Peter Andreas Thiel is an American entrepreneur, venture capitalist, and hedge fund manager.
Thiel cofounded PayPal with Max Levchin and Elon Musk and served as its CEO. He also cofounded
Palantir, of which he is chairman. He serves as president of Clarium Capital, a global
macro hedge fund with $700 million in assets under management; a managing partner in Founders
Fund, a venture capital fund with $2 billion in assets under management; and cofounder
and investment committee chair of Mithril Capital Management. He was the first outside
investor in Facebook, the popular social-networking site, with a 10.2% stake acquired in 2004
for $500,000, and sits on the company's board of directors. Thiel was ranked #293 on the
Forbes 400 in 2011, with a net worth of $1.5 billion as of March 2012. He was ranked #4 on the
Forbes Midas List of 2014 at $2.2 billion. Thiel lives in San Francisco, California.
Early life Childhood
Born to German parents in Frankfurt am Main, West Germany, Thiel moved to the United States
with his parents when he was a toddler, and was raised in Foster City, California. Thiel
was a US-rated Chess Master and one of the highest ranked under-21 players in the country.
College and law school Thiel studied 20th-century philosophy as an
undergraduate at Stanford University. He received his B.A. in Philosophy from Stanford in 1989
and acquired a J.D. from Stanford Law School in 1992.
An avowed libertarian, he founded The Stanford Review in 1987 along with Norman Book. The
Stanford Review became famous for challenging campus mores including political correctness
and laws against hate speech. The Stanford Review is now the university's main conservative/libertarian
newspaper. Thiel formed friendships with other students
at Stanford, many of whom contributed to the Stanford Review. These include Keith Rabois,
David O. Sacks, and Reid Hoffman. Some of these friends later took up jobs at PayPal
and became part of the PayPal Mafia. While studying at Stanford, Thiel also encountered
René Girard, whose mimetic theory influenced him.
Career Early career
Thiel clerked for Judge J.L. Edmondson of the United States Court of Appeals for the
11th Circuit. From 1993 to 1996, he traded derivatives for Credit Suisse Group. He founded
Thiel Capital Management, a multistrategy fund, in 1996.
PayPal In 1998 Thiel co-founded PayPal, an online
payments system, with Max Levchin. The company later merged with X.com, then headed by Elon
Musk. PayPal went public on February 15, 2002, and was sold to eBay for $1.5 billion later
that year. Thiel's 3.7 percent stake in PayPal was worth approximately $55 million at the
time of the acquisition. According to Eric Jackson's account of PayPal
in his book The PayPal Wars, Thiel viewed PayPal's mission as liberating people throughout
the world from the erosion of the value of their currencies due to inflation. Jackson
recalls an inspirational speech by Thiel in 1999:
"We're definitely onto something big. The need PayPal answers is monumental. Everyone
in the world needs money – to get paid, to trade, to live. Paper money is an ancient
technology and an inconvenient means of payment. You can run out of it. It wears out. It can
get lost or stolen. In the twenty-first century, people need a form of money that's more convenient
and secure, something that can be accessed from anywhere with a PDA or an Internet connection.
Of course, what we're calling 'convenient' for American users will be revolutionary for
the developing world. Many of these countries' governments play fast and loose with their
currencies," the former derivatives trader [referring to Thiel] noted, before continuing,
"They use inflation and sometimes wholesale currency devaluations, like we saw in Russia
and several Southeast Asian countries last year [referring to the 1998 Russian financial
crisis and 1997 Asian financial crisis], to take wealth away from their citizens. Most
of the ordinary people there never have an opportunity to open an offshore account or
to get their hands on more than a few bills of a stable currency like U.S. dollars. Eventually
PayPal will be able to change this. In the future, when we make our service available
outside the U.S. and as Internet penetration continues to expand to all economic tiers
of people, PayPal will give citizens worldwide more direct control over their currencies
than they ever had before. It will be nearly impossible for corrupt governments to steal
wealth from their people through their old means because if they try the people will
switch to dollars or Pounds or Yen, in effect dumping the worthless local currency for something
more secure."
Clarium Capital Immediately after selling PayPal, Thiel launched
a global macro hedge fund, Clarium Capital, pursuing a global macro strategy. In 2005
Clarium was honored as global macro fund of the year by both MarHedge and Absolute Return,
two trade magazines. Thiel’s approach to investing became the subject of a chapter
in Steve Drobny’s book, Inside the House of Money. Thiel successfully bet that the
U.S. dollar would weaken in 2003, and gained significant returns betting that the dollar
and energy would rally in 2005. After significant losses starting in 2009, Clarium dropped
from $7 billion in assets in 2008 to around $350 million in 2011.
In 2004, well before the financial crisis of 2007–2010 bore him out in general terms,
Thiel spoke of the dot-com bubble of 2000 having migrated, in effect, into a growing
bubble in the financial sector. He specified General Electric, with its large financing
arm, and WalMart as vulnerable. To illustrate, in 2004, he reported having backed away from
buying Martha Stewart's Manhattan duplex for $7 million in the winter of 2003-2004. While
the apartment did sell in 2004 for $6.65 million to another buyer, it was on the market but
unsold in early 2010 at $15.9 million, and later at the reduced price of $13.9 million.
Facebook In August 2004, Thiel made a $500,000 angel
investment in the social network Facebook for 10.2% of the company and joined Facebook's
board. This was the first outside investment in Facebook, and Thiel went on to be portrayed
in The Social Network by actor Wallace Langham. In his book The Facebook Effect, David Kirkpatrick
outlines the story of how Thiel came to make his investment: former Napster and Plaxo cofounder
Sean Parker, who at the time had assumed the title of "President" of Facebook, was seeking
investors for Facebook. Parker approached Reid Hoffman, the CEO of work-based social
network LinkedIn. Hoffman liked Facebook but declined to be the lead investor because of
the potential for conflict of interest with his duties as LinkedIn CEO. He redirected
Parker to Thiel, whom he knew from their PayPal days. Thiel met Parker and Mark Zuckerberg,
the Harvard college student who had founded Facebook and controlled it. Thiel and Zuckerberg
got along well and Thiel agreed to lead Facebook's seed round with $500,000 for 10.2% of the
company. Hoffman and Mark Pincus also participated in the round. The investment was originally
in the form of a convertible note, to be converted to equity if Facebook reached 1.5 million
users by the end of 2004. Although Facebook narrowly missed the target, Thiel allowed
the loan to be converted to equity anyway. Thiel said of his investment:
"I was comfortable with them pursuing their original vision. And it was a very reasonable
valuation. I thought it was going to be a pretty safe investment."
As a board member, Thiel was not actively involved in Facebook's day-to-day decision
making. According to Sarah Lacy, Thiel's main advice to Zuckerberg in their initial years
was "Just don’t fuck it up." However, he did provide help with timing the various rounds
of funding. Zuckerberg credited Thiel with helping him time Facebook's 2007 Series D
to close before the 2007–2010 financial crisis.
In September 2010, Thiel, while expressing skepticism about the potential for growth
in the consumer Internet sector, argued that relative to other Internet companies, Facebook
was comparatively undervalued. Facebook's IPO was in May 2012, with a market cap of
nearly $100 billion, at which time Thiel sold 16.8 million shares for $638 million. In August
2012, immediately upon the conclusion of the early investor lock out period, Thiel sold
almost all of his remaining stake for between $19.27 and $20.69 per share, or $395.8 million,
for a total of more than $1 billion. He still retained 5 million shares and a seat on the
board of directors. Angel investor and venture capitalist
In 2005 Thiel created Founders Fund, a San Francisco based venture capital fund. Other
partners in the fund include Sean Parker, Ken Howery, and Luke Nosek.
In addition to Facebook, Thiel has made early-stage investments in numerous startups, including
Booktrack, Slide, LinkedIn, Friendster, Rapleaf, Geni.com, Yammer, Yelp, Inc., Powerset, Practice
Fusion, MetaMed, Vator, Palantir Technologies, IronPort, Votizen, Asana, Big Think, Caplinked,
Quora, Rypple, TransferWise, Nanotronics Imaging, Stripe, and Legendary Entertainment. Slide,
LinkedIn, Geni.com, and Yammer were founded by Thiel's former colleagues at PayPal, Slide
by Levchin, Linkedin by Reid Hoffman, Yelp by Jeremy Stoppelman, Geni.com and Yammer
by David Sacks, and Xero by Rod Drury. Fortune magazine reports that PayPal alumni have founded
or invested in dozens of startups with an aggregate value of around $30 billion. In
Silicon Valley circles, Thiel is colloquially referred to as the "Don of the PayPal Mafia",
as noted in the Fortune magazine article. Thiel's views on management are highly regarded,
especially his famous observation that start-up success is highly correlated with low CEO
pay. Thiel founded Palantir Technologies funded
by the CIA's venture capital arm In-Q-Tel. In February 2013, Thiel received a TechCrunch
Crunchie Award for Venture Capitalist of the year.
Mithril: a late-stage investment fund In June 2012, Peter Thiel launched Mithril,
a late-stage investment fund with $402 million at the time of launch, intended for companies
that were at the cusp between being private and going public. Other partners in the fund
include Jim O'Neill, co-founder of the Thiel Fellowship, and Ajay Royan, a former managing
director at Clarium Capital, a hedge fund started by Thiel.
Philanthropy
Thiel carries out most of his philanthropic activities through a nonprofit foundation
created by him called the Thiel Foundation. Theory of philanthropy
Thiel concentrates the bulk of his philanthropic efforts on what he sees as potential breakthrough
technologies. In November 2010, Thiel organized a Breakthrough Philanthropy conference that
showcased eight nonprofits that he believed were working on radical new ideas in technology,
government, and human affairs. A similar conference was organized in December 2011 with the name
"Fast Forward". Machine Intelligence Research Institute
Thiel believes in the importance and desirability of a technological singularity. In February 2006,
Thiel provided $100,000 of matching funds to back the Singularity Challenge donation
drive of the Machine Intelligence Research Institute. Additionally, he joined the Institute's
advisory board and participated in the May 2006 Singularity Summit at Stanford as well as
at the 2011 Summit held in New York City. In May 2007, Thiel provided half of the $400,000
matching funds for the annual Singularity Challenge donation drive.
The organization was a participant in the Breakthrough Philanthropy conference and the
Fast Forward conference. Anti-aging research
In September 2006, Thiel announced that he would donate $3.5 million to foster anti-aging
research through the Methuselah Mouse Prize foundation. He gave the following reasons
for his pledge: "Rapid advances in biological science foretell of a treasure trove of discoveries
this century, including dramatically improved health and longevity for all. I’m backing
Dr. [Aubrey] de Grey, because I believe that his revolutionary approach to aging research
will accelerate this process, allowing many people alive today to enjoy radically longer
and healthier lives for themselves and their loved ones."
The Thiel Foundation supports the research of the SENS Foundation, headed by Dr. de Grey,
that is working to achieve the reversal of biological aging. The Thiel Foundation also
supports the work of anti-aging researcher Cynthia Kenyon.
The SENS Foundation was a participant in the Breakthrough Philanthropy conference and
the Fast Forward conference. Seasteading
On April 15, 2008, Thiel pledged $500,000 to the new Seasteading Institute, directed
by Patri Friedman, whose mission is "to establish permanent, autonomous ocean communities to
enable experimentation and innovation with diverse social, political, and legal systems".
This was followed in February 2010 by a subsequent grant of $250,000, and an additional $100,000
in matching funds. In a talk at the Seasteading Institute conference
in November 2009, Thiel explained why he believed that seasteading was necessary for
the future of humanity. In 2011 Thiel was reported as having given
a total of $1.25 million to the Seasteading Institute. According to the Daily Mail Peter
Thiel was inspired to do so by Ayn Rand's philosophical novel Atlas Shrugged.
The Seasteading Institute was a participant in the Breakthrough Philanthropy conference
and the Fast Forward conference. Thiel Fellowship
On September 29, 2010, Thiel said he had created a new fellowship called the Thiel
Fellowship, which will award $100,000 to 20 people under 20 years old, in order to spur
them to quit college and create their own ventures.
Breakout Labs In October 2011, the Thiel Foundation announced
the creation of Breakout Labs, a grant-making program intended to fund early-stage scientific
research that may be too radical or innovative for traditional scientific funding bodies
but also too long-term and speculative for venture investors. In April 2012, Breakout
Labs announced its first set of grantees. Other causes
The Thiel Foundation is also a supporter of the Committee to Protect Journalists, which
promotes the right of journalists to report the news freely without fear of reprisal,
and the Human Rights Foundation, which organizes the Oslo Freedom Forum.
Political activities Quotes
Peter Thiel wrote, on April 13, 2009, in the Libertarian 'Cato Unbound' blog, “Most importantly,
I no longer believe that freedom and democracy are compatible.” In the same article, he
also wrote, "Since 1920, the vast increase in welfare beneficiaries and the extension
of the franchise to women — two constituencies that are notoriously tough for libertarians
— have rendered the notion of “capitalist democracy” into an oxymoron."
On September 22, 2010, Thiel said at a 2010 fundraiser for the American Foundation for
Equal Rights, “I believe that gay rights and marriage rights for gay people should
not be a partisan issue,” and ”Gay marriage can’t be a partisan issue because as long
there are partisan issues or cultural issues in this country, you’ll have trench warfare
like on the western front in World War I. You’ll have lots of carnage and no progress.”
He wrote an editorial in National Review in 2011 claiming that the world had entered a
"tech slowdown" and that 1969 was when "the hippies took over the country, and when the
true cultural war over Progress was lost." Bilderberg Group
Thiel is listed as a member of the Steering Committee of The Bilderberg Group, a private,
annual gathering of intellectual figures, political leaders and business executives.
Support for political activism Thiel is a self-described conservative libertarian,
libertarian, and an Objectivist. Thiel has supported gay-rights causes such
as the American Foundation for Equal Rights and GOProud. In 2010, Thiel held Homocon 2010
for GOProud, a LGBT conservative/libertarian, in his New York City apartment. He invited
conservative columnist Ann Coulter, who is a friend of his, to Homocon 2010 to guest
speak. Coulter would later dedicate her new book, Demonic: How the Liberal Mob Is Endangering
America, to Thiel. In 2012, Thiel would donate $10,000 to Minnesotans United for All Families,
in order to fight Minnesota Amendment 1. In 2009, it was reported that Thiel helped
fund college student James O'Keefe's "Taxpayers Clearing House" video – a satirical look
at the politics behind the Wall Street bailout. O'Keefe went on to produce the ACORN undercover
sting videos, but through a spokesperson, Thiel denied involvement in — or even knowledge
of — the ACORN sting. In July 2012, after donating $1 million in
a single donation, Thiel became the largest contributor to the Club for Growth, a fiscally
conservative 501(c)4. Support for political candidates
Although a member of the Libertarian Party, Thiel donates overwhelmingly more political
contributions to Republicans. In December 2007, Thiel endorsed Ron Paul
for President. After Ron Paul failed to secure the Republican nomination for president, Thiel
contributed to the John McCain/Sarah Palin presidential ticket of 2008.
In 2010, Thiel supported Meg Whitman, who as CEO of eBay had purchased PayPal from Thiel
and his co-founders and investors, in her unsuccessful bid for the governorship of California.
He contributed the maximum allowable $25,900 to the Whitman campaign.
In 2012, Thiel, along with PayPal co-founder Luke Nosek and Scott Banister, an early adviser
and board member, put their support behind Ron Paul's Endorse Liberty Super PAC, alongside
Internet advertising veteran Stephen Oskoui and entrepreneur Jeffrey Harmon, who founded
Endorse Liberty in November 2011. Collectively Thiel et al. gave $3.9 million to Endorse
Liberty, whose purpose was to promote Texas congressman Ron Paul for president in 2012.
As of January 31, 2012, Endorse Liberty reported spending about $3.3 million promoting Paul
by setting up two YouTube channels, buying ads from Google and Facebook and StumbleUpon,
and building a presence on the Web. At the 2012 Republican National Convention, Thiel
held a private meeting with Rand Paul and Ron Paul's presidential delegates to discuss
"the future of the Liberty Movement." After Ron Paul again failed to secure the Republican
nomination for president, Thiel contributed to the Mitt Romney/Paul Ryan presidential
ticket of 2012. Other Republican politicians Thiel has contributed
donations to include Rep. James E. Rogan, Don Stenberg, Sen. John Thune Douglas Forrester,
Rep. Robin Hayes, Sen. John Cornyn, Sen. Elizabeth Dole, Sen. Lamar Alexander, State Sen. Dick
Monteith, Rep. Lee Terry, Sen. Chuck Hagel, Rep. Dan Lungren, Rep. Bob Beauprez, Rep.
Mike Simpson, Rep. Tom Tancredo, Rep. Mary Bono, Gov. Butch Otter, Rep. Dana Rohrabacher,
Rep. Nancy Johnson, Rep. Scott Garrett, Rep. Tim Johnson, Rep. Bill Thomas, Sen. Jeff Flake,
Sen. Jim DeMint, Sen. Jim Talent, Rep. Denny Rehberg, Rep. Rob Simmons, Rep. Jon Porter,
Rep. Roscoe Bartlett, Rep. Ed Royce, Sen. Susan Collins, Sen. Gordon H. Smith, Rep.
Bob Schaffer, John Neely Kennedy, Sen. Norm Coleman, Rep. Mike Coffman, Rep. Eric Cantor,
John Raese, Dino Rossi, Ryan Brumberg, Sen. Rand Paul, Randy Altschuler, Rep. Justin Amash,
State Sen. Richard Tisei, Kevin McCarthy, Sen. Ted Cruz, Josh Mandel, and Sen. Orrin
Hatch. The only Democrat Thiel has contributed donations
to is Ro Khanna. Khanna has been criticized by members of his own party as a "fiscal conservative",
"libertarian", and "Republican lite." Religious views
Thiel inherited his Christian beliefs from his parents. He grew up as an evangelical,
but he describes his beliefs as “somewhat heterodox,” complicated by his cultural
liberalism. “I believe Christianity is true,” he said. “I don’t sort of feel a compelling
need to convince other people of that.” Sonia Arrison, the author of “100 Plus,”
a book on research into life extension, first met Thiel in 2003, when she heard him give
a lunch talk about the failure of the U.S. Constitution. Eight years later, they are
close friends, but she has no idea of his religious beliefs. “He won’t tell me what
he is,” she said. “He thinks I should just know. He would never tell me whether
he believes in God.” During his time at Stanford, he had attended
a lecture given by a French professor named René Girard, which had led him to Girard’s
books, and he became a devotee. Girard had developed a theory of mimetic desire, of people
learning to want and compete for the same things, which attempted to explain the origins
of violence. Girard, a conservative Catholic, explained the role of sacrifice and the scapegoat
in resolving social conflict, which appealed to Thiel, offering a basis for his Christian
belief without the fundamentalism of his parents. Other pursuits
Media appearances and commentary Thiel is an occasional commentator on CNBC,
having appeared numerous times on both Closing Bell with Kelly Evans, and Squawk Box with
Becky Quick. He has been interviewed twice by Charlie Rose on PBS.
Thiel has contributed articles to The Wall Street Journal, First Things, Forbes, and
Policy Review, the journal published by the Hoover Institution, on whose board he sits.
Thiel is supposedly the inspiration for the Peter Gregory character on HBO's Silicon Valley
Awards and honors In 2006, Thiel won the Herman Lay Award for
Entrepreneurship. In 2007, he was honored as a Young Global leader by the World Economic
Forum as one of the 250 most distinguished leaders age 40 and under. On November 7, 2009,
Thiel was awarded an honorary degree from Universidad Francisco Marroquin In 2012, Students
For Liberty, an organization dedicated to spreading libertarian ideals on college campuses,
awarded Thiel its "Alumnus of the Year" award, and Thiel delivered the keynote address at
the 2012 International Students For Liberty Conference.
The Diversity Myth Thiel is the co-author, with David O. Sacks,
of the 1995 book The Diversity Myth: 'Multiculturalism' and the Politics of Intolerance at Stanford.
The book was critical of what it perceived as political correctness and a dilution of
academic rigor. It "drew a sharp rebuttal from then-Stanford Provost Condoleezza Rice."
According to his 2011 New Yorker profile, Thiel has backtracked somewhat from his assertions
in the book:
“All of the identity-related things are in my mind much more nuanced,” he said.
“I think there is a gay experience, I think there is a black experience, I think there
is a woman’s experience that is meaningfully different. I also think there was a tendency
to exaggerate it and turn it into an ideological category.” But his reaction against political
correctness, he said, was just as narrowly ideological.
Thank You For Smoking Thiel was the co-producer of Thank You for
Smoking, a 2005 feature film based on Christopher Buckley's 1994 novel of the same name.
Teaching In spring 2012 Thiel taught Stanford class
CS 183: Startup. References
Further reading Drobny, Steven. Inside the House of Money.
The Dot-Commer: Wiley. ISBN 0-471-79447-3. External links
Thiel Foundation profile The Optimistic Thought Experiment essay by
Peter Thiel published in Policy Review Audiovisual Media, NewMedia at Universidad
Francisco Marroquín Epub Version of Peter Thiel Lectures at Stanford
University, CS183: Startup