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Facebook's First Investor Pays Teens to Not Go to College

David Paul Morris/Bloomberg via Getty Images(PALO ALTO, Calif.) -- 19-year-old Indian immigrant Diwank Singh Tomer has an impressive resume. The accomplished hacker and startup founder who initially enrolled in college in India quickly decided he would learn more by moving here and immersing himself in the Silicon Valley entrepreneurial scene.

And one of the world's most famous entrepreneurs agrees with him.

For the third year running, Peter Thiel, Facebook's first investor and the co-founder and former CEO of PayPal, is giving about 20 teenagers $100,000 each to drop out of college and launch a business.

The German immigrant's Thiel Foundation mentors the young entrepreneurs during the two-year fellowship as they pursue new advances in everything from robotics to fashion. But there's a catch. The recipients cannot be enrolled in school or employed during that time without special approval from the foundation. The idea is for fellows to immerse themselves entirely in the world of innovation.

There are some skeptics who point out that not every one of Thiel's fellows succeed. Some fail miserably. But the beauty of the tech world and those who reside in it is the ability to iterate quickly. Failure and the determination to try again is a huge part of that.

And besides, Thiel would argue that many of his fellows do succeed in spectacular fashion.

In the past two years, the fellows have launched more than 30 companies and raised more than $34 million in outside funding. The new crop of fellows was selected from a pool of more than 500 applicants from nearly 50 nations.

"When we created the fellowship more than two years ago, our intention was to help a small number of creative people learn and accomplish more than they might have otherwise," Thiel said in a statement. "To their great credit, they have exceeded our expectations, and inspired people of all ages by reminding them that qualities like intellectual curiosity, grit, and determination are more important than a degree in determining success in life."

The idea that a college education is highly overvalued sounds controversial. Everyone from the Obama administration to high school counselors seem to push students toward a university degree. And study after study shows that college graduates make more money and advance further than people who don't attend college.

But it's not necessarily for everyone, the Thiel Foundation argues, particularly with many students racking up student debt to pursue degrees that may never be worth the expense.

Thiel Foundation Vice President of Grants Mike Gibson said he can see technical certificates that confirm someone knows how to code, for example, being valuable. But this idea that a college degree makes someone qualified or that someone cannot be qualified without one, is bogus.

Tomer agrees.

He had been at college in India for less than a month when he decided "he had nothing to lose" by dropping out. He'd already launched a startup to help people learn to code, and the computer science major knew he could continue to teach himself how to code.

So, he bought a ticket to San Francisco, hopped on a plane and only called home to tell his parents he'd left for the United States when he landed.

"To drop out in India means failure," he said. But failure doesn't scare Tomer. In fact, he thinks it's an important part of the growing process.

The key to learning, he said, is to ask lots of questions, something he doesn't think traditional schools promote.

"Schools force you to appear smart," he said. "It's bad to ask questions."

People learn best, he said, when they have access to mentors and the ability to learn in a way that suits them. The Thiel Foundation is big on mentors - each fellow meets with them throughout the two-year fellowship.

In Tomer's case, that approach has produced something interesting. The biking enthusiast is using his foundation funding to launch a new interactive learning environment based on his earlier coding venture.

He wants to launch a site that will allow people to learn about different topics - he's focused on coding and applied sciences - at their own pace with the help of his program. He's developed an algorithm that will respond to the user's actions. If someone wants to learn about a small area of coding and then do a deep dive into it before moving on, the program will prod the user in that direction by taking cues from the ways they interact with the site. If someone wants to get a breadth of knowledge before focusing on depth - Tomer's preferred style - that's fine too.

He thinks he'll need to hire a couple of engineers and a designer, but says his ability to code means he's capable of remaining at the helm.

Although he's only been in the Bay Area about eight months, Tomer plans to stay for good. He lives in a "hacker house" in Palo Alto with a bunch of other like-minded young people looking to strike entrepreneurial gold.

Tomer wouldn't say so himself - but he's an example of what a young entrepreneur with perseverance and a high tolerance for failure can accomplish by taking an unconventional path. The worst thing that can happen is that he has to go home and back to college. With that knowledge, Tomer said, coming to the hotbed of innovation was worth every bit of risk.

Copyright 2013 ABC News Radio

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