[How About This Book] The PayPal Mafia Who Designed Silicon Valley Wealth

PayPal Valued at $1.5 Billion... Jackpot from eBay Acquisition in 2002
Elon Musk, Lacking Social Skills... Success in Founding Tesla and SpaceX
Thiel as Facebook's First Investor... Levchin Founded Affirm Holdings

"Because I was so lacking in social skills, I couldn't talk to anyone. So I just stood in the lobby. It was really embarrassing. I just stood there looking around for someone to talk to, but suddenly I got scared and just left."

The speaker is Elon Musk, CEO of Tesla. In 1995, Musk applied for a job at Netscape, which was popular as an internet browser at the time. Musk was debating whether to go to graduate school or start a business, and ended up trying to get a job as a middle ground. He thought employment was a middle choice between graduate school and entrepreneurship. However, Netscape never contacted him. Curious about the reason, Musk boldly visited Netscape headquarters to hear any story, but ended up leaving without doing anything.

Now the world's richest person who sometimes dives fearlessly into political debates, Musk showed a rather shy side in his younger days. Although his awkward choices and decisions are hard to imagine from his current image, even then Musk had a clear vision for the future. At that time, Musk made a list of fields that could have a big impact in the near future: the internet, space exploration, and sustainable energy. He already had visions for Tesla Motors and SpaceX.

[How About This Book] The PayPal Mafia Who Designed Silicon Valley Wealth

The Founders focuses on the youth of the giants who now dominate Silicon Valley, including Musk. The author, Jimmy Soni, mentions Silicon Valley giants such as Musk, Peter Thiel, Max Levchin, and Reid Hoffman. They are all known as the PayPal Mafia.

In 2007, the American business magazine Fortune gathered 13 PayPal alumni at an Italian restaurant for a group photo and ran a cover story titled "The PayPal Mafia." In the cover photo, PayPal co-founders Thiel and Levchin sit at the front table. On the table are drinks and poker chips, and Levchin holds cards, creating a gangster vibe. In the far back, YouTube co-founder Jawed Karim and Yelp founder Jeremy Stoppelman stare directly at the camera while holding cigars.

Soni’s The Founders sheds light on the history of PayPal from its founding to its sale to eBay in 2002. It explores the stories of PayPal alumni who grew into powerful figures dominating Silicon Valley. They established the massive laws of wealth that govern Silicon Valley today. Although not appearing in Fortune’s cover photo, Musk co-founded PayPal alongside Thiel and Levchin. Steve Chen and Chad Hurley, who co-founded YouTube with Karim, are also PayPal alumni.

Photo of the PayPal Mafia featured on the cover of the 2007 issue of the American economic magazine Fortune. The two people sitting at the front table are Peter Thiel (left) and Max Levchin, who co-founded PayPal along with Elon Musk.

Levchin was born in 1975 in Kyiv, Ukraine. When Levchin was eleven in 1986, the Chernobyl nuclear power plant accident occurred near where he lived. Levchin’s parents immigrated to the United States in 1991. Levchin happened to attend a finance lecture by Thiel at Stanford University, was deeply impressed, and formed a connection with him. In 1996, Thiel raised money from friends and family to launch a hedge fund called Thiel Capital. In December 1998, Thiel Capital lent $100,000 in operating funds to Levchin’s company. Levchin’s mobile device startup founded in 1998 was Fieldlink. Levchin wanted to serve as CTO and have someone else as CEO, and later Thiel joined as CEO. Fieldlink changed its name to Confinity in 2000, and Confinity merged with X.com, an internet bank founded by Musk, to create PayPal. PayPal was acquired by eBay in 2002 for $1.5 billion, and the PayPal Mafia sat on a fortune. Rather than enjoying a comfortable life with wealth gained at a young age, the PayPal Mafia continued to take on challenges. Musk used the proceeds from selling PayPal shares to establish Tesla and SpaceX. Thiel founded Palantir and Founders Fund and became Facebook’s first investor. Thiel also became a major Republican donor, supporting Donald Trump heavily in the 2016 U.S. presidential election, exerting significant influence in politics. Levchin founded fintech company Affirm Holdings and invested in Yelp, founded by his PayPal colleague Stoppelman.

The book is nearly 700 pages long but is easy and quick to read. Soni spent six years interviewing hundreds of people and reviewing thousands of pages of internal documents to tell an engaging story. Various episodes unfold, such as Musk buying an expensive McLaren F1 after selling his first startup and nearly dying in a car accident while giving Thiel a ride.

In the preface, Soni introduces the conflicting views on the PayPal Mafia. Some see them as heroes, while others view them as heretics who should be punished as representatives of the harms caused by today’s big tech companies. In the epilogue, Soni shares the story of two convicted murderers who were deeply inspired by the PayPal Mafia, showing a tendency to defend the heroic perspective.