Billionaire Selena Gomez’s mental health startup Wondermind failed to pay its employees for weeks, forcing CEO Mandy Teefey to take out a personal loan against her home to cover mounting debts while her daughter’s billion-dollar empire flourished elsewhere.
Key Takeaways
- Wondermind CEO Mandy Teefey reportedly took out a loan against her home to pay employee salaries, freelancers, and vendors who were owed hundreds of thousands of dollars.
- Employees received only one of two missed paychecks, and in March, their health benefits were terminated with advice to opt for COBRA coverage.
- The company’s financial troubles reportedly intensified after Teefey became sole CEO in January 2023, with employees claiming she lacked necessary business leadership skills.
- Despite Wondermind’s $100 million valuation and $5 million in funding secured in 2022, the mental health startup faced significant operational challenges.
- Selena Gomez, who reached billionaire status in September 2024 primarily through her Rare Beauty makeup brand, has allegedly invested millions into Wondermind over the years.
Financial Crisis Forces CEO’s Personal Sacrifice
Wondermind, the mental health startup co-founded by Selena Gomez and her mother Mandy Teefey in 2021, has been struggling to meet its financial obligations. Reports reveal that the company failed to pay its approximately 15 employees on time, with staff receiving compensation for only one of two missed paychecks. The situation became so dire that CEO Teefey reportedly took out a loan against her own home to address the company’s mounting debts, which include missed payments to freelancers and vendors totaling “hundreds of thousands” of dollars.
The extent of the financial troubles became evident when employee health benefits were terminated in March, with staff being advised to seek COBRA coverage instead. Additionally, the company reportedly owes around $60,000 to a PR firm, highlighting the breadth of its financial difficulties. These issues have created significant instability for a company that was founded with the mission of providing a safe online space for discussing mental health struggles.
Conflicting Narratives About Financial Rescue
Competing accounts have emerged regarding how Wondermind is addressing its financial crisis. While reports indicate Teefey took out a home loan to cover expenses, a source told PEOPLE this isn’t accurate, claiming instead that Selena Gomez invested additional money upon learning of the financial issues. This conflicting information has created confusion about who exactly is bailing out the struggling company and how its financial problems are being resolved.
“To invest in the future of the company, Mandy has chosen to take the lead here with a personal loan to invest in the future of the company,” shared in AOL
Another source claimed: “Selena has invested millions of dollars over the years into Wondermind to support her mother and their shared passion for mental health, including when she was alerted about the most recent financial setback, and immediately invested more money as she’s not involved in the day-to-day operations.”
This inconsistency raises questions about transparency within the company’s leadership and communication with stakeholders during this challenging period.
Leadership Issues Behind Financial Troubles
The financial difficulties reportedly began in January 2023 when Teefey became the sole CEO of Wondermind. According to insider accounts, employees have alleged that Teefey lacked the necessary business acumen to lead the company successfully. This leadership transition appears to have coincided with the beginning of Wondermind’s financial decline, despite having secured $5 million in funding in 2022 with an impressive $100 million valuation.
Billionaire Founder Stays Distant
The contrast between Wondermind’s struggles and Selena Gomez’s personal financial success is stark. Gomez achieved billionaire status in September 2024, largely due to her Rare Beauty makeup brand, along with income from her singing and acting careers, real estate investments, and paid partnerships. Despite this enormous wealth, employees claim Gomez has been largely absent from Wondermind operations, allegedly meeting with staff only once in three years – a claim that company representatives dispute.
“Something I’ve always tried to do in my career is make sure I lend my voice to places where it matters, and I have to give my mom credit for that because she taught me everything,” said Gomez
Wondermind’s chief of staff Emma Wright has defended Teefey’s leadership, stating: “She has been singularly focused on keeping everyone’s livelihoods intact and keeping the company growing.”
Meanwhile, Wondermind has acknowledged its difficulties, with a company statement noting: “Like many startups, Wondermind has been working through its own set of growing pains.”
The company maintains that the financial situation has been rectified and all owed payments will be made, as it plans to transition into a new chapter while continuing its work in mental fitness.
