Am I doing the right thing: How can I know when I should start a business

In my opinion, getting a PhD is the wrong direction for starting a company.

It takes a long time and is essentially training for being a professor at a university. If your career goal is not to be a professor at a university, the training is not the right kind of training.

To be successful as an entrepreneur you can't hesitate. If you're wavering, the first time you reach an obstacle, you'll give up. The best entrepreneurs are a little bit reckless and convinced that no other alternative is possible. If you're not feeling this way, entrepreneurship may not be for you!

Plans and life don't often stay too close together!

In your question and background, the one thing you don't address at all is your business idea. In fact it's not clear to me if you have one. Wanting to start a business is great - but to do so you need to have a viable idea and some idea of how to execute it. Then enough flexibility to admit 9 of your 10 guesses were wrong and keep adjusting until you end up with something that works!

You should also ask yourself why you want to start a business. There's many types of businesses too - some more risky than others.

Who can say if you're ready, or which is right? Not sure anyone can but you - but I will say no amount of reading and preparation can replace just doing. Though having said that you should probably go read "Founders at Work"

I don't have an answer for you on what to do with your life. I will tell you a story or two:

I met with two business partners this afternoon. One had a business development background, the other a unique specialty in a very specific medical field. They have raised an invested over 10 million dollars in a medical device company. The presence of a terminal degree in his field made one of the founders extraordinarily valuable to the partnership and the company.

One of my favorite start-up clients was a brilliant entrepreneur who started his life as an engineer, then became a ordained minister and then finally a marriage counselor. His unique approach resulted in books, workshops a devoted following and a start-up with legs. Those three advanced degrees were not a detraction from his entrepreneurial spirit at all.

Next month I will be working with a professor (PdD) from a major University that has pulled together a team of investors and supporters to launch a start-up to bring a new model of water purification to rural areas. After years of studies and research, his model has the potential of bringing potable water to millions. His entrepreneurial approach to solving a significant global health issue has not been hampered by his years of academia. They provided him an R&D incubator.

Diverse Experiences Matter

In today's economy we don't all have one profession. And entrepreneurship need not be the first, nor the last. Different life experiences provide different strengths to a new company. Sometimes maturity will make all the difference. Sometime youthful arrogance will be the essential ingredient.

In some markets you can blog your way to credibility. In other's peer-reviewed papers are the appropriate degree are essential. In highly specialized fields -- like medicine, or therapy, biology, chemistry, physics -- and yes, even computer science -- the training and discipline which comes with a PhD can be the differentiators which will make the start-up work.

A Solid Link Between PhD's and Entrepreneurship

There are many entrepreneurs with PhD's. It is more or less prevalent by industry. Also some culture -- like Germany, or China -- put a higher value in the business community on education. I did notice that a significant percentage of the "entrepreneurs from around the world which were award winners in Ernst & Youngs Entrepreneur of the Year had advanced degrees in their fields. (I know many of you wont consider him an entrepreneur of a start-up, but of note: Eric Schmidt @ Google had a PhD in Computer Science.)

I was recently checking out Third Rock Venture's website doing some research for a client and noticed that ever single one of their "Entrepreneurs in Residence" had a PhD.

And there are many Universities actually offering PhD programs in Entrepreneurship. St. Louis Univiersity.

Emerging Markets -- like BioTech -- Need PhDs

This is from a press release in 2009:

Biotech is the industry that is attracting the most venture capital dollars, according to the latest stats from the National Venture Capital Association. So wouldn’t it make sense that science PhDs could be poised to become the 21st century version of the Google Guys? Meaning, pursuing a science PhD or an MD in 2009 could be the right training for an inventive entrepreneur, parallel to studying computer science in 1999.

At least that’s the thinking behind new fellowships being granted by the Ewing Marion Kauffman Foundation. The organization announced today that it’s awarding 13 postdoctoral researchers the financial and mentorship support to commercialize their scientific findings.

I met recently in New York with Lesa Mitchell, the Kauffman Foundation’s vice president of Advancing Innovation. “The economic recovery will happen through entrepreneurship, which can help fuel growth,” she said. “We want to help build a pipeline between PhDs and MDs and VCs.”

Last year Biotect was the number one VC invested area for new start-ups. I am willing to bet every nearly single one of them has PhD's in leadership positions.

Universities Support Entrepreneurial Activity Among their PhD's

Most major universities have entire departments which work with their professors across the disciplines on how to commercialize the research developed with their support. Perhaps it would be worth your time to ask the University that has offered you the PhD position what type of support, licensing requirements and track record they have. Perhaps you will find that the two paths are not as mutually exclusive as you thought.

Final Note

And to close things out -- here is a great little blog post from a PhD with the top 5 reasons why he believe PhD's make great entrepreneurs.