Peter Thiel is rocking the boat of higher education. The libertarian entrepreneur, venture capitalist, and co-founder of PayPal is sending liberal college administrators into a tizzy with his latest push to encourage young innovators to ditch college for two years and pursue entrepreneurship.
Last week, Thiel awarded 20 young people with “20 Under 20” Thiel Fellowships: $100,000 and two years of mentorship to develop entrepreneurial ventures in science and technology.
Thiel’s dismisses conventional wisdom, which says that college is the necessary next-step for success after high school. He understands that conventional wisdom is conventional ignorance now that the American university system is broken.
Today’s students pay bloated prices so universities can hire a fleets of non-academic staff to monitor student speech codes, distribute cookies in campus lounges and court elites like Bill Clinton to speak on-campus and warn young people never to believe: “There is no such thing as a good tax…”
Tuition is rising and debt loads are mounting while students at institutions as prestigious as Stanford’s Graduate School of Business are failing to learn basic skills. When Stanford graduate students rely on private coaches outside the classroom to teach them how to write for business, you know higher education is deteriorating.
I took a hybrid route for my own higher education. I went to college and started an entrepreneurial venture at the same time. My path was unique and challenging, so I understand first-hand that Thiel is offering young entrepreneurs the opportunity of a lifetime.
In college, your liberal arts professors may provide you with tips on how to outline your thoughts, but they generally expect that you already know how to give a 10-minute presentation or write a 15-page paper. Meanwhile, your business professors do not teach you how to run a business. Rather, they lecture you on business models, assign you to read case studies and tell you to look for an internship.
Looking back, I realize that I really did not need college. I think many young people do not need college to become successful. The real world lessons I took away from my college experience came from running a conservative student newspaper on a shoestring budget out of my dorm room and from the experience I gained during my internship in commercial real estate.
Today, historic numbers of high-school graduates are going to college. More than ever, parents are pouring their hard-earned savings into college educations for their children.
Venture capitalist, author and parent James Altucher argues that it is irrational for parents to blindly pay for their child’s higher education. New York Magazine reports Altucher as saying: “What am I going to do? When [my daughters are] 18 years old, just hand them $200,000 to go off and have a fun time for four years? Why would I want to do that? … The cost of college in the past 30 years has gone up tenfold. Health care has only gone up sixfold, and inflation has only gone up threefold. Not only is it a scam, but the college presidents know it. That’s why they keep raising tuition.”
It is not cruel and unusual punishment to expect an 18-year-old to finance his or her own higher education. In fact, forcing them to do so could help them decide whether they even need college. My parents told me, “You’re on your own for college.” So, I chose to be a college student and an entrepreneur simultaneously because I had a boatload of self-motivation, I was blessed with an academic scholarship that allowed me to graduate debt-free, and, because I had developed a growing network of accomplished mentors who generously coached me along the way.
Parents, before you feel tempted to write out that six-figure tuition check, consider doing yourselves and your child a favor by honestly assessing the skills that your child demonstrates. If your child thrives within structure or if they want to pursue law or medicine, then college is likely the right path. However, if your child thrives in a creative environment, is self-driven and is constantly innovating, you should consider offering them your own version of Thiel’s 20 Under 20 fellowship as an alternative to subsidizing their college tuition.
Thiel contends that many parents shy away from even thinking about a nontraditional path for their children because they view college as an insurance policy. “I think that’s the way probably a lot of parents think about it. It’s a way for their kids to be safe … an insurance policy against falling out of the middle class. …Why are we spending ten times as much for insurance as we were 30 years ago?”
That’s a good question. More high-school students and their parents should consider whether there is an entrepreneurial, Thiel-style alternative to success before they impulsively jump into college debt.