves,” Gaines told Crunchbase News.
Gaines is not professionally trained, and said that her clients, often early-stage founders, have used her services along with traditional therapy services. Think of her as a personal trainer, but for founders.
As for whether or not Gaines thinks people like her or other mindfulness professionals will ever be part of a suite of services across more VC firms?
“For VCs it’s such a fast paced, ‘you need to get shit done’ environment and that is the opposite of meditation and mindfulness,” Gaines said. “It’s going to be a VC-by-VC basis, and needs someone in the company who is really passionate about it becoming a benefit.”
In some ways, San Francisco-based Builders VC has found a way to fit mindfulness into this get-it-done mentality. This support includes an in-house therapist, a promise of confidentiality and a healthy dose of trust.
Johnny LaLonde, a licensed and trained therapist, moved to the Bay Area eight years ago and started a private practice. He soon learned that his clientele, which included founders and “folks who worked with VC firms” needed services valuable for high-stress, high-pressure positions. Then, Jim Kim, the founder and general partner of Builders VC, which we’ve written about before, approached LaLonde asking if he wanted to be a “more consistent resource” for the firm.
LaLonde agreed to be an in-house resource, with one non-negotiable in place: anonymity for founders who talked to him–especially from Kim. That’s just in case the founders feared they were being checked up on by the investor that cut a check into their company.
“It meant that founders could meet with me on a weekly basis for a year, and Jim would not know anything about it,” LaLonde said. The anonymity made a difference.
“I have a license built on confidentiality and anonymity, and that allows them to have a little more trust for me on the front end,” he said.
LaLonde noted how there’s a shortage of trained professionals helping founders.
“As far as I know, if there are other folks like me you can count them on one hand,” he said. Demand for his services reflects that. And since consistency in therapy is an important tenet, his use rate is high.
Finally, he pointed to a lesson he’s learned since working with Builders VC: Despite the general trend of awareness around mental health and mindfulness, younger entrepreneurs are more likely to use his services than older ones.
And that brings us back to where we started, with Galston. Sometimes, Starting Line’s Galston has learned, just providing and paying for the services isn’t enough.
Since kickstarting the subsidy program with Starting Line, Galston said he’s struggled to get portfolio companies to take advantage of the opportunity.
“In spite of offering people free therapy, it’s really really really hard to get anybody to actually close the loop on it and attend, and attend with any sort of regularity … and I wish 100 percent of our entrepreneurs were utilizing our subsidies,” he said.
Illustration: Dom Guzman