If you give an 18-year-old $100,000 not to go to college, will you create the next Mark Zuckerberg?
That's what venture capitalist and technology entrepreneur Peter Thiel wants to do with the "20 Under 20" project funded by his foundation.
Thiel told CNBC Thursday he wants to revitalize the technology sector in the developed world, specifically the areas of information technology, mobility, robotics and space, through giving students $100,000 and mentoring for two years.
"The idea was to focus on people who are 18 or 19 years old because this is the point where people are making a lot of decisions about their lives," he said. Going through four years of college while amassing thousands of dollars in student loan debt in order to take a job "may not move the dial on innovation" or the economy.
"Things that involve technology [and] innovation often involve a lot of risk," he said, "and I’m very concerned the enormous amount of debt run up by students prevents people from starting the kinds of companies that will move the dial on the economy."
College is not the only area where the costs have jumped since he finished college, added Thiel.
"I think the bar for IPOs remains incredibly high. We’re in a post-Sarbanes-Oxley world," he said. "Companies probably need to have a $5 billion or $10 billion market cap to have an IPO. That is the new normal when it was $200 million as recently as 1995."
Thiel said Wall Street has shown that, with some exceptions, it does not love the tech sector compared with other areas such as commodities.
"People on Wall Street believe in China, they do not like California. They do not like technology," he said. "I believe there is a radical divergence; people are super bullish on China, super bearish on California. I think some recalibration on that would be in order."
Thiel's investments include Linked-In , Paypal and Mark Zuckerberg's Facebook, on whose board he sits. He said there have been discussions about taking Facebook public but a strategic decision has been made to leave it private.
"We think it’s been better to build the company as a private company rather than a public," he said. "There are a lot of downsides to being a public company, and that’s not going to change anytime soon."