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Founder wellbeing - what can and should investors do?
An honest account from the trenches, at a time where most founders are going through the toughest times they'll meet in a long time.
Editor’s note: With the current macro, bank failures, and the funding environment, the job of a startup CEO can sometimes look like Mission Impossible to even the best. This article discusses the behind-the-scenes of staying sane as a leader and the role that investors can (and should?) play. Written by founder Arne Peder Blix and executive coach Anna Liebel this is a post from the trenches to you as investors. I hope you’ll enjoy it 🙏.
In the past several years, investors talk about investing in people first and foremost. Not the idea or the technical solution, but the team building and leading the company. The paradox is that when suggesting investors put more emphasis, as well as money, on the founders’ performance, balance, and well-being, there are plenty of doubts, reasons and excuses why it shouldn’t or can’t be done.
I want to address the most common doubts, based on my experiences as a CEO, investor, advisor, chairperson and board member. This piece is inspired by the rough patches of my own CEO journey. I hope to open up investors’ minds to new angles of the founders’ mental health topic, to show how small changes can make a big difference in our investments’ success.
To give you a bit of background, over the period of 2 years in 2019-2021, I was faced with more challenging situations than, perhaps, all the previous 16 years put together. Without going into details, I think I can safely say that it was above and beyond what you can expect from most CEO jobs.
I am not saying this to brag, as I would not wish this sort of high-cost unique experience on my worst enemies (not that I have many). Rather, I’m writing this article to emphasise that investors can make a positive impact on founders’ significant challenges of staying sane, healthy and reasonably happy during their careers.
I would not wish this sort of high-cost unique experience on my worst enemies (not that I have many).
Rather, I’m writing this article to emphasise that investors can make a positive impact on founders’ significant challenges of staying sane, healthy and reasonably happy during their careers.
Over the past 3 years, partly as a result of the above-mentioned ordeals, I have been reflecting on the inherent impossibleness of the CEO role of today. It is quite a lonely job at times, and frequently you will experience despair. It can sometimes feel like being in a war with many fronts to fight, squeezed between employees, your management team who are mostly on your side but still report to you, your board, the investors, partners and clients. “Up against” all this, there is no one by your side who is really and truly on your side.
In the summer of 2021, it all came to a point where I felt I could no longer lean on my network for support. I felt it rude and improper to intrude on and potentially exhaust my supporters by demanding too much from them. The same with my wife and family.
After some serious self-reflection, I decided it was time to consider finding the right sort of professional coach/mentor to be able to stand my ground under pressure and start re-balancing myself (like putting on your own mask first, before helping others). I invested in myself.
Over the following 3 months, with good guidance and support from a professional “mindshifter” (coach), I was able to get over the most demanding period of my professional life. With effort and help, I was able to get reasonably re-balanced, re-energized, in tune and ready to take on new challenges. I also decided to continue the job of re-balancing, and also start building more robustness to prevent a recurrence.
So what did I learn in the process that can be valuable for you as an investor?
Let’s address the concerns you might have about supporting the mental health of your portfolio teams.
“Self-care and/or coaching can’t be pushed onto a person. The decision to engage in such work has to come from them.”
This argument sounds reasonable and respectful. Yet, even if an investor can’t make anyone commit to coaching or work focused on founders’ physical and mental health, the bare minimum of asking them to try is always possible. It is ungrateful work and a waste of time and money to force someone into leadership coaching if they are not ready to commit to doing the work. Yet, they need to know what they are saying “no” to. To many entrepreneurs, personal and leadership development work is an unknown tool in the toolbox. Most of them have no clue what they are missing out on by not even trying, not daring to ask for it (and thereby admitting weakness) or not being offered it!
I think we tend to forget that it is quite normal for top performers in sports to have all kinds of coaching and mental training to achieve top results. A top athlete’s performance peaks and throughs, and sometimes they are competition ready and other times they are not in peak condition. Why shouldn’t the same apply to the most valuable players (MVPs) in a management team?
If you as an investor talk about caring about people first, why not make it a rule for the founding teams to try coaching at least once, maybe even as a prerequisite to get your money invested in their company? See if they are bold enough, self-aware enough, and open enough - to consider change and improve.
If you are ready to take care of founders a step further, you can follow the lead of companies like Founders Taboo who are advocating for commitment to support founder wellbeing as part of investment term sheets. For example, this could include agreeing on and committing to a binding policy document addressing management well-being that needs to be reported to the board and shareholders. This should include a commitment to assign (invest!) necessary funds ensuring that this can be followed up professionally.
“Entrepreneurship is hard, and my founding teams just need to focus and push through this tough period. There is no time for fluffy things like talking to a coach.”
You as an investor probably feel obliged to push for the solutions that will move your portfolio companies forward. You have a say in who should be on the board to provide relevant and quality guidance, you set the tone when it comes to business development, strategy, sales or marketing. Why should company culture and psychosocial work environment be any different? Multiple studies show that poor leadership and inner conflicts negatively affect a company's performance. “The tone from the top” still applies and work-related stress costs the World economy billions of dollars per annum. By avoiding talking about the elephant in the room, you are supporting the unhealthy company culture, thus risking your investment significantly.
“My background is in business development/sales/finances/fill in the blank. That is what I can bring to the table for my portfolio.”
This is the cornerstone issue in the whole discussion. Way too many investors have been pushing through back in the days of their own CEO or corporate journey. They have succeeded and are now trying to pass on their valuable experience to their portfolio. Yet, not knowing what we don’t know, we might be doing a disservice by keeping more entrepreneurs in unhealthy, unsustainable patterns that harm themselves, their employees and their families, businesses as a whole as well as larger communities and even industries. You might not feel confident enough to propose that your portfolio teams go through executive coaching because you have never experienced its value yourself.
Here is my advice: Don’t hesitate. Do it. Now. You will not regret it.
To invest in the CEO makes total sense.
Worst case scenario, you and your teams will learn something new, do some healthy self-reflection and be considered in tune with a modern workplace.
Best case scenario: You avoid latent burn-outs and open up for better communication and awareness internally, which again will lead to better decision-making and a much more healthy and sound corporate culture to boot.
It’s a no-brainer and the best investment I’ve made in a long time: Investing in myself.
About the authors: Arne Peder Blix & Anna Liebel
Arne Peder Blix is a technology entrepreneur with 2 decades worth of experience as CEO of international companies covering energy, fintech, software and sensor companies. After graduating from the Royal Norwegian Naval Academy, Arne served most of his seagoing service on submarines. At Det Norske Veritas (DNV), Arne led two major anti-corruption projects, living in the Philippines and Panama. Arne represented the Norwegian Shipowners’ Association in the International Maritime Organization (IMO) where he, amongst other, actively participated in the negotiations on SOX, NOX and CO2 emissions. Thereafter, Arne moved to Houston TX as Head of Commercial for a petrochemicals gas shipping and trading company “West of Suez”. In 2003, Arne co-founded a SaaS fin-tech company which became an international success within complex financial instruments which was sold to a PE in 2015 and to Computershare in 2018. Since 2013, Arne has built up a portfolio of technology companies, covering various roles as Co-Founding CEO or Chairman. Today, Arne is CEO of CL-Invest, a company that finances, manages and monetises GHG emission reduction projects in emerging markets.
Anna Liebel is a mindshifter and an executive and team development coach with a background in international project management from automotive, life science and pharmaceutical industries. She helps entrepreneurs and their teams stay sane on their journeys and build healthy company cultures that will be able to scale along with the company's success and growth.