Peter Thiel: 21st Century Free Radical
By Romesh Ratnesar (http://www.businessweek.com/magazine/content/11_07/b4215072350752.htm)
On a chilly December night, a few hundred people gathered at San Francisco’s Palace of Fine Arts for an event called Breakthrough Philanthropy. For an hour the guests engaged in the familiar social rituals of Silicon Valley, trading business cards and startup ideas over sushi, spring rolls, and pinot noir, before filing into an auditorium to listen to fundraising pitches from eight nonprofit organizations. The groups had disparate agendas, but all shared a fantastic vision for changing the world—**
- Defy death through regenerative medicine!
- Harness intelligence from machines smarter than the human brain!
- Build self-governing communities on the high seas!
They also had a common benefactor: Peter A. Thiel, the iconoclastic, libertarian 43-year-old venture capitalist and macro-hedge-fund investor. When the speakers finished, James B. O’Neill, who runs the Thiel Foundation, introduced his boss as someone "who works every day to reshape the world and focus on solutions to problems other people overlook."
Thiel emerged from backstage, wearing a navy blue striped shirt, jeans, and a blazer. “The future is not an abstraction,” he said. “It’s something we are all participants in, helping to create and forge and shape.” Thiel is not a natural performer. He has a flat, mechanical delivery that instantly deflates his attempts to inspire. After three and a half minutes, he wrapped up his remarks and encouraged the audience to stay, schmooze, and “start building the future for the 21st century.”
Thiel followed the crowd into the main hall, where a Stanford University freshman named Max Marmer was waiting. Marmer had come to the event in part because of Thiel’s latest philanthropic brainchild: a program that will award fellowships of $100,000 to 20 entrepreneurs under the age of 20, on the condition that they drop out of college for two years to pursue their ventures full-time. Marmer, who’s launching a business consulting startup with two friends, decided to apply for the fellowship as soon as he heard about it on Facebook. At the Palace of Fine Arts, Marmer introduced himself to his idol. For the next five minutes “it was mostly me talking,” Marmer says. Thiel steered him toward a partner in the Founders Fund, Thiel’s venture capital firm, who agreed to listen to Marmer’s pitch. Marmer has informed his parents that, whether he wins a Thiel Fellowship or not, he is dropping out of Stanford.
Three of America’s defining tech geniuses are renowned college dropouts—Bill Gates and Mark Zuckerberg left Harvard University; Steve Jobs hung around Reed College but was enrolled for only one semester—and it has almost become expected that visionary technologists will stop everything to pursue a ripening idea. It’s worth remembering, however, that Gates, Zuckerberg, and Jobs are anomalies. Thiel thinks it’s the anomalies who matter and thinks he can create more of them. Whether you view his plan as cause for celebration or horror depends on your take on America’s future. Are we hobbled by a deficit of risk or too much of it? Does government spending stimulate innovation or obstruct it? Are America’s best universities assets or liabilities?
Despite his fund’s disastrous recent performance—Clarium Capital Management fell about 23 percent in 2010, the third straight year of declines, according to investors—Thiel is financially set for life. He co-founded PayPal (EBAY) with Elon Musk and Max Levchin, was the first outside investor in Facebook, and owns a stake in a bevy of promising tech companies, from LinkedIn to Halcyon Molecular to Palantir Technologies. He made the Forbes 400 before he reached 40. After being portrayed in The Social Network, Thiel is perhaps the most famous venture capitalist in the world.
Despite all that, he remains troubled. Absent rapid, groundbreaking scientific breakthroughs, Thiel foresees an age when, he says, “people will have a lower quality of life, where people won’t be able to retire, where governments are pushed toward more and more austerity. That will lead to a more constrained, pessimistic future. That’s a big part of what is happening, and that trend is likely to continue.”
Thiel has thus far put his money into the kind of bleeding-edge technologies he says can expand human possibility and stave off the future he fears: nanotechnology, artificial intelligence, robotics, space exploration. A science fiction junkie, he adheres to a worldview shaped as much by French social theorists as by Star Trek. “I wouldn’t necessarily categorize him as a pessimist, though he can be,” says David O. Sacks, a college friend who worked with Thiel at PayPal and has since founded Yammer, a social networking service. “He is very bullish about technology, but he just doesn’t think it’s happening fast enough.”
