Prince Harry signed on as the chief impact officer of BetterUp last spring, promising to help promote the startup’s mission of “mental fitness” and its army of more than 2,000 professional coaches. It’s likely a lucrative gig for the British royal: BetterUp raised $300 million at a $4.7 billion valuation in October.
But just six months later, an uprising has been brewing among the company’s career coaches following BetterUp’s recent announcement that it would modify their contracts—resulting in what those mentors said was effectively a sneaky pay cut—according to six coaches who spoke with The Daily Beast.
“There’s so many of us now who are upset,” said one coach whose effective pay was slated to fall by nearly a third, speaking on condition of anonymity in order to discuss private company matters. “I would say my heart is broken. And I think there’s really questionable ethics going on.”
“They’ve turned us into a commodity,” added another.
Two key issues were at the center of the still-evolving dispute: coaches’ pay and a new rating system that would also influence their fees. The company announced a plan to cut a stipend coaches used for note-taking, researching clients, and assigning activities. The firm’s new metrics, meanwhile, retroactively evaluated coaches in part based on how “life-changing” a client found their guidance and how frequently they met for sessions. Those changes in particular stirred unrest over concerns that they would violate industry norms and cause coaches to pander to their clients rather than offer impartial feedback.
“[If] I’m coaching a member, I don’t want to be focused on how they’re going to rate me,” another BetterUp contractor said. “From an ethical perspective… we are there to coach the client, not to have them press the ‘like’ button.”
Now, amid the internal turmoil, BetterUp says it’s working to modify its original plans—though the details are still vague. The company scheduled a number of town halls for this week and pledged to walk back at least some of the changes.
“No one will see any sort of decrease in their effective session rate compared to their 2021 effective session rate,” a BetterUp executive wrote to coaches on Tuesday, after The Daily Beast had reached out for comment. The note appeared to leave open the possibility that contracts will be adjusted in 2023, stating, “we are on a multi-year journey, and we will be treating this first year as a learning period.”
The company, which declined to comment, seemed to ease at least some of the coaches’ fury with its latest update.
“I am relieved, but not satisfied,” one coach said in response to the email. “The fact that [BetterUp] rolled out their initial plan at all makes me suspect of their intentions, and makes me distrust them. It was so demeaning and insulting to have to pressure them not to give us pay cuts—it leaves a bad taste in my mouth.”
Another mentor added, “This was the power of the collective body here.”
“We can’t unionize because we’re independent contractors but there were quite a few of us, over 600, who were furious,” she told us. “We united in pushing back.” Some coaches were so outraged, she added, that they discussed taking legal action.
BetterUp, which has worked with Chevron, Hilton, Google, and WarnerMedia, among other high-profile clients, has a stated mission of fusing “world-class coaching, AI technology, and behavioral science experts” to optimize both individuals and organizations. In other words, it’s personal and professional development, but marketed using startup diction.
Founded in 2013, the company has become a major revenue driver for the coaches on its platform. “I got into coaching and then found out that I hate selling myself,” one contractor said. “BetterUp made that part easy… Just to say, ‘Come here and we’ll find clients for you.’”
The coaches who spoke to The Daily Beast said they were largely happy with the startup prior to receiving notice earlier this month about impending contract changes.
At first blush, it appeared that BetterUp was planning to raise its rates. “Many of us were very, very excited about it,” one coach said. “Instead what they came out with was a program that cut everybody’s pay in the middle of one of the greatest inflation times in history.”
“This is the way capitalism I suppose works. But for a company [whose] mission is to help empower people throughout the world… They’re not walking the walk,” added another.
The initial plans announced included cutting the prep-work stipend but raising the coaches’ hourly rates. The company also ranked coaches using data that was analyzed retroactively—based on a client’s post-session evaluation of their mentor. In the evaluation, clients can rate the session as either amazing or life changing; a “good” rating will result in a penalty, coaches said.
The company seemed ill-prepared for the ensuing blowback. In a webinar last week, an executive appeared to tear up and apologized for the debacle. “I want to acknowledge up front that we could have done a better job of communicating and of managing the change,” she said.
“BetterUp cares deeply about coaches. I care deeply about coaches,” she added, her voice wavering.
After the executive’s remarks, a colleague read aloud questions from the contractors, including one about BetterUp’s apparent plan to stop paying them the activity stipend, which they utilized for creating assignments like articles, video, or podcasts, but also for general client prep work.
“Why are you eliminating the activity stipend? One minute or 10 minutes, there should be no situation in which I am required to complete tasks for a multibillion-dollar company and not receive payment for it,” the question stated. “So why are we being asked to volunteer our time?”
“We are paying a blanket activity stipend for activities whether they were delivered or not, and that is just not economically sustainable for a business,” the executive replied. “So we have a choice to make. Do we continue to pay for things that people aren’t doing, or do we reward the coaches who are having the biggest impact on members?”
Several coaches told The Daily Beast that they planned to stop working with the platform, though they were still waiting to hear concrete details about how the company would reverse some of the changes. It appeared as of Tuesday that the company was working to remedy those concerns.
As those issues continue to play out, multiple coaches said the company lacks transparency in other areas, too. “They hired and hired and hired…over the past couple of years. They have so many VPs. Now, I don’t even know what these VPs do,” one coach said.
None of the coaches was clear about Prince Harry’s role at the company either, raising questions in their minds about how meaningful his role is or whether it is simply marketing “smoke and mirrors.”
The coaches have discussed their grievances in a private social media group with several hundred members (they are contractually forbidden from discussing their pay with each other, two of them said).
One coach expressed concern about the rapid evolution of the professional coaching world, which has emerged as a crowded “cottage industry” with limited oversight, as The Daily Beast has previously reported.
“Is it democratization of coaching? Or is it commoditization?” he said.
Still, no matter what changes BetterUp makes, many of its coaches will stick with the platform. Said one frustrated contractor, “I think that for some people it’s their primary income, and they’re stuck between a rock and a hard place.”