PhDs for Entrepreneurs
“Today’s ‘best practices’ lead to dead ends; the best paths are new and untried.” — Peter Thiel, Zero to One
Many people think that the path to success for entrepreneurs is to get out of school as early as possible and start building. Some of the richest people in the world, including Bill Gates, Steve Jobs, Larry Ellison, Michael Dell, and Mark Zuckerberg, all were college drop-outs. A few, such as Richard Branson and Walt Disney, didn’t even make it to the first day of college. Many current-day entrepreneurs are also college drop-outs, such as WhatsApp’s co-founder Jan Koum. This sentiment has been gaining so much steam that Peter Thiel announced in 2010 that he would be paying $100,000 to twenty students under 20 years old to drop out of college and pursue other work such as a startup. This initiative, now known as the Thiel Fellowship, has been highly successful - Thiel Fellows command an incredible amount of respect in the startup community. To add fuel to the fire, much has been written on the higher education bubble and its effect on student debt.
Given all this negativity about the role of colleges in entrepreneurship, or even the worth of a college education in general, why consider spending even more years in school getting a PhD? After all, as popular opinion goes, universities teach outdated material that don’t apply to the real world — what value could a PhD, the pinnacle of academic snobbery, bring to entrepreneurship?
As it turns out, a lot. A PhD is fundamentally a problem-solving degree. Almost every sentence written about the downsides of college for entrepreneurs does not apply for PhDs. The most important fact about a PhD program is that you get to define your own experience: you choose your own advisor, your research topic, and your own points of emphasis. In addition, certain types of startups are simply impossible without an advanced degree. Doing a PhD opens the door on super-high-tech, research-based startups that you weren’t able to consider before. As a technical entrepreneur, a PhD could be just what you need to hit the ground running on your startup and launch the Next Big Thing upon graduation. This article will characterize a well-designed Computer Science or Computer Engineering PhD program that will help train the essential skills necessary for your future startups.
PhDs: The Original Thiel Fellowship
“I’ve always tried to be contrarian, to go against the crowd, to identify opportunities in places where people are not looking.”
- Peter Thiel
Ever since the Dot Com boom, Computer Science PhD degrees have been slowly shifting towards the practical side of the spectrum — some research labs even act like startup incubators. Like the Thiel Fellowship, the number one benefit of a PhD is its ability to allow you to freely explore your topic of your choosing without having to worry about having money or doing well in class. In any decent engineering or CS PhD program, you never pay a cent to the school: the school pays you instead!
The net value of a Thiel Fellowship is 100K over 2 years. In contrast, the net value of a PhD stipend is 125K+ over 5 years, and even more if you count benefits such as classes, a free Master Degree, and health insurance. The PhD stipend is designed to simply be a living wage, but its certainly enough to live comfortably. For example, many private schools such as Stanford, Cornell, Rice, and others pay you 30K a year. Public schools generally pay a bit less, in the 20–30K range depending on location and prestigiousness, but generally include very nice health insurance packages. The Thiel Fellowship’s 50K stipend is certainly higher, but the fellowship only lasts for 2 years whereas the PhD stipend will be made available for the duration of your PhD. On the bright side, the lower PhD stipend means that you’ll need to work a bit harder to make ends meet, giving you good practice for bootstrapping a startup.
While you still need to take a few classes in graduate school, the work and material covered in class is vastly different from that in undergrad. Whereas undergraduate classes frequently consist of nothing but mindless homework and projects with tight specifications and low degrees of implementation freedom, graduate classes usually offer little to no homework with open-ended semester projects. These semester projects are great opportunities for you to explore your ideas; frequently, the professor doesn’t even care if the project proposal has anything to do with the course material. I was able to write the back-end web server code for my own startup and received an A for my efforts. Of course, the most important component of a PhD degree is not the stipend or the coursework, but the research. In fact, it’s the research that trains the skills most relevant for an entrepreneur.
PhDs: The Best Entrepreneurial Degree
“Someone who was strong-willed but self-indulgent would not be called determined. Determination implies your willfulness is balanced by discipline.”
― Paul Graham
For a technical founder, which skills are essential for success? Paul Graham of Y Combinator has the answer: determination, flexibility, imagination, naughtiness, and friendship. While some people may demonstrate these skills with ease, others may benefit from some practice. Each of these skills is exercised and honed in the fires of research in your PhD degree.
Determination is the most obvious. As a PhD student, you will be working 40, 60, or even 80 hours a week on solving a singular problem that no one in the world has solved before. Along the way, you will certainly run into many challenging obstacles, ranging from code debugging problems to implementation feasibility issues to unexpectedly poor results. Only when all the obstacles are surmounted through relentless determination will you be able to eventually publish your work. Then, repeat until you have received your PhD.
Flexibility is another key skill practiced by PhD students. As previously discussed, you will be experiencing many unforeseen problems through the course of your research. You will frequently discover that your brilliant idea was not quite so brilliant once you accounted for every potential factor. When this happens, you need to be flexible enough to tweak your idea until it works or in the worst case, pivot to another research topic altogether — hopefully still leveraging some of your previous work and experience.
PhD students are also trained in the use of their imagination. To maximize this training, it is important to choose an advisor who lets their students come up with their own research topic. As my advisor says, a good place to start is by observing engineering rules of thumb and customs, and figuring out how to break them. As a result, many months will be spent attempting to come up with new ideas, reading the existing literature, and discovering that someone has already done your idea before. Another popular approach is to study the literature and identify weaknesses and low-hanging fruit in other peoples’ work. After countless iterations and dogged determination, you will start to develop the intuition and imagination to come with original research ideas. Of course, you will also need your imagination to come up with novel solutions when running into unforeseen problems during idea implementation.
“Fail often so you can succeed sooner.” -Tom Kelley
Rather than choosing your own topic, sometimes the advisor assigning an open-ended and ambitious problem is good enough. For example, my advisor previously had me work on a project whose goal was to enable a single person to be able to design an Intel-class computer processor, which normally takes hundreds or thousands of engineers many years of development, in a few months. Although we decided not to go ahead with implementation of the resulting solution due to various technical problems, the intellectual exercise alone was excellent training for thinking outside the box.
Finally, as a PhD student, you will be collaborating with many of your fellow students on research projects throughout your years. You will be brainstorming together, writing code and fixing bugs together, writing the paper together, and even perhaps presenting the work together. The challenging nature of the work, stress levels induced through surprise problems and looming deadlines, and the sheer number of hours spent together will certainly test your friendship to new levels. If your collaborators survive the test, this is a good opportunity to consider them as a potential co-founder.
These aforementioned skills will be trained starting Day 1 of your PhD. As you progress, you can visibly notice yourself becoming a stronger entrepreneur day by day. Once, I snuck onto the list for an MBA Fireside chat with a well-known Y Combinator partner. I was able to meet with him one-on-one for 20 minutes and pitch my startup idea. He was insanely intelligent and razor-sharp, quick to pounce on any potential weakness in the project. This would have been a tremendously daunting task had I not been practicing every week at this exact scenario during my one-on-one meetings with my advisor, debating about the merits of my research. With time, I became good at predicting potential questions and addressing criticism. In the end, I was able to survive and get his business card and a request for follow-up.
Bootcamp for Entrepreneurs
“It’s not in the dreaming, it’s in the doing.”
- Mark Cuban
Aside from training the abstract qualities that help you become a good entrepreneur, being in a PhD program helps with the process of building your startups as well — provided that you put in the effort to take advantage of the opportunities.
Some of the benefits are simply inherent at most major universities regardless of your age or program. However, as a PhD student, you will immediately stand out simply by virtue of being older and more experienced. Universities provide the perfect environment for connecting with talented individuals and building your team. Need a fellow coder? The CS department is full of potential options. What about a designer? Try the School of Art & Design. Looking for a non-technical founder? Hit up the business school. What if you’re too intimidated to cold-call or place ads? Attend networking and startup events. At the University of Texas at Austin, aside from going to hackathons, you can take specialized startup classes taught by the legendary co-inventor of Ethernet and Venture Capitalist Bob Metcalfe, form a team and hack on a startup at 3 Day Startup, get mentorship and office-space at the University-funded Austin Technology Incubator, and more.
Aside from the benefits inherent at most major universities, it’s possible to draw many parallels between the act of publishing a paper in academia and launching a product in the startup world. The startup catch-phrase “Fuck it, ship it” is simply a more crass version of the academic catch-phrase “publish or perish.” You may be surprised to learn that academia also has the concept of a Minimum Viable Product: the Least Publishable Unit. A key difference though is that in academia, simply publishing the LPU is generally discouraged by more ambitious advisors, who generally prefer publishing bigger, potentially more impactful work. This is understandable since unlike startups, the pay-off for successfully publishing an incremental LPU is far smaller than the pay-off for a successful startup product launch.
However, a game-changing research paper could change your life far more than the average successful startup product launch. Aside from the resulting fame, many such papers have been spun off into wildly successful companies. The most obvious example is the publication of the PageRank algorithm, which led to a series of events resulting in the behemoth known as Google today. A lesser known example is CAPTCHA, which is in use by almost every website today. The author went on to start reCAPTCHA, sold it to Google in 2009, and is now the co-founder and CEO of the language learning startup Duolingo.
Don’t Jump on the Bandwagon; Create It
“An entrepreneur is someone who has a vision for something and a want to create.”
As a PhD student, you need to find an important and unsolved problem, invent an elegant and simple solution, spend countless hours with implementation by writing code or conducting an experiment, publish the paper before your competing research labs, and repeat. A startup requires the same vision and drive to create while being similarly challenged by your competitors. By training you in this process while providing a supportive environment and monetary support, a PhD could very well be the prescription of choice for an aspiring entrepreneur who doesn’t yet feel ready for the big leagues. In addition, for those who want to do startups but don’t yet have a killer idea, your PhD research can frequently be spun off into its own company.
A PhD isn’t for everybody. For one, it’s incredibly difficult to get into a top PhD program. In addition, many startup ideas are about exploiting the right timing; delaying your startup idea for a few years might not be the best idea. However, for those who don’t quite feel ready and feel like taking their education into your own hands, what starts in a PhD program could very well change the world.