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PayPal Co-Founder Gives Out $100,000 To Not Go To College
Paypal co-founder Peter Thiel says the key to quicker business innovation is skipping college. His foundation is handing out $100,000 to 24 people under 20 to drop out of college for two years and start companies. From the press release: "As the first members of the 20 Under 20 Thiel Fellowship, the Fellows will pursue innovative scientific and technical projects, learn entrepreneurship, and begin to build the technology companies of tomorrow. During their two-year tenure, each Fellow will receive $100,000 from the Thiel Foundation as well as mentorship from the Foundation’s network of tech entrepreneurs and innovators. The project areas for this class of fellows include biotech, career development, economics and finance, education, energy, information technology, mobility, robotics, and space."
This is just stupid. Yes, some people will do better starting a company instead of going to college (myself included), but that is not the rule, that is the exception.
The vast majority will do worst if they drop college to start a company. Heck, most will crash and burn starting a company even after college.
The numbers of factor determining "success without/instead of college" is staggering, and it is not about $100k (heck, I did it with a quarter of that).
morcego
Which means he's fully qualified to claim it did him absolutely no good, having actually gone through and done it.
He argues from the fact that a few people buck the trend and succeed despite dropping out of school. That does not mean they succeeded because they did not go to school. That's like Oprah getting up on her final show and saying she owed her success to her prayers to Jesus. Well tens of thousands of people around her prayed too and none of them were up there, so that logic should mean prayer failed in nearly every case rather than prayer is what made her succeed. Looking at the exceptions without looking at all the factors that actually made them exceptional is a big error here.
It is if you're a 20 year old trying to get a generic business loan from a bank for the next hottest social networking fad instead of $5-$20k of student loans at a state/community college. Hello bankruptcy. But I guess the idea behind this experiment is you'd get the money from a VC. And if a VC wants to give you huge amounts of money for a likely lesson in failure, I see no problem with letting them take the risk. You can always re-enroll after 2 years.
These students should avoid failure by blowing $150k in college to qualify for a entry level job. Much more successful.
Whenever I see this I have to ask, "what posessed that young student to go to an out-of-state college"?
I mean, I am right now attending college part time (trying to convert an awful associates to a full bachelors). Im just finished freshman / sophmore levels at a community college at a whopping $95 per credit hour, and will be going to a state university this fall at an astounding $500 per credit hour. My bill at the end of all of this will be less than $45000, for a full bachelors degree.
I could, of course, have chosen to go to an out-of-state ritzy school like Georgetown, lived on campus, and blown $45000 per semester... but then, I really wouldnt have anyone else to blame for my debt but myself, would I?
As a venture capitalist, Peter Thiel benefits from a larger pool of potential innovators to work from. Even better if they're college-age whiz kids who will work for pizza and beer. He's very skilled and knowledgeable at identifying winners, but he's also operating under a huge capital blanket that allows him to spread his bets and mitigate his losses.
The other side of this equation is the kid who takes him up on the bet. For every one that's actually successful, there may be 10 or 100 grant recipients who fail, and hundreds of thousands of grant applicants who take up Thiel's challenge but don't end up qualifying for the grant anyway. So, this is ultimately a losing proposition for many, as is often the case.
It is really important that young people recognize that the handful of startups that succeed enormously, distorted by the myopic lens of the media, are vastly outnumbered by the carcasses of miserable failures, many of which were well-planned, well-executed, but simply not in the right place at the right time with the right connections. And here's the rub: The two most talented pools of business innovation fellows come out of Stanford and MIT... which not only teach the necessary skills to make successful ventures, but also put those students in an environment conducive to building the right networks of people with fresh ideas that they can get off the ground before anyone else. Notice I didn't say "get there first"... Many get there first, and then don't know what to do from there, and never get truly off the ground.
Consider on a smaller scale the movie review websites Cinemablend and Ain't It Cool News... There are seas of film websites that come and go, but these two were able to monetize successfully simply by virtue of being among the first to get there, and they both rely on a relatively endless supply of free labor. But even they are working constantly just to stay in place. I know a guy who runs a film website with huge traffic and he can barely pay himself, let alone his 50 tireless volunteers.
Apple was there early. Google was there early. Facebook wasn't there first but they were in the right place (both Harvard and Stanford) at the right time, and they made some key innovations that no other social networks had thought of (most people who want to find former classmates go to Facebook. It's funny what one single field of data can do... but Facebook thought of it, and implemented it well).
So it's really critical to have a backup plan because the fact is, the market is so saturated that statistically most of you will never be a Mark Zuckerberg, Steve Jobs, Bill Gates, Sergey Brin, Larry Page, etc. It would be great to see it, but I wouldn't bank on it.
Peter Thiel is another story... because no matter how many of you lose, he still wins.