This top VC has bet close to 20% of his fund on teenagers — here’s why

Kevin Hartz is no stranger to seizing opportunities. In 2001, he co-founded Xoom, revolutionizing international money transfers when it was still a cumbersome process reliant on services like Western Union. The company went public in 2013, and in 2015, PayPal acquired it for a staggering $1.1 billion. Following this success, he co-founded Eventbrite, which transformed the ticket-buying experience and went public in 2018. After a period at Founders Fund, Hartz established his own venture firm, A* Capital, named after a computer science algorithm. His keen eye for trends led him to capitalize on the SPAC boom in 2020, culminating in a $2.1 billion reverse merger with 3D printing firm Markforged in 2021, just as the trend was gaining momentum across Silicon Valley. Hartz is now focusing on a fresh trend: investing in teenage entrepreneurs. This is not merely a social experiment; it has evolved into a strategic investment thesis. His firm recently provided funding to Aaru, an AI-based predictive platform founded by a youth still too young to drive. He is not alone in this venture; the movement of young founders echoing the paths of giants like Steve Jobs and Mark Zuckerberg is gaining traction among ambitious youths. Cory Levy, an intern-turned-entrepreneur who left college after just one year, now leads Z Fellows, a week-long accelerator that offers $10,000 grants to technical founders, including high school students. Levy recalls that when he dropped out a decade ago, the Thiel Fellowship was a groundbreaking concept. Today, he observes that dropout culture is increasingly prevalent, with many young innovators opting for entrepreneurship over traditional education. Y Combinator, a key player in nurturing startup culture, has also adapted by launching a program for students who wish to start their own companies while still in school, allowing them to apply and secure funding before graduation. This shift reflects a growing acceptance of alternative paths to success. In a recent discussion, Hartz noted that many bright young individuals find themselves unchallenged by conventional schooling, prompting them to pursue their entrepreneurial ambitions. He shared examples of impressive young founders, including one team with members aged 15, 16, and 18. Hartz compared Z Fellows to the Thiel Fellowship, highlighting that while both aim to support young talent, Z Fellows operates on a more aggressive footing. He pointed to the rising costs of higher education and the shifting job landscape as factors driving teenagers to consider entrepreneurship as a viable option. As the nature of work evolves, with an increasing number of individuals opting for freelance roles over traditional jobs, Hartz predicts a surge in entrepreneurial activity. He reflected on the exhilaration and challenges faced by young founders, acknowledging the intense pressure that accompanies early success. When asked about his own daughters’ futures, Hartz expressed his hope for a balanced education experience, yet he remains open to their aspirations of starting their own ventures. Remarkably, he disclosed that nearly 20% of his recent investments have been in teenage-led companies, a notable increase from approximately 5% just two years prior. This shift signifies a burgeoning era where young innovators are not only participating in the tech landscape but actively shaping its future.