The Surprising Toll of Entrepreneurship on Founders’ Mental Health

An unspoken story of loss and a misguided attempt at healing

Founders are the rockstars of our era. From musicians to professional athletes to high school students, everyone wants a piece of the entrepreneurial dream. But beneath the allure of startup success lies an under-discussed reality that affects both venture-backed founders and small business owners alike: the profound impact on mental health.

While we have endless content about cryptocurrency investing strategies, scaling passive revenue through real estate, and disrupting markets through software automation, honest discussions about founder mental health remain rare. Our cultural narratives around emotional wellbeing are largely shaped by insurance companies and mental health startups promising rapid growth, quality providers, and constant availability. Not only are these narratives misleading—quality mental health support is inherently costly and time-intensive—they often emerge from the very wounds most entrepreneurs carry.

As a psychologist working with founders, cofounders, and executives for the past five years, I've observed a striking pattern across different sectors and stages: the presence of trauma. By trauma, I mean disruptive experiences that resist easy integration into awareness. While everyone carries some form of emotional wound, entrepreneurs often display distinctive patterns in how these experiences shape their journey.

Brian: Achievement as Escape

Brian was a 30-year-old serial entrepreneur who appeared to have everything: a bootstrapped agency generating $3 million in annual revenue, impressive industry connections, and the external validation many founders crave. But beneath this success lay a story of profound loss that began long before his entrepreneurial journey.

In our conversations, Brian shared how his achievement-oriented parents had shamed his passion for online gaming during his youth. This early experience marked his first significant loss—the ability to feel valued for his authentic interests and ways of being. Feeling misunderstood and devalued by his loved ones created a void he would spend years trying to fill through increasingly costly attempts at compensation.

Entrepreneurship became his socially acceptable escape. Each business success—his title of "Founder & CEO," podcast appearances, social media following—temporarily numbed the pain of his earlier losses. Building an online business, ironically in the digital world his parents had dismissed, became his unconscious vehicle for revenge. Each substantial paycheck seemed to validate his path, but this validation came at the cost of further losses.

As his companies grew, Brian gradually lost connection with the parts of himself he once valued. His joy of cooking, once a source of genuine pleasure and creativity, was sacrificed in the name of efficiency—outsourced meal prep meant more time for uninterrupted work. Old friendships withered as he became too busy to return calls. His romantic relationship suffered from his emotional unavailability and intense anger during conflicts. Even his ability to receive genuine feedback eroded, as he began viewing everyone as potential roadblocks to his success.

Working constantly and receiving non-stop external validation kept his emotional pain at bay, but each achievement demanded another piece of his humanity in exchange. His drive created undeniable business success but also transformed him. The young man who once found joy in gaming and cooking disappeared beneath layers of compensatory achievement and inflated self-worth. Despite all the measurable gains—income, car, house, title—Brian had lost something far more fundamental: his connection to himself and others.

His story illustrates a pattern I often see in successful founders—how early emotional wounds can lead to compensatory behaviors that, while impressive from the outside, exact a heavy toll through accumulated personal losses.

Brian's journey shows how entrepreneurship, while providing a powerful vehicle for proving one's worth, can also become a mechanized path of losing oneself.

Elizabeth: The Perfect Helper

Elizabeth came to see me after a never-ending sense of imposter syndrome gnawed her into perpetual self-doubt. She had done well to this point, raising a $7 million Series A and scaling to 12+ employees. But now, her company was at a transition point. Her old, transparent leadership style no longer fit what the organization needed to continue growing, and she believed her skillset was less helpful than in the past.

Thinking back on her life, Elizabeth identified painful experiences of being shipped house-to-house between different relatives due to a complex family structure steeped in divorce. She remembered feeling like a burden and inconvenience for her wealthy step-father and recalled moments of being excluded from family gatherings due to her acting out behavior. Elizabeth never felt good enough. Her stories centered around self-blame for bad behavior and featured an utter disregard for the difficult emotional context that prompted her attention-seeking actions.

Elizabeth spent 20+ years of her life running from her shame. She built a life (and company) based on being helpful to other people. She presented an image of perfection and felt confident when others looked at her with admiration but fell apart without positive reinforcement. Lacking reassurance from others, Elizabeth's inner shame was activated, corrupting her confidence and amplifying negative self-talk. These dynamics restricted her ability to continue growing into the leader she wanted to become.

The Pattern Beneath Success

Both of these examples demonstrate themes of relational trauma and compensatory actions to avoid an underlying emotional wound. Each individual suffered from narcissistic injuries, which contributed to the pursuit of achievement to evoke the recognition they did not receive in childhood. These stories are not unique—many founders struggle with similar wounds and compensatory actions. You might even say that entrepreneurs are those who cope with their emotional pain through work, trying to prove their perspective matters and create a place for themselves in a cold, rejecting world.

The limitations of each entrepreneur's coping strategies became amplified during prolonged periods of stress. For most entrepreneurs, the added pressures of building a company contribute to mood-related issues with depression, anxiety, disrupted sleep, increased agitation, and difficulty concentrating. While these experiences are known, they are under-discussed.

The two most common personality types for successful founders are narcissistic and obsessive-compulsive—the dreamers and the doers. These types of personalities are disproportionately rewarded by a culture hyper-focused on work, productivity, and achievement. But these prevalent patterns are also under-acknowledged, perhaps due to the lack of a critical psychological examination of entrepreneurship.

The Path Forward

The draw of entrepreneurship is illustrious. Recognition through achievement and huge financial payouts creates an environment ripe for hiding emotional pain. Many individuals from all parts of society see the possibility for a major payday and the opportunity to have their contrarian perspectives affirmed. But allowing all of the positive potentials of entrepreneurship to overshadow the negative polarity of this modern warrior archetype does a disservice to the community.

One-sided narratives embracing workaholism and thereby worshipping avoidance will lead many down a path of achievement before leaving them successful and alone. Allowing large companies to tell us mental fitness is easy, cheap, and constantly accessible downplays the significance and complexity of mental health issues. These profit-motivated statements have positive outcomes for businesses but poor long-term outcomes for their consumers.

The path forward requires two essential shifts:

First, founders need to share more authentic stories about their struggles. The cultural narrative around entrepreneurship must expand to include its shadow side. Integrating these experiences into broader conversations would help entrepreneurs feel whole and seen in ways our current success-focused dialogue doesn't allow.

Second, founders must actively resist losing themselves to their work. This means maintaining connections with parts of yourself beyond the entrepreneur identity—preserving old hobbies, nurturing relationships without discussing work, and protecting these practices even as demands increase. It's ultimately a fight for wholeness, not just success.

Professional support through therapy and coaching remains crucial. Feeding neurosis may drive short-term success, but it rarely leads to lasting fulfillment. The goal isn't to abandon ambition, but to pursue it from a place of greater wholeness rather than compensation for old wounds.