Philip Delves-Broughton

The future made Thiel

Meet the hyper-successful investor who defines the technological cutting edge of American conservatism

The future made Thiel
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Turn right along the American political spectrum and you find all kinds of curious species. First there are country club Republicans bemoaning the loss of their party to extremists. Then come Evangelical Christians, trying to reconcile themselves to voting for a Mormon. Further along, you find the Tea Party, crowing over their improbable rise and Mitt Romney’s choice of Paul Ryan as his running mate.

Then somewhere out there past Ron Paul, the Texan libertarian, amongst the witchy thickets of Ayn Rand and techno-futurism, you will find Peter Thiel, billionaire technology investor, Christian, gay, and a man so committed to the idea of personal freedom that he is investing in ‘seasteads’, self-governing communities built on floating rigs out at sea, beyond the reach of any nation.

These seasteads are intended to be social and political laboratories, each one different, letting inhabitants hop from one to another in search of the perfect society. Choosing between Switzerland, non-dom life in London and the British Virgin Islands is not enough for Thiel. He craves a wider range of social options, free of ancient prejudices, legacies and lame-brained politicians. If it sounds a bit like Stromberg, the villain in The Spy Who Loved Me who was so disgusted with the world that he yearned to create an undersea civilisation, you wouldn’t be far wrong.

Thiel, 44, is the provost of a group of man-children who have come to prominence during the most recent Silicon Valley boom. Their most visible member is Mark Zuckerberg, the founder of Facebook. Thiel, who had already made a fortune as a founder of PayPal, paid $500,000 for a 10 per cent stake in Facebook in its earliest days, and has since sold most of that for more than $1 billion.

For a while he ran a hedge fund, Clarium Capital, which bet correctly on the US housing bust. Thiel misjudged the aftermath of the crisis and Clarium quickly shrank back from its $8 billion peak, robbing him of a chance to be the next George Soros. Nonetheless his still large fortune, acquired through technology investing, gained him attention, and his ideas kept people coming back.

Most of his peers remain studiously apolitical in public, for fear of disruption to their business lives. Thiel goes where even most libertarians fear to tread. In an essay published in 2009, titled ‘Education of a Libertarian’, he wrote: ‘In our time, the great task for libertarians is to find an escape from politics in all its forms — from the totalitarian and fundamentalist catastrophes to the unthinking demos that guides so-called “social democracy”….The fate of our world may depend on the effort of a single person who builds or propagates the machinery of freedom that makes the world safe for capitalism.’

That single person, he believes, will find such machinery in cyberspace, outer space or on the high seas. His partner in the sea-steading enterprise is Patri Friedman, a former Google engineer, blogging polyamorist and grandson of the economist Milton Friedman. Their hope is that there will be tens of millions of seasteaders by 2050, aboard hundreds of motorised residential structures. Thiel and Friedman consider the world’s governments a cartel, ripe to be broken.

There is a heady purity to Thiel’s political thinking, which he defends much as he would an idea for a business. Yes, it may be far beyond what most people would dare consider. But that is its magic. Most of us, especially those with expensive educations, tend to feel safest in packs. We see competition as the means to excellence. We crave what others like us crave. According to Thiel, what you should really want is to escape the sharp-elbowed herd and become a monopolist in your own self-defined niche.

Thiel loathes higher education, and he loathes anyone, employers especially, who rewards a degree-holder over a non-degree-holder, regardless of potential. Though he attended Stanford as an undergraduate and later as a law student, he believes that for most, university is a waste of time and money. And he doesn’t just chunter about the futility of degrees in exercise science or media studies. He genuinely yearns to upend the university system and force young people to engage in that noblest of endeavours: starting their companies, preferably in technology. Last year, he awarded 20 fellowships worth $100,000 each to 20 people under 20 willing to forego university and start a company. None are yet even close to reaching Thielian levels of success, but the programme was worth it if only for drawing the fretful scorn of the education establishment. Thiel has also challenged the biotechnology industry by investing in companies searching for ways to stave off ageing.

He has attributed the radicalism of his thinking to a childhood spent as a gifted loner. His parents came to the United States from Germany when he was a toddler. He was a formidable chess player in his youth, and a lover of fantasy novels. At Stanford, he founded the conservative newspaper the Stanford Review, which railed against political correctness on campus. As his friend, the former world chess champion Garry Kasparov, once told Wired magazine: ‘Most people think that if something’s written, if it’s shared by the majority of people, then you’ll look like a black sheep for challenging it. Peter doesn’t have any problem with that.’ Long before he was a billionaire, he was aggressively independent-minded.

His fearlessness extends to his nerdish tastes. He feels no shame as a middle-aged man expressing his devotion to Star Wars and Tolkien. He has named his latest investment fund Mithril Capital, after the super-lightweight metal mined by dwarves in The Lord of the Rings.

In ordinary times, it might be possible to dismiss Thiel as yet another rich crank. Except that he is one of the very few addressing, in his perverse yet prescient way, the central economic and social issue in America. The denizens of Silicon Valley are accelerating away from the rest of the economy at an ever faster rate, concentrating ever more wealth in ever fewer hands, and building ever larger companies while creating ever fewer jobs. It is a template for where modern economies are going, rent in two very uneven pieces. Thiel’s techno-future would be a utopia for a few, and hell for most, but as a focus for modern political thought, it is invaluable.