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Saturday
May182013

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

Monday
Mar262012

‘PayPal Here’ Turns Phones Into Credit Card Readers

ABC News(NEW YORK) -- You’re likely familiar with PayPal as an online payment system. The company’s logos are frequently found on eBay pages or on other websites. Click it and you can pay big or small retailers online via credit card or checking account.

But the equivalent of those online PayPal buttons are going to start showing up in the world outside of your computer screen. Or at least that’s the company’s mission.

“The mobile phone has revolutionized the way we shop,” PayPal’s director of communications Anuj Nayar told ABC News. “If you are making a purchase from your mobile phone in store, what sort of purchase is that? Is it an online purchase? The reality is it is all about multichannel retail.”

And multiple options are exactly PayPal’s strategy. The company has a number of solutions that allow consumers to use the service to pay away from the computer, but its newest one — PayPal Here — allows small merchants and independent sellers to take credit cards right on their phones.

The entire solution is based around a small triangle-shaped dongle, which plugs into an iPhone. When plugged into the headphone jack, sellers can swipe a customer’s credit card right along the top, and then process the payment on the phone using PayPal’s backend. The dongle is fully encrypted.

A companion app provides a place for the customer to confirm the transaction and sign. The same app allows the seller to invoice the buyer or record a cash transaction. While PayPal’s Internet services paved the way for small sellers to open up shop, the dongle and an iPhone now let small stores, street merchants and others to create a very mobile, electronic cash register.

If a merchant doesn’t have the new dongle they can use the app to just take a picture of the credit card. The little triangle itself doesn’t cost anything, but sellers are required to pay PayPal a flat rate of 2.7 percent on any transaction. PayPal Here will be rolling out soon to select small merchants. It will also be available for Android phones very soon, says Nayar.

Other companies, like Square, provide similar tools to sellers.

Copyright 2012 ABC News Radio

Friday
Aug262011

Tech Mogul Plans to Start Independent Island Nation 

David Paul Morris/Bloomberg via Getty Images(LOS ANGELES) -- "The future is limitless," said Peter Thiel , the PayPal co-founder, hedge fund manager and venture capitalist, who is harnessing that concept with his libertarian island nation for exactly 270 residents. In an interview with ABC News last May, the tech mogul described his ideas about finance, philanthropy and innovation, and in new photos released of his island venture, the world gets to see exactly what he's talking about.

Thiel is working with Patri Frieman, previously an engineer at Google, to launch the first of the floating colony offices in the Pacific Ocean by 2012, reported Details magazine.

Thiel, 43, who launched PayPal in 1998 and was depicted in the Hollywood film The Social Network for his role as Facebook's first investor, has already sunk $1.25 million into the independent ocean colony that will be constructed in the waters of the Pacific Ocean, just off the coast of San Francisco. The republic would be independent from federal government jurisdiction and would sit atop a floating 12,000-ton structure with accommodation for 270 residents, he told Details magazine.

The self-made billionaire is working closely with the Seasteading Institute to create sovereign nations in international waters, free from the laws of any country.

The Silicon Valley tech mogul hopes that dozens of similar structures will form an open-minded nation "with full diplomatic recognition by the United Nations," he told Details.

"Seventy percent of the planet is covered with water, and there's so much we can be doing with oceans and it was one of the frontiers that people have more or less abandoned," Thiel said in an interview with ABC News in May. "It's pretty far in the future but closer than, say, building cities on the moon."

Thiel has been credited with transforming the world with PayPal, which he co-founded in 1998.

Thiel has become the poster boy for Silicon Valley libertarianism, the belief among many entrepreneurs that government hinders innovation. Openly gay, Thiel endorsed Ron Paul for president in 2008 and is one of the GOP's biggest donors.

Thiel hopes that the colony will expand beyond its initial space for 270 colonists.

The two-time Stanford graduate who recently made headlines with his decision to pay college students to drop out of school, clearly has an eye for ideas that turn into big, profitable companies.

The Silicon Valley billionaire was reportedly worth $1.5 billion earlier this year.

His ultimate goal for the autonomous colony, Thiel told Details magazine, "is to open a frontier for experimenting with new ideas for government," that include, "no welfare, looser building codes, no minimum wage and few restrictions on weapons.

"When you start a company, true freedom is at the beginning of things," he told the magazine. "The United States Constitution had things you could do at the beginning that you couldn't do later. So the question is, can you go back to the beginning of things? How do you start over?"

Thiel recently invested $2 million "to get college students younger than 20 to drop out of school and start a business with $100,000 each," ABC News reported last May.

While many of the details regarding Thiel's island nation remain unclear (Who gets to live there? Will they pay taxes? Is the island sustainable?) one thing remains certain. Thiel's plan of a floating island nation is a unique venture whose future is worth watching.

Copyright 2011 ABC News Radio

Friday
May272011

PayPal Suing Google Over Mobile Payment System

ABC News(NEW YORK) -- A battle is brewing in cyberspace between Google and Ebay's PayPal unit over the search engine's new plan for a mobile payment system that would replace the use of credit cards.

PayPal has filed a lawsuit against Google, claiming the search engine used its trade secrets to launch the new system.  The filing came after Google unveiled its Google Wallet, an app that allows shoppers to pay for purchases using their smartphones.

The lawsuit claims Google sought out Osama Bedier, who currently serves as Google's vice president of payments, after working for several years at PayPal.  During his employment there, PayPal had been developing a mobile payment system of its own.

Copryight 2011 ABC News Radio







ABC News Radio