On his 34th birthday, Matt Munson was on the verge of what for many people is prime time on their career paths. But his startup had enough cash to survive just 87 more days, and every day felt heavier than the last.
A meteoric rise preceded his dramatic downward spiral. Two years earlier, in May 2012, Munson had launched Instacanvas, which let Instagram users sell their photos as canvas prints. In its first four days, the startup went from zero to 50,000 users, and within just a few months, it had amassed $1 million in revenue.
Munson’s timing seemed perfect. A month before he took Instacanvas out of beta, Facebook had acquired Instagram, and in less than a year the social media phenom would grow from 30 million to 100 million users. Munson, who had raised $1.7 million, was ready to tap into the ecosystem emerging around mobile photo sharing.
But rather than riding the wave that Instagram created, Instacanvas got lost in its considerable wake. Sales flatlined for 12 months.
CEO Munson and his co-founders frantically retooled and rebranded the company in October 2013. As Twenty20, the platform would enable users to license their mobile pics as stock photos.
The fate of Munson’s startup rested on his ability to sell this pivot to both investors and the new customers he’d need to find. Anxiety regularly shook him awake at night. He lay in bed thinking that saving the company, which now had 10 employees, was up to him alone. And what if Twenty20 collapsed? It would destroy him–though maybe he’d finally be able to sleep through the night.
At work, he hid this pressure. All that anyone else saw in the company’s Los Angeles office was a founder relentlessly fine-tuning his pitch deck and spiel for Twenty20’s vision. The clock was ticking: Soon, Munson would fly to San Francisco to beg for money on Sand Hill Road.
A birthday dinner with his wife, two days before his trip, failed to alleviate Munson’s stress. After dinner, he got violently ill, and then spent a day and a half in bed. On Sunday, Munson’s wife entered their bedroom. She said she had arranged for a nanny to watch their two sons, one just 4 weeks old and the other 18 months old.
“We need to go for a walk,” she said.
“I don’t think I can handle a surprise party, if that’s what you have in mind,” Munson replied.
A short stroll away from their Santa Monica home, his wife confessed that she’d had an affair, and the newborn son was not Munson’s.
Reeling, staggered, he wondered how he’d missed the red flags. Sure, he worked 60-hour weeks, but all founders did that or more. At home, though, he’d still be thinking of work–physically present, but mentally so far away.
Munson postponed his trip for a week to get his bearings, and then rocked Sand Hill Road–focusing all his energy on daily investor meetings, and weeping over bourbons with co-founder Todd Emaus late into the night before collapsing. After five weeks, he landed an $8 million term sheet, $5 million more than planned. “That felt awesome,” he says. But the buzz faded fast. His marriage had ended and Munson initiated what would be a messy divorce.
About nine months after his Sand Hill Road triumph, Munson felt despondent and trapped. The funding had not changed the fundamentals–Twenty20 wasn’t growing fast enough. In October 2015, his desperation led him to a five-day Colorado retreat for struggling founders run by a leadership-coaching firm called Reboot. Jerry Colonna, a pioneering internet investor, co-founded Reboot, in 2014, after grappling with his own depression.
“Leaders carry unresolved, broken aspects of their personalities from childhood. the more these remain hidden, the more likely they are to do damage.”
During one of the camp’s Quaker-inspired group-therapy-like sessions, called a Clearness Committee, about 15 other CEOs encircled Munson as he explained that he felt lost at his company and in his role as a founder. They asked him open-ended, wide-ranging questions. Why did you start your company? What percentage of the time do you feel happy at work?
Post-bootcamp, Munson began to realize that “getting out” was a favorite topic in countless conversations with other founders. “Why do we work so hard to build something from nothing, to against all odds after years of iteration get something out in the world that people actually love and use, only to spend a significant portion of our time daydreaming about getting the fuck out?” he later wrote in a blog post.
Whatever their success, founders everywhere are unhappy.
Munson’s emotional extremes–from the single-minded focus on pushing through the dissolution of his personal life to his fantasies of escape–are frighteningly common among founders. Founders are 30 percent more likely than non-founders to report a history of depression, according to a study led by Michael Freeman, a psychiatry professor at the University of California, San Francisco. Among the CEOs of the Inc. 5000 companies whom Inc. surveyed this year, 40 percent cited fear of failure as the primary emotional obstacle they had to overcome to start their firms.
Not surprisingly, the market to support struggling CEOs has ballooned. According to market research firm IBISWorld, the U.S. business coaching industry will hit $13 billion this year.
But revealing vulnerability remains taboo for founders. Muskian superheroes, leaders of the rise-and-grind culture characterized by long hours and obsessive commitment, are lionized, even though this leadership style has produced a number of high-profile flameouts in the past year, such as Away co-founder and co-CEO Steph Korey.
When I discussed founder burnout with Colonna, he related an ancient Chinese folk tale: A master potter spends his life trying to perfect a new glaze for his porcelain vases. Try as he might, he never achieves the beauty and perfection he seeks. So he decides his meaningful life is over and walks into his kiln. The next day, his assistants open the kiln and discover the vases have the most exquisite glaze they have ever seen.
“This is the message coming out of Silicon Valley: I’ll sleep when I’m dead,” says Colonna. “I call it the life-deferment plan. When you merge your sense of identity with the enterprise, you’re no longer yourself.”
Like many issues that plague founders, this problem starts early in life. “Leaders carry forward unresolved, broken aspects of their personality from childhood,” Colonna says. “The more these issues remain hidden to them, the more likely they are to do damage.”
Munson grew up in Holland, Michigan, watching the enterprising men in his family. His grandfather launched several small businesses, his uncle founded a hospitality software company in Arizona, and his father ran a local tech company. “He was very successful,” Munson says. “And then it all fell apart.”
As his business suffered, Munson’s father turned to alcohol and drugs. His rages became more frequent, and the family suffered. Munson’s mother leaned heavily on her son. “I had this ‘early life promotion,’ ” Munson says, referring to a term he’d picked up at Reboot. “By the age of 13 or 14, I had become this cohesive person for the family.”
Against his parents’ wishes, Munson finished high school early and left home to attend Wheaton College in Illinois at age 17. After graduation, he wandered restlessly through his 20s. Waiting tables. Writing a book that he never published. Living in Africa for six months. Dabbling in startups in Ann Arbor, Michigan, and then L.A. Moving to the French Mediterranean resort town of Antibes. “At first, I was pretty lonely,” Munson says. “But it gave me a certain resourcefulness and fearlessness.” He’d spend nearly five years in Europe, eventually getting an MBA at Insead, and landing at a U.S.-owned business consultancy in Paris. But working for someone else wasn’t for him.
What Munson really wanted, when he returned to L.A. in 2010, was to live by the beach and start a company with Emaus and Steven Bull, friends from previous jobs. After building a Groupon knockoff called BoomStreet and flipping it for a modest profit, Munson and his partners came up with Instacanvas. “We always wrestled with the ‘meaning’ part of the business,” Munson says, “but it was exploding so quickly, we felt we had to pursue it.”
Munson saw his personal life as a stable contrast to his amped-up professional pursuits. He married a woman he’d met at B-school and settled down in Santa Monica. The couple welcomed a son just as Instacanvas was taking off. Less than two years later, they were a family of four.
Happiness studies often highlight entrepreneurs–possibly because the prevailing wisdom dictates that people tend to be more content when they are masters of their own fate. Indeed, the World Happiness Report in 2017 relayed that business owners are among the most engaged people at work compared with other professionals.
While it may be true that entrepreneurs find great satisfaction working for themselves, they’ll tell you that starting a company can be crushing. “Startups are a crucible,” says Amy Buechler, a licensed psychotherapist and the former in-house coach at startup accelerator Y Combinator. “If you’re looking for it to make you happy, you’ll be devastated.”
“I would experience a kind of hypomania,” says Shay Berman of the early days at Digital Resource, the West Palm Beach, Florida-based digital marketing agency that landed at No. 747 on the 2020 Inc. 5000. “When business was good, I’d feel amazing. When it wasn’t, I’d get down really quickly.”
Founders often fit the profile of the “engaged, exhausted worker,” says Gabriella Rosen Kellerman, a physician trained in psychiatry and the chief innovation officer at San Francisco- based BetterUp, a leadership- coaching firm. When it comes to stress management and the ability to focus, Kellerman says, founders score 18 percent and 22 percent below the general working population, respectively. Susana Saeliu, CEO of Pluto Pillow, an L.A.-based startup that sells customized headrests, is an example–pushing away family, friends, and hobbies to focus on her business. “When I wake up, the company is all I think about until I try to sleep at night,” she says.
Seemingly overnight, Munson had gone from being a husband with two kids to a single dad who saw his only child half as often as before. “I didn’t just lose a marriage, I lost a son,” he says. In his moment of crisis, Munson realized he had no close friends in L.A. besides Emaus. And even that friendship was shaky. “Am I a direct report now or a friend?” Emaus says he often wondered. “After we raised VC money, we didn’t have as many talks as friends.”
Munson suddenly felt the deep absence of connections in his life. “I was going to need more of them to get through that experience and to just be happy,” he says. So Munson made a list of five people he knew and decided to have dinner with each one. “I did that,” he says, “and they ended up becoming my closest friends in the world.”
Not being straight with his staff would undermine him as a leader, Munson knew. After staying away for a week, he returned to the office, where he broke down in tears and laid out his problems at home and with the business.
“When I was willing to be open and raw with people, they rallied around me,” he says, tearing up.
Munson realized that he had been asking his team to meet unspoken expectations and white-knuckle their way through adversity, as he’d always done.
“You have to learn to ignore the baby, which is totally unnatural for founders.”
He began working to become more open and empathetic, articulating his newfound vulnerability in a November 2016 blog post entitled “How I Burned Through 10 Million Dollars So You Don’t Have To”: “I feel scared writing this. Nervous. Embarrassed. I feel ashamed. This is the first time in my life I’ve shared this stuff publicly. I’m scared of what you’ll think of me as you read this. I’m afraid of what future investors might think. I’m scared of what other founders will think … But mostly, I’m just afraid of being found out and looking foolish. Looking like the imposter CEO.”
Taking so much venture capital the previous year had imposed a growth-at-all- costs mentality on Munson. Twenty20 bulked up on expensive sales hires only to realize that customers preferred a self-service online model for buying photos.
The company went through three rounds of layoffs in 2016, reducing the team from 55 to 12. “Thirty sets of eyes looked at me with shock, disappointment, and contempt,” Munson wrote of the day he cut 64 percent of the staff. Emaus, who felt disconnected with the mission and decision-making, left in the first round.
Munson attended multiple Reboot camps and worked one-on-one with Colonna. Munson had to face that he had been managing inner turmoil since he was a kid, and that his early experiences had shaped the kind of leader he’d become: isolated and unwilling to ask for help. And yet, the chaos of startup life served a function. He deeply feared that life would pass him by if he had a “normal” life and job. Being an entrepreneur saved him from the perceived banality of a conventional existence and instead served up a different set of problems.
As Munson continued to engage with founders who, like him, were unhappy, a theme emerged: Running a startup is hard, and it’s all but impossible when your entire identity rests upon it.
“I had this acute desire for meaning,” Munson says. “There was this divide in what I was looking for in my own life and what we were doing as a business. I was building a stock photo company, and I didn’t care about stock photos.”
Yes, the “why” question. Between her own practice and her stint at Y Combinator, Buechler has worked with more than 1,000 founding teams. She says having a “why” is critical both for personal fulfillment and burnout prevention. So, too, is the ability to detach yourself from your company. Like an infant constantly crying out for attention, a startup demands all of your time and energy. “You have to learn to ignore the baby, which is totally unnatural for founders,” she says.
Simple habits and rituals–such as stepping out for a walk, taking a trip, or making a weekly appointment with someone not connected to the company–are key to gaining perspective and preserving the ability to fulfill all the roles of a founder: leader, partner, spouse, friend, teammate, parent.
“When Covid hit, I went back to a bad habit [working nonstop],” says Lawrence Wagner, CEO of Colorado Springs, Colorado-based Spark Mindset, which teaches cybersecurity skills to high schoolers in underserved communities. “I had to change my routine. The first three hours of the day, I had to do things physically and mentally that brought me life,” like working out, reading, and praying.
Of course, such seemingly simple steps are not always easy to put into practice. Buechler says founders often find themselves in crisis mode even after a crisis passes. They may will themselves into thinking they are prepared to step away from work, but they can’t banish the notion that if they do, everything will fall apart. She counters this by posing such questions to her clients as “Is how you’re engaging with your company right now helping the company? Is it helping you? Are you depleting yourself or the people around you? When you’re 80 years old and sitting with your grandkids, will this moment in time be part of your story?”
“The founders who find starting a company most enriching and have the most successful outcomes see their startup as a way to explore, experiment, and grow personally,” Buechler says. “That’s their purpose.”
Absent a larger purpose, Munson had to find Twenty20 an exit so he could exit too.
With little left to lose, Twenty20 became an experiment in openness. Munson estimated that he’d need to quintuple the company’s revenue, without adding head count, to attract a buyer. He made everything transparent to the team–financials, salaries, even the cap table–and asked them for ideas to grow the company. Every quarter, they’d shut down for five days to pore over the data on everything from customer acquisition to sales-channel optimization.
It worked: In three years, the company hit its revenue target and became profitable. An executive from the Australian company Envato, an online marketplace for creative assets, messaged Munson on LinkedIn, kicking off a lengthy negotiation process to buy the company.
A week before Christmas 2018, Munson, his fiancée, and his son flew to Australia on 36 hours’ notice. Munson sat in a conference room in Envato’s Melbourne headquarters, exhausted, ready to unyoke himself from the responsibility he’d been carrying, but still wondering if he was doing the right thing.
“I had introduced myself as the co-founder and CEO for many years at this point,” he says. “But the deeper part of it was, these have been my people, my tribe, the thing I built. Was I doing the right thing or selling them out?”
After completing the sale, Munson remarried and traveled extensively with his new wife and his son before returning to the Twenty20 office in August 2019 to help his team make the transition.
Munson thought about his father and how alone he must have felt when his business fell apart. He thought about Colonna’s guidance, and how Munson himself enjoyed helping founders at Reboot. He had even begun to take coaching classes. One day, while driving beside the vast, blue Pacific to Malibu, he had an epiphany: “The past seven years were filled with pain,” he thought, “but maybe I can turn that into something helpful to others. Maybe I can help other founders feel less alone.”
Last September, Munson launched his coaching business, Sanity Labs, out of an office in his converted two-car garage. His clients number about 15 CEOs and leaders, including Pluto Pillow’s Saeliu. Most are backed by such firms as First Round Capital and Founders Fund. Covid has sent more clients his way, many of them at a crossroads like what Munson faced at Twenty20. “For a long time,” Munson says, “I carried the story that my value was tied to my achievements and that I was alone.”
The coaching, and his own introspection, had helped him recalculate that value, and to understand what is worth valuing. In October, he and his wife are due to welcome a new baby girl into their lives. “These days,” Munson says, “I feel deeply alive, deeply connected, deeply me.”
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From the September 2020 issue of Inc. Magazine