PayPal billionaire funds college-aged kids' ideas

Imagine being 19 years old and getting $100,000 to start your own company.

Alex Kiselev and 23 other college-aged entrepreneurs got to do just that when Peter Thiel, the billionaire co-founder of PayPal, gave them a fellowship in a program called "20 Under 20."

Kiselev, 19, dropped everything - including college, to reinvent the liquid chromatography-mass spectrometer, a medical device that analyzes a person's physical health.

Kiselev  told CBS News, "I hope to see my equipment in the end be the equipment used to help cure cancer or HIV-AIDS.

Kiselev believes he can radically change the world of medicine by making these expensive devices more affordable.

Kiselev explained, "The cost now is anywhere from $80,000 to $250,000. The cost I hope to achieve on the lower-end models is $5,000 to $10,000."

He is now the chief executive officer of Open Industrial, Inc., a high-tech start-up company.

Kiselev said, "All I'm doing is taking what's already been done ... and condensing it into a cheap enough instrument to sell it to the Third World and citizen scientists."

At 20 years old, Jim Danielson converted a gas-powered Porsche to electric while at Perdue University, and ended up quitting school two years before graduation to join the fellow program.

Danielson said, "The electric vehicle industry is changing quite rapidly right now.

Under Peter Thiel's program, the entrepreneurs must be committed to their field full-time, and actually give up college. They are given two years to prove their project will work.

Kiselev said, "The beauty of a start-up is, it's not a 9 to 5 job. This is the future. Your success. Your failure. Everything rides on your doing well."

On "The Early Show" PayPal co-founder Peter Thiel, and "20 Under 20" Thiel fellows Jim Danielson and Alex Kiselev discussed their work.

Thiel said the program that forces students to quit college isn't making "any categorical statements about education."

"It's good for some people, maybe most people to stay in school, but it is not good for everybody," he said. "There are people who are inventors, who are entrepreneurs for whom staying in school is not the right thing. And a lot of these ideas there's a certain right time and place for when they should be built. And if people have a passionate, great idea that is going to change the world, they should get started on it right away."

Thiel said the program had more than 400 applicants.

"We announced the program last September and it was an incredible caliber of people," Thiel said. "It was really encouraging thing. There's so much pessimism about the future of the U.S. and looking at the amount of people who are passionate about creating great, new businesses gives one a real sense that the future of the U.S. is going to be a lot better. These two, as well as the other 22 that we ended up selecting have been working on ideas for a number of years. Typically they have mastered like an incredible expertise at these things, and they are all good reasons why they will be able to do more outside of college than in college."

He added, "This is what the program is not about dropping out. Dropping out has the connotation you stop education and do nothing. I think all of these people will do a lot more outside of college than they would have done in college."

And the fellows say they're already making progress in their work outside of college.

Danielson said, "I've only had two days in Silicon Valley, but having 100 percent of my time to be able to dedicate to the project, I'm going to be able to move forward a lot faster than if I was spending a couple of hours a day after I finish classes."

Kiselev said he's been programming since he was 7 or 8 years old.

He said, "I've been doing everything outside of school and I think that I've learned everything I could through high school and college. And now it's time to get out in the world and build things that will change it."

As for going back to school, Kiselev says it would be counterproductive.

"It is a little bit far beyond that, because I believe that you should learn everything you need to know in the world," he said. "Just in the last week I've met so many entrepreneurs and learned so much that going back for example an MBA wouldn't be the best use of my time."

Thiel, who has an undergraduate degree and graduate degree from Stanford, added, "If I had to go back to college, I might still finish college and go to law school, but I would do one thing differently: (I would) think about it a lot more."

He continued, "I think one of the challenges with our school system has become so much the default of what people do. You're a senior in high school, you go to college, when you're a senior in college, you go to grad school. And education has become a way of not thinking about your future, and I think it is an incredibly valuable and an important thing to think about what great things you want to do in your life and not use education as a substitute for not thinking about the future."