Brothers Rory and Kieran O' Reilly dropped out of Harvard to join the Thiel Fellowship program to build their own successful company Gifs.com in Silicon valley.

Kieran, 18 and Rory O'Reilly, 19 both quit Harvard as undergrads two years ago and headed to San Francisco to launch their own website. After months of intense coding, the duo were confident they were on to something when their website crashed because of massive user traffic. Today, their website gifs.com, a tool for re-editing online videos gets 17 million users a month.

"People that drop out of Harvard, maybe the Zuckerbergs of the world, they're the people that are really changing the entire world, in my opinion," said Rory O Reilly. "I'm glad to be a part of that."

The O'Reilly's are striking out in Silicon Valley because Peter Thiel, the billionaire co-founder of PayPal, gave them $100,000 each. One of the richest, best-educated American entrepreneurs, Thiel, thinks elite education is nothing but a nightclub with a long line. The child prodigy who breezed through Stanford Law School started the Thiel Fellowships five years ago, offering $100,000 and mentoring to young people if they’ll forego or drop out of college to “build new things.”

Instead of being stuck in a "college rut" the billionaire entrepreneur wants bright young people under 22, who are eligible for the Thiel fellowship, to explore their start-up ideas, do real science or work on a social movement. Waiting for graduation, Thiel says is an expensive waste of time.

Making a Case Against Thiel's Idea

Not surprisingly, the educational establishment has dismissed Thiel's idea as "dangerous and misguided."

Well-known academic and tech entrepreneur Vivek Wadhwa, who has faced off against Thiel on the value of higher education on "CBS Sunday Morning" and a globally telecast "Intelligence Squared" debate, told Braigainmag.com he was appalled by the message Thiel was sending young people.

"Thiel goes as far as giving elite students $100,000 to drop out of college. It glorifies college dropouts who start companies — even though the vast majority will fail and permanently wreck their careers," said Vivek Wadhwa, Director of Research in the Pratt School of Engineering, at Duke University.

"In the technology future we are headed into, the half-life of a career will be about five years because entire industries will rapidly be reinvented. Education counts more than ever. A bachelor’s degree is now the equivalent of high school and technology skills are as fundamental as reading and writing. Given this, my greatest frustration is that Silicon Valley is regressing by encouraging children to skip college and play the startup lottery," said Wadhwa.

Wadhwa came to the United States in 1980 to complete a Master's degree at New York University. He went onto build a software firm called Relativity Technologies (now part of IBM) which was hailed as one of the “coolest” companies in the world by Fortune magazine. Wadhwa helps students and fledgling entrepreneurs at Duke and Stanford University get better acquainted with the business world.

"It breaks my heart when some of the most promising students don't fulfill their potential because they're chasing rainbows," said Wadhwa, who has been one of the sharpest critics of the Thiel Fellowship.

"It's like what happens in Hollywood: You have tens of thousands of young people flocking to Hollywood thinking that they're gonna become a Brad Pitt or an Angelina Jolie; they don't," he said. "They don't become billionaires. There haven't been many Mark Zuckerbergs after Mark Zuckerberg achieved success."

Thiel Fellows are trying to follow a path made famous by some of Silicon Valley's biggest names: Mark Zuckerberg didn't complete Harvard, Steve Jobs dropped out of Reed College and Bill Gates dropped out of Harvard.

Thiel Fellowships get Entrepreneurs Going

Peter Thiel, co-founder of Paypal started the Thiel fellowship to pay promising students $100,000 to skip college and pursue their start-up ideas. Photo credit: iStockphoto.

The rising costs of higher education and the burden of student loans have made the Thiel Fellowships increasingly attractive. A select group of whiz kids seem to be thriving despite dropping out of college: proving you don't need a college degree to start a business. According to media reports, of the 105 people who started in the Thiel program, only 8 have gone back to college, and some of them have already sold their companies to Silicon Valley firms like Box and Palantir Technologies.

“You increasingly have people who are graduating from college, not being able to get good jobs, moving back home with their parents,” Thiel told "The New York Times" while pointing out that huge student loans can hurt your chances at success.

Thiel says that when you do something entrepreneurial, the credentials are not what really matters. What matters is having "the right idea at the right time, the right place."

What is Thiel encouraging? "If you have a great idea, the time to pursue it is now," said Jack Abraham, executive director of the Thiel Fellowship, which distributes the money to 20 new dropouts each year.

"We also hope to show society that this is an alternate path that people can and should consider and take," added Abraham.

Thiel Fellow Eden Full who describes herself as not pro-college or anti-college says that while the fellowship was the right move for her as a student, she doesn't believe the program is for everyone.

"It's for people who are naturally antsy to start on something, and they have a vision for how they want to impact the world and it can't wait," Eden told "Business Insider."

"For these people, she said, real life is a distraction, whether it's finishing college or getting a job."

Eden, one of the success stories of the program dropped out of Princeton at 19 to join the Thiel program. She worked on her startup SunSaluter, which makes a low-cost contraption that attaches to solar panels to provide cheap solar energy and clean water.

SunSaluter has a presence in 15 countries and a large factory in India. Originally from Canada, Eden now 24, lives in New York City, leads a global SunSaluter team and is expanding manufacturing from India to Malawi.

Eden says that through the Thiel Fellowship, she was able to meet with "the founder of a clean-tech start-up, a consultant in the solar industry, and a lawyer for start-ups."

Similarly, Thiel Fellow Aditya Ganesh, a computer science whiz, has developed IntentSense, an intelligent bionic glove that can be used by partial hand amputees to mimic a real hand. He is “interested in using machine learning and predictive analytics to personalize bionics and health care in general.”

According to the Thiel Foundation the 105 current and former Thiel Fellows have created more than 1,000 jobs and raised $330 million from investors.

The Thiel Fellowship selection committee is currently sorting through over 5,000 applications from 20 different countries to find this year's fellowship recipients. They accept rolling applications and review them as they come in.

Uttara Choudhury is Editor, North America for TV 18’s Firstpost news site and writes for Forbes India. In 1997, she went on the British Chevening Scholarship to study journalism in the University of Westminster, in London.