Photo: Peter Thiel (left) and Elon Musk, X.Com Corp. chairman and CEO respectively, show the cards they use for what became PayPal in 2000. The initial goal was to create an Internet currency to replace the dollar. Photo: PAUL SAKUMA / PAUL SAKUMA / Associated Press 2000
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Here is a brief excerpt from an especially interesting article about Peter Thiel written by Julian Guthrie for SFGate, the Hearst-owned website sister-site of the San Francisco Chronicle and the go-to online source for all news and entertainment related to the Bay Area. With a Pulitzer prize and 22 million readers each month, the SFGate publishes a moment-by-moment, 360˚ view of San Francisco that is wildly reflective of right now for the most mobile and social audience in the country.
To read the complete article and check out others, please click here.
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Whenever Peter Thiel interviews someone for a job or listens to a startup pitch, he wants to know: “What important truth do very few people agree with you on?”
The contrarian question is key for Thiel, considered one of the great tech investors and entrepreneurs of our time. The answer he’s looking for has more courage than brilliance, makes a statement about the future, and is anti-competitive.
“I think we could be doing a lot better,” said Thiel, 46, the PayPal co-founder and first outside investor of Facebook, sitting in his gleaming investment office in the Presidio of San Francisco. “We have a tagline, ‘They promised us flying cars and all we got was 140 characters.’ I’m pro Silicon Valley; it’s still where the most innovation happens. But we need to be doing more to take our civilization to the next level.”
Thiel, whose $500,000 investment in Facebook netted a $1 billion return, added, “I’ve come to think of tech, and the tech industry, as one of the best ways for people to impact our world today. It’s not actually clear that making money by itself gets you that much impact. There’s no shortage of money; there is a shortage of ideas. That’s what’s much more valuable in our world.”
Thiel, introvert, billionaire, philosopher and rebel — he tells employees to pass on startup pitches by engineers wearing suits — has written a new book that has already become required reading for tech entrepreneurs. Called Zero to One: Notes on Startups or How to Build the Future, the book asks myriad questions, from, “What valuable company is nobody building?” and “How are startups and cults alike?” to “Can we permanently escape misfortune?” It presents competition as something that undermines originality, and makes the distinction between horizontal and vertical progress — between copying what works and creating something new, between going from zero to n, and zero to 1.
“Cliff Notes’’ of ideas
“The book is Peter’s ‘Cliff Notes’ of his last 15 years as an entrepreneur,” said computer scientist and PayPal co-founder Max Levchin. “The fact that he codified his thoughts is probably testament to his getting older. Peter is still tough. He is still very curious about life. But I think he’s gotten even more aware of his intellectual needs.”
Jeremy Stoppelman, an engineer at PayPal who went on to co-found Yelp with seed money from Levchin and Thiel, calls Thiel an “interesting-person magnet.”
“He has an eye for potential talent, and when he spots someone who might do something interesting, he’s extremely generous,” said Stoppelman. “Once Yelp got started, I would call Peter every two or three months and we’d go on runs at Crissy Field. He was always available. He was a startup mentor and adviser to me.”
Thiel, whose parents are German and moved the family from Frankfurt to the Bay Area, grew up in Foster City and graduated from San Mateo High. By his own admission, he was highly competitive, introverted, and great at math and chess — at age 12 he was ranked seventh nationally in the under 13 age group.
One of his best friends wrote in Thiel’s eighth-grade yearbook that he was “most likely to attend Stanford.” Peter, who has a younger brother, had his quarterly allowance tied to his grades. His favorite book as a teenager was The Lord of the Rings.
As predicted, Thiel (pronounced “Teal”) earned a bachelor’s degree in philosophy and a law degree from Stanford. He worked briefly for the white-shoe New York law firm, Sullivan & Cromwell, before returning to the Bay Area to start his hedge fund, Thiel Capital. (Of Sullivan & Cromwell, Thiel says, “Everyone on the outside wanted in, and everyone on the inside wanted out.”)
Thiel was giving a lecture at Stanford on currency trading when he was approached by a 23-year-old Ukranian scientist who wanted to talk about a new company. Thiel and Levchin met the next morning for smoothies on University Avenue, and talked about the company that would become PayPal.
It was the late 1990s, and dot-com mania was under way. Thiel received a $5 million wire transfer from a South Korean firm interested in investing in PayPal, without negotiating a deal or signing any papers.
“When I was running PayPal in late 1999,” Thiel writes in Zero to One, “I was scared out of my wits — not because I didn’t believe in our company but because it seemed like everyone else in the Valley was ready to believe anything at all.” The initial goal of PayPal was to create a new Internet currency to replace the U.S. dollar. Their first product, which let people send money between PalmPilots, was voted one of the 10 worst business ideas of 1999.
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Here is a direct link to the complete article.
Julian Guthrie is a San Francisco Chronicle staff writer. E-mail: firstname.lastname@example.org