silicon valley visions

Peter Thiel Wants to Make Hackers Into Heroes

Peter Thiel, president of Thiel Capital, speaks at the annual Milken Institute Global Conference in Beverly Hills, California, U.S., on Monday, April 29, 2013. The Global Conference convenes chief executive officers, senior government officials and leading figures in the global capital markets to explore solutions to today's most pressing challenges in business, health, government and education.
Photo: Patrick T. Fallon/Bloomberg via Getty Images

Name a science fiction movie in the last 25 years that shows technology in a positive light,” says Peter Thiel, the billionaire tech guru, PayPal co-founder, early Facebook investor, and all-around defender of the future. “It’s always Terminator, The Matrix, Avatar, Elysium. Why can’t you make the villains a group of Luddites?”

Thiel and I are in his greenroom before he goes onstage at the Commonwealth Club of Silicon Valley — one of the friendlier turfs he’ll visit on the tour for his new book, Zero to One. Tall and thin with close-cropped hair and ageless skin, he’s gesticulating purposefully on a cheap-looking sofa, wearing a blue blazer over a shirt unbuttoned to his pectorals, a look that has the effect of making him appear less like a tech financier than a French philosophy student defending his dissertation.

Thiel has avoided the glazed-over boredom found among authors forced to recite points from their books, which is admirable given the unusual length (seven weeks) and scope (Boston! London! Hamburg!) of his tour. He spoke to a standing-room-only crowd at Wharton, and enraptured a huge group of students at Harvard Business School, nearly all of whom wanted to work in tech. That made him slightly uncomfortable, since Harvard students piling into any one industry tends to be a sell signal. “There’s a study about how whatever the largest number of people at HBS do is the wrong thing,” he says, laughing.

It’s somewhat surprising that Thiel is being invited to schools at all. His Thiel Fellowship program, which pays promising innovators $100,000 each to drop out of college and start companies, is now four years old, and its success has been mixed (among other things, the fellows have shown a pesky tendency to re-enroll once their money runs out). But Thiel, a former white-collar lawyer and Credit Suisse trader with two Stanford degrees, isn’t dissuaded. He’s on a mission to convince the most talented young people in America to build start-ups rather than go to law school or sell mortgage derivatives. “I’m sort of biased pro–Silicon Valley, but, I don’t know, I think it’s a little more substantive, and so I do think, um, if things are centered on substance and engineering, that’s … that’s healthy.”

In person, Thiel is not unlike Peter Gregory, the space-cadet mogul in HBO’s Silicon Valley, played by the late Christopher Evan Welch, who was reportedly based on him. (“I’d never drive a car as small as the one he has,” Thiel says, when I ask about the comparison.) Like his cable doppelgänger, Thiel avoids eye contact, pauses mid-sentence to roll words around in his mind, and lapses into silence so often that interviewing him feels, at times, like attending a Quaker meeting. When he does speak, he refines and revises on the fly, ironing out imperfect turns of phrase as if debugging lines of code.

Zero to One is perhaps a better vehicle for his ideas. One of the few business best sellers that doesn’t feel like it was wrung out of a ghostwriter at gunpoint, the book is an enjoyable collection of solid start-up advice, based on a class Thiel taught at Stanford in 2012, that he hopes will serve as a pep talk for a generation of young entrepreneurs. Much of what’s in the book is cheerfully contrarian — monopolies are good, disruption is bad, luck isn’t always related to success — and there’s a certain appeal to Thiel’s go-getter attitude about the future, one in which everything from fixing climate change to colonizing Mars will simply be a matter of assembling bright technologists to build good businesses.

Thiel’s best-known idea is his “tech stagnation” thesis — which holds, basically, that America has been falling behind when it comes to innovation in hard areas like transportation and life science for the past several decades. (His venture firm’s motto is “We wanted flying cars, instead we got 140 characters.”) He thinks that the tech stagnation partly explains the recent backlash to the tech sector — the Google bus protests in San Francisco, the local battles against regulatory rebels like Uber and Airbnb. “There’s always a risk of an overhype problem, there’s a bit of an arrogance problem,” he says, “but the big issue is that Silicon Valley is booming and the rest of the country feels relatively stagnant. We’re making technological progress, but it’s in a narrow cone, and so there’s a sense in which people feel like they’re left behind.”

A committed libertarian who bankrolled Ron Paul’s 2012 campaign, Thiel says he’s “sort of interested” in politics these days, but more intrigued by solutions that could bypass the public sector, like Elon Musk’s efforts to send people to Mars. (He doesn’t mention Musk’s partnership with NASA, or the billions in tax incentives and government grants SpaceX got.) “I always go back and forth on how much to do politically,” he says. “An effective way to change things is to just start changing them.”

Thiel was doing the bomb-throwing public-intellectual thing long before it was fashionable among venture capitalists, and he’s very good at it. (During a recent CNBC interview, he wondered aloud whether Twitter’s executives were mismanaging the company because there’s “probably a lot of pot-smoking going on there.”) But these days, Thiel seems to be reeling himself back in from the fringe, or at least putting distance between himself and some of his loopier ideas. Left unmentioned in his book is the Seasteading Institute, a group Thiel funded that is planning to build inhabitable cities on giant platforms floating in the ocean. (“A small side project I got involved with that gets insane amounts of attention,” he now calls it.) Not all of Thiel’s plans will be as easy to dial back — later, after his talk at the Commonwealth Club, an audience member will accuse him of “encouraging delusional wannabes to drop out of school.”

Thiel thinks that many of the tech sector’s critics will ultimately be persuaded by the technology itself. “We’re skeptical of supersonic airplanes, we’re skeptical of new drugs, we’re skeptical of building better-designed nuclear power plants. When you had decades where not that much new stuff happened, people have low expectations, and that’s the context in which people are negative.”

So once people see Amazon drones flying over their heads, they’ll fall for them?

Something like that.”

One possible way to rekindle America’s love affair with technology, Thiel says, is just to build better stuff. “But the main way is probably still … I don’t know.” He loses himself in thought again, then, after a silence you could drop a Super Bowl commercial into, finds the idea he was looking for. “If you could change the movies … ”