Frager Factor

Friday, October 19, 2018

He too started with a small million loan from family...but his next IPO is the mother of all IPOs

Meet Trump supporter Peter Thiel... 

A gay immigrant who has probably done more to move the world forward then more iconic tech geniuses we hear about. 

Thiel has started, invested in and advised some of the most important technology companies in the past 20 years, earning himself a fortune in the process. 

Limited thinking is not Thiel's style. Thiel's background is as diverse as you'd expect, given his non-linear style.

He excelled in math, was a master chess champion at 12, was valedictorian at Stamford, first editor in chief of Stamford Law Review, clerked for appeals court judge, securities lawyer at major firm, derivatives trader on wall street, and WH speech writer, leaving it all behind to do something more meaningful with his life.

Upon returning to the Bay Area, Thiel noticed that the development of the internet and personal computer had already altered the economic landscape and the dot-com boom was well underway. 

With financial support from friends and family, he was able to raise $1 million toward the establishment of Thiel Capital Management and embark on his venture capital career. Max Levchin, a friend of a friend, introduced him to his cryptography-related company idea, which later became their first venture called Confinity in 1998.

With Confinity, Thiel realized they could develop software to solve a gap in making online payments. Although the use of credit cards and expanding automated teller machine networks provided consumers with more available payment options, not all merchants could gain the necessary hardware to accept credit cards. Thus, consumers were often left with little choice and instead had to pay with exact cash or personal checks. 

Thiel wanted to create a type of digital wallet in the hopes of ensuring more consumer convenience and security by encrypting data on digital devices, and in 1999 Confinity launched PayPal.

His small $1 million family loan was cashed out for $55 million when eBay acquired PayPal for $1.5 billion.

In August 2004, Thiel made a $500,000 angel investment in Facebook for a 10.2% stake in the company and joined Facebook's board. This was the first outside investment in Facebook, and put the valuation of the company at $4.9 million. 

He has since turned his $500K investment into a cashout of over a billion dollars. However he sold when stock was $19-38. 

At today’s value, even after recent dip, had he held it it would be worth $58 billion. 

However, using that billion to launch something else, he made much more. He invested in SpaceX, Spotify, Palantir Technologies, Slide, LinkedIn, Friendster, Votizen, Quora, Rypple, TransferWise, Stripe, Airbnb, and emerging Canadian Cannabis behemoth Tilray.

In mid-2017 Thiel’s Founders Fund bought $15–20 million worth of bitcoin. In January 2018 the venture capital firm told investors that due to the cryptocurrency's surge the holdings were worth hundreds of millions of dollars. Thiel now sees“It’s like bars of gold in a vault that never move, and it’s a sort of hedge of sorts against the whole world going falling apart.”

While Peter Thiel remains in the long game of Bitcoin, he’s not a total idiot, he knows the odds and pegs them at around 80 percent, that the world’s first cryptocurrency would ultimately become worthless. People have been claiming the end of money for decades now, and if fiat converted into blockchain digital money is one interpretation — that reality could be upon us as central banks pivot to the blockchain. In the act of doing this however, cryptocurrencies take on a new light and tangibility.

Just press releases announcing Thiels involvement with Bitcoin and Tilray drew investors in drove and artificially inflated values for a short time.

Thiel Is About To Get Richer


Going public could more than double Thiel’s net worth—and prove that, even in Palo Alto, a close relationship with the Trump administration can pay off.

Palantir, the hyper-secretive data-mining company founded by Trump homie Peter Thiel and C.E.O. Alex Karp, is almost as mysterious as the clients it works for. 

Started in 2003 and with seed money from the C.I.A., Palantir has developed a suite of surveillance technologies that have reportedly been used by the military to hunt down Osama bin Laden, to avoid roadside bombs, and by police departments to predict crimes before they happen. 

On the civilian side, Palantir has a team of some 2,000 engineers, half of whom are deployed to client sites to embed with Fortune 500 companies and Wall Street firms with a singular goal: to run every kilobyte of available data through an algorithm that makes traditional consultancies look like dinosaurs. 

If that all sounds somewhat sinister, Thiel doesn’t seem concerned. A longtime Tolkien fan, Thiel named Palantir after the all-seeing crystal ball that the evil wizard Saruman uses to spy on his enemies. In 2014, living up to its name, Palantir began designing a new intelligence platform for ICE.

Peter Thiel has made his biggest political contribution since his divisive bet on Donald Trump in 2016, investing $1 million into a conservative advocacy group that is backing key Republican candidates before November.

About The Author: Owen Frager is an Internet marketing expert ready to help take your company to the next level.

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