PhDs Are Entrepreneurs – 3 Ways To Start A Business And Quit Denying Your Leadership Skills
Contributing Author: Joydeep Pal, PhD
I kissed academia goodbye, and I didn’t look back.
In a sense, this was my very first move as an entrepreneur.
I ventured into the unknown world of industry, where results–not theory–are king.
But I didn’t jump straight into my role as a CEO.
I got my first taste of true entrepreneurship as an advisor to a CEO.
I’d hoped my new role would be exciting – that it would challenge me.
I’m happy to say that it did, but what I didn’t expect was that it would be educational.
After all, what did I really have left to learn?
I was a PhD: the pinnacle of noble learnedness.
I’m personally qualified to tell you that PhDs who think this way do sit atop a pinnacle – the pinnacle of confusion.
Our extensive education is formidable, but when it comes to business, many PhDs have all our work ahead of us.
I first put my PhD to work in a fast-moving startup, globally expanding its business activity.
This experience was worth more than I can express, and it was a profound education in the workings of industry.
But after 8 months, I knew it was time for a change – I needed to be at the wheel of my own business.
As the proud CEO of my own startup, I want to delve into something PhDs often fail to consider.
Industry transitions are incredible achievements, but what if you could take it even 1 step further?
The titles “PhD” and “CEO” are a perfect fit, and I’m going to explain why.
How A PhD Program Instills Entrepreneurship
Are you a PhD with your heart set on becoming a CEO?
Pause for a moment and recognize how rare you are.
The majority of PhDs will never cross the gap between working for other people and working for themselves.
Entrepreneurship in general is rare, but becoming an entrepreneur after completing a PhD is exceptional.
Study EU examined the largest companies on each continent, and they reported that among these companies’ CEOs, a mere 10% can boast a doctoral degree.
But the question is this: Why don’t more PhDs go this route?
After all, as a PhD, you have a substantial business advantage: You know how to learn.
You worked awfully hard to develop your PhD skill set – as just a few examples, you know how to:
- Gather evidence and collect data through rigorous research and experimentation
- Respond to experimental feedback
- Identify trends and outliers
- Optimize and innovate systems
- Manage multiple projects at the same time
All of these items are core ingredients of a good entrepreneurial strategy.
PhDs know how to navigate uncertainty, even if it means fumbling around in the dark, blindly looking for clues.
Hypothesize, design, test, fail and iterate – it works in science, and it works in business too.
Going from PhD to entrepreneur is a natural transition, but there’s one other thing to mention…
A study by Kerr et al. identified “locus of control” (LOC) as a key trait in entrepreneurship literature – your locus of control can be internal or external.
Entrepreneurs benefit vastly from having an internal LOC because it means they believe that they are fundamentally in control of their own lives.
In other words, they source control within themselves – not in random external forces.
This is how you need to be.
PhDs are off to a good start – just by obtaining an advanced degree, a PhD has drawn from an internal LOC to show initiative and move forward in a self-empowered way.
The final mental shift for PhDs is to move from valuing knowledge for its own sake to valuing the translation of knowledge into a product or service that improves other people’s lives and drives a profit.
3 Ways PhDs Can Break Into Industry On Their Own Terms
How can I improve this product or service?
Can I do this better or differently?
Is there enough room for another business in this sector?
If you want to be an entrepreneur or CEO, you’d better get comfortable with these questions.
They will be central to your process, and every thriving business has its roots in these very questions – in the adaptive innovation and perseverance of its founding entrepreneurs.
Specifically, an entrepreneur needs to identify frustrations – both your own and the frustrations of others.
You may need to completely reorient your perspective to embrace this fact: Frustrations are business opportunities.
Frustrations are experiments waiting to be run – solutions waiting to be marketed.
Fortunately, experimentation and problem-solving represent definitive skills from the PhD toolbox.
You just need to understand how these skills get adapted to entrepreneurship.
Let’s cover the 3 guidelines behind transforming problems and breaking into industry on your own terms.
1. Do your research. Locate frustrations and pinpoint what the market needs – that’s your niche.
Unless you are relying on supreme luck to find entrepreneurial success, you need to begin your journey with good research.
First, make it a goal to identify revenue-generating industries.
Apply your PhD research skills and find out which industries are projected to see major revenue growth in the next 5-10 years.
You should also work to identify industries in need of a good shakeup, also known as a “disruption.”
Industry disruption occurs when a new product or service emerges that totally changes the way in which companies do business.
As an example, streaming video services disrupted the home-media industry, and Uber revolutionized the transport industry.
Take a look at which industries haven’t been disrupted in a long time – these are the ones where you will find well-established problems that need solving.
Further refine your survey by researching companies with the most customer complaints (or frustrations).
Those frustrations are one of your most important resources because they tell you what your product or service should aim to fix.
Finally, make it a goal to identify industries that could be re-segmented – research the “white space” or gaps in the current market.
Ask yourself, “Can I find a niche market and disrupt an industry?
Overall, you will need to discover which “levers” you need to pull in order to achieve market success.
Consider your idea’s strengths and figure out the best points for market entry.
2. Get oriented to market trends, then use this knowledge to predict the flow of industry.
Don’t just speculate loosely – you know better than that.
You must rely on data and facts, and that takes time and experience.
You wouldn’t expect to solve a complex scientific problem without knowing that problem’s history of attempted solutions.
Industry is no different.
It is extremely important that an up-and-coming entrepreneur gets oriented with the state of their chosen industry.
And the best way to become aware of emerging markets and trends?
Follow the online activity of specific companies and their leaders.
You can follow venture capitalists and angel investors too.
These groups will routinely post calls for applications surrounding specific themes and alert you to different startup events in your area.
Attend these events.
They can be quite inspiring, even if all you learn is that people less qualified than you are daring to change the world every day.
They’re trying it – why can’t you?
The more you learn about the direction of your chosen industry (what they are investing in, for example), the more likely you are to come up with ideas that could be realistically funded.
Learning about your industry means learning what the market is ready for – what it’s “asking” for.
It’s not all that different from when you prepare to write grant proposals. Just like how granting agencies have different focus areas and calls for specific proposals, so do investors.
Both academics and investors have their own different areas of specialization.
3. Start networking – connect with other entrepreneurs and hone your ultimate vision.
If you really want to succeed as an entrepreneur, you shouldn’t “reinvent the wheel.”
This is a waste of time.
Instead, examine other startup businesses and become an active participant in startup, investor, and innovation events.
You can attend startup/innovation competitions too – start looking for ways to get involved with like-minded professionals and take notes on what the successful ones are doing.
When you attend gatherings like these, it’s not a problem if you want merely to observe.
Of course, if you are feeling bold, competition is a timeless way of sharpening your entrepreneurial skills.
What’s the worst thing that could happen?
People won’t identify with your idea?
Good – there’s another word for that outcome: feedback.
A lack of interest in your idea is normal, and it means you need to work on strengthening your pitch.
In general, don’t get too caught up in the fact that no one is interested in what you are trying to do.
Feedback is extremely valuable, and if you waste it by dwelling on how annoyed you are that no one likes your “brilliant idea,” you need to toughen up.
Feedback facilitates innovation, and if what you have is truly innovative, there is always a way.
If you have the vision, but people aren’t interested in your idea, it may be more about reducing that vision to a one-line value proposition that others–especially investors–can understand.
Your PhD program has endowed you with the skills and training that entrepreneurs need. What you do with this training is on you. If you’re ready to take control of your career in a profound new way, you can start here: Do your research and pinpoint what the market needs – that’s your niche. Then you’ll need to get oriented to market trends and use this knowledge to predict the flow of industry. And finally, start networking – connect with other entrepreneurs and hone your ultimate vision. True entrepreneurs know that there is no magic trick to becoming the successful CEO of your own startup. You must be the driving force behind everything – how will you apply your training?
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