Dropping out and dreaming on
Controversial grant program lures college students with business ideas
Jeffrey Lim of Arlington always dreamed of going to MIT, and once he got there, he enjoyed the workload so much that he took as many courses as possible. But the 20-year-old computer science major will not be on campus next semester or the semester after that. He is dropping out.
In fact, two dozen students like him - eight with ties to the Boston area - are quitting school for the same reason Lim is. They have been lured by an unusual and controversial new fellowship created by PayPal cofounder Peter Thiel that pays them $100,000 each to leave college and launch a start-up, a tempting offer that has raised the ire of some parents and college officials. The 20 Under 20 Thiel Fellowship is only open to students 20 and younger. More than 400 students applied.
The Thiel Foundation “thought that we should identify some talented young people and encourage them to pursue their passions in science and technology and about how we could get innovation accelerated in this country,’’ Thiel said yesterday in an interview.
He said he knows many students are graduating with huge debt and that it is hard to launch a company with that burden. “We hear about this all the time where people can’t take any sort of risky job. They have to get paid a lot because they have all these debts to pay off. You can’t really start a business because you’re servicing all this debt. Even with financial aid packages you end up with a lot of debt.’’
The story of Mark Zuckerberg dropping out of Harvard at 20 to expand Facebook has created an entire generation of competitive dreamers. And who was Facebook’s first outside investor, whose $500,000 stake is reportedly worth $1.5 billion today? Peter Thiel.
“If the people who started Facebook had waited to graduate, somebody else would have done a social network,’’ he said. “Facebook started in 2004. By 2006, it would have been too late.’’
Thiel, who cofounded PayPal in 1998, is himself not only a college graduate (Stanford, class of 1989), but also a 1992 graduate of Stanford Law School. But now he talks almost dismissively about college education.
“I think it’s best for people to actually try to think about the future and not default to education,’’ he said. “I’m in favor of learning, but I don’t think our education system can live up to the great expectations that are set.’’
Most of the Thiel fellows are focusing less on complaints like Thiel’s about college and more on the opportunities he is offering. David Luan, 19, of Worcester, had secured a full ride to Yale, which he loved and called the “perfect choice.’’ But then he got a call from the Thiel Foundation.
“Ever since I was a little kid, my life dream was to start my own robot company,’’ Luan said. “Everything I have been working on was either consciously or unconsciously preparing me for this.’’
His mother, Ruifan Zhang, 56, an accountant for the city of Worcester, recalled that when he was only 7, Luan was peddling homemade floppy disk computer games for $1 each to his classmates. She wondered where he had gotten this entrepreneurial spirit. Now, she said, “I have a lot of confidence in David, but I’m pretty worried. He’s still young.’’
Being young never daunted Sujay Tyle, 17, who has already finished his sophomore year at Harvard, having skipped grades. A part-time job at Boston data intelligence start-up InsightSquared got him excited about starting his own business. “The amount that I learned with InsightSquared was 100 times more than anything I’d done in the classroom,’’ he said. He is looking for a Boston area biotechnology or clean energy start-up to join; he would like to be a cofounder or early employee.
Bill Aulet, managing director of the MIT Entrepreneurship Center, would argue that Tyle still has a lot to learn from school. “To produce innovation, you need a good foundation in science and technology. Entrepreneurial ventures are great but not good at training you in fundamental science skills,’’ he said.
Tyle’s father, Praveen Tyle, 51, a senior vice president at drug maker
If the fellows have second thoughts about leaving school, they can typically return to finish their degrees. But some will be greeted with less attractive financial aid packages, particularly those who had relied on outside scholarships.
Some of the fellows were already beginning to doubt the value of higher education, even before the Thiel Fellowship came along. After only one semester at Harvard, Ben Yu, 19, began to ask himself if what he was doing in school was as beneficial as what he could be doing outside it. When he decided the answer was no, he took a leave of absence to travel the world.
While preparing for his travels, he came up with his start-up idea - a price comparison website - after he spent four days combing through after-Thanksgiving sales for supplies.
As for Nick Cammarata, 18, of Newburyport, and his start-up partner, David Merfield, the fellowship application process itself helped them hone their idea.
“We probably wouldn’t have had the same amount of focus if it weren’t for the Thiel Fellowship,’’ Cammarata said. “Just having people interview us and steps to go through to make sure we really knew what we were doing - they made us step up to the bar.’’
Days after putting down security deposits to Carnegie Mellon and Princeton, respectively, Cammarata and Merfield pulled out to pursue their project - before they had even been chosen for the fellowship. “We figured either way we wouldn’t want to go to college, we’d rather work on this, so we did.’’
Their website, opentheclassroom.com, offers tools for teachers to create digital lessons for high school students to complete at home, opening up class time for discussion.
The direction of Lim’s future company is still up in the air, but he knows it will have something to do with people having their own personal currency. In a few days, he will leave Arlington to set up shop in Silicon Valley.
His mother, Margaret, is not quite ready to let go. A teacher at Arlington High School whose parents were also educators, she grew up hearing, “Go to a good school, get a good job, and you’ll have a good life.’’ But she knows the world her son inhabits is different from the one she knew, so that mantra may no longer be the only route to success.
“This Thiel Fellowship may be the credential that trumps a bachelor’s from MIT,’’ she said. “I’m not convinced yet, but maybe. The rules are different now.’’
Jialu Chen can be reached at firstname.lastname@example.org.