Bradley Smith is an undisputed business success. Rescue One Financial in Irvine, California, made $32 million in sales last year. Smith’s company has risen 1,400% in three years, ranking 310th on this year’s Inc. 500. Five years ago, Smith was near financial and emotional collapse.
In 2008, Smith spent considerable hours advising debtors. His placid exterior hid the fact that he shared their anxieties. Smith was in debt like them. He went broke running a debt-settlement company. “I heard how depressed and stressed out my clients were, yet I had twice as much debt as them,” Smith says.
He cashed up his 401(k) and maxed out his credit line. He sold the Rolex he acquired with his first stockbroker salary. He asked his father, who taught him “money doesn’t grow on trees” and “never do business with family,” for $10,000, which he obtained at 5% interest after signing a promissory note.
Smith’s company finally made money after 8 months of concern.
Smith’s co-founders and 10 workers saw excitement, but he was nervous. “My wife and I would split $5 wine for dinner and just look at each other,” adds Smith. “We were on the brink.” The couple’s stress increased when they learnt they were expecting. Smith recalls sleepless nights staring at the ceiling. “I’d wake up at 4 a.m. with my head racing, wondering when this thing will turn. Smith’s company finally made money after 8 months of concern.
Entrepreneurs are cultural heroes. Mark Zuckerberg and Elon Musk are idolized. We celebrate Inc. 500’s rapid development. Before they made it big, many of these entrepreneurs, like Smith, lived with near-debilitating worry and despair.
“A man on a lion. “He’s brave,” others say. And he’s thinking, ‘How did I get on a lion?'”
“A man on a lion. “He’s brave,” others say. And he’s thinking, ‘How did I get on a lion?'”
This was prohibited until recently. Business leaders have used impression control, or “fake it till you make it,” rather than exhibiting weakness. EnSite Solutions CEO Toby Thomas compares it to a man riding a lion. “People assume he’s put together. Courageous! “”Thomas,” “The man atop the lion wonders how he got there and how to avoid being devoured.”
Not everyone emerges from darkness. Ecomom creator Jody Sherman, 47, committed suicide in January. His death shocked startup culture. It also rekindled a discussion about entrepreneurship and mental health that began after the suicide of Diaspora co-founder Ilya Zhitomirskiy, 22.
More businesses are speaking out about depression and anxiety to battle the stigma that makes it hard for sufferers to seek assistance. Ben Huh, CEO of the Cheezburger Network, wrote about suicide thoughts after a failed venture in 2001. Former MySpace VP and Wittlebee co-founder Sean Percival wrote “When It’s Not All Good, Ask for Help” “I was on the brink with my business and depression this last year,” he stated. “Contact me if you’re losing it.” Percival advises distressed businesses to call 1-800-273-8255 for help.
Brad Feld, a Foundry Group managing director, started blogging about depression in October. The venture capitalist has struggled with mental issues throughout his adult life and didn’t expect a reaction. Emails followed. Many. Many were from anxious and depressed entrepreneurs. Feld’s piece “Surviving the Dark Nights of the Soul” appears in Inc.’s July/August issue. Feld: “The names would surprise you” “They’re successful, charismatic, and visible, but they’ve struggled silently. They feel like talking about it is a sign of weakness or embarrassment. They’re concealing, which makes things worse.”
If you own a business, you know all that. It’s an emotionally taxing job. First, failure is likely. Shikhar Ghosh, a Harvard Business School lecturer, found that 3/4 venture-backed firms fail. Over 95% of businesses miss their initial predictions, Ghosh discovered.
Entrepreneurs juggle several jobs and endure countless setbacks—lost customers, partner disputes, increasing competition, staffing problems—while striving to make payroll. Psychiatrist and former entrepreneur Michael A. Freeman studies mental health and entrepreneurship.
Neglecting their health makes fledgling entrepreneurs less resilient. Overeaters. No sleep. Inactivity. Freeman: “You can get into startup mode and abuse your body.” “That can affect mood”
Entrepreneurs face more anxiety than employees. Entrepreneurs are more anxious than other workers, according to the 2018 Gallup-Healthways Well-Being Index. Entrepreneurs are more stressed than regular workers, at 45%.
Some founders may be driven over the edge by more than stress. Many entrepreneurs have features that make them prone to mood swings, say researchers. “Energized, motivated, and creative people are more enterprising and have strong emotions,” adds Freeman. Depression, despair, hopelessness, worthlessness, motivation loss, and suicidal thoughts are examples.
Call it being up’s downside.
Founders’ passionate dispositions can occasionally devour them. Australian experts said business owners are “prone to obsession’s negative side.” A research about entrepreneurial passion interviewed founders. In an article published in April in the Entrepreneurship Research Journal, the researchers discovered that several subjects demonstrated indicators of clinical preoccupation, including significant distress and anxiety.
John Gartner, a Johns Hopkins psychologist, echoes this message. Gartner contends in The Hypomanic Edge that hypomania may be responsible for some entrepreneurs’ strengths and weaknesses.
Hypomania, a lesser form of mania, affects 5-10% of Americans, generally relatives of manic-depressives. Gartner: “Manics think they’re Jesus.” “Hypomanics think they’re technology investing’s savior. Different levels of grandiosity, same symptoms.”
Gartner said the U.S. has so many hypomanics and entrepreneurs due of immigration. He says, “We self-selected.” “Immigrants’ ambition, energy, drive, and risk tolerance let them move for a better opportunity. Biological temperament qualities. If you plant them throughout a continent, you’ll get entrepreneurs.”
Gartner says hypomanics are more prone to depression while being ambitious and imaginative. Anything that inhibits a hypomanic’s momentum can trigger depressed episodes. Gartner thinks they must run like border collies. “They destroy furniture if kept indoors. They pace irrationally. Hypomaniacs do that. They must be active, overworked.”
“Silently, entrepreneurs struggled. They feel it’s a weakness and can’t discuss it.”
Big business defeats may devastate anyone, regardless of personality. Even seasoned businesspeople have been swindled. In 1992, Mark Woeppel founded Pinnacle Strategies. It ceased ringing in 2009.
His consumers were more concerned with survival than with increasing output during the global financial crisis. Sales fell 75%. Woeppel fired six workers. He sold automobiles, jewels, and anything else he could. His confidence waned. “As CEO, you’re the master of the universe,” he explains. “You’re not then.”
Woeppel stayed home. Anxious and low-esteem, he overate and gained 50 pounds. He sought temporary relief by playing guitar. He practiced Stevie Ray Vaughan and Chet Atkins solos alone. “I could do it for fun,” he says. “It was just me, the guitar, and calm.”
He keeps developing new services. He thought his company could sell them. 2010 saw returning customers. Pinnacle’s biggest contract, with an aircraft firm, was based on a white paper Woeppel wrote during the recession. Pinnacle made $7 million last year. Since 2009, sales have increased more than 5,000%, placing the company at No. 57 on the Inc. 500.
Woeppel feels terrible experiences have strengthened him. “My work was me,” he explains. “False. Your kids love you. Still married? Still loves you, dog.”
Many entrepreneurs’ war wounds never heal. John Pope, CEO of Laramie, Wyoming-based WellDog, agreed. Pope had $8.42 on Dec. 11, 2002. He’d missed 90 automobile payments. He’d missed 75 mortgage payments. IRS liens him. His phones and cable were off. In less than a week, the gas company would cut off service to his family’s home. No heat. After months of talks, his company expected a wire payment from strategic backer Shell. He waited.
Next day, the wire arrived. Pope’s business was preserved. He produced a list of all the ways he overspent. he thought, “I’ll remember this” It’s my limit.
Since then, WellDog’s sales have grown 3,700% to $8 million, earning it No. 89 on the Inc. 500. Years of turmoil left emotional residue. Pope feels overextended and can’t relax. “You lose confidence. When you feel safe, something takes it away.”
Pope overreacts to trivial things. It’s PTSD-like behavior. “You panic,” he says. “The problem is smaller than your emotional response. Scar tissue from these experiences causes that.”
“Manics believe they’re Jesus. Hypomanics think they’re technology investing’s savior.”
Experts suggest entrepreneurs can keep their lives from spiraling out of control despite the ups and downs of starting a firm. Freeman advises prioritizing family time. “Don’t let business replace human connections,” he warns. Friends and family can help overcome depression. Seek help if you have severe anxiety, PTSD, or depression.
Freeman helps entrepreneurs to limit risk. Entrepreneurs’ risk blind spots can fit a Mack truck, he argues. It can affect your money account and stress levels. Set an investment limit for your own money. Don’t let family and friends invest more than they can afford.
Exercise, a healthy diet, and sleep also assist. Developing a separate persona helps, too. “Self-worth is not net worth,” says Freeman. “Your identity should include other aspects of your existence.” It’s crucial to feel successful outside of work, whether you’re raising a family, volunteering, creating model rockets, or swing dancing.
Reframing failure and loss can enhance leaders’ mental health. “Instead of saying, “I failed, the business flopped, I’m a loser,” says Freeman, “look at the facts differently: Nothing ventured, nothing gained.” Life is trial-and-error. Don’t embellish.”
Brad Feld advises being transparent about your feelings, even at work. Being emotionally honest, he argues, helps you connect with others. “People can see past denial,” adds Feld. “A leader’s vulnerability is powerful.”