What If Ventures’ Stephen Hays Is Tackling Stigma in Mental Health VC

Hays had since rebuilt his life around his recovery, and the felony charges against him were dismissed or knocked down to misdemeanors. But his past mistakes still loomed large. The assumption that Hays is unstable has followed him ever since, through 45 days in rehab, hundreds of Alcoholics Anonymous meetings, and nearly six years of sobriety.

Hays isn’t letting it stop him. In 2020, he started What If Ventures, a venture firm focused on investing in mental health startups. The firm has backed companies like Alto Neuroscience, which went public in February in a $147.9 million IPO, and Grow Therapy, which raised a $75 million Series B in May.

What If Ventures is now raising $10 million for its first fund, and Hays said it’s closed on most of that cash already. It’s the next step in Hays’ mission to lift up access to quality mental healthcare and tackle the stigma that still plagues disorders like substance abuse.

“I want people who are like me to look at my story and go, OK, there’s hope,” he said. “I can tell my story and get better. I can have a full, whole, healthy life after whatever it is I’m going through.”

The darkest timeline

After graduating from West Point in 2003, Hays spent several years in investment banking, before starting the VC firm Deep Space Ventures in 2016 with $20 million from a Texas investor.

All the while, he was making frequent trips to Atlantic City and Las Vegas, gambling away tens of thousands of dollars and deepening his dependence on alcohol and drugs. All of his addictions helped blunt his too-strong emotions, the calling card of what would later be diagnosed as bipolar disorder.

Hays managed to keep up the illusion that his behavior was under control — using the mania to his advantage to work hard and party harder — until 2017.

That year, he was charged with and pleaded guilty to attempted assault and attempted extortion after a drunken altercation in Colorado, where he was accused of striking a woman in the face, causing her to fall down a set of stairs. (The assault charge was ultimately knocked down to a misdemeanor; the extortion charge, about which Hays maintains his innocence, was dismissed.)

Then, in August 2018, his wife accused him of coming home drunk, wrecking their house, and hitting her in the head with what she thought was a hammer.

Hays’ wife told Inc. Magazine in March 2021 that she admitted to the police a day later that a picture frame Hays knocked down had fallen on her head. Out of anger, “I said what I needed to say to get him arrested,” she told the publication.

Regardless, the damage had been done. Hays was charged with aggravated assault with a deadly weapon. A barrage of headlines followed. The investor behind Deep Space Ventures fired him.

Three weeks later, Hays went to Las Vegas, thinking he wouldn’t make it out alive.

“My intent in going away that weekend was, I’m out. I can’t do this anymore. Everywhere I go, I run into these problems, and I can’t seem to get away from them,” he said.

He contemplated overdosing or jumping off the wraparound balcony of the hotel room he’d specially booked. Instead, his wife and his father flew to Las Vegas to find him. They told him that, if he wanted to live, they were there to help.

In September, Hays went to The Meadows in Wickenburg, Arizona, for 45 days of in-person treatment. There, he received a bipolar disorder diagnosis for the first time. He started taking medication. He spoke with and listened to other people struggling with substance abuse, and was surprised to recognize himself in their stories. So began the long and arduous journey of scrapping his old life and crafting a new one from scratch.

Finding new purpose in VC

Back in Texas, Hays scraped his life off of rock bottom.

It was hardly easy. Hays had used the remainder of his savings, most of which he’d squandered on his gambling addiction, to go to rehab. He was forced to declare bankruptcy. The first two months after coming back from rehab, he hardly left his bed.

But a weekly Bible study filled with other former addicts and ex-convicts brought him new hope. He started regularly attending Alcoholics Anonymous meetings on top of therapy sessions and began working his way through the 12-step program.

“These guys took me under their wing, and they were just like, ‘Your story doesn’t scare us,'” he said. “That was my number one fear.”

As Hays found relationships more aligned with his recovery, he realized that he wanted to use his life to empower other people like him. He spent most of 2019 trying to raise money to start his own mental health-focused venture fund — but many investors “kind of laughed at me,” he said.

“They were really nice, but they said, look, you just got out of rehab, there’s no way I’m going to give you $20 million. No one’s going to do that,” he said.

Realizing he’d have to take a different approach, Hays put together a syndicate of investors to back startups together. That firm, What If Ventures, launched in 2020 with a focus on mental health bets.

Psychiatric drug developer Alto Neuroscience was one of What If Ventures’ earliest investments. The firm would go on to invest in every round from Alto’s Series A to its IPO earlier this year. Alto’s founder and CEO Dr. Amit Etkin, a psychiatrist by training, told BI he quickly recognized Hays’ uncompromising drive to make a positive impact in mental healthcare.

“The fact that he had his own personal journey, in terms of addiction and hitting the lows that he’s hit, was something quite interesting and unique,” Etkin said. Since that first investment, Hays has been “a supporter and a friend, and in it for the right reasons,” he added.

What If Ventures has now deployed $84 million into its 73 portfolio companies. And this year, Hays set out to raise What If Ventures’ first fund, which he’ll manage entirely himself.

With a single email to his existing investors about the fund, he raised $6 million. Hays says that’s a testament both to What If Ventures’s success so far and to the character of those limited partners.

“They’re people that genuinely care, that want to see people get better, and they’re happy to fund taking a chance at that,” he said.

“I know there’s a lot of stuff about Stephen on the internet, and he has this past. But I think he’s definitely a man of strong character,” said Christopher Kim, the cofounder and managing partner of Argosy Strategic Partners, which first invested in What If Ventures in 2022. Argosy will also contribute to What If Ventures’ first fund.

“It’s not easy what he’s trying to do, but it’s amazing that he’s trying to do it,” Kim said.

The way forward

Hays doesn’t always know when his past comes back to bite him. He wonders — did that family office stop answering his emails because they got busy, or because they came across one of the articles from 2018?

“It’s been really hard,” he said. “If I read those headlines, I wouldn’t want to do business with me either.“

Hays’s new public persona as a staunch mental health advocate also puts a certain pressure on him to perform his recovery — “and I hate that,” he said.

“It crosses my mind from time to time: what if I screw up? What if I relapse?” he said.

And in some ways, the risky business of VC looks a lot like gambling. Hays doesn’t see it that way, though. His diligence is patient and methodical, intent on making the best decisions for the firm and for the startups in his portfolio rather than for the sake of a dopamine hit, he said.

He can’t say he’ll never make another mistake. He might occasionally act out of emotion, like firing off the odd angry email when he feels someone is using his past against him.

He wants to show people struggling with their own mental health that working to get well is good enough.

“I don’t just want to destigmatize addiction and mental health issues — I want to destigmatize the journey of getting better,” he said. “A lot of people look at it and think, either this addict got better or they didn’t. But it’s a journey, an ongoing process. It never ends.”