2140 Jefferson Street 2016

The Marina District mansion that PayPal co-founder, turned iconic Silicon Valley venture capitalist, Peter Thiel, purchased for $6.5 million in 2010 (and then spent a pretty penny to reconfigure and redecorate), has just hit the market listed for $9.25 million.

Thiel had actually rented the 7,000-square-foot home at 2140 Jefferson Street, which overlooks both the Palace of Fine Arts and Golden Gate Bridge, for a number of years prior to his well-timed purchase of the pad for $1.7 million less than the $8.2 million the seller’s were seeking in 2009.

And to quote Thiel, with respect to his concerns about the current “frothiness” in the market, at a conference in San Francisco last month: “Startup tech stocks may be overvalued, but so are public equities, [and] houses…”

55 thoughts on “Iconic Silicon Valley VC Selling His Marina Mansion and HQ”
  1. Here’s a guy who puts his money where his mouth is. Let’s see if he finds a Greater Fool (TM) and cashes out.

  2. This post brings back memories from the old days. 🙂 Looks to be improved over the last time it emerged on the market.

  3. Location and views are great. Privacy is minimal. Interior design is pottery barn bland. Thiel sounds like one boring dude.

    As for his prognostications, is he selling off his tech stocks? I doubt it, so just another person shooting his mouth off. We’ll see.

    In the meantime, if he had any vision and taste, he’d get a good designer for that place. Maybe he could enjoy it and hold on to long term value, as location is prime. But no, just another techie with bad taste.

      1. Just FB, and as soccermom pointed out, he got hosed.

        Why you such a Debbie downer on the economy anyways? You own RE. It’s incongruent to own RE and be a permabear. Might as well have cashish in your mattress, no?

        1. I’m bearish when things are overvalued, bullish when undervalued, as best as I can tell. But especially vocal about this unicorn bubble because it’s been bad from a quality of life perspective- friends all moved away, horrible traffic, lame attitudes, etc. I bought real estate for the long haul so not too worried either way. The last bubble was private debt, this bubble is corporate debt, the next bubble will be public debt and that’s when our real estate holdings will really pay off.

          1. Soon they’ll be forced to admit that monetary stimulus has failed and will have to switch to fiscal stimulus.

          2. I agree the added traffic is annoying (especially in the eves, I hate getting my take out food cold due to added traffic.)

            But why the hate on all the new peeps? These are the ones paying you premium rent. Can’t bite the hand that feeds 😉

            Also I don’t mind the mix of new and old. Old SF was getting rather staid with all these boring liberal boomers anyways. i don’t mind an influx of hipsters, tech bros and cute gals in yoga pants coming around.

          3. “Soon they’ll be forced to admit that monetary stimulus has failed and will have to switch to fiscal stimulus.”

            Maybe I’m too pessimistic, but I wouldn’t count on that. TPTB will let go of their hold on wealth creation when 1) there’s a gun held to their head, or 2) they’re offered a better deal in exchange.

            These people — the pillars of our society — are sociopaths. They won’t give up one inherited or stolen cent without a fight, without a threat to their well-being, and they’re incapable of seeing that the well-being of society in general _is_ in their own best self-interest. They’d sooner trash civilization — go down with the ship — then let people who work for a living get a break.

        2. Hmmm, turn $500k into $1B or turn $500k into a house in the Bayview.
          Not sure that he’s the one who got hosed here.

          1. A. It’s houses (numerous) not house (one)

            B. It’s zero of my own money (moderate leverage)

            C. I’m not in an exclusive-rich-prick-guy club like thiel

            D. But like thiel, I ain’t workin’ either!

          2. Hey, at least you’re honest about landlording not being work. Adam Smith and David Ricardo emphatically agree.

    1. Or, maybe he guy just wanted to move.

      Not everything is A Referendum On Tech. Maybe he lived there for a while and wanted to move

  4. He might end up in the red on this one, so much for the “smart money”. Business Insider had not one but two great articles this weekend about the upcoming unicorn bust. And if you like economics, do not miss the Druckenmiller speech from the Sohn Conference last week.

  5. Peter Thiel sold @ 20 million shares of Facebook for around $20 each in 2012, netting nearly $400mm. Those shares would be worth $2 billion today. Being ‘iconic’ isn’t necessarily isn’t necessarily knowing how the market will behave in the future.

    Nice house though, seems like being too close to the tourist hordes is the main drawback. Close to the bridge and Marin!

      1. (When you tee it up that high, I can’t help myself)

        If you’re happy with $1 instead of $5, your screen name makes a lot more sense.

        1. What can a person do in life to enjoy $2 billion that couldn’t be done with $400 million? Or is the goal simply to amass as much as possible, regardless of the negative externalities engendered by such acquisition?

          1. I think a lot of the shares that were sold were institutionally-held, as in Venture funds whose clients typically include pension funds and insurance companies.

            So, with 2 billion dollars, you can pay for five times as many retirement benefits, or life insurance benefits etc..

            If you’re a baker, you’re supposed to bake well. If you are a house painter, you’re supposed to paint houses well. If you are a money manager, you’re supposed to make investments grow.

          2. “What can a person do in life to enjoy $2 billion that couldn’t be done with $400 million?”

            Buy art, real estate, boats and jets; influence politicians, start companies, fun developments, etc.

          3. Seriously, you don’t think $400 million can buy many lifetimes worth of “art, real estate, boats and jets; [] politicians, [] companies, fun developments, etc.”

            But you’re right: it buys them politicians, i.e. power, and this is the exact reason why most Americans feel they have never left the recession.

        2. The investor was able to receive a nice return multiple on his original investment.

          The stock price could have gone down just as well as it has gone up. Remember, this is the time when Zynga was already trading at a significant discount from original IPO price.

          Perhaps you should stick to watching soccer games instead of offering up investing advice?

    1. Thiel invested $500,000 in facebook in 2004. Like most VCs he has been selling off this shares overtime. He sold a big chunk in the IPO and then the 20 million in 2012, after which he still had more than 5 million shares. The big sales in 2012 brought his cash out to more than a billion.

      BTW, he just sold another ~800k shares for ~$100 million a week ago. He still owns more than $25 million in FB shares. He is nearly cashed out after a great ROI. Let me know the next time you turn $500k in more than $1 Billion.

      FWIW, he wasn’t a techie at Paypal. He has visions, some of which foresee the market, others ….

      1. Thiel made a great investment in Facebook. It would have been better had he waited to sell that big chunk of shares. The point is that even people who are regarded as experts are frequently wrong about market price moves.

        1. Thiel was the first major investor in FB. He beat all the ‘smart’ money, even Jim Breyer of Accel came in after Thiel. And Breyer is very very smart money.

          Thiel doesn’t have to play the sucker game of ride the public market rollercoaster. That’s the game outsiders gotta play, worrying about “market price moves” and longing for mere 5 to 1 returns. Try finding a market price move that could return 500 to 1, and you’ll realize he games at an exclusive casino, a private capital market by invite only, not a public market.

          BTW, he structured his original $500k as a loan convertible to stock. Even with as near a sure thing on the upside as has been in this millennium, he protected his downside.

          1. He seems bright, but his investment strategy is nowhere near as spot on as Yuri Milner’s.

          2. Sure Jake, public equity markets don’t matter to venture capitalists and a convertible note is an innovative venture investment structure. You got this one nailed.

          3. Of course the public equity markets matter to VCs that specialize in seed and early rounds like Theil. He extracted more than $ billion from them on these FB trades alone. And not the first $ billion he has extracted from them either. And I never said a convertible note was an innovation. You’re just making stuff up now.

            There are VCs and investment bankers that specialize in market plays, e.g. Mitt Romney at Bain Capital and all the other leverage buyout barbarians at the gates. They would be delighted at 5 to 1, even 2 to 1. Those vultures have been circling Zynga and other walking woundeds.

            Like comparing formula one and nascar: both fast, competitive, with spectacular crashes, but one is higher octane and much more exclusive.

          4. So much froth and billion dollar garbage out there in the market these days and you want to harp on one of the few VC investments that actually worked out? And actually worked out in a company that actually makes a profit? And your point of harping is to compare his return to some hindsight theoretical max return?

          5. Jake – Private Equity investors like Bain Capital are neither venture capitalists nor investment bankers. If you really can find me an investor who would turn down a 5X return in 4 years, I will show you someone who has not been an investor for very long.

            Thiel is an incredibly talented guy, lawyer, derivatives trader, investor, hedge fund manager etc.. He had a great call on excessive leverage in the global economy in the 07 peak period while running Clarium. The pity was that he didn’t express it through the purchase of CDX contracts like Paulson, Burry and everyone else who really reaped the profits. What I was told or read (can’t remember) was that Thiel actually thought more of the investment banks would go under and didn’t want the counterparty risk in a CDX trade. He bought treasuries and made some money, when he should have bought CDX swaps and really crushed it. Instead, his investors lost money elsewhere and pulled a lot of funds our from under him. He’s a brilliant iconoclast and I am a big fan.

            But just because he’s selling a house, it doesn’t mean everyone ought to list her home… That was my original point.

          6. So Thiel says: “Startup tech stocks may be overvalued, but so are public equities, [and] houses…”, and you huff and puff and try to blow his home sale down.

            Yet you lap up some press release from a condo marketing firm about how “Now is a great time to buy”

          7. soccermom, no one was guaranteed a 5 to 1 return on FB stock in 2012, so there isn’t an option to “turn down a 5X return in 4 years”. You just making up more stuff and ignoring my point that Thiel has made most of his money by investing early, then cashing out post-IPO, and then reinvesting early again with the intention of making much more than the public market offers. Afterall, anyone could have bought FB shares in 2012, sat on them until now, and made your 5 to 1. Only a few people could have bought FB shares in 2004….

            FTR, Romney was a VC at Bain Capital. That is how he founded and ran it for years. “One of Bain’s earliest and most notable venture investments was in Staples…Bain Capital eventually reaped a nearly sevenfold return on its investment, and Romney sat on the Staples board of directors for over a decade….Beginning in 1989, the firm, which began as a venture capital source investing in start-up companies, adjusted its strategy to focus on leveraged buyouts and growth capital investments in more mature companies.” – wikedpedia

          8. Jake – If Thiel didn’t have a good sense of the value in public securities markets he would not have started Clarium Capital. I am fairly sure his first ‘real job’ was as a junior derivatives trader at CSFB. I suspect you’ve grasped only a portion of Thiel’s work history. Why would he invest time and energy in trading public securities if he had a magical pipeline of private companies to which to dedicate his capital?

            If Bain is a great venture capital company, and not a private equity firm, please point me to three start-ups-made-good in which Bain has invested. Unless buying crazy vacation homes qualifies as venture investing, Mitt Romney is not a venture capitalist

            I’ll let you have the last word on this as always. Swing away.

          9. One need only spend 3 seconds on Bain Capital’s website to see that it does both private equity (listed first) and venture capital (listed 4th) work.

            But it doesn’t really matter. Peter Thiel hit about as big a grand slam as one could hit with facebook. I don’t think he needs more life insurance.

            Now, as to this house . . . it is about 7 times as big, and has way better views, but from the photos, with that furniture, it looks eerily like my grandmother’s house on the south side of Chicago circa 1977. Even the wicker patio furniture.

          10. Soccermom, I never wrote anything like “Thiel didn’t have a good sense of the value in public securities markets.” That really has nothing to do with my point, which was that Thiel made a killing with his FB investment because he got to the party early, very early, not because he had exquisite timing on his exit. Same is true of his other big payoff, Pay Pal, though of course he helped found and run it as well. I haven’t extolled his talents, you have though. I don’t know him well enough to judge his talents, but he sure has had some great opportunities.

            And, of course, I also never wrote anything like “Bain is a great venture capital company, and not a private equity firm.” FTR, Romney was a VC at Bain. That is how he founded and ran it at first. They raised venture funds and put them into startups, most famously Staples. These are facts and history you can look up. Romney moved Bain away from startup ventures to leverage buyouts, which by most accounts were a better fit for his skill set. Romney at Bain was first a VC and then an LBO shark. I don’t think it matters what Bain Capital is now, not wrt to the points that I made anyway.

            There wouldn’t be any need for a last word by any of the many of us that have responded to you on this thread, if you would just respond to what we actually wrote, instead of making things up.

          11. “He’s a brilliant iconoclast and I am a big fan. ”

            That’s interesting. What other sociopaths are you a big fan of?

        1. That’s how VC works. Lots of “small” bets hoping one provides outsized returns for the whole fund.

          1. Exactly. Who knows how many other bets he lost his ass off, but I can guess it’s plenty. VC funds in general don’t have spectacular returns, outside of a few lucky ones that win a few big hits in one fund. You read about those. The others? Usually forgotten.

    2. Name me one investor where you couldn’t go back with hindsight and find a single trade where they could have made a larger profit?

      What did he get into these shares at? Did he beat the S&P on this trade?

      Money managers are judged vs benchmarks such as the S&P or risk free rate. Judging against maximum theoretical hindsight profit is ridiculous.

    3. Except that what if he took that $400M, reinvested it in other startups, and it will be worth $5B in 2020? Then it would look pretty stupid of him to settle for an extra $1.6B in FB.

      Now I don’t know what he did with the $400M and I don’t care, but without knowing more it’s unclear whether this was a good decision or not.

  6. Thiel hasn’t actually lived here for many months — he renovated a place up on the Gold Coast. It was always decorated blandly, but this is probably purely staged. It is almost a great location, but actually quite awkward for both car and foot traffic.

  7. Fantasy buyer would be George Lucas so he can overlook his museum at the the (seismically retrofitted) Palace of Fine Arts. One can dream…

  8. I guess the stereotype that gay men have fabulous taste in interior decorating isn’t necessarily true

  9. Pretty dull looking house. Makes it seem hardly worth the bother to become a billionaire.

  10. Thiel is now out of the closet for Trump. I may have to actually agree with the normally too-pessimistic Two Beers; Thiel may indeed be a sociopath. Seems to have zero empathy, lives in his mind.

    Not a human being with any admirable qualities outside of a ledger. How about Warren Buffet as a counterpoint?

    [Editor’s Note: And now back to the property and sale(s) at hand…]

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