Meet The VC Who Invests In High Schoolers

Michael Gibson shares insights on identifying extraordinary talent in young people from investing in them early via his VC fund 1517.

He explains how classic predictors like test scores fail to capture entrepreneurial gifts like courage, initiative, and "insider-outsider" status. Homeschoolers often excel as they're self-driven. Malcolm notes EA types who use funds practically tend to thrive.

They discuss why cities lack on-ramps for talent, risks of attaching to "smart" identity, and how youth's fluid intelligence enables conceptual leaps elders miss. Overall Michael concludes talent ID is tough, but development is key - we must cultivate qualities like grit young.

Simone Collins: [00:00:00] Michael Gibson. He is the co founder of the VC fund, the 1517 fund, which invest in young people typically before they've gone to college,

Malcolm Collins: how do you judge the competence of somebody who's young,

Michael Gibson: yeah, we learned a lot. Well, when we started the fellowship, we had an application a lot like colleges. We asked for test scores, GPA, what school you went to. And that was good at, certainly signaling cognitive ability, but we quickly learned it was not a strong predictor of success out in the wild. And so we had to start looking for other things . There were even negative correlations that were surprising.

Would you like to know more?

Simone Collins: Hello. Today we are joined by Michael Gibson. He is the co founder of the VC fund, the 1517 fund, which is game changer in terms of venture capital investment, because they invest in young people typically before they've gone to college, sometimes during but he also wrote a book that I've enjoyed very much called paper belt on fire, which I really encourage you to.

Simone Collins: Yeah. Check out, but we're not going to be [00:01:00] talking so much about the book today. We really want to get into Michael's work with the 1517 fund with how he spots young talent with things he's learned from his investments and the people he's worked with and the people he's found through this fund, because I mean, Oh my gosh, the talent you're meeting, it's, it's insane.

Simone Collins: So we're really excited to dive into this and thank you so much for joining

Michael Gibson: us. Yeah. Thanks for having me.

Simone Collins: So the biggest thing that I'm really curious about, cause it's been a while now, you know, you're like, you've been, you've been doing this for years at this point. And you've done a lot of hustling.

Simone Collins: I mean, like sleeping on couches, staying up all night, going to these crazy young person parties. I couldn't do this, you know, like young people stay up late and I'm like, my bedtime's at eight 30. you're doing these. I

Malcolm Collins: went, I, sorry, I got to take a little detour here. So I went on this trip to, I don't know, somewhere in Central America.

Malcolm Collins: With a bunch of Peter Thiel fellowship kids and they like they went out like I, I hadn't gone to a party, like a club in years, but I was like, maybe it's gotten better. Maybe it's not as bad as I remember. And I get there and I'm [00:02:00] stuck there until 1 30 in the morning and it's loud and it's sweaty and it's gross.

Malcolm Collins: And it was just as pointless as it always was. And you have to deal with this stuff. I think professionally. It's all about how you. Get these young geniuses interested in working with what you guys are doing. How do you sell yourself to them?

Michael Gibson: Man, well, that is certainly part of it. Yeah, it's funny is it's such a slippery, tough craft that we're constantly reexamining the foundations of what we do.

Michael Gibson: And, and one of the I guess, two different problems that we constantly wrestle with, or, or, you know, we, I guess we're trying to figure out which problem we're, we're. Operating in one is if you are a fisherman, is it better to be in a well stocked river? Our pond. So it's you're one of those bears just grabbing salmon cause they're flying in your face where in this case, the fish are, you know, talented people building startups or is it better to focus on the craft [00:03:00] of fishing, like being the best, you know, it's like you could identify the one fish that's in the stagnant pond and find it and fish it out.

Michael Gibson: You know, that's, so this is like the two problems we struggle with. We're like, okay, which one is it better to be? Is it better to find the location where just talented people are and then figure out what they're working on? Or is it better to, you know, hone your skill pattern matching skill at okay, does this person have the right stuff and just, you know, go out there, you know, looking for that.

Michael Gibson: And so, so, so that is a trade off. Or, you know, I can't, I guess I'm saying it's two problems. It's just one problem. It's which one are we in? So to that end is yeah, I've been in hacker houses. I've lived in ecosystems and, you know, tried to go native to the extent that I can, but now that I'm getting older, I've lost the steps.

Michael Gibson: So maybe I, like you said, it's. It's tough to keep pace with a 21 year old.

Malcolm Collins: Let's talk about what a hacker house is, because our audience may not even know what this is. And I think for young people who don't [00:04:00] grow up or maybe live in like more rural environments, it's useful to know that this other world exists that they can then move into, which is a quick path.

Malcolm Collins: to move up. Hacker houses are houses where near tech hubs, because it's often too expensive to have a house yourself. A number of young people get together and put together a house. Now, hacker houses have variable levels of prestige. And so you want to make sure you get into a prestigious hacker house, which typically means you're gonna want to find someone in the hacker house ecosystem and ask them in the city you're planning to move to typically San Francisco or New York.

Malcolm Collins: If you're moving into hacker houses or London, I suppose. Which are the most prestigious hacker houses right now in this area? My brother and his wife actually ran a hacker house for a long time in Silicon Valley house. It was one of the high, high prestige ones. Yeah. Yeah. The icebreaker was probably the one that everyone knew about during that

Michael Gibson: time period.

Michael Gibson: Yes. I, that was on the boat. Right. Yeah. Yeah. Some

Malcolm Collins: people got, so hacker houses are usually pretty weird. So they would the icebreaker, what they did is they got an old icebreaker, it's like a Norwegian icebreaker and they [00:05:00] converted it into a house that was on the pier by San Francisco and people would have parties there and stuff.

Malcolm Collins: Can you talk about some of the more modern hacker houses you've seen? What they're like? It's interesting.

Michael Gibson: Yeah. I wish. Yeah. Yeah. Yeah. It'd be great if they had some intelligibility, meaning you could, you know, find a list of hacker houses. You could find an ordering of okay, here's what you get out of these.

Michael Gibson: But I, it's, it's much more underground and not widely publicized. I guess you got to hear about them through word of mouth or some Reddit chat group or something of that nature. Yeah, they come and go too. And and, and, and, and they're driv