How to raise a smart risk-taker

What’s the difference between someone who says “that’s crazy,” and someone who says “that’s just crazy enough to work?”

👉️ Their level of risk tolerance.

They both know that an idea could work — or even lead to massive success — but only one is willing to try it.

This story plays out every day in entrepreneurship. And often it’s the difference between a world-changing idea, and nothing at all. 

But your kid is also being faced with situations every day where they need to calculate risk, such as:

• 📚 Taking an advanced class

• 🏈 Trying out for the varsity team

• 🛩️ Going on an overseas trip 

• 🎸 Forming a band

• 🪧 Petitioning to the school to change an unfair policy

• 🪩 Asking their crush to the prom

I’ve got a stomach ache just thinking about some of those. 

Uncertainty can be daunting, but it also tends to be where the sweetest opportunities lie. 

So if you want to raise a maverick who thrives by taking smart risks, here are some ways to get started. 👇

1. Experiment with low-stake situations

Hellen Keller isn’t the first name that comes to mind when we think about history’s biggest risk-takers. But when you consider the challenges she faced, every step she took was a colossal risk.

“Life is either a daring adventure or nothing,” she famously said.

It’s overwhelming to jump into adventure, so your kid needs to be in an experiment-friendly environment to learn that risk is a part of life.

So when they have an idea — even if it sounds foolish or crazy — let them try it anyway.

Why?

Because the stakes aren’t very high.

By experimenting a lot — and failing a lot — your kid will develop some pretty remarkable core values:

• Tactical Values: Actual learnings that they can apply to the next experiment.

• Emotional Values: Desensitization of failure, and acceptance of bad outcomes as a normal part of life.

• Directional Values: The humbling realization that success takes consistent hard work.

You can even guide them to make a “failure resume”, and reframe all the bad outcomes into badges of honor. 

If you nurture these habits, risk will no longer be a daunting antagonist for your kid, but rather a worthy challenger that’ll help them level-up in life. 

2. Say yes to optimism 

I’ll be frank — being an optimist in business has gotten a bad rep in recent years. 

I blame it on all the overhyped Silicon Valley founders who tout their startups as the company that will save the world.

But optimism is an essential value.

As adults, the biggest reason we avoid risks is because we think we’ve got too much to lose… 

💰 Stable income… 

🫂 Steady relationship…

📰 Reputation… 

🏠 Comfort… 

So we choose realism over optimism — mainly because of our anxiety.

But kids have fewer of those inhibitions, which presents an opportunity for you to help them reframe the idea of optimism. 

Optimism doesn’t mean being foolishly sure of your abilities or of things turning out well. Rather, it’s the trust in yourself to handle things when life doesn’t go as planned.

It gives you the guts to start over. 

One way you can raise an optimist is routinely sitting down with your kid and role playing “worst case scenarios.” Make it into a game by giving each potential outcome a rank of difficulty, and have them go down the list. 

For each outcome, they need to give it a “tolerance score” for how well they think they can handle it, and an actual solution. 

This is a helpful trick in mental health as well. 

3. Understand risk better

Sure, every failure is a lesson, but you don’t want your kid to always lose when they take risks. 

That’s why it’s pivotal to actually guide them to learn about calculated risks. 

The discipline of risk-taking includes a myriad of fascinating subjects, from game theory, to probability, to algorithmic forecasting. 

Your kid can start with a simple prompts, such as: 

Why even take risks? 

When is it actually worthwhile? 

They can do so by researching and choosing a smart decision-making framework, and learning about the risk and reward ratio. 

Then, they can further their understanding by: 

• Reading books about risk-taking entrepreneurs

• Playing strategic board games

• Trying small-scale investing or stock trading simulations

• Learning to code and making a risk-based mini app (I would buy it!)

Having a grasp on the mechanism of risk will help them tackle it with way more confidence and savvy. 

Combined with an experiment-first mentality, and an unwavering optimism, your kid will have an awesome arsenal to take on any risk with stride. 👊