By Kate Clark | Photography by Cody O'Loughlin for WSJ

CAMBRIDGE, Mass. -- Andrew Castellano had tough news for his parents over the winter break: He was taking a leave of absence from Harvard University halfway through his sophomore year to work full-time on his AI startup.

His mother cried. His venture capital backers saw an opportunity.

Castellano and his co-founder, Nebiyu Demie, who met working campus jobs as freshman computer science students, moved out of the dorms and straight into an apartment complex owned by their investors, Cambridge-based Link Ventures. Their next-door neighbors are three Delta Kappa Epsilon fraternity brothers developing AI that helps insurance companies sell more policies.

During this blisteringly fast phase of AI development, it's no longer enough for venture capital firms to invest in companies. They're buying apartments and workplaces, Ikea furniture and dishes, and providing housekeeping for their teenage and 20-something founders. The logic: fewer responsibilities mean more waking hours for working.

Starting a company has never been easier or required fewer people. New AI tools like Claude Code help write and debug software faster, and spin up a website or a marketing plan.

Venture capital money is abundant, and every minute feels precious. Many founders say there is a short window of opportunity to build something new before AI systems become smarter than humans. And they see a chance to make a fortune.

"If you wait until after you graduate," said Castellano, a first-generation college student whose parents immigrated to the U.S. from Ecuador and Venezuela, "all the good ideas are going to be already taken."

Many students take breaks from school with no real intention of returning. Universities -- and parents -- often prefer to call them leaves rather than acknowledge that the students are dropping out. Leave policies vary by school. MIT, for example, allows undergraduates to take up to four semesters off.

While young founders have long dropped out of college to chase startup dreams during past technological booms, this time, their financial backers are funding housing for them and ensuring their daily needs, from changing sheets, taking out the trash and booking travel, are met.

Competition to invest in the best talent is intense, and that talent is increasingly younger. The average age of founders of so-called AI unicorns -- companies worth more than $1 billion -- has fallen from 40 in 2020 to 29 in 2024, according to investment firm Antler.

Link Ventures founder Dave Blundin spent $5.4 million of his own money last year to buy a six-unit, 10,000 square foot apartment building near MIT in Cambridge to house some of the founders the firm has backed.

He and his staff talk about the prospect of AI riches, sharing stories of teenagers who got into elite universities, but barely stayed through orientation.

"I'm first trying to convince them that there's nothing else you can do in life right now," said Blundin, who graduated from MIT in 1988 and went on to found several companies, including insurance marketplace EverQuote. "If it were me, would I even vaguely think about going back to class? Not even close."

After buying the building, Blundin spent another $500,000 on renovations, redoing floors, painting cabinets and gutting rust-stained ceramic tubs, to "make it a little more techie looking," said Karen Green, Link's office manager whose staff jokingly refer to as the "den mother." She furnished the apartments, keeps them tidy and looks after the young residents.

"I'd do anything for them," she says.

Green outfitted the apartments with Ikea furniture, a snake plant and Martha Stewart kitchenware. There are telltale signs of the age of the apartments' residents: a happy birthday sign from months earlier still hangs on the wall of the fraternity brothers' apartment and a leftover keg lingers in the building basement.

Life in the apartments revolves around work -- and the fuel required to keep going. The fraternity brothers, whose startup is called Vocara, are former varsity football and baseball players. They added only one notable appliance to their kitchen: a giant pot for rice, large enough to meal-prep a week's worth of carbs in one batch. Since their latest round of venture funding, they've mostly upgraded to daily Chipotle.

The Vocara founders graduated from MIT last spring. Other founders who drop out say their universities aren't moving fast enough to adapt coursework to the AI era. Some question whether four years in the classroom is still worth the time, especially as the unemployment rate for new graduates rises and they scramble to AI-proof their careers.

"I don't think you necessarily need college anymore," said Shraman Kar, 19, who left Stanford after completing his freshman year last spring, then raised $4.5 million for his AI video startup Golpo. Kar lives in Palo Alto with his older brother, who dropped out of Stanford at the same time to work on the startup.

A torrent of money is pouring into AI startups. Global venture capital investment hit a record in the first quarter of this year, according to Crunchbase data, pulling in a new generation of founders eager to raise capital before interest wanes.

"It's a modern gold rush," said Christine Zhang, who took leave from Harvard last spring after her freshman year to build an AI platform that helps healthcare providers predict how patients will respond during a clinical trial or treatment, raising $1.3 million. At 19, she said there is little risk to giving it a shot.

"My worst-case scenario is going back to Harvard, which isn't a worse-case scenario at all," said Zhang, who now lives in San Francisco.

Ben Rhodes-Kropf grew up dreaming of a spot at MIT, where his father, Matt Rhodes-Kropf is a professor in the finance department.

But when his acceptance letter arrived in 2024, the AI boom was already well underway, and an offer from Y Combinator to join its accelerator program in the winter won out.

After finishing the accelerator program, which counts OpenAI chief Sam Altman among its graduates, Rhodes-Kropf, 21, raised $5 million for his defense tech startup, SalesPatriot.

He now lives in a house with 10 of his employees in San Francisco's Twin Peaks neighborhood, where investor money pays the rent, for a personal chef, a house cleaner and someone to make sure the trash gets taken out and the fridge is stocked with LaCroix. It also paid for them to convert the garage into a gym and add a cold plunge pool to the deck, changes that help ensure they can work 15 hours per day, seven days per week, and to rarely leave the house.

SalesPatriot is growing fast, but regardless of how it fares, Rhodes-Kropf says working on a startup looks good on a resume. "You become very employable because you learn all this crazy stuff, even if your company blows up," he said.

For many parents, that gamble can be hard to stomach. But the AI boom has made their old advice of picking a safe major and pursuing a stable career feel a lot less certain.

The unemployment rate for recent college graduates was 5.6% as of December, according to the Federal Reserve Bank of New York, compared with 4.2% for all workers. The unemployment rate for computer science majors has climbed to 7%.

Matt Rhodes-Kropf, who is also a managing partner at Tectonic Ventures, often helps his students figure out how to tell their parents they're taking a job at a startup. When his own son decided to defer college indefinitely to start a company, he wholeheartedly supported it, but admitted he was sad Ben would miss the experience of being a college freshman and hopes he'll study at MIT at some point.

"They're kids, so they think they might never come back. But who knows," he said.

Rents for apartments in Link Ventures' Cambridge building are about $5,000 a month. The firm covers at least half of that, they said.

A few blocks away, Link has a 40,000-square-foot co-working space, a former rubber factory with conference rooms named after large language models like Grok and Sonnet and decorated with stuffed lobsters--a mascot of the AI boom.

Link partners have discussed buying the founders cars as well as a weekend ski house.

"This isn't [meant] to be a Four Seasons," said John Werner, a managing director at Link. "This is just to be something where they can just kind of land here and then hit the ground running."

Both the apartments and offices are in the shadow of MIT, one of America's universities thinking harder about how to support entrepreneurship on campus--and hold onto its students.

MIT Provost Anantha Chandrakasan said MIT is exploring ways to better help both students and professors start companies. The school may, for example, begin allowing tenured professors to take longer leaves to work on companies.

"We don't want them to just make a choice: Either I continue school or go start a company," said Chandrakasan.

He urges students to finish their degrees. "I think you got to play the long game," he said. "It's very short term to sort of just say, 'Let's go hack.'"

Other universities are also reconsidering both their curriculums and AI in the classroom. In recent weeks, Northwestern University, University of Northern Iowa and University of North Texas have announced new AI majors. University of Wisconsin will begin operating a new college of computing and AI this summer.

"The onus is 100% on us to say: here is the value of being here," said Remzi Arpaci-Dusseau, a professor of computer sciences at University of Wisconsin. "Who do we have to blame but ourselves if we are not putting the right proposition in front of the student?"

For 21-year-old Rudy Arora, it wasn't worth sticking around until his planned graduation from Northwestern in 2027. He dropped out after his sophomore year to build learning app Turbo AI.

His parents weren't thrilled, but he reassured them: "Would you rather tell your friends that your kid makes millions of dollars a month or has a college degree?"

Write to Kate Clark at kate.clark@wsj.com

(MORE TO FOLLOW) Dow Jones Newswires

April 03, 2026 20:00 ET (00:00 GMT)

Copyright (c) 2026 Dow Jones & Company, Inc.