A few months ago, prominent silicon valley venture capitalist Peter Thiel unveiled a controversial program that will grant 20 "lucky" kids $100,000 to drop out of school to build a startup. His motives are to get rich (nothing wrong with that) but he masks this in his commentary on the inflated and unreasonable cost of higher education in the US.
Peter Thiel is notorius for making controversial statements just for the sake of headlines. However, what he's advocating here is reckless and pure exploitation.
He is telling kids to drop out of school and work for a startup that pays about minimum wage (assuming 2 yrs, 80 hr/weeks, minor overheads) in the hopes of making it big. Startups are lottery style bets and he's telling kids to gamble a couple of their early years to make it big.
The truth is that without a college education, if the first one or two startups fail, that kid is going to have a very tough time getting a job. Not impossible, but very tough. For every school drop-out success like Steve Jobs or Bill Gates, there are thousands that toil in annonimity. Will Peter Thiel employ these kids for life afterwards? No.
Indeed, he reminds me of a shady car salesman who finds a kid that has charm and shows him how much money he can make as a full-time car salesman without any need for school. (some of you may remember that Fresh Prince of BelAir episode with Will Smith in a similar situation. But I digress).
While there is a good debate to be had on the spiraling cost of higher education in the US, the answer is not Thiel's solution. The best brand schools aren't essential but a solid education that includes college is.
University teaches more than books. It gives kids a chance to mature and stand on their own, to learn how to solve problems, to work with people, to push themselves hard without the risk of being fired and, most importantly, to discover subjects and areas that they might excel at which they would not have known before. These skills are invaluable throughout life. And a good/great school also exposes kids to other hard working smart kids in environments that allow kids to explore.
Finally, the brand of the university is an insurance policy against downturns in the economy and industry you've chosen because it means people who don't know you or your industry may at least talk to you. All this is worth something, maybe not $50-100k/yr, but more than what Thiel is saying.
If anyone wondered why Thiel and his crew from PayPal are referred to as the PayPal Mafia his effort here should clarify that.
I realize now that I did not fully understand Peter Thiel's reasons for his above fund and was incorrect and shallow in my commentary. This New Yorker article on Thiel explains his background and motivations well and indeed, I myself have come around to a similar conclusion as Peter did, though not as extreme.
Finally, the whole post has a tone of rudeness I am not proud of as I was trying to be provacative with my first blog post. I regret this very much now.