Making Risk More Accessible: a Review of Anne-Marie Slaughter's "Renewal"

Bitter political partisanship continues to divide America. Devastating wildfires, floods, and hurricanes leave no part of the country untouched. Rapid technological innovation has altered global business patterns and relationships, and left individual workers, companies, and even entire industries wondering what the future holds for them. Now throw in a global pandemic. It's not an environment conducive to risk-taking. 

And yet risk is how you find breakout opportunities that lead to life-changing gains — in your career and life in general. Slow incremental progress is good. But massive progress all at once is even better, because it doesn't just propel you forward in that instant. The benefits you reap from your new place in the world compound over time. If you join an unknown start-up right out of college and that start-up becomes Google, the opportunities that follow for the rest of your career will likely be significantly better than if you'd started out at a less consequential company. 

Of course, there's always a downside to risk. That unknown start-up you join could crash and burn before you've even had a chance to pay off a semester's worth of student loans. That's why learning to effectively evaluate risk is a key career skill. But as I discuss in my book The Start-up of You, what constitutes an intelligent risk — where the upside significantly outweighs the downside — is highly dependent upon how much tolerance for risk you have. And that varies greatly from person to person. If you have ample savings, a strong professional network, or other forms of capital that make downside risk more survivable, you can take more risks than someone who doesn't possess these assets. This is a topic Anne-Marie Slaughter examines in insightful ways in her new book, Renewal.

Anne-Marie is President and CEO of New America, a think tank and civic enterprise where I've been a board member since November 2019. While Anne-Marie's book is in part an account of her own personal journey of renewal, it is more broadly about America's opportunity to "renew our ideals and recommit to being our best selves without hiding from our worst deeds and impulses" at a time of growing social discord and alienation. As Anne-Marie puts it, "What should we be, could we be, in 2076, at the nation's three hundredth anniversary?...What are our utopias? We have to at least be able to imagine them." 

Amidst the current chaos of our national discourse, it's an illuminating synthesis of reflection, reckoning, and aspiration about what America has been and what it can be, a book that I hope thoughtful people of all political stripes will read and engage with.

In talking about transformation and the process of renewal, Anne-Marie covers a wide range of subjects, including risk-taking as the catalyst for productive change. "It is impossible to grow, to learn, to bring something new into the world without taking risks," she writes. But she also recognizes that a capacity for risk is not just an innate personality trait, something you're born with or not. Instead, it's largely a product of the resources you are fortunate enough to have access to, and, as she expresses it, "a straightforward calculation of costs and benefits…. How high you are willing to try to climb depends in most cases on how far you think you can fall."

What this suggests, of course, is that risk favors those who are best positioned to survive the setbacks and consequences of failure. And not just survive, but also retain the capacity to try again when future opportunities arise. Thus, people born to wealth, high social status, and overall cultural privilege have a greater capacity to take on risk than those who do not. And because taking on risk allows you to better pursue breakthrough opportunities and the great gains they can yield, you can see how this plays out over time. The wealthier you are, the more risk you can take. The more risk you can take, the more likely you are to get wealthier. 

As Anne-Marie notes, this is a particular issue for my own industry. "It is deeply telling that the vocabulary of venture capital begins with 'the friends and family round'," she writes. "[The] initial funds that an entrepreneur can rustle up in $10,000 and $20,000 increments from parents, grandparents, aunts, uncles, siblings, college roommates, elementary school friends to whom the entrepreneur can appeal. People who don't have family and friends of means are out of luck." 

Making early-stage investment capital accessible to a broader range of founders is the impetus behind my own investments in companies like Concrete Rose Capital, 645 Ventures, and Village Global, among others. But inequitable access to seed-stage capital is a pervasive structural issue. To sufficiently scale risk tolerance in an era of cataclysmic change and uncertainty, we need better government-level interventions and solutions. As Anne-Marie puts it, "Most Americans are experiencing far too much uncertainty already. To enable them to take the risks necessary for their personal and professional growth, policymakers at the local, state, and federal levels will have to provide, paradoxically, much more security."

In the past, I've written about how the Affordable Care Act was not a gateway to socialism, as so many conservative observers contend, but rather a boon to entrepreneurism, because of the way it insulates against risk. Similarly, Anne-Marie writes, "The flood of young people willing to try their hand at start-ups in Silicon Valley and across the country was spurred in part by the Obama Administration's expansion of parental health insurance for children until age twenty-six." 

And she envisions going further, by creating even more social infrastructure that strengthens risk tolerance — such as affordable education for all, genuinely universal public healthcare, and government-backed pools of capital for early-stage funding aimed at women entrepreneurs and entrepreneurs of color.

In short, she illuminates how many of the proposals and policies that are often characterized as examples of creeping socialism or an overly protective nanny state can actually serve as the foundation for a more autonomous, risk-taking, dynamic, and entrepreneurial America. "Suppose...we brought a whole set of education, health, housing, labor, and care policies together to create the foundation for a new generation of entrepreneurs, men and women who would assess that the benefits of the risks necessary to bring something new into the world or to follow an uncharted path outweigh the costs. Call it the American Innovation Act…" she writes.

While many people, including many entrepreneurs, typically cast founders in the rugged-individualist mode of John Galt, the hero of Ayn Rand's novel Atlas Shrugged, I see entrepreneurism first and foremost as a team game where the most successful individuals succeed in large part because of their strong professional networks that function as a crucial source for allies, mentors, partners, customers, funders, and more. Indeed, that's why I created LinkedIn. In addition, I believe that entrepreneurism works best in markets that have been shaped, quite visibly, by government institutions that establish rule of law, create social safety nets, help produce highly educated workforces, and play key roles in domestic and global capital markets. 

So while I strongly believe that entrepreneurism and capitalism are cornerstones of human flourishing, Anne-Marie's vision of a world where government plays a more supportive role in maintaining conducive conditions for entrepreneurism and the creation of new jobs, new industries, and new opportunities makes perfect sense to me. In this vision, more expansive government policies and programs aren't safety nets. They're trampolines that can help renew and amplify America's entrepreneurial spirit at a time when it makes great strategic sense to do so. While some might argue that what Anne-Marie advocates for is a risky proposition, it's only through taking on risk that we reap breakthrough rewards.