Are there any examples of people who successfully did a startup AND worked in academia? Or is it better to just choose one?

Question

I'm a newly minted PhD researcher from Sweden who just finished my defense this summer (after a really stressfull and draining final year). Ever since then I have been thinking about my future in academia. I basically decided I wanted to build a startup together some friends of mine and we are now in the middle of developing a note-taking app for academia to make it easier to write and organize notes when writing research articles. We've received a bunch of really encouraging feedback so far from the people who have signed up for the free test version. However, I realize that the more time I spend on this, the less time I have to build my academic profile, publish papers and so forth.

So my specific questions are:

• Are there any successful examples of people who have managed to both be part of a growing startup and continue on in academia?
• I've currently chosen to work in academia only part-time (making basically 1/3 of the salary that I made as a PhD student, just barely enough to pay the bills so I don't take from my limited savings) but I keep hearing the advice that it's better to go all in and remove any safety net? Is this good advice or is it better to do it gradually?

Answer 1

There is a huge literature on the topic of academic entrepreneurs (and entrepreneurial academics). A recent review of the literature can be found here. Similarly, there are many books on the topic (e.g. here and here). Plus millions of blog posts (e.g. here).

I think it is hard to generalise. For example, this paper highlights the multitude of dimensions involved in the extent and success of entrepreneuring, some outside the control of the individual. This paper distinguished between three groups. First, the ‘entrepreneurial academics’:

These are individuals who planned to stay in a university but also spent time working in spin‐out companies. They had experienced a number of operational difficulties in trying to develop this new career type and many felt that although the government and universities said they want them to work like this, they had been slow to adjust their own policies and procedures to take account of this change.

A second group, consisting of:

individuals who were in the process of developing a new kind of career as technology‐transfer professionals. Notably they were younger than those in the first group, and more junior within their departments. The majority wished to stay working in a university context but did not see themselves staying at the laboratory bench.

Finally, the third group:

made up of younger people who have either recently completed their PhD or have been employed on postdoctoral research contracts. Most seemed unsure where their future direction lay and were using [a research program] to develop the knowledge, skills and resources that they saw as vital to the development of a successful career. ... The scientists in the third group were well aware of the traditional scientific career path and its status but saw it as largely unavailable; a relic of the past that was now only offered to the lucky few. Their aim was to find, or develop, a career path that would allow them to use their science, provide opportunities for growth, and offer a degree of security unavailable to the large numbers of postdoctoral scientists who find themselves in a seemingly endless spiral of short‐term contracts.

Relatedly, this paper offers and tests a model of career path, concluding that:

entrepreneurial self-efficacy, type of research, perceived role models, number of years spent at an academic institution, and patents are significantly related to the formation of academic-entrepreneurial intentions, regardless of cultural context.

A similar approach is taking by this paper.

The bottom line is that success as entrepreneurs depends on many conditions, some outside the control of the academic. There are different models in which academics engage in these activities, some involving moving away from academia. All in all, beyond anecdotal evidence, of course there are successful entrepreneurial academics. Whether you can be one or not is something you must confront with the evidence above and your own insights.

Answer 2

People who go into startups tend to become completely consumed by those startups, or else the startups fail.

As such, what I've observed amongst my colleagues is that the professor generally either quickly ends up in only a consulting/advisory role or else jumps ship to the startup.

What seems to work very well, however, is for graduating students or postdocs to become the core members of the startup. The folks graduating from the lab generally are the most deeply familiar with the specific technology, and they're in a good situation to invest themselves fully in the startup. The professor then typically lends their name and their expertise at a lower level.

In short: it's best to choose one or the other, but one can generally de facto split the difference because there's usually more than one person involved.

Answer 3

In my experience, those who succeed in academia tend to work quite hard at it. If you just want to teach classes, and not worry about research, then I think that working part-time might make sense. But if you want a career as a researcher, then without a full-time effort you might find it difficult to keep up with your field at all.

From what I have read, those who succeed at startups work still harder at them. You might read Paul Graham's essays on this. He describes his days as a founder of Viaweb -- at one point, he had to have a root canal done, and he had been working so hard that sitting in the dentist's chair felt like a break.

I know of two examples of startups started by research mathematicians. One is NTRU, started by three very successful number theorists, which sold cryptography software. From what I recall, the startup was only modestly successful, but the founders are all still very successful academics.

Conversely, there is William Stein. For awhile he worked simultaneously as an academic and a startup founder, and he has since resigned his academic post to work full time on his business (which I understand is doing well).

In summary, I suspect that succeeding at academia and at a startup simultaneously would require a huge amount of motivation to work very hard, together with very good luck. You might be able to do both for a year, if you have a lot of energy, but in the long run I suspect that you would probably want to choose.

Answer 4

Summary: a whole-hearted career is usually not achieved in part-time. Neither in academia nor in industry.
The exception I can see, though, is if the start-up is closely related to the founder's field of research. In that case, the professional experience from both academia and business may sucessfully add up, and can be transferred from one to the other, e.g. academic research going into high-tech business, and business experience providing knowledge such as "this works in practice and also over extended time".

(I'd definitively not take the full plunge in your situation - unless a founder grant comes up that pays you for developing the business full time. But that is something that you'll have to decide for yourself.)

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Disclaimer: I'm business owner, still quite close to academia (see below) and doing research, but not a start-up founder (in the sense that I'm not planning fast/explosive growth for the company)

IMHO there are some business models and circumstances that go well alongside academia/research and give synergy effects while other combinations don't combine as well/just exist in parallel without synergy.

E.g. my business now is pretty much the same as what I did as researcher: chemometrics, i.e. data analysis specialized to chemistry.
In contrast, your business idea is related to academia (you spotted a need there), but that experience is unlikely to help your civil engineering academic carreer (nor vice versa).

This will probably make the transition/distinction between academia and business harder/sharper for you. However, there's still quite a lot of room for you to decide how much of a sharp transition is is to be.

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[Working part-time vs.] I keep hearing the advice that it's better to go all in and remove any safety net

That's of course up to you to decide. And as a startup founder, you may as well get used to making decision of that "size".

The most obvious advantage of going all in is developing the business faster. This may mean more profit/success earlier, and it may tip the scales to becoming successful at all.

I went the gradual way, very much so: I first had my business as a side-line that served also as having an immediate plan B to counter academic job insecurity, at the same time putting together quite some savings (by working while sticking to a student lifestyle - this easy when working in academia as large parts of the colleagues around are unpaid or on part-time wage), both with the primary goal of creating a level playing field for academic job negotiations. After some 10 years of experience in my field I finally decided it's time to move more seriously into business, and took the offer of my employer to "phase out" with a part-time contract looking a bit longer after one research project. Since then, I've had more part-time contracts at other academic institutes, which I mentally treat as clients, though: they had grants that called for employees but did not allow sub-contractors.

In that situation, the part-time academia/part-time self-employed has some burocratic disadvantages: I need non-standard working contracts that explicitly put formal boundaries around what is supposed to be the results of the employed work (otherwise e.g. copyright for software I write for a customer or for my company may end up being with the [academic] employer) - and university HR departments may will probably block anything they are not used to ("We never do anything but standard contracts").

Consequences

Back to the recommendation of plunging in: I'd also recommend to keep in mind how much skin those who advise you have in the consequences of that decision (i.e. Is it your parents who advise and would maybe take you into their home again if the business fails and you're deep in debt? Or who even say that they'd bail you out up to xxx SEK? Is it some friends for whom your financial desaster won't have the slightest consequence? Is it someone who could easily afford to loose, say, 1/4 mio SEK or 25 k€ or even more on the start-up experiment telling you what they'd do in your place?)

Of course if you go wholly in at a stage in life where you have hardly any savings, there isn't as much that is lost if that business fails. But you may be ending in a personal bankrupcy. Also, some business models have clients that take a deep look into the financial position of the owner, or that may require substantial financial stamina - my experience with universities as late paying customers suggests that the latter may be the case with your business as well.

There are also cultural aspects here: I'm in Germany where society is in general comparably risk-averse and failing as business owner (and much less personal bancruptcy) is not really the done thing.

Plus, what are the consequences in terms of social insurance of (not) having a side job? Here, the social security system in large parts revolves around the so-called normal employee. One of the peculiarities is that for self-employed the governmental health insurance has a minimum contribution (which was recently lowered so that the proportional zone starts now already at ≈1040 €/month), another one is that for self-employed all sources of income count while for employees only the wage is subject to health insurance fees.
In consequence, the recommendation here for most is to start a business from a part-time position if feasible (unless one is really sure that it will generate good income from the 1st year on, or one is paid by a business founder grant etc.).

All this aside, some startup statistics:

• the vast majority (> 3/4) of start-ups have their founders actually put savings into the business (EU Startup Monitor 2018, numbers in the US are AFAIK similar).
• It is normal for a startup to take years becoming successful. This doesn't mean the business won't be able to pay, but if you have the financial freedom to decide whether it's good to take out money to pay yourself vs. leaving that money in the business as investment you're obviously in a much better position than if you have to take out the money for your own survival.
  And having a small but steady and sufficient income from some other source may give you that freedom.

Part time positions for business founders are again something that is often much easier available in academia than in industry, particularly if the reason for asking for a part-time job is that one wants to found a business in that profession: to academia that is usually not a competitor but a source of pride "that's our former colleague who's now a founder" or, if it's a spin-off, also something that counts in evaluations of the department.
Your situation of founding something totally different from your profession may help you to get an industry part-time job (paid with an industry wage) in parallel to your own business. So if you decide that keeping a foot inside academia isn't for your love of academic research but for practical financial reasons, you may consider a part time job in industry as alternative.

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• Professional experience in the field of business is an important factor for start-up success
  I'd expect your business to be at lower-than-average chance of success (unless someone else in your team has substantial experience in your business) and would therefore keep a "survival" side-job.

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Academic career

Last but not least, you'll have to specify what a successful career in academia is for you.

Personally, I like doing research - so for me a lifetime position as a researcher (as opposed to research manager such as professors usually are) would be a successful academic career. You may call that the eternal postdoc.
Even though I certainly do a lot of burocracy as business owner, I most probably would have spent similar amounts of time with grant writing and (other) burocracy had I stayed in academia as "advancing" from postdoc to PI would have been basically unavoidable.

Oh, and I teach (mostly industry clients but also at universities and research institutes) and I still do reseach and method development - in some ways I now have more freedom in that than the academic freedom I experienced in some research institutes. So I still have the parts of academic work that I like most.

What I think is not going to work is at the same time trying to get a startup successfully going and going for a highly competitive academic career (professorship/starting your own academic group - see also What ratio of PhD graduates in STEM fields ultimately end up as (tenured) professors?).

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Unrelated business field and academia

This is only hear-say, so please take it as such. I've been told anecdotally by a chemistry professor close to retirement that it is not unusual for people being somewhat burned out/fed up with their profession after finishing their PhD and in consequence running an unrelated business (think pet shop by PhD in chemistry) for a while - until they return to their original profession. I don't recall whether anything was said about returning to academic research vs. working in industry (but a chemist with PhD in industry is likely to do research as well)

Answer 5

I don't have examples for you, but having something on the side while pursuing an academic career is pretty common. Many people are book authors, for example. Both academic books and otherwise. Writing software with the hope of selling it is also pretty common. I've done both, actually.

A fair number of people in finance are active investors also.

But, both academia and running a company with employees is difficult. Both are full time jobs and it may be possible that neither helps much with the other. So, you may need to focus on one or the other as your primary interest and just "dabble" in the other.

Some textbook authors have become millionaires, actually.