Conference Presentation, Panel
Strengthening Pathways to Capital: The Business Case for Inclusive Growth | Global Conference 2025
Milken InstituteTroy Duffie, Wally Adeyemo, David Hall, Cassandra Lichnock, Linnea Roberts, Jim Shelton
- The US economy is projected to require strategic generational choices to sustain growth, repair societal structures, and unlock unrealized potential in communities currently excluded from traditional labor markets, with unemployment at 4% expected to drive investment in these areas.
- Venture capital distribution remains highly concentrated, with 75% of funds currently directed to California, New York, and Massachusetts, while rural areas and cities like Chicago, Detroit, and Miami face a need for sustainable ecosystems supporting future jobs rather than legacy industries.
- A demographic shift involving a transfer of over $35 trillion in wealth from white men to women over the next five to ten years is anticipated, creating significant investment opportunities despite women receiving less than 2% of venture funding and Black founders receiving less than 1%.
- CalSTRS faces a funding gap between $19.2 billion in payouts and $16 billion in contributions, necessitating a 7% return assumption driven by a portfolio rebalanced to 55% public and 45% private markets, with specific focus on private credit and energy sectors including AI-related power needs.
- Scaling investments are projected to range from $10 million for early-stage ventures to over $100 million for mature opportunities, aiming to bridge the pipeline gap where first-time entrepreneurs, particularly women and people of color, struggle to access the $10 million round required to scale beyond Series A.
- Technology, particularly artificial intelligence, is identified as the dominant trend impacting lives over the next 70 years, expected to reshape organizational structures and employment skills, with risks of dissatisfaction over the next decade if workforce development and clean energy training interventions fail to address historical mobility declines.
- Economic mobility has been falling since the 1940s, a trend attributed to the uneven distribution of corporate profits and lack of infrastructure, with models suggesting that redistributing profits to 1940s levels could address two-thirds of the decline.
- A collaborative approach involving public dollars, philanthropy, and private capital is required to upgrade the technology, human capital, and supply chains of CDFIs, with specific efforts to catalyze liquidity in rural Idaho and the South Side of Chicago and to match community skills with growing job markets.
- Government and philanthropic entities are expected to act as risk mitigators and capital suppliers of last resort to realign the cost of capital with discrete opportunities, including a $10 billion Treasury initiative and bipartisan Senate efforts to fund CDFIs and the State Small Business Credit Initiative (SSBCI).
- Family offices managing $10 trillion are positioned to serve as a wedge for institutional investors by demonstrating returns, potentially triggering a broader market engagement driven by the fear of missing out on opportunities in women-led enterprises, which represent 85% of consumer and 90% of healthcare decision-making power.