Startup culture has long conditioned entrepreneurs to project a public image of “crushing it” at all costs. With a first of its kind capital pledge, one of Silicon Valley’s new-guard venture firms is looking to change that—and do away with the stigma of founders raising their hands for help.
Launched by Felicis Ventures, the program will commit 1% on top of every check the firm writes in non-dilutive capital earmarked for “founder development” in coaching and mental health. The money, which will be available no-strings-attached for years after the investment is made, can be used by Felicis’ founders to cover costs such as therapy sessions, leadership coaching, development programs and peer CEO groups.
Inspired in part by changes in fields such as professional sports, where a growing number of high-profile athletes have gone public with their mental health and psychological struggles, the program is the result of close to two years of testing and surveying of founders, say Felicis founder Aydin Senkut and partner Dasha Maggio, who will oversee the program. The choice of 1%, meanwhile, was inspired by Salesforce’s 1-1-1 model of pledging 1% of time, technology and resources to philanthropic causes, the partners say.
“Startup founders are in high-pressure environments, and we ask them to build these disruptive companies that will change the world, and yet we are not really providing support on this front,” says Senkut. “We’re putting all of it in a box for founders to deal with alone. And that didn’t make sense to us.”
Felicis’ bet is that by making such resources available and publicly known, founders won’t feel too proud, or too much pressure to seem successful, to address personal and team issues. Tactical marketing help can only go so far, Senkut says, when founders aren’t telling their investors that they’re unable to sleep from anxiety, or not speaking to their cofounders.
At startup Recursion Pharma in Utah, CEO Chris Gibson has raised just under $80 million to combine technology and biology to find more beneficial drugs faster, with active clinical trials and 30 programs in the pipeline. A first-time founder, Gibson took advantage of Felicis’ offer to put him in a CEO boot camp with five other founders who’d meet for video conferences every couple weeks to discuss major hiring decisions or founder problems. “You get in a room with other CEOs and there are no investors or people you think will judge you, and it’s incredible how people will talk about what a shit show it is behind the scenes,” says Gibson. “People feel like if they share these things, it might admit to investors or others that things aren’t going well. But it’s stressful even when things are going well.”
At billion-dollar startup Canva, Melanie Perkins says her Australian design software company has gone on a “complete roller coaster” of team building as it scaled from five employees to about 315 over the last five years. Canva embraced executive coaching to cope, and now has a full-time coach on staff with plans to hire more. A fellow Felicis portfolio CEO, Perkins says she hopes that other firms and founders follow the firm’s example in months to come. “I think this will definitely be the start of something,” she says. “One of my favorite quotes is that the reason we struggle behind the scenes is we compare ourselves to everyone else’s highlight reel.”
The 1% pledge isn’t Felicis Ventures’ first public pledge to its founders. In 2016, the firm announced that baked into its funds moving forward would be a promise not to vote against its founders in board meetings. To some in the VC landscape, it was positive signaling; to others, it was bad business or a harmless but publicity-seeking stunt.
Senkut dismisses the notion that Felicis is going public with its program as mere virtue signaling. The 1% comes out of the partners’ own management fees, he notes; Felicis also plans to invest directly in more startups working in mental health and wellness. The pledge to vote with founders comes up in more than 80% of conversations with potential new investments, he says. “At the end of the day, founders want partners who share their values,” Maggio says. “We will let the score take care of itself.”
That score—and whether Felicis’ announcement will prove to be the start of a trend—will depend in large part on how much Felicis is able to get its portfolio to actually use the newly available funds. The firm is confident that the demand is there; results and changing the conversation around asking for help, however, may take time. “Even if only ten percent of our funders use this, that’s still better than zero,” Senkut says.