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E21 - Sabine Flechet, co-founding Partner of Masawa (France)
81 Plays1 month ago
Mental health is a core driver of how we change the world. What if it was also a smart financial strategy? In this episode, Sabine Flechet, co-founder of Masawa, one of the first funds in Europe dedicated to mental health innovations, shares how she is channeling capital into startups that address emotional well-being, mental illness, and tech-driven solutions, from gamified ADHD awareness to dementia prevention platforms. From cyberbullying prevention to gut-brain innovation. Sabine also shares how 65% of startup failures stem from human capital challenges, like burnout, co-founder conflict, or lack of emotional resilience, and how investors can reduce risk by supporting founders as people, not just performers. But Masawa is more than a fund, it’s a systems-level shift. Sabine talks about how traditional VC models fail founders, and how their approach at Masawa, called “nurture capital”, is designed to protect founders as people and their performance, rewriting power dynamics between founders and investors. It’s a wake-up call for anyone still thinking of mental health as a “soft” issue. Because this conversation proves: it’s systemic, and it’s investable.
Please review the episode, share your feedback, and subscribe to the podcast!
You can also:
- Visit our website: womenchangingfinance.org
- Follow Sabine on LinkedIn
To go further, here are some of the references mentioned during the episode:
- Masawa — https://masawa.fund/
- BMW Foundation Herbert Quandt — https://www.bmw-foundation.org
- La French Tech — https://lafrenchtech.com
- Purpose Foundation — https://purpose-economy.org
- Ecosia — https://www.ecosia.org
- Bill & Melinda Gates Foundation — https://www.gatesfoundation.org
- World Health Organization (WHO) — https://www.who.int
- Outlive by Peter Attia — https://peterattiamd.com/outlive/
Women Changing Finance is part of the Impact Alpha Podcast Network.
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Transcript
Introduction to Women Changing Finance Podcast
00:00:05
Speaker
Hi, welcome to the podcast Women Changing Finance, where you will discover amazing women from all around the world who are making finance become a force for good.
00:00:21
Speaker
Welcome to the podcast Women Changing Finance.
Meeting Sabine Flechet and Her Vision for Mental Health
00:00:24
Speaker
I'm k Krisztina Tora and I'm welcoming today Sabine Flechet, who is co-founding partner at Massawa, a newly launched venture capital fund designed to support European founders, catalyzing well-being and mental health. I met Sabine a few years ago at Change Now, the largest impact conference, and we immediately connected because we both believe that investing in mental health is essential for our future.
00:00:47
Speaker
Sabine, it's wonderful to have you on the show today. Thank you so
The Founding of Masawa and Its Mental Health Focus
00:00:51
Speaker
much for joining. And so as we begin, can you tell us more about Masawa? How was it born? How was it designed? What kinds of investments do you do? Yes, of course. Thanks first for having me, Krisztina. It's a pleasure. i am always very glad to be connecting with you and to discuss with you because I think we have similar alignments. And I remembered also our first encounter when I was pitching at Change Now. you were one of the most ecstatic and enthusiastic people
00:01:19
Speaker
person of the jury. So again, a big thank you, because I think we need more of more people like you. So my journey with Masawa started probably like two, three years ago when I met Joshua Haynes, my co-founding partner.
00:01:32
Speaker
We were both actually invited by the BMW Foundation at their Responsible Leadership event, which is a seminar for responsible leaders, where they invite the founders from their cohort program called Respond, where they basically mentor and teach responsible leadership to a set of entrepreneurs on regenerative topics. And Joshua conducted a workshop there, which I will remember for long, which was about mentoring entrepreneurs on mental health and well-being. And he made me discover actually that entrepreneurs are a set of population that are more likely to be exposed to ADHD, to autism, to bipolar syndrome, to depression, not because they are entrepreneurs, but because who they are before becoming
Impact of Mental Health on Entrepreneurship
00:02:18
Speaker
entrepreneurs. So on their journey of becoming entrepreneurs, they they have this trauma kind of accelerating or exacerbating their impact. And among the population of entrepreneurs, we find more of these people with cases of depression, of bipolar syndrome. And that made me realize as an investor how intersect the well-being of the founders is to the success of the business, right? It's embedded into the company's success. And if we're not taking care of their well-being, if we're not acknowledging that they struggle, that they have a lot of pressure, that there are ups and downs and a lot of anxiety burnout, but also sometimes elements that are challenging their way to the success of the company, then I think...
00:03:01
Speaker
As an investor, we miss out on great opportunities and we put more risk to the business. So if we manage to anticipate that, that allows for better success, that allows us to have also more survival rates. And Joshua came to me with these stats. 65% of startup failure at this stage are caused by human capital risk, what we call human capital risk as co-founders conflict. As I said, anxiety, burnout, but also lack of leadership skills, lack of culture.
00:03:30
Speaker
And all this put the business at risk. And so if we manage to take care of that human capital in ah in a good way, if we help the entrepreneurs thrive as much emotionally as they could thrive commercially, financially, thanks to our investment, then I think an investor rule is then completed,
Nurture Capital and Entrepreneurial Resilience
00:03:47
Speaker
right? And so when I met Joshua, when he explained to me his endeavor of setting up a mental health focused fund with that approach, which we now call Nurture Capital, I was totally blown away and I was like, how did investors never thought of ah about this?
00:04:03
Speaker
Because I was previously also in the venture capital industry. So I was raising a venture capital fund in the food tech industry. So investing at the intersection of food and digital solutions. So across agriculture, supply chain, logistics, all the way to distribution to retail, hotels and restaurants.
00:04:20
Speaker
So think about the mams and paps that own a restaurant and that are discovering digital solutions to automate, to make processes more efficient, to have a better review of their costs, their margins and their revenues. And COVID hit us pretty hard, as you can imagine. That's when I realized how the emotional resilience of a founder is as important as its go-to-market or its way of thinking around internationalization, pricing, etc. nurturing that human behind the capital, behind the startup, then you are born to kind of get more failure. And so for me, that was something that I really resonated with when I met Joshua three years ago. And then I got interested by mental health because... At the time, we're not really talking about mental health. I think it was very stigmatized still. And COVID had happened and then kind of opened the Pandora box of all these mental health challenges. Not only, of course, you know, burnout, which we talk more and more at at work, but also use mental health, right? Smartphone addiction, but also what tech does to kids and teenagers. When we, for example, look at cyberbullying, hate speech online, what people are actually able to say online without any filter. When we look at image manipulation and misuse, I mean, most of the suicide from teenage girls in in the US is caused by naked pictures that are being circulated or manipulated pictures that have been circulated by ex-boyfriends, et cetera. So when you think about this, you realize that there is like um an essential focus that the society needs to have on mental health if we don't want this to become a huge crisis. And it's already a crisis. But if you don't want to hit the wall in the next couple of years and ai is going to amplify this, So we need to really start looking at mental health as an opportunity to have an impact, but also as an investable opportunity where we can make money. And this is the reason I joined the journey at Mass Hour. It's beautiful. Thank you for sharing the story of how it came to life.
00:06:22
Speaker
So how does it work? What kind of businesses do you invest in You have this nurture approach. How is it integrated into what you do? Yeah, so we take mental health kind of ah as a Trojan horse because mental health is not just purely mental illness, right? So our approach to mental health is quite broad. We have, of course, the medical pillar, which is looking at solutions tackling, eating disorder, schizophrenia, PTSD, trauma, but also burnout, anxiety, depression, any type of addiction. But these usually involve a medical staff, right? Clinics, hospitals, practitioners. We also look at the tools for the caregivers, the nurses, but also the parents. and anyone who is taking care of ah of a loved one who has mental health issues. But that usually has a very strong medical implication and involvement.
00:07:10
Speaker
And what we also realize is mental health is not only caused by mental illness. I mean, there's lot of preventive care that can happen, right? So we also look at what we call the social determinants of mental health, and that's the intersection of mental health and your lifestyle or social habits.
00:07:26
Speaker
So we look at what you eat. nutrition and of course the connection between your gut health and your microbiote and your brain energy. We look at sleep, we look at fitness, obviously. We look at education, not only from the kid's perspective, but also from the teacher perspective. So at school, how do you recognize a kid that has difficulty because of neurodiversity or ADHD or has been exposed to bullying or has been even exposed to some violence at home, right? How can you actually equip the teachers so that they can become more a safety net for the kids? We also look at Use mental health in more in a relation to technology. So as I said, online safety, anything around hate speech, cyberbullying, image misuse, and of course, smartphone addiction, which is a big topic at the moment. And then we go all the way to elderly care.
00:08:10
Speaker
How do we handle people with neurodegenerative disease like dementia and Alzheimer's and bring them back some lives of cognitive issues? function, but also mental support for people with cancer or exposed to chronic disease, because this is also a trauma sometimes to not being ah able to go back to work. So at the end of the day, it's a mental health fund, but we also look at emotional cognitive wellbeing. We also look at wellness. And at some point, i hope I haven't seen yet some startups in that field, but I hope we could also look at eco-anxiety and climate resilience because populations that are affected by the climate crisis could also benefit from mental health solution. And for me, mental health, it's the root cause is kind of transversal to all the challenges that we are living at the moment, being the climate crisis, the geopolitical scene, the type of leaders that we have at the top, the wars, everything is rooted into what I call a behavioral crisis.
00:09:07
Speaker
For me, like mental health, well-being is something that we have absolutely to take care of if we want to take care of the implications, which are what all the crisis that we actually currently living in. We are a small drop in the ocean. We're a small fund. But so we hope that a lot of people will kind of tag along the journey and come with us because we really believe there is an investable opportunity and it's an imperative for our society to look into mental health.
Masawa's Approach to Founder Relationships
00:09:34
Speaker
And to your question, so yes, we focus on mental health. That's our scope.
00:09:37
Speaker
But our thesis is based on the fact that by nurturing the human capital behind the startup, so looking at the founders and their well-being, we can also cap our downside scenario as a VC. So instead of having 80% startup failure, we reduce this by 60% because we help them and get support in the phases of ups and downs and the roller coasters of entrepreneurship. So through our natural capital approach,
00:10:00
Speaker
They get access to therapists, leadership expert coaches, depending on their needs. So during the diligence, we really focus on understanding where they come from. And it's funny because they're not used to this. We have workshops where we ask them, so who are you? And they start like...
00:10:17
Speaker
kind of relating their CV. And I'm like, no, I know your CV. You know, we've been in commercial due diligence. We've done our our assessment on your skill sets, your competences, your track record, et cetera. I want to know who you are. Do you have kids? Are you married? Are your parents still alive? What are they doing? How was your childhood like? Where did you study? Where did you grow up? Et cetera. Because we really want to go deep into the relationship that we built with the founders because we also...
00:10:43
Speaker
strongly convinced that the relationship between founders and investors has been distorted over the past 20 years. And there shouldn't be this kind of power imbalance. It's a marriage and we should be at equal level, at high level and having a transparent and trustworthy relationship. And we want to build this from day one, right? So we invest in founders that really are looking to...
00:11:03
Speaker
share with us their their trauma and we can help solve this trauma by putting them in touch with more professional. Of course, we're not coaches. um and That would be a conflict of interest in our sense if we as investors were also the coaches, but we put them in touch with the certified professionals, the leadership experts that can help them. And through this due diligence, we kind of co-create with them a nurture capital plan, which identify two, three key elements they would like to work on in terms of self-development. That can be one-on-one coaching, that can be co-founders coaching, coaching that can be professional, personal, that can be, i don't know, seminar. I've done myself a high-performance leadership seminar at IMD. We could sponsor that. We could also sponsor a tool that they implemented to the organization for the organization health. So for their mid-level management or their employees. At the end of the day, it's very dependent on what we found out during the due diligence, but also what are the founders interested in and how and what do they want to work on in terms of self-development. And we pay for this, right? It's part of our management fee.
Linking Nurturing with Financial Performance
00:12:01
Speaker
We allocate 0.5% of our 2.5% management fee towards these accesses or these tools that we will implement for a period of 12 months. That's amazing. I really love this natural capital approach, which is hopefully something that you can teach other investors because it makes financial sense.
00:12:20
Speaker
You are reducing your financial risk by doing this. And it's it's not rocket science. Exactly. It doesn't mean that we're not going after the upside. Of course, we're also looking in terms of scaling startups, making them successful, having potentially some unicorn, but probably more grass fed than anything else. But we look at the downside and we look at how many startups also suffer from their entrepreneurship journey and how we could help them also transition. Right. We have a soft learning package, which we makes make ah available to founders. by saying, okay, maybe you're not the right CEO and maybe you need to step out or maybe you would like to step out. But what is it after? i mean, it's his or her baby. I mean, leaving the startup is tough. It's also a big decision and they need closure. What we offer is a couple of hours of coaching so that they can start again from scratch, rebound, get some closure and start innovating again. And maybe our relationship will continue because... will invest into their second startup or they will invest as an LP into our fund. So we're not bound by the holding period of 10 years of the fund to say that's our 10-year relationship with the founders. This is an ecosystem which is so small.
00:13:29
Speaker
Everyone knows each other and we should build this relationship as if it was a people business. We always hear that this is a people business, but we forgot about the people behind the business sometimes. And And this is for me like something that I really struggle during COVID with the founders I was trying to help because I was really unequipped and I didn't also have any more capital because our main LP was basically limiting any deal outflow, any cash outflow to the startup. So I had really no tools. And I feel now with this natural capital approach, we have the tools also to to help them out. That's brilliant. And also thank you for previously highlighting how much the mental health issues or the potential of mental health can change how the world works because everything is rooted in that. Well, I have so many questions, but maybe one is, can you give specific examples of businesses that you have invested in grow? give the listeners an idea because you touched on so many different topics, of course, but just to kind of explain like what kinds of businesses you were able to work with, because perhaps, and I'm not sure, but perhaps the listeners might have a view that this is more the topic of nonprofits, but actually there are businesses that are investable.
00:14:41
Speaker
And so that you are supporting to grow. Yeah, no, definitively. So one of our investments is French UK company that deals with Alzheimer's and dementia. So they've built a methodology to calculate a risk factor of developing the disease. What's your likelihood of developing dementia or Alzheimer's?
AI-Driven Mental Health Solutions
00:14:58
Speaker
And it's based on cognitive tests and games, plus questions around your social habits, as I said, or the social determinants. So what can influence actually someone um ah having Alzheimer's dementia? It's your nutrition, it's your sleep, it's your fitness, and it's your social interaction. And all this together gives you a risk factor. And based on that risk factor, they can actually then deep dive into an AI coach that helps you kind of um stay healthy and avoid getting Alzheimer's dementia, but also slow down the the development of the disease if you were already diagnosed. And the cool thing about them is their go-to-market strategy. They're working B2B2C with the insurers, with the pharma. And I found the use case actually quite interesting because, yes, of course, You can provide this to the insurers as preventive tools to slow down the arrival or the development of the disease. That's one company. The second one that kind of we've invested or currently investing, we're finalizing the convertible loan as we speak, is also around health games, but for ADHD. And here it's about first ah stage awareness and second stage diagnosis. And the idea is to build games that can help understand what it means to have ADHD as an adult. not only as a patient, but also as a caregiver. I'm a parent, I'm a teacher, I'm a nurse. You know, to understand what the person, the patient is going through, what best in a game, an interactive game to understand, okay, like these are the challenges on a day-to-day life. And the cool thing about this company is they're working both for-profit and non-for-profit. They're building, publishing, creating games for profit sector to create awareness like a marketing campaign for health disease. Right. So they've done a a game for COVID vaccine and they've done also a game for the HPV virus vaccine with the Gates Foundation, with WHO for emerging vaccines. populations to create education around this disease and their vaccine and to kind of convince, of course, population to get vaccinated. And on the for-profit side, they created and published this ADHD game that they also releasing with the commercialization of the drug with the pharma companies. That's like more on the medical side.
00:17:04
Speaker
But I'm looking also at two companies in the more the online safety space. The last one, which I would mention is one which is encrypting images to trace back images that has been shared and manipulated or misused. so that you can identify the perpetrators who has shared an image which was not his or her own, has manipulated with negative consequences. And that is not only, yet so there is a pure mental health focused use case, of course, because as I said, a lot of suicide
00:17:35
Speaker
are happening because people are sharing unintended image online and destroying the reputation of someone. Unintended use, which is more commercial, is they're working with media and movie studios to avoid on-set costumes and script from movies to be shared on the net so that you avoid basically the entire secret of the on-set image movie to be actually shared before release. And that's a pure commercial case. And they're actually working with movie studios and also, of course, all social media platforms like Instagram and Meta. Oh, yeah. And it's the cool thing about it because it's very diversified. So we have B2B SaaS businesses in the nutrition space. For example, we have test at home kit that actually enable to identify the biomarkers in your gut, which are responsible for anxiety, depression, and lack of performance.
00:18:29
Speaker
And these are more like probably med tech biotech because you need the lab behind to be able to analyze the fatty acid amino acid, vitamins and hormones and the samples of blood or or urine. But we also have very deep tech with Gen AI. I mean, AI, the intersection of AI and mental health is very exciting space. not only as a prevention to digital harm, but also as an enabler of personalization, customization, as anything which is around precision medicine. So how do we make sure that the awareness and the and the diagnosis are specifically bound to you as a person is something that's going to come with AI. We're going to have AI doctors that are specifically to talking to us and being able to even diagnose. not yet regulated. So wait a little bit, but this is also some areas which are on the rise. It's brilliant. So interesting.
00:19:20
Speaker
And yeah, we definitely didn't, for example, don't talk enough about this relationship between our internal health. So the the gut health and our mental health and how those two connect So that's very exciting and also exciting to see how AI is actually not as harmful as we, or not only harmful, like we picture it many times in the media, but it can really bring very good outcomes as well for different issues. I want to ask you, you said it's a small sector. I wish it was bigger. Can you tell us about like how are you doing different activities to bring awareness to the fact that this is an investable sector? Do you see competitors being set up or do you wish for competitors to being set up? Yeah. So early 2024, I think this was very an early nascent field for VC or for investment. I think things have slightly changed and I'm very hopeful that we'll see a lot more. So first on the innovation side, I think there is an acceleration of technology related to this typical field. We've seen also what technology can do for healthcare in terms of medtech, biotech, but on the mental health side, I think because you can combine different types of technology, wearables, AI, anything around VR and AR, I think there is a lot more innovations
00:20:41
Speaker
coming to play. So there is plenty of startups to invest in. So that's probably not the problem. What we've seen, though, is the lack of financing. I think this is one area in the entire investable space where we don't
Investment Needs in Mental Health Innovations
00:20:54
Speaker
see enough capital. Why? So first, so far, it has been mostly financed by public funding and philanthropy, as you said earlier. people might think that mental health is just purely a social kind of philanthropy, non-for-profit topic. It's not. I mean, mental health is 13 or 15, actually 15% of the burden of healthcare challenges, right? But it only represents between 1% and 2% of the healthcare budget. I think it's 2% of the public funding for healthcare and it's 0.5% of the philanthropic budget. And on the private side, so the more returnable capital, it's nowhere to be seen.
00:21:27
Speaker
At least it was nowhere to be seen last year. And that's why Joshua and I said, okay, before we start raising this fund, let's create visibility. So we've been on stage, we've been at every conference talking about mental health, not only from a thematic point of view, but also from the nurture capital point of view. And I think that resonates a lot now.
00:21:44
Speaker
First, you have a few venture capital funds that are being set up focusing on mental health. I can still count them on my 10 fingers between the US and Europe. So it's not like climate tech for sure, but you have a few specific health tech. So they they might be very geared towards one specificity. So you have a lot of psychedelics fund, for example. So investing into the new area of psychedelics, you have a lot of brain tech funds. So at the intersection of neurology and tech, non-invasive and invasive brain solutions and
00:22:18
Speaker
Then we we have Masawa, which is really like looking at a broad scope between the medical and the non-medical, what we call the social determinants. So that's, I think, what we've gained from this rise in also destigmatization. People are much more open to talk about it. I mean, you can see a lot more articles around mental health. You can see a lot more athletes talking about their mental health issues, their burnout, their anxiety. You can see a lot more leaders talking about it. So I think like we're getting there, but it's still super, super small.
00:22:46
Speaker
Now on the nurture capital space, because of the different crisis we've been through on the tech side, founders have had a lot more difficulty to raise. The times of the last 10 years are gone.
00:22:58
Speaker
Startup funding is differently a different world right now. And so you see a lot more burnout. You see a lot more anxiety. And I think the VCs, some of the VCs, not all, have started realizing that they can't go ah go on like this without also taking care of the well-being of the funders. So we've seen some VC funds integrating coaching in their approach, providing some some programs around metabolic health. So looking at how can we make sure that the funder is sleeping well, eating well, having some type of work-life balance. I mean, there is a lot of discussions at the moment in the startups seen around the 996 timetable, et cetera. So I think we see a lot more people talking about what I'm missing is is the walk. Let's execute now because the mental health crisis is not going to wait for us. And our kids are going to be the first one that are affected by this. So we need more capital now to finance these innovations because they are there and then they require capital for sure. And they are as investable as what you would see on the climate tech, the defense side or on the overall traditional sectors. That's a really great call to action. Thank you, Sabine. know that you are also having other hats than your co-founder hat at Massa Roy because you're a thinker and you're passionate about kind of how we improve finance.
00:24:16
Speaker
Can you tell us more about those roles and how they they connect to each other? Yeah, sure. So I have two, I would say two main rules that have a direct impact on on finance and how do we change the financial landscape. I think one is the the French tech field. So I'm the vice president of La French Tech in Munich. We set that up in 2021. We grew up that to a very large organization. It's non-for-profit. We're all doing voluntary work there. But the idea is to build bridges between France and Germany, right? And why are we doing this? Because we really believe that the EU should maintain its sovereignty in digital and deep tech, and that we should be able to build the solutions that we need for the future. And so there we basically, on our free time, try to help French entrepreneurs come to Germany, but also German company expand to France. We're not replacing their business development or their internationalization team, but we try to open doors, right? So we would connect them with the VC ecosystem in France or in Germany. We would connect them with talent. Talent is a big ah gap in the European ecosystem. So accessing talent is something that French and the German companies are suffering from when they expand internationally, but also like getting access to public funding, right?
La French Tech and Steward Ownership
00:25:29
Speaker
right? So all the kind of semi-public governmental institutions that are helping build you know new companies, for example, in Bavaria or in the Ile-de-France.
00:25:38
Speaker
So we do this on a regular basis. We organize events. We try to bring together the communities. And that has been very helpful in also creating visibility around the European ecosystem and finding ways to fight again this fragmentation. Because in my work at Massawa, I see this as a challenge. I mean, let's Be honest, Europe is not the US. And when you talk about healthcare and access to pharma insurers or even the public reimbursement scheme, it's fragmented. So how do you actually mitigate that? Well, in our portfolio at Massawa, we create synergies because they all have somehow to deal with these specificities.
00:26:16
Speaker
A French company that is getting approved by loi Pékin, for example, can actually share best practices with a Finnish company that would like to expand to France on a different topic, different medical condition, different formats. So the idea is to really like share the do's and don'ts when you get access and go to market with a pharma, an insurer or the public sector. And I think we need to nurture this and foster this in every single sector in Europe. So that's what La French Tech is trying to do as well. And then my second hat also pro bono is I'm a senior advisor to the Purpose Foundation. And I think this is an amazing initiative towards changing finance and changing the way we think about capitalism in a sustainable way. We've always been told, and that was during my school school time, undergrad, MBA, maximizing shareholder value. Well, I think we actually build much more resilient and sustainable business if we talk stakeholder versus your shareholder and not maximizing value, but sharing that value. And so the Purpose Foundation is known for being a think tank behind the steward ownership concept. The steward ownership concept is about this non-extracting model where you, in a simple way, separate economic rights and ownership rights. So the ownership rights stay with the stewards of the company who are executing in the business operative and the economic right is then given to the shareholders, but they don't have an ownership right, which means that you reduce conflicts around exit and There's no potential exit. Actually, the company stays within the people that are operating in the company. And it also doesn't create this extraction of value by maximizing just one shareholder. And these concepts, we've actually also mirrored them in the way Masao is structured. So our fund structure is having certain principles of steward ownership. So we also have this concept of sales. stakeholders versus shareholders. We share our carry with our founders. So 10% of our carry, which we receive, Joshua and I, will be shared ah with the founders in our portfolio. Why? Because again, it creates synergies between the portfolio companies. I mean, as a founder, I'm not incentivized only by my startup, but also by other startups Masawa has invested in. So there is a benefit in actually cross-sharing information and being able to share best practices. But it's also create a solidarity among founders and investors and put the investors and the founders at high level again, right? So you also incentivize in the portfolio as us, and we align basically our expectations. And then second, we have also carry cap. And this carry cap mirrors a little bit the concept concept of zero ownership, which is that you are capped on your return. As an investor, you don't maximize your value. You just try to see, okay, what is the
00:29:03
Speaker
realistic value that I can get out of this company that makes it still sustainable, resilient. And that's enough for me, right? What is enough? I think this concept of n enoughness, we completely forgot in our society. It's always about more, more and more. But what does it bring? It doesn't bring any more happiness. We know this is actually surveyed and studied. And it doesn't bring anything more impactful. It's actually create more damages and more garbage. Sorry for my French. But so at Massawa, we have this carry cap, which means that anything above 4x on multiple uninvested capital, Joshua and I will redistribute to a foundation. And that foundation will have the same mission as Massawa, which is improving mental health and quality of life of society. but through a different types of asset class, which are not linked to our LPS. So it's not pure VC. It can be public equity. It can be credit. It can be grants. It can be non-for-profit. And it can be also outside of our geographies. At Massawa, we focus on Europe. This foundation could focus on emerging market, the global SaaS, et cetera. So it allows for us to have a systemic approach towards mental health. Not only we have this VC asset class that can invest into mental health innovation, but we also have this foundation that can
00:30:09
Speaker
foster the same mission, but through different as classes and through a more system approach. And this is a concept that we kind of, we've stolen to from the steward ownership. But with the Purpose Foundation, I'm super close. We've done a lot of events where we try to kind of also create visibility around this concept, because I think not enough people know about alternative to capitalism and maximization of shareholder value, they are sustainable and resilient business that can be created that way. I mean, look at Ecosia, for example, which is one of the best example in Germany that has been going through this steward ownership concept and is a steward-owned company. And we don't, unfortunately, we don't have yet the structure or the jurisdiction or the laws that enable VC to be steward-owned and invest in into steward-owned companies. So that's kind of the bottleneck still at the moment where, yes, we can be a steward-owned company, but how do you get financing if any of the VC cannot invest in steward-owned companies? Because we have this fiduciary duty towards our LPs and we, again, need to maximize their shareholder value.
00:31:08
Speaker
And so I think there's still a little bit of a dilemma on how we bring these worlds together, but I think this is a change in finance that should get more
Masawa's Achievements and Challenges
00:31:17
Speaker
visibility. And I hope, yeah, thanks to you, I hope it will gain more visibility through this podcast. you so much, Sabine. And it's great to also see how you're putting it in practice, right? Because we might know about the idea, but you're living it and you're thinking about, okay, but how does it work concretely? This is what we're doing. It's a really great example of putting into practice, really. Yeah. And believe me, the bottlenecks are around legal tax, how to structure this, we've been living it through. Yeah.
00:31:47
Speaker
120%. Well, but it's great. And let's try to spread this model because it's much more regenerative than extractive like the other well very traditional models. Still some questions for you, perhaps one that I really like to ask. This is an opportunity for you to reflect on achievements. Do you want to share something that you're really be proud of? Well, about first being invited to this podcast...
00:32:14
Speaker
I think what we've worked on with Masawa and with Josh, trying to create some visibility around mental health innovation around a VC that is only focusing on mental health is some gains here. So thanks a lot for having me, because I think this is a topic which is not unfortunately enough talked about. i mean, I was at Superventure or Super Return. Mental health was absolutely not a topic. Now we shifted from climate tech to defensibility. And this is a shame because, as I said, like I think... mental health is a trillion horse for a lot of the different challenges that our society is living in.
00:32:45
Speaker
So that is is cool. That is very, very cool. And then, of course, I mean, we've been on this journey with Joshua for a year and a half, two years now. We've had our first close. I think that was also kind of a milestone, which could be considered a success even though it was small. We managed to convince impact investors, mostly family office and high net worth individuals to come along on our journey. And I thank them so much for believing in us. The journey is not done, right? We still have a few closes to run through until we reach our final close in March, 2026. But... I think the momentum is there. I think we get super positive feedback. We even now have some resonance with institutional investors. So that's also something that I'm very grateful for because institutional investors usually don't invest into emerging managers and especially on a topic which is not common practice or hasn't been proven yet. So we have Dutch insurer who is finalizing their legal and tax ID. And then we have also multifamily offices from the U.S., in the data room. So there are momentum. Hopefully this will concretize into checks because at the end of the day, we need more financing. We need more capital to be able to invest in into these great funders. And even though we have the the best team, the best conviction, the best conferences to talk, was in London actually last week at the Real Foundation Summit. And this was two days entirely focused on mental health and wellbeing with different perspectives, academic, scientifics, the R&D, but also the corporates of course, the investors and the the founders, but still it's a lot of talk, not a lot of concrete actions. So we're still far from our target, but we believe that the momentum has been now created and it's time to invest. So I'm very grateful for first close and very grateful for the impact investor we've been able to convince. It's amazing. I also wanted to ask you, you know, you talked about mental health for the founders that you were investing in. What helps you to be your best self? Oof.
00:34:44
Speaker
Yeah. So it's funny you said this because you also mentioned that a lot of VCs should apply this concept concept of natural capital. We have a lot of requests now from our LPs, even from families that would like us to run workshops. We call it Massawa Salon. And the idea is to have an intimate kind of interactive workshop where we talk about emotional resilience, what it takes to be a leader, especially in families where you have different generations and where the sense of purpose has been lost. Right. And so I think this is great to have these reflections and the thought process also not only just at the founders level, but it goes through the entire ecosystem through like a waterfall.
00:35:23
Speaker
from bottom to top. And I have my friends who are in this journey with me who have been earlier colleagues or earlier classmates. And we have actually show fix every two weeks where we just complain and where we just say like, what's happening? Why is that not... working. And then we also cheer up when someone has a good day or or milestone. And so that keeps us going. And so I think building up that secure base, that safety net, where you can always go to be yourself, be transparent, because we're selling, right? When you fundraise, you need to be also representing your fund and representing why you're convinced that this thesis will work out. But that that's also like a representation. And sometimes you cannot be vulnerable. I wish people were more vulnerable in this industry because then, you know, there will be less ego and more balanced discussion, but you can't. So you need to kind of act as if, and this is a shame because then who are you talking to when you want to share that things are not going as well as expected, or you just get a decline from an LP. And because at the end of the day, we also entrepreneurs, we also starting up a fund, we doing everything from fund administration to portfolio management, to due diligence in new investment, to sourcing, and fundraising at the same time. So it's kind of a Swiss knife. And we also have bad days. So I think having building up that secure base, that safety net is super important. And then, of course, I am big sportler. So i sport is helping a lot. So I'll go running. I go hiking, nature, like being in contact with nature, being able to just say, okay, today, no digital, nothing.
Gender Inclusion in Finance
00:36:56
Speaker
I just want to be in the nature and admire how beautiful this planet is. Then that helps a lot as well. Sabine, I asked this question of all my guests. How does it feel to be a woman to do this job?
00:37:08
Speaker
So it's tough, but I've been in the male industry my entire life. So I don't have much to compare with because I worked in investment banking. I worked in strategy consulting and now I'm in VC and most of my stakeholders and most of the people I'm talking to are men.
00:37:26
Speaker
So, and that was the the case 20 years ago. So I never felt inferior or undermined, but I guess, how am I going to say this? Because I had a few more encounters lately of men kind of complaining or resisting a little bit this kind of woman involvement, right? So I think it was accepted until a certain time. And now because you have so many initiatives around women, women-only events, women-only network, women-only fund, et cetera, that I think the men feel pretty oppressed. And I had a few kind of pretty rude reactions towards women woman. So in the past conference, I was told that the person in front of me was used as i quote, to be interrupted by a woman with a microphone. And I was like, okay, well, I wasn't expecting that. So, and that never happened to me when I was in investment banking or a strategy cons consulting. But so maybe there is a certain oppression that men are feeling because they just feel not heard anymore. They kind of felt Probably also discriminated because now we have so many of these initiatives, but i think these initiatives are good. Don't get me wrong. I think we just need balance and we need to also make everyone participate. I think we cannot create silos where women are trying to, yes, of course, and legitimately get a a voice, but we need also to incorporate the men's voice. And I wish the different initiatives were a bit more balanced in that sense. and But I'm also definitively in for pushing women in that industry because, as I said, most of the people I'm talking to on a regular basis are are men, and that shouldn't be.
00:39:08
Speaker
I'm basically being selling a fund to more male individuals. And mental health sometimes is also kind of judged and stigmatized as a woman topic, which also shouldn't be. We need also to talk about men's mental health because I think they... they struggle as well with this role that they need to play as strength and power, which shouldn't be. Everyone needs to be vulnerable at some point. So I'm very much in favor for pushing the woman's voice and these types of initiatives, but we also need to bring the men's alley into the circle. Absolutely. Bringing the balance and everyone in the room. So as we are approaching the end of this podcast, three very quick questions. What's keeping you optimistic?
Optimism and Personal Reflections on Well-being
00:39:50
Speaker
My co-founding partner, Joshua. No, our conviction that there is and a financing gap in the mental health industry and that we need to really mitigate that if we want to bring this innovation to the patients that need it the most. Absolutely.
00:40:04
Speaker
Who or what is inspiring you? My founders. They usually have had lived experiences. So when they tell you the story why they're building this company, it's very touching and really it breaks my heart. It's beautiful. Are you reading anything that you would recommend to the listeners? Well, I'm reading different books at the moment, but I don't manage to finish them. So I love fiction because it just gets me out of my day to day. So for me, it's a good way to relax. Reading a French roman right now, it's a lot of mystery and a lot of ah plots and it's really good. And then I'm ah reading two other books, Of course, anything around longevity.
00:40:41
Speaker
So outlive from Peter Atiyah and anything on the gut health, because I'm really interested into the topic of brain energy between your gut health and what's happening in the brain. Brilliant. Thank you so much, Sabine, for the time that you spent today on this podcast. Do you have any final thoughts or advice for fellow changemakers or any specific ask? Maybe some advice because this is what I'm keeping myself, so I'm saying to myself on a regular basis is you need to be resilient. It's a tough journey. It's ups and downs like any entrepreneurs, but I'm convinced and the feedback I get from you, Krisztina, from any of the other stakeholders in this industry makes me continue the journey, right? And keep on moving because i can't stay still. And I can't stay still when I see so many people suffering from mental health issues, being medical or non-medical. And I think listening to the founders, there must be some way we can repurpose capital for this mentally healthier world. So that would be what keeps me going. resilience. Thank you. That's a beautiful word to end this episode. Thank you so much, Sabine, for your time. It was a real pleasure. Well, thanks for having me Yes. Thank you. Thanks lot, Krisztina.
00:41:55
Speaker
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00:42:07
Speaker
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00:42:18
Speaker
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00:42:33
Speaker
Women Changing Finance is part of the Impact Alpha podcast network. Smart conversations by and for impact investing professionals.