‘College dropout’ has become the most coveted qualification to be a startup founder

Iconic founders like Steve Jobs, Bill Gates, and Mark Zuckerberg famously did not graduate from college, but they have conducted multiple studies. Shows that the majority of successful startups have founders with bachelor’s or graduate degrees degree.

Despite this data, venture capitalists’ enthusiasm for “no-degrees” is far from constant, but the appeal of dropout founders continues. It’s a phenomenon that comes and goes, and we’re certainly having a moment right now in the midst of the AI ​​boom.

This trend is especially evident during Y Combinator Demo Day, where founders increasingly advertise their dropout status in one-minute pitches.

“While we do not believe YC officially tracks dropout status, anecdotally, we were struck by how many founders in recent batches highlighted being college, grad school, or even high school dropouts,” said Katie Jacobs Stanton, founder and general partner at Moxie Ventures. “Being a dropout is a kind of entitlement in itself and reflects a deep belief and commitment to building, and I think that is perceived as a very positive thing in the venture ecosystem.”

Many of the key founders of the AI ​​wave are young, but most still chose to stay to get their diplomas. For example, Cursor CEO Michael Truell graduated from MIT, and Cognition co-founder Scott Wu graduated from Harvard University.

But despite these examples, a growing number of would-be entrepreneurs are worried that by staying until graduation, they’ll be missing out on the most important part of the AI ​​build cycle. Some, like Mercor co-founder Brendan Foody, famously dropped out of prestigious schools like Georgetown to pursue startups.

Kulveer Taggar, founder of YC-focused venture firm Phosphor Capital, told TechCrunch: “There’s just this sense of crisis and maybe FOMO.” There’s a calculation at the moment: “Can I get my degree or else can I start building?”

This fear has led to extreme cases. A professor at an elite university recently spoke about students who dropped their degrees in their final semester. The student was convinced that having a diploma would actually hurt his chances of getting funding.

While some founders worry that a diploma can be a negative signal, Yuri Sagalov, head of seed strategy at General Catalyst, suggests that VCs are less attached to the dropout label, especially for students nearing graduation.

While self-taught tech geniuses can launch startups without formal education, Sagalov argues that the social networks and university brands that universities generate can still have value even if founders don’t receive a diploma.

“You get a lot of social value… because you can publicize the fact that you participated,” Sagalov said. “Most people will search for you on LinkedIn, but they don’t really care if you completed it.”

Many investors now believe that founders don’t need a college degree, but not all VCs agree that young founders have an advantage in this market.

Wesley Chan, co-founder of FPV Ventures, is less enthusiastic about investing in dropouts because he prioritizes a trait that most young founders don’t yet have: wisdom. Chan believes wisdom is usually found in “older founders and people who have had some scars.”