What should I choose, PhD or startup?

[teralaser]

Recently, I was asked by a professor to advice his student, whether to pursue his idea/startup (a chemical product, he invented) or go for a Ph.D. degree in chemistry eng.. The professor chose to ask me, because I both have a PhD degree and multiple startup experience.

In my answer I didn't focus so much on the basics (business plan etc.), figuring he already knows most of this, but more on how to choose.

Do you like/agree with my answer ?

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Hello,

The pros of a PhD degree: A PhD degree does sometimes give you access and credibility to venture into bigger ideas. However, there is no guarantees. You could choose to finish your PhD degree and enter or found a highfuelled venture later on, such as those founded by www.kpcb.com or www.sequoiacap.com (these are most successfull and well-known ones, there are of course many smaller). Personally, it might give you the aptitude to write better (due to writing papers or the thesis), be a better at figuring stuff out, give you a large network (going to conferences etc.) than many other jobs. And , of course, some technical insight & independence from having to show financial results. But, in my experience, most technical insight become outdated in just a few years.

The cons of a PhD degree: It takes time, it doesnt give you business experience. One of the most vocal opponents of long educations are Steve Jobs of Apple, his ventings can be read for instance here : http://news-service.stanford.edu/news/2005/june15/jobs-061505.html I once read, that "when buying real estate, the first thing you should think about how will you sell this again in 5 years". Perhaps the same applies to a PhD. Perhaps look into what finished PhDs from your institute of choice do now, and ask yourself, if this is what you want.

The business : Well. First, a lot of people start businesses. The street vendor around the corner sort of started a business. Even very unintellectual activities sometime pay handsomely (e.g. www.milliondollarhomepage.com ). In my mind, to be worth it the business must end in something, that pays much better than taking a job as a PhD. Why much better ? Because there is uncertainty, so if you figure, oh "I'll make 300000$ on this" and then the reality is, "Oh I only made 100000$ over 3 years!"; it's much better to start with "I plan to make 20million$ on this" and then end up "Oh I made only 1million$". So, firstly, I think your business must have a business plan (there are many books on this topic) to clarify this. Also check up on the 'likelihood of success' factors for your startup - (you have to hit an existing market or demand, preferably be more than one person etc.,...). Secondly, it must in some degree support your education. Once in a while, people at DTU at the "Innovation" course go "oh I want to make a travel agency!" ... and the reply is usually "So go do it now ? Why do you need a degree ?".

- The pros of a business : Noone can just fire you in bad times, you are your own master, a lot of it is fun - figuring out who you can talk to, make things happen. You stand a chance of getting rich, or perhaps just not being in a J-O-B situation (JOB = Just Over Broke) :) And if you go broke, future employers can certainly use your experience anyways. You will learn from it regardless of outcome.

- The cons of a business : You can't just leave it one day, it can take a lot of time and mental energy compared to a normal job. Many people are "the worst employers" to themselves. There is considerable uncertainty over the finances - some people are very uncomfortable with this. Oh, and remember, it isn't hard to get ideas - it's hard to realize them as a business. Most self-employed people have tons of ideas, but only the time to do a few. So, you might also be able to get an idea after you finish your PhD.

Your heart : You should also listen to your heart. Other people (parents, siblings, girlfriend...) could have pressured you into thinking one or another choice is better than the other. You should do what you want, not what they would do. A famous musician in Denmark, Peter Bastian, was a particle physicist and played bassoon as a hobby. Although he stood to become a great physicist, at one point he doubted what to choose, and he asked his wife. She bluntly said "musician" - when asked why, she said, "you look happier when you play the bassoon".

Lots of choices in life is about choosing one or another, and it will never be clear which was the best, and there is no "scientific" way of choosing, lots of luck are involved too.

Ok, that's what I can come up with.

Cheers, teralaser

-------------------------------------------------------------------------------- From: Dr. <...> To: teralaser <...> Sent: Wed, November 25, 2009 9:51:48 PM Subject: perspective

Dear Dr. teralaser Hi! I am contacting you to see if you can give a little perspective to one of my students, due to your experience.

The reason for this is because you got a PhD but at the same time you have experience with the development of your own business in a successful way.

My student is a student of Chemical Engineering. Right now he has the opportunity of developing his own chemical-based business with a good economical prospects. At the same time he is finishing grad school and would like to study a PhD abroad in a good university. He was abroad last summer and he is thinking of programs in there or other good ones like in MIT and other Ivy League-related. However, his concern is that if he focuses primarily on the business, it might take him several years before he gets in a PhD program; on the other side, it might take him about 5-6 years to start growing up the business if he starts a Phd next year. So he wants to do both... at the same time. In my experience, what I recommended is that he studies the PhD next year, and waits those 5-6 years for the business or that he delegates the work of the business to someone else. After all, if the business fails (which we hope not) he can still get a decent income while having an intellectually demanding job. In the other case, of course he could get reasonable wealth from his business, but it is unlikely that such a business grows incredibly fast to make a living of it in short-mid term, and maybe a 5-6 year difference if not so important, especially because he is 24. The problem is also that he got into a program that will support his business idea in January, so he is afraid of taking the wrong choice prematurely. Besides, if the business works he might decide not doing right in the middle of his success a PhD and after some years get bored of not having something intellectually stimulating (which might be seriously important knowing him).

Here is where I think your opinion will be very valuable to him, since you have been in both situations and you understand the value of both having a specialized degree and of developing your own technology-based business. I hope you can contribute with some perspective to him, so that he can make a better choice.

Best regards, Prof. <name deleted> -end-

[FredSource]

Having chosen to go into business rather than a PhD (in physics) -- and then having succeeded in selling my startup, I explored going back to do a PhD. It was not an attractive option. The heads of department said I would get bored and frustrated with the politics and slow progress of the department.

Bottomline: starting a business (that succeeds) does change you expectations for "action" which will likely poison you from academia. I hypothesize if you fail in the startup that the PhD will not be an economic option at that stage!? The implication: it's hard to "reverse" this decision.

[eric_t]

It's a good roundup, but I think you missed the most compelling reason to do a PhD, at least it was for me. And that is that you get the opportunity to dig really deep into a problem for three year or more. And that is your only concern, no business crap, no customers, just you and your problem.

Also, the freedom of doing a PhD is great. Want to take two weeks to learn a new programming language? Sure! Want to take two weeks off and go surfing? No problem! In fact, some of my most important work on my PhD was done during one of these "diversions".

Finally, some jobs require a PhD. You may want to consider if that's the kind of job you want. Hard to answer that before you finish, though. For me the answer was a resounding YES!

[falsestprophet]

If this student can't figure this out for himself, then he should absolutely not start a business.

[dagw]

Funny, I was about to say that if he can't figure it out for himself, he probably shouldn't do PhD.

[hn]

Agreed! Ironically, this kind of encourages him [in a subtle way] to start a business to prove he can do it. :)

[richardburton]

I dropped out of university after my first year so I can't comment on academic pursuits with any authority. However, what I can say is that starting a half-decent startup gives you the most incredible ability to hack your lifestyle. This summer I was able to travel to some awesome places to kitesurf (my favourite passtime outside business) whilst working furiously on lots of my ideas. A couple of years ago I would have never thought that possible.

[neilc]

I won't try to tell the student what to do, but I will say: (1) Doing a PhD and anything else at the same time is pretty exhausting, and a pretty sure recipe for dragging for PhD out for a long time. A PhD requires a lot of dedication. (2) When you're trying to decide between the two options, think about what you'd rather have 30 years down the line. You can always start another company once you've got your PhD; once you've worked for a few years, will you be in a position to go back to graduate school?

[physcab]

This debate comes up often here, but one point that always seems to get left out is that a PhD affords you time for your ideas and skills to mature.

I currently have the unique opportunity to work for a startup while also working on my PhD. I can say without a doubt that a PhD does provide its benefits in some scenarios--that is, you can tailor your PhD research to benefit your startup or vice versa.

For example, I am currently a PhD student studying how to implement Machine Learning algorithms to materials characterization. I often use the same algorithms in R&D work for our startup doing music recommendations and user analytics. Working for a rapidly growing startup helps me see the real world implications of my research, and helps me further understand the benefits or disadvantages of using them.

Another great side benefit of working for a startup is that I have learned how to be more efficient. By learning VIM and unix commands I can do data analysis 1000x quicker on my experimental work than other scientists in my department, just because they are busy fooling around with MS Excel/Origin/LabView.

[teralaser]

I concur, mixing academia and business life can be a very potent combination. I did do an industrial Ph.D., where I ,according to the plan, did spend half my time at the university and half the time at the company. It doubled or tripled my network (if not more) and gave me a profound insight into both the limitations/benefits of university thinking and the business life/thinking.

[jlees]

I think personally I would start the PhD but use that to shoehorn my way into the university's innovation support, spinout funding, etc, take part in university entrepreneurship clubs, business plan competitions, so on. Really milk the level of support and encouragement there is within academic institutions for new enterprise.

(Conditional on the business being pretty much at the 'idea' stage and some easy way to ensure the university doesn't grab all the IP etc. If he has a fully developed, tested product and it's just a matter of executing, well, why is he even considering a PhD ;))

It is possible to do both, I know of several PhD students here running or starting up businesses. It's not easy to excel at both and sooner or later there would be a decision point: continue with a PhD with some sunk time and research, or continue with the business which is starting to take off? It should be clear which is the better route by then. Meanwhile the 'kudos' of being a PhD student at $university will help lend credibility to the business.

(note that this is sort of what I did, happy to answer further questions.)

[Rick1981]

Many students also like to ask "which JC should I go? should I pursue the college that is top in sports since i love sports or should i pursue the college that tops in academic?"

The root of these kind of questions are really simple. Get the student to search his soul on what he wants really. When a greed takes over, then everything becomes complex since everything looks so appealing.

Focus on one thing and work on one thing whole heartedly, whether business or PhD. When you are focus on one thing, pursue it with all your heart and don't look back, don't think of "what if i fail? what if i choose wrongly?". Once you have decided, "cross the river", "burn all boats, dont look back" and move forward. Its really that simple in life.

If you really should "fail", its not bad too because you would have learn valuable and important lessons. Its really the journey that matters and not so much on the end product. That way, you would not have lived your life in vain. Phd or business, we cant bring fame or fortune to our graves, so do they really matter?

[bootload]

"... Do you like/agree with my answer ? ..."

Over analysis?

"... My student is a student of Chemical Engineering. Right now he has the opportunity of developing his own chemical-based business with a good economical prospects. ..."

If you are making "stuff", unless you are selling the process, the derivative of making "stuff" you will be bound to the old laws of creating a business. In some ways it reminds me more of a hardware Startup. The rules of Software startup rules don't apply. You (might) need offices, lab space or time, hiring of extra expertise, equipment and the problems of marketing and sales. All this requires cash and a degree of risk higher than a software Startup.

One question. Does has this new "stuff" got existing or potential customers? Is your "stuff" applicable to a large market commodity or a high cost niche market?

[bahless]

I dropped out of my PhD at MIT Chem Eng this year to run my startup full-time. Never looked back. I am also international, like the person in the story seems to be.

He just needs to try each one separately and see which one gets him more excited to go to work. It really is that simple.

[ehsanul]

No mention of intellectual property rights? I was under the impression that if you worked on something original using university facilities, you have effectively given up your rights to anything that you come up with using those facilities. The university owns it all.

[eric_t]

This used to be the case, but universities are getting better at this. Usually it's pretty easy to spin off a company, where the university retains some ownership. It's a win-win situation, really, a university is a great place to foster ideas, but not very good for bringing a product to market.

[yummyfajitas]

Sometimes the university will give you a piece. I believe NYU gives you about 45%, for instance.

[Aegean]

Here is my way of decision making on this:

If you don't mind dealing with faculty politics and report to a boss, go for the PhD. The benefit is that you get a reasonable salary and funding, and managing others badly does not bring fatality to the venture you are pursuing. You can also focus on your research, without immediate financial worries.

If you don't like a boss, if you want to build your own team that you are in full charge, and if you want to expand the team to pursue partly financial success and partly research goals, go for the Startup. In fact, this is what I did, and I am happy to be in full control right now, even though it is harder to manage people and manage finances in addition to R&D.

[eric_t]

If you think of your supervisor like a boss, that's wrong, IMO. You should pursue your own ideas in your own way, and your supervisor should do just that, supervise you and guide you as best as he can, then let you do what you want with his advice.

Of course it's hard to build a team as a PhD, at best you can get some reasonably competent master students to do some work for you.

[hn]

The danger of going for PhD is that after 5 years or more of studying, with all the time investment and academic achievement, you no longer have as much desire or motivation as initially. I think this partly explains many legendary founders started their start-ups very early: Bill Gates, Steve Jobs, Mark Zuckerberg (not considered legendary yet but on his way), etc. The more you how hard it is to start a business, the less time you have left, the more unlikely you actually start one. If you think you will start a business someday, why wait any longer, start one now. Good luck!

[ananthrk]

Does it matter whether he does his PhD first or the business first? One always finds people going from one to the other. I believe doing any of the two will enrich him and will place him well in his next step. If both of them look equally good, then this may help: http://sivers.org/scares-excites-do-it

However, if the success of his business idea is time bound, he should probably do that first.

[Kaizyn]

Hey Teralaser, how long do you realistically think it would take someone to determine if their business would be a success? 2 years? 3 years? 10 years? Also, if someone takes a multi-year break from school, how easy is it for them to just pick back up in a Ph.D. program? Is such a pause a deal breaker for most universities when considering an application to their programs?

[teeja]

If you don't like to deal with the public, don't have business experience, and would rather focus on your discipline than on people/money/marketing problems, a PhD can be a cozy way to go ... if you pick the right one, and are crazy talented or know the right people. Some PhD's spend a few years driving taxi.

[h_operator]

The Ph.D. will always be there, but the opportunity for a startup might disappear with time. Given that, staying upwind (http://paulgraham.com/hs.html) would tend to dictate going with a startup.

[jack7890]

Not sure I agree with that; I would suggest that the opposite is true.

Top-tier PhD programs almost never allow students to defer an acceptance offer, so the person in question would need to re-apply. Being accepted becomes substantially more difficult the longer you've been working in industry, particularly if you haven't been working in something directly related to the PhD's field of study (like a startup).

Startup ideas, however, are a dime per dozen, so there is no danger in delaying because it will always be easy to find a worthwhile idea on which to work.

[pgbovine]

i think it really depends on your field. in software, if you have a great product and are an awesome hacker, nobody cares if you got a Ph.D. (or even went to college for that matter). but if you're trying to start a company whose clients are in a more 'old-school' field, like health care, civil engineering, or bio-sciences, having a Ph.D. (or even an MD/Ph.D. if you want to start a company in the medical sector) gives you a mark of credibility ... that's the sense i've gotten from people wanting to do business in non-software fields.

[kapauldo]

For Chemistry, go with the Ph.D. Here's why. Having the Ph.D. at the end of your name gets emails answered. Having the Ph.D. gets you access to collaborators. It's a huge differentiator. It makes you an expert, which you need to be in Chemistry. Anyone can do a startup, very few people finish a Ph.D. When you're finished, you'll have access to hundreds of thousands of government R&D dollars which you will otherwise not have, which can translate to a huge advantage. Ph.D. dropouts who hit it big are usually in the right place at the right time, in addition to being smart, but that's unlikely to happen to you.

One word of advice- when you're finished, don't try to blend the university with your business (by splitting a company with your professor, for example), that never works.

[eru]

I heard that Ph.D.s are very important in chemistry, too.

> Anyone can do a startup, very few people finish a Ph.D.

A lot of people can start a Ph.D. I do not know how many people `finish' a startup.