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Dropout grants raise issue of college’s value

Big-name magnates left early

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Christopher Rueth blew off college for a once-in-a-lifetime opportunity: a $100,000 grant to work on wireless Internet technology.

The 17-year-old San Diego native is part of the 20 Under 20 grant program started by Peter Thiel, co-founder of PayPal and an early Facebook investor. The business magnate is now paying promising innovators to skip college and pursue their own ideas instead. The initiative has fueled debate about whether the ever-rising cost of a college education is worth it.

In forgoing a college degree, Mr. Rueth and his 20 Under 20 colleagues are following in some famous footsteps: Bill Gates, the billionaire Microsoft founder, dropped out Harvard without getting a degree; Michael Dell, CEO of the behemoth computer company that bears his name, never finished his studies at the University of Texas; and Steve Jobs, the iconic Apple chief, left Reed College in Oregon without a diploma.

More recently, Facebook founder Mark Zuckerberg dropped out of Harvard and made billions of dollars as CEO of the world's most successful social networking site. At least 19 Fortune 500 CEOs never finished college, according to a recent survey by U.S. News & World Report. Talk-show host Rush Limbaugh dropped out of Southeast Missouri State University after two semesters and a summer but has become the nation's most successful radio personality.

Despite those stories, Mr. Rueth still hasn't convinced his toughest critic that he is doing the right thing.

"My dad isn't thrilled that I'm not going to college," he told The Washington Times.

The vast majority of parents share that sentiment. In a recent Pew Research Center study, 94 percent said they expect their child to attend college. Before connecting with Mr. Thiel's foundation, Mr. Rueth planned to do just that.

"I certainly did have the plan to go off to college, until I realized that I didn't fit in," he said. "I never really fit in in high school. I was always 'that hacker kid.' In the right situation, and if someone can afford it, college can be the right direction. But if you're a nonconformist, you're just not going to be happy there."

While not enthusiastic about college, Mr. Rueth was fascinated by the Internet. He plans to use his $100,000 grant to develop Wi-Fi hot spots that can break through government barriers in places such as Iran and China, where government heavily controls Internet access.

Gary Kurek, another beneficiary of a Thiel Foundation grant, was offered a full scholarship to the University of Calgary. He turned it down.

"I still personally think the traditional road of education, going to college, is still the best route for most people," he said.

"But there are a handful in every crowd that are a little more rebellious, a little different, that need something else," said Mr. Kurek, an Edmonton, Alberta, native who plans to use his $100,000 for research into mobility aids for the physically disabled.

Before finishing high school, he founded GET Mobility Solutions and has developed, among other things, a walker-wheelchair hybrid.

But the dropout success stories are the exceptions, not the rule, education specialists say.

Trying to follow the examples of Mr. Gates, Mr. Zuckerberg or Mr. Kurek carries serious risk for the average student, said Brooks C. Holtom, associate professor in the McDonough School of Business at Georgetown University and consultant to the U.S. Chamber of Commerce, the International Monetary Fund and the World Bank.

"These are exceptional people," he said of those who avoid college but succeed in the business world. "If you look at lifetime earnings of high school graduates and people who are college undergraduates ... you see important differences. You're talking about millions of dollars in lifetime earnings. But when you have a classmate who [drops out and finds success], it's easy to say, 'Well, hey, I wonder if?' "

The brightest minds with the best ideas, Mr. Holtom added, increase their chances of success with a college education.

"Having the theories, the framework from school, you increase the odds that you can execute on that idea," he said.

The chances of an average student founding a cutting-edge company like Apple or a wildly popular website like Facebook, Mr. Holtom said, are slim.

The vast majority of students instead will find work with established companies, which are rarely interested in people without college degrees. Most people, he said, "are average," and shouldn't convince themselves that a better life awaits if they drop out of college or skip it altogether.

The average college graduate will earn about $20,000 more each year than the average person with only a high school diploma, according to 2010 data from the U.S. Census Bureau. Those with master's or doctorate degrees typically further enhance their earning power.

With that in mind, the Thiel Foundation isn't recommending that every student drop out of college.

"For some people, college is a really shrewd investment," foundation Director James O'Neill said. "But for other people, college is basically a debt-fueled luxury good" that doesn't lead to a good job.

He said innovators often have to set aside their ideas and find steady jobs to pay off thousands of dollars in college debt. By working with Mr. Kurek, Mr. Rueth and others, Mr. O'Neill said, their creativity will be more easily unleashed.

Even while pursuing their dreams, the 20 Under 20 participants aren't closing any doors.

"In two years, if my company goes belly up ... I can always just go back to school," Mr. Kurek said.

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