Drop Out, Start Up

[YankeeFan]

New York Times on the Peter Thiel's fellowship:

Taylor Wilson has big dreams: to build nuclear fusion reactors that will solve the world’s energy crisis. “I’ve got some technology that will really change the world, so college right now is not the best option for me,” said Mr. Wilson, who is just 18 but built his first working reactor at 14. He plans to start a company, aided by a $100,000 grant as the recipient of a “20 Under 20” Thiel Fellowship. Before tackling a new form of energy, he will address slightly more modest tasks: detecting nuclear weapons and diagnosing cancer with his technology.

The two-year fellowship, for applicants under age 20, was started last year by Peter Thiel, the Silicon Valley investor who believes more young people should be chasing breakthrough technologies instead of wasting their time and money in college. Mr. Wilson is in the second group of grant recipients, announced last month. He joins 43 other fellows — 39 men and 4 women — working on projects like developing unmanned aerial vehicles and building electric car motors with rare earth magnets.

By recruiting would-be Mark Zuckerbergs, Mr. Thiel is tapping into the lore of Silicon Valley, where coffee shops are crammed with C.E.O.’s barely out of their teens and being a dropout is a badge of honor — one held by tech’s biggest luminaries, including Steve Jobs and Bill Gates as well as Mr. Zuckerberg.

But the Thiel Fellowship has also fueled a fierce debate about the value of a college education in a changing economy, one where the skills to write software or build a robot, coupled with an outsize dose of ambition and a youthful belief in one’s ability to change the world, have the potential to produce fame and fortune in a way that few other professions do.

“You increasingly have people who are graduating from college, not being able to get good jobs, moving back home with their parents,” Mr. Thiel said. “I think there’s a surprising openness to the idea that something’s gone badly wrong and needs to be fixed.”

James O’Neill, a founder of the program, blames the cost of college for what he sees as a lack of innovation in areas like energy, transportation, nanotechnology, space travel and robotics. “Not only does college track you into a career with a big company,” he said, “but for many people, it piles on a huge amount of debt that limits people starting a company or quitting your job to tinker in your garage.”

http://www.nytimes.com/2012/07/20/education/edlife/the-thiel-fellowship-aids-young-entrepreneurs-with-grants.html

 

[93Devil]

New York Times on the Peter Thiel's fellowship:

Taylor Wilson has big dreams: to build nuclear fusion reactors that will solve the world’s energy crisis. “I’ve got some technology that will really change the world, so college right now is not the best option for me,” said Mr. Wilson, who is just 18 but built his first working reactor at 14. He plans to start a company, aided by a $100,000 grant as the recipient of a “20 Under 20” Thiel Fellowship. Before tackling a new form of energy, he will address slightly more modest tasks: detecting nuclear weapons and diagnosing cancer with his technology.

The two-year fellowship, for applicants under age 20, was started last year by Peter Thiel, the Silicon Valley investor who believes more young people should be chasing breakthrough technologies instead of wasting their time and money in college. Mr. Wilson is in the second group of grant recipients, announced last month. He joins 43 other fellows — 39 men and 4 women — working on projects like developing unmanned aerial vehicles and building electric car motors with rare earth magnets.

By recruiting would-be Mark Zuckerbergs, Mr. Thiel is tapping into the lore of Silicon Valley, where coffee shops are crammed with C.E.O.’s barely out of their teens and being a dropout is a badge of honor — one held by tech’s biggest luminaries, including Steve Jobs and Bill Gates as well as Mr. Zuckerberg.

But the Thiel Fellowship has also fueled a fierce debate about the value of a college education in a changing economy, one where the skills to write software or build a robot, coupled with an outsize dose of ambition and a youthful belief in one’s ability to change the world, have the potential to produce fame and fortune in a way that few other professions do.

“You increasingly have people who are graduating from college, not being able to get good jobs, moving back home with their parents,” Mr. Thiel said. “I think there’s a surprising openness to the idea that something’s gone badly wrong and needs to be fixed.”

James O’Neill, a founder of the program, blames the cost of college for what he sees as a lack of innovation in areas like energy, transportation, nanotechnology, space travel and robotics. “Not only does college track you into a career with a big company,” he said, “but for many people, it piles on a huge amount of debt that limits people starting a company or quitting your job to tinker in your garage.”

http://www.nytimes.com/2012/07/20/education/edlife/the-thiel-fellowship-aids-young-entrepreneurs-with-grants.html

From your story...

For those who drop out — and fail to get a start-up off the ground — giving up college can hurt. Unemployment for those with just a high school diploma is 21 percent. And college has countless benefits even for out-of-box thinkers, from networking opportunities to learning practical skills that apply to starting companies.

Wouldn't it be great if public education had some vision to nurture these technological minds?

http://www.usnews.com/news/articles/2012/07/18/white-house-announces-1-billion-master-teacher-program

http://schoolsofthought.blogs.cnn.com/2012/07/18/obama-administration-announces-stem-teacher-corps/

 

[YankeeFan]

From your story...

For those who drop out — and fail to get a start-up off the ground — giving up college can hurt. Unemployment for those with just a high school diploma is 21 percent. And college has countless benefits even for out-of-box thinkers, from networking opportunities to learning practical skills that apply to starting companies.

Sure, the numbers for the average person without a degree are not going to be good. We all know that.

These kids are not average. They're also still young enough to get a degree if they want. And, they have real world experience that will help them decide what they want to study.

 

[93Devil]

Well these fellows help 50 or so kids.

Are these students financially tied to Theil? Can they do whatever they want with their inventions and never have to give any patents or percentage of profit back to the lender?

From your story...

For those who drop out — and fail to get a start-up off the ground — giving up college can hurt. Unemployment for those with just a high school diploma is 21 percent. And college has countless benefits even for out-of-box thinkers, from networking opportunities to learning practical skills that apply to starting companies.

Sure, the numbers for the average person without a degree are not going to be good. We all know that.

These kids are not average. They're also still young enough to get a degree if they want. And, they have real world experience that will help them decide what they want to study.

Nope. They are not average.
They are not good
They are not great.
They are not superior.
They are not the top 1%.
They are not the top .01%.
They are not the top .001%.

They are the best of the best of the best students in America and this works for them.

Question to you. Think back to when you are 18, does your coffee repair business have a chance for success with the knowledge you had then?

If you ever have a kid, hopefully they will ask you for their $50,000 in college money to start their own business. Be sure to hand it over, because if they fail, and what is the failure rate of start up businesses, you guys will have nothing to show for it.

 

[LongTimeListener]

Why don't kids just play professional basketball? LeBron James plays professional basketball and he didn't need college for that.

 

[YankeeFan]

Question to you. Think back to when you are 18, does your coffee repair business have a chance for success with the knowledge you had then?

If you ever have a kid, hopefully they will ask you for their $50,000 in college money to start their own business. Be sure to hand it over, because if they fail, and what is the failure rate of start up businesses, you guys will have nothing to show for it.

I dropped out of college.

I started my first business at age 20. I sold it for a profit.

I'm not sure if the specialty coffee business was mature enough when I was 18 for me to have built this business, but I wish I had started it sooner. (Though, I really did enjoy my jobs at City Hall and Continental Airlines.)

If I had an 18-year-old son, nephew, or cousin, who was mature and responsible, I would absolutely fund him to start a similar business.

 

[dreunc1542]

Question to you. Think back to when you are 18, does your coffee repair business have a chance for success with the knowledge you had then?

If you ever have a kid, hopefully they will ask you for their $50,000 in college money to start their own business. Be sure to hand it over, because if they fail, and what is the failure rate of start up businesses, you guys will have nothing to show for it.

If I had an 18-year-old son, nephew, or cousin, who was mature and responsible, I would absolutely fund him to start a similar business.

Apparently not if the person is a woman, though.

 

[YankeeFan]

Question to you. Think back to when you are 18, does your coffee repair business have a chance for success with the knowledge you had then?

If you ever have a kid, hopefully they will ask you for their $50,000 in college money to start their own business. Be sure to hand it over, because if they fail, and what is the failure rate of start up businesses, you guys will have nothing to show for it.

If I had an 18-year-old son, nephew, or cousin, who was mature and responsible, I would absolutely fund him to start a similar business.

Apparently not if the person is a woman, though.

Ha. I actually would consider a woman.

Illy's local tech is a woman. I had a female tech for a while.

It's juts not a business that appeals to a lot of women. But, I shouldn't have worded it that way.

 

[Stitch]

Who paid for your college education? How did you fund your first business?

 

[YankeeFan]

Who paid for your college education? How did you fund your first business?

My parents paid for college, but I only went for a semester.

A big reason why I dropped out was that I felt like I was wasting their money. I didn't know what I wanted to be when I grew up.

I bought my first business for $20,000. The business was basically to be a clerk for a bunch of different clerks on the New York Futures Exchange.

The business cleared over $1,500 a week (and a lot of that was cash), but the price was low, since their was no guaranty any of the previous owner's customers would stay with me. And, she wanted to get out fast, because she wanted to move out of town for a boyfriend.

I borrowed the money, and paid it back quickly, since I not only didn't loose any customers, I was able to immediately grow the business.

My old company, REFCO, hired me to process all of their trades. I did that in my old job, and they didn't have anyone else that could do it for them. It was so bad the exchange began to fine them.

So, even though they weren't happy about it, they paid me $300 a week to keep their trades straight.

 

[Stitch]

I assume you had to borrow the money for the business from your parents? Not criticizing you if you did, but my parents didn't have money to pay for college, or start a business.

I'm sure i'm not alone. Are those kids told they should have had richer parents? Everyone who is qualified should have the opportunity to go to college and not be in debt up to their ears for doing so.

 

[KJIM]

I assume you had to borrow the money for the business from your parents? Not criticizing you if you did, but my parents didn't have money to pay for college, or start a business.

I'm sure i'm not alone. Are those kids told they should have had richer parents? Everyone who is qualified should have the opportunity to go to college and not be in debt up to their ears for doing so.

Seems to me a lot of parents are going into debt paying for their kids' college. Taking out second mortgages, establishing college accounts, cashing in 401ks for their kids. Many are in over $20k themselves before their kid takes out a loan.

So if your child had a business idea and you felt she or he had a good business plan and was mature enough to handle it, which would be the better investment?

 

[Batman]

Wait a second. This kid built a working nuclear reactor when he was 14!?
Why do you need college when you're probably already smarter than 90 percent of the professors you'll encounter? Is taking a music appreciation elective class really that important to this guy's development?

 

[Stitch]

Wait a second. This kid built a working nuclear reactor when he was 14!?
Why do you need college when you're probably already smarter than 90 percent of the professors you'll encounter? Is taking a music appreciation elective class really that important to this guy's development?

No, but what about the rest of us who can't build a reactor?

 

[waterytart]

If I had an 18-year-old son, nephew, or cousin, who was mature and responsible, I would absolutely fund him to start a similar business.

Apparently not if the person is a woman, though.

It's the Thiel effect.

 

[Greenhorn]

A college education lasts a lifetime and can never be taken away. A business can close after a short time and be gone forever.

 

[imjustagirl]

A college education lasts a lifetime and can never be taken away. A business can close after a short time and be gone forever.

Screw that. My college education is long gone.

 

[YankeeFan]

I assume you had to borrow the money for the business from your parents? Not criticizing you if you did, but my parents didn't have money to pay for college, or start a business.

I'm sure i'm not alone. Are those kids told they should have had richer parents? Everyone who is qualified should have the opportunity to go to college and not be in debt up to their ears for doing so.

I'm not sure why this thread has to be about my experience. It wasn't my intent.

That said, I think you confuse "had to" borrow from my parents with "was able to".

I don't remember what percentage of the money I borrowed, but I know it wasn't the whole nut. I'd been working full time on Wall St. for over a year at that point (not that it was big money). Had worked full time prior to that, and had always worked summers as a kid. I had a decent amount of money saved, lived on my own. etc.

The opportunity was a good one, and, I believe I could have raised it without my folks. I think I could have gotten the previous owner to finance the purchase if I needed to.

Either way, $20,000 or less is not a ton of money to borrow. Even if you lose everything, it's not an amount you could not pay back if the business failed and you had to go get a real job.

The idea of knocking every business startup because it requires some initial capital is silly.

None of the businesses I've started required more than 20,000. That's a pretty low number for a business startup. And, all of them have succeeded. I have a good track record.

When I started my last business, I had people interested in investing, that I turned down.

Regardless, people borrow a lot more than $20,000 for college.

And, no one is saying this is for everyone. But, I think it's worth questioning the conventional wisdom that everyone should go to college, and should borrow heavily to do so.

College definitely is not for everyone. There are lots of folks in college right now who are wasting their time and money.

Starting a business might not be for everyone either, but it's probably a good idea for a lot more people than are currently exploring the idea.

A college education lasts a lifetime and can never be taken away. A business can close after a short time and be gone forever.

A failed business can also be a fabulous education, which can't be taken away.

Many successful entrepreneurs failed in their initial business attempt.

 

[Stitch]

When you question the wisdom of college or certain policies using your experiences, it's important to point out not everyone has access to their parents' savings to fund college or their business ideas. People without your resources are going to question your bootstraps philosophy once they know it wasn't bootstraps that got you going.

You can borrow several thousand a year for college rather easily. Much harder to find capital.

You started a thread on starting your own espresso machine repair business, but did you just start out borrowing $1,500 for tools and spare parts, or did you borrow a bit more?

 

[Frank_Ridgeway]

I can't make a blanket statement for all of mankind, but for me, dropping out was the best thing to do. My heart was in the newsroom from the moment I stepped into one at 16. My attempt at college was a waste of time and money -- some of the latter belonging to the school and the taxpayers. It didn't have to be, but I ensured it would be by placing it far behind newspaper work on my priorities.