African tech startup founders are highly stressed

The vast majority of African tech founders say that running a startup has significantly impacted their mental wellbeing, with many experiencing high levels of stress, anxiety, exhaustion and burnout.

That is according to a report from early-stage venture capital (VC) firm Flourish Ventures which found that 86% of founders experienced an impact on their mental wellbeing.

The report titled "Passion and Perseverance: Voices from the African Founder Journey" found that 60% of founders had experienced anxiety in the two weeks prior to the survey; 58% had high stress levels; 52% experienced exhaustion or burnout; and 20% were facing depression.

According to the report: "The state of founder wellbeing is not widely discussed, and until now, supporting data has not been available."

The survey revealed that even high performers feel intense pressure, with 76% of founders who said their startup is "thriving" reporting an impact on their wellbeing.

In fact, the researchers said that startup milestones can often increase stress because company growth can be accompanied by added competition and scrutiny.

"Prioritizing founder wellbeing not only has a positive impact on founders' lives, but also on the long-term success of their business. We hope that by sharing these early learnings, we can jumpstart a broader conversation about the state of founder wellbeing and how founders, and their funders, can better navigate it – in Africa and beyond," said Ameya Upadhyay, venture partner at Flourish Ventures.

Flourish conducted the survey in partnership with Endeavor, Launch Africa, Madica, and research firms Econa and Startup Snapshot.

The research included responses from more than 160 startup founders across 13 African countries spotlighting the experiences of early-stage entrepreneurs across the continent.

Despite the challenges, startup founders love what they do and overwhelmingly reported enjoying the journey of being a founder. Nearly two-thirds said they would rather start a new company than take a job if their business fails.

(Source: Flourish Ventures)

"Being a founder is one of the most rewarding things you could ever do. Most founders would say there's nothing they would rather be doing," Diana Owusu-Kyereko, cofounder and CEO of social commerce platform Maka, told researchers.

Lonely at the top

Despite constant social interactions, 78% of founders said being a founder is a lonely job.

Many reflected that they often feel the company's weight rests solely on their shoulders. To keep team morale and productivity high, they don't feel they can speak openly about their business concerns and stressors.

"As the founder and leader of a startup, the buck stops with you. We founders feel the weight of our responsibility to our teams, investors, and communities. We know it's our burden to bear and we don’t want to put that burden on others," Laurin Hainy, cofounder and CEO of Nigerian microfinance bank FairMoney, revealed to researchers.

Founder stress factors

The top three sources of stress for African tech founders came from external factors like inflation and currency devaluations, raising funds and other macroeconomic challenges.

Inflation was a high stressor for startups in Nigeria and Egypt in particular.

(Source: Flourish Ventures)

"The external stressors - factors largely outside our control - are big contributors to stress and burnout for most entrepreneurs. As an investor, I try to help my founders focus on what they can control and let go of what they cannot," reflected Iyinoluwa Aboyeji, cofounder of Andela and Flutterwave and founding partner at Future Africa.

When it came to female founders, the data showed that women felt distinct stressors that extend beyond typical business challenges.

A fear of failure, issues with work-life balance, loneliness and isolation emerged as disproportionately more stressful for female founders compared to their male counterparts.

(Source: Flourish Ventures)

"Female founders need more equitable representation and visibility in the VC ecosystem, as well as access to peers who truly understand their unique experiences," said Isis Nyong'o Madison, cofounder of WomenWork Kenya and partner at Asphalt & Ink.

Investor support vs. pressure

Another key insight from the report was that most founders perceive their investors as a significant source of stress rather than support.

The researchers said that while investors provide important financial resources and strategic insight, founders may struggle to manage investor expectations and pressures. This creates an environment where founders are hesitant to have open conversations with their investors.

"While some level of stress can be beneficial, overwhelming stress is detrimental. Investors don't have to be soft, but we need to know what's constructive versus counterproductive," Flourish Ventures' Upadhyay explained.

(Source: Flourish Ventures)

Less than two in ten founders felt completely comfortable having an open conversation with their investors, and only 11% believe investors truly care about their wellbeing.

Over 40% of founders believe that investors don't care at all about their wellbeing, or that they only care when it affects their returns.

The top requests from founders were for investors to engage in a constructive way, get to know founders as people, avoid unrealistic demands and provide transparency around funding decision-making and timelines.

(Source: Flourish Ventures)

"When choosing investors, make sure to ask: Will they put the founder or the business first? The right answer is always the founder, because a dedicated founder prioritizes the business above all. Great investors believe in the person behind the business model, not just the model itself," suggested Rose Goslinga, cofounder and president of agricultural insurance and technology company Pula.