Four years ago, billionaire entrepreneur Peter Thiel announced the Thiel Fellowship, a two-year start-up accelerator for young science and tech prodigies. The program awards 20 kids under age 20 $100,000 each to pursue world-changing innovations and businesses. The one caveat: They have to drop out of school to get it. The unorthodox program did not go over well with many. Larry Summers, former Harvard president and U.S. Treasury secretary, told attendees at a conference last October that it was "the single most misdirected bit of philanthropy in this decade." He called the fellowship "meretricious in its impact and the signals that it sends to a broader society."
Thiel, a 46-year-old tech prodigy himself, has never hewed to convention. He co-founded PayPal in 1998, and in 2004 became the first outside investor in Facebook. He then sank his wealth and business acumen into global venture-capital and hedge funds, which have invested in such startups as SpaceX, LinkedIn, Yelp, and Spotify. Thiel, in other words, has a long history of backing winning entrepreneurs, and now he's betting on the potential of his fellows. Some 500 teenagers apply each year for a slot. "These people are phenomenally talented," he says, "so I think this subset will make a very big difference in the years and decades ahead."