Peter Thiel
Based on Wikipedia: Peter Thiel
In 2004, a venture capitalist walked into a cramped Harvard dorm room and handed a college kid half a million dollars. The kid was Mark Zuckerberg. The venture capitalist was Peter Thiel. That single bet—made when Facebook was literally three people working out of a dormitory—would eventually return over a billion dollars. But money was never really the point for Thiel. He wanted to reshape the world.
And reshape it he has, though whether for better or worse depends entirely on whom you ask.
The Immigrant Who Became Silicon Valley's Philosopher King
Peter Andreas Thiel was born in Frankfurt, Germany, in 1967. His family emigrated to Cleveland when he was just one year old, following his father Klaus, a chemical engineer who hopped between mining companies. This meant young Peter never stayed anywhere for long.
The family's path took them through some of the world's most contested territories. Before settling in Foster City, California, in 1977, the Thiels lived in South Africa and South West Africa—the country now called Namibia—during the era of apartheid. For two years, Peter attended a German-language school in the coastal town of Swakopmund, where students wore uniforms and teachers struck children's hands with rulers as punishment.
Swakopmund's German community at the time was notorious for something darker: a continued glorification of Nazism, decades after the war had ended.
Thiel would later say that this regimented, conformist upbringing instilled in him a lifelong distaste for uniformity—a revulsion that would eventually blossom into his distinctive brand of libertarianism. His classmates, meanwhile, remembered him as brilliant but isolated. They kept their distance, knowing he would soon move on to another town, another school.
He changed elementary schools seven times.
The Making of a Contrarian Mind
Thiel found escape in fantasy. He played Dungeons & Dragons obsessively and devoured science fiction, particularly the works of Isaac Asimov and Robert Heinlein. But his deepest literary love was J.R.R. Tolkien. As an adult, he would admit to reading The Lord of the Rings more than ten times. This wasn't casual fandom—Tolkien's themes of hidden power, corrupting rings, and all-seeing stones would later permeate his business ventures in ways both obvious and subtle.
Academically, he was exceptional. He placed first in a California-wide mathematics competition while still in middle school. At San Mateo High School, he discovered Ayn Rand and developed an admiration for Nixon and Reagan, influenced by his parents. He graduated as valedictorian in 1985.
But even then, Thiel showed a willingness to operate outside conventional rules. According to reports, he charged underclassmen five hundred dollars each to take the SAT on their behalf—a scheme that could have cost him his spot at Stanford if discovered.
It didn't stop him.
Stanford and the Birth of a Network
At Stanford, Thiel studied philosophy. But his most lasting contribution to the university had nothing to do with his coursework. In 1987, when Stanford replaced its "Western Culture" program with a new course called "Culture, Ideas and Values"—designed to address diversity and multiculturalism—Thiel co-founded The Stanford Review as a conservative counterweight.
The newspaper became something more than a publication. According to the venture capitalist Marc Andreessen, it marked the beginning of a career-long strategy: Thiel would use provocative ideas, delivered through talks, books, and memorable slogans, to attract talented people to his orbit. Rather than actively recruiting, he let his controversial positions act as a filter, drawing in those who resonated with his worldview.
The strategy worked spectacularly. The Stanford Review spawned a network of industry leaders—by some counts, around three hundred people who would eventually work for or receive investment from either Thiel or Joe Lonsdale, another prominent editor who became Thiel's protégé. Several Review alumni went on to become public officials, including Jay Bhattacharya and Paula Stannard, who served as editors during Thiel's tenure as editor-in-chief.
This pattern—building intellectual communities that became talent pipelines—would repeat throughout Thiel's career.
From Law to Derivatives to Digital Money
After earning his undergraduate degree, Thiel stayed at Stanford for law school, graduating in 1992. During this time, he encountered the philosopher René Girard, whose "mimetic theory" would profoundly influence his thinking. Girard argued that human desire is fundamentally imitative—we want things because others want them, leading to competition, conflict, and eventually violence. This insight would later inform Thiel's business philosophy: avoid competition whenever possible, seek monopolies, and never fight battles where everyone else is fighting.
His legal career was brief. He clerked for a federal judge for a year, then joined the prestigious law firm Sullivan & Cromwell in New York. He quit in under twelve months.
Next came derivatives trading at Credit Suisse, where he worked in currency options. Derivatives are financial instruments whose value depends on—or "derives from"—something else, like the future price of a currency or commodity. It's a world of complex bets and leveraged speculation. Simultaneously, Thiel moonlit as a speechwriter for William Bennett, who had served as Secretary of Education under Reagan.
By 1996, Thiel was back in California, ready to capitalize on the internet boom.
PayPal: The Money Revolution That Almost Wasn't
With a million dollars raised from friends and family, Thiel launched Thiel Capital Management. His first significant investment was a hundred thousand dollars in a web-based calendar project run by his friend Luke Nosek.
It failed.
But Nosek introduced Thiel to Max Levchin, a cryptography expert with an idea for a company. That company, initially called Fieldlink, then Confinity, would become PayPal.
The problem PayPal solved was deceptively simple. In the late 1990s, online shopping was taking off, but paying for things remained clunky. Credit cards required merchants to have expensive processing equipment. Sending money to individuals meant writing checks or wiring funds through banks. Thiel envisioned a digital wallet—a way to transfer money securely using just an email address.
When PayPal launched at a press conference in 1999, representatives from Nokia and Deutsche Bank demonstrated the concept by sending three million dollars in venture funding to Thiel using their PalmPilots—the smartphone predecessors that were cutting-edge technology at the time.
The company grew through a series of mergers. In 2000, it combined with X.com, an online financial services company founded by a young entrepreneur named Elon Musk. They also acquired Pixo, which specialized in mobile commerce. These combinations transformed PayPal from a niche product into a mainstream payment system.
Thiel viewed PayPal's mission in almost revolutionary terms. He saw it as liberating people from governments' ability to erode their savings through inflation. Money, in his vision, could become something beyond state control.
PayPal went public in February 2002. Eight months later, eBay bought it for 1.5 billion dollars. Thiel's 3.7 percent stake was worth fifty-five million dollars.
In Silicon Valley, he became known as the "Don of the PayPal Mafia"—a reference to the extraordinary number of PayPal alumni who went on to found or lead major technology companies.
Clarium: Betting on the End of Oil
With ten million dollars from the PayPal sale, Thiel founded Clarium Capital Management, a global macro hedge fund. Macro hedge funds make bets on large-scale economic trends—currency movements, interest rate changes, commodity prices—rather than individual stocks.
Clarium's central thesis was peak oil: the theory that global oil production would soon reach its maximum and begin declining, with no easy alternatives available. If true, this would reshape the entire global economy.
For several years, the bet worked brilliantly. In 2003, Thiel correctly predicted the dollar would weaken. In 2005, Clarium returned 57.1 percent to investors when Thiel anticipated a dollar rally. By early 2008, the fund managed over seven billion dollars.
Then everything fell apart.
The 2008 financial crisis devastated Clarium's positions. The fund continued to struggle in 2009, missing the economic rebound entirely. By 2011, investors had fled, reducing assets under management to just 350 million dollars—two-thirds of which was Thiel's own money.
The peak oil thesis, as it turned out, was wrong. The fracking revolution would soon unlock vast new reserves of American oil and gas, transforming the United States into an energy superpower. Thiel had made a massive directional bet on a future that never arrived.
Palantir: The All-Seeing Stone
In May 2003, while still running Clarium, Thiel incorporated a very different kind of company. He named it Palantir Technologies, after the seeing-stones in Tolkien's Lord of the Rings—magical artifacts that could show visions of distant places and times but could also be used for surveillance and deception.
The choice of name was telling.
Thiel's idea grew from PayPal's fraud detection systems. The techniques they had developed to identify criminals abusing the payment platform, he realized, could be applied to a much larger problem: terrorism. In the aftermath of the September 11 attacks, American security agencies were drowning in data but struggling to connect the dots.
Thiel framed Palantir as a solution to what he saw as a false choice. The national debate, he argued, assumed Americans had to pick between more security with less privacy or less security with more privacy. Palantir would offer a third option: technology that could find terrorists without operating illegally.
Critics are skeptical of this framing. While Palantir's software technically only analyzes data that customers have already collected, the company's tools make surveillance dramatically more powerful and efficient. Professor Vasilis Galis has argued that the software isn't merely a neutral tool—it actively shapes policing culture, establishing new norms about what kinds of surveillance are acceptable.
The company's intellectual foundations are unusual for a tech firm. According to analysts Geoff Shullenberger and Moira Weigel, Thiel and his co-founder Alex Karp built Palantir's philosophy on their readings of Leo Strauss, a political philosopher associated with neoconservatism, and the Frankfurt School, a tradition of Marxist-influenced critical theory. It's an unlikely combination—right-wing and left-wing intellectual traditions fused into a surveillance technology company.
Thiel has served as Palantir's chairman since its founding.
The Facebook Bet
The meeting happened in August 2004. Mark Zuckerberg, then a twenty-year-old Harvard dropout, pitched his social networking site to Thiel. Facebook was barely six months old, operated by three people out of a dorm room.
Thiel invested five hundred thousand dollars for a 10.2 percent stake, valuing the entire company at 4.9 million dollars. It was Facebook's first outside investment. Thiel also bought Zuckerberg a car.
Technically, the investment was structured as a convertible note—a loan that would convert into equity only if Facebook reached 1.5 million users by the end of 2004. Facebook narrowly missed the target. Thiel converted the loan to equity anyway.
His influence on the company went beyond what's typical for a board member. Some Facebook employees reported that Thiel wielded unusual power for someone who wasn't the chief executive. Critics accused him of pushing both Zuckerberg and the company toward right-wing positions. Supporters credited him with helping Facebook time its 2007 funding round perfectly, closing before the 2008 financial crisis devastated the markets.
When Facebook went public in May 2012, Thiel began selling. He unloaded 16.8 million shares for 638 million dollars at the initial public offering. Three months later, when the lock-up period ended for early investors, he sold almost everything else—another 395.8 million dollars worth of stock at prices between nineteen and twenty-one dollars per share.
His total return exceeded one billion dollars on a half-million-dollar investment.
In February 2022, Thiel announced he would leave Facebook's board after seventeen years. His stated reason: to focus on supporting candidates aligned with Donald Trump in the upcoming elections.
Founders Fund and the Turn to "Hard Tech"
In 2005, Thiel created Founders Fund, a venture capital firm based in San Francisco. His partners included Sean Parker, the Napster co-founder who had helped Facebook in its early days, along with PayPal veterans Ken Howery and Luke Nosek.
The fund's early investments included many of the companies that would define the next decade of technology: Airbnb, LinkedIn, Spotify, SpaceX, Stripe. But Thiel grew dissatisfied with the direction of Silicon Valley innovation.
After Facebook, despite its enormous financial success, Thiel pushed Founders Fund to pivot toward what he called "hard tech"—companies working on fundamental technological challenges rather than social applications. His reasoning was philosophical: while companies like Twitter might achieve high valuations, they wouldn't "take civilization to the next level."
The fund increasingly focused on defense-related startups. The Economist has noted that Founders Fund and Thiel personally have a history of incubating companies that do sensitive work related to national security. The fund views Palantir, the defense contractor Anduril, and a nuclear energy startup called General Matter as a trilogy—with plans to add more companies working on technologies like advanced semiconductor manufacturing.
Among Thiel's inner circle, who know well his devotion to Tolkien, the fund has acquired a nickname: "the Precious," after the One Ring that Gollum covets in The Lord of the Rings.
The Quantum Computing Bets
Founders Fund has made investments that reveal Thiel's thinking about the future of computing itself. The fund backed both PsiQuantum, which is developing quantum computers using photons—particles of light—and Rigetti Computing, which uses superconducting circuits.
Quantum computing represents a fundamental shift in how calculations are performed. Traditional computers process information as bits—ones and zeros. Quantum computers use quantum bits, or qubits, which can exist in multiple states simultaneously thanks to the strange physics of the subatomic world. If successfully scaled, quantum computers could solve certain problems that would take traditional computers longer than the age of the universe.
By investing in two different approaches, Thiel is hedging his bets on which technology will ultimately prove viable—while ensuring he has a stake in whichever one succeeds.
The Philosophy Behind the Billions
What makes Thiel unusual among billionaires isn't his wealth but his ideas. He has been described as "perhaps America's leading public intellectual today" and the "intellectual architect of Silicon Valley's contemporary ethos."
His philosophy is a distinctive blend: libertarian skepticism of government, combined with contrarian views on democracy itself. He has described himself as no longer believing that freedom and democracy are compatible—a position that has earned him labels ranging from "conservative libertarian" to "democracy-skeptic authoritarian."
The common thread is a belief that conventional wisdom is usually wrong, that competition is for losers, and that the future belongs to those bold enough to pursue monopoly power in uncontested spaces. These ideas, articulated in his book "Zero to One" and his famous Stanford lectures, have become influential throughout Silicon Valley.
Whether this influence has been positive is hotly debated. To admirers, Thiel represents intellectual seriousness in an industry often criticized for shallow thinking. To critics, he has provided sophisticated justifications for concentrating power in the hands of a small technological elite.
The Gawker Affair
In 2016, a bizarre legal case reached its conclusion. Hulk Hogan, the professional wrestler whose real name is Terry Bollea, had sued Gawker Media for publishing a sex tape. The jury awarded Hogan 140 million dollars, bankrupting Gawker.
Then Thiel revealed that he had secretly financed Hogan's lawsuit.
His motive was personal. Years earlier, Gawker had published an article outing Thiel as gay—something he had kept private. The publication did so casually, treating his sexuality as gossip rather than news. Thiel never forgot.
Rather than sue Gawker directly, which would have attracted media sympathy for the underdog publication, Thiel found a more elegant solution. He funded other people's lawsuits against the company, providing them with top legal representation they couldn't otherwise afford. The Hogan case was simply the one that succeeded.
To supporters, this was justice—a wealthy individual using his resources to hold a reckless media outlet accountable. To critics, it was a chilling demonstration of how billionaires can destroy publications they dislike by weaponizing the legal system.
Citizenship and Controversy
In 2011, Thiel was granted New Zealand citizenship, despite not meeting the normal residency requirements. The decision later became controversial in New Zealand, raising questions about whether wealthy foreigners were receiving preferential treatment in exchange for investment.
Thiel has made substantial donations to American right-wing figures and causes. Through the Thiel Foundation, he funds the Thiel Fellowship, which pays young people to drop out of college and pursue entrepreneurship, and Breakout Labs, which supports early-stage scientific research.
His political evolution has been striking. The man who once wrote for a conservative college newspaper now occupies a position in American politics that defies easy categorization—supporting Trump while maintaining close relationships across Silicon Valley, advocating for technological progress while questioning the foundations of liberal democracy.
The Lord of the Rings Connection
Throughout Thiel's career, Tolkien's mythology appears again and again. Palantir is named after the seeing-stones. Founders Fund is nicknamed "the Precious." Another Thiel-backed fund is called Mithril Capital, after the precious metal in Middle-earth that is lighter than silk but harder than steel.
This isn't mere branding. Tolkien's work contains themes that resonate with Thiel's worldview: the danger of centralized power (the One Ring), the value of small groups of determined individuals against vast impersonal forces (the Fellowship), and the idea that some knowledge is too dangerous to be widely shared (the palantíri, which corrupt their users).
Whether Thiel sees himself as Gandalf, guiding events from behind the scenes, or as someone else in the mythology entirely, remains an open question.
The Man Behind the Money
As of May 2025, Forbes estimated Thiel's net worth at 20.8 billion dollars, making him the 103rd-richest person in the world. But wealth has always seemed secondary to influence in Thiel's calculus.
He remains chairman of Palantir, a company that has become deeply embedded in the surveillance infrastructure of Western governments. He continues to shape Silicon Valley's direction through Founders Fund's investments. His network of proteges and allies spans technology, media, and politics.
The lonely boy who changed schools seven times, who found escape in fantasy novels and mathematics, who learned to distrust conformity in a town still nostalgic for Nazism, has become one of the most powerful figures in American technology and politics.
His vision—of technological progress unbound by democratic constraints, of monopolies as the natural goal of ambitious companies, of a world where the talented few should be freed from the limitations imposed by the many—continues to spread through the industry he helped build.
Whether that vision leads to liberation or tyranny may be the defining question of the technological age.