At the height of the dot-com bubble, a record number of graduating MBAs chose entrepreneurship over traditional corporate jobs, and now MBAs are choosing entrepreneurship again, this time in record-breaking numbers. It hasn’t gone unnoticed that there is a “generational shift toward entrepreneurship,” according to Pulin Sanghvi, director of Stanford’s Career Management Center. There’s also an argument for graduate students and postdocs who are early-stage researchers to pursue entrepreneurship.
In Nature, Peter Fiske argues that for too long early-stage researchers are expected to stay in the laboratory producing results and publications while their supervisor commercializes the research. But supervisors are not well suited to start companies, Fiske says. Why? They don’t have the time, and they would have to risk a well-established academic career to pursue it. Early-stage researchers, however, have a powerful reason to put the time and effort into making a startup successful: They need a job.
Early-stage researchers also have the insight and single-minded focus that’s required to successfully commercialize research. They are, after all, the ones in the lab day in and day out.
To capitalize on the unique position of early-stage researchers, several leading research universities are establishing innovation ecosystems that support researchers. These ecosystems provide space for researchers to meet with outside investors and customers as well as programs that give researchers the basic how-to for starting companies.
All of the resources are great tools for early-stage researchers who have one thing on their minds: early-stage fundraising. Mark Suster, a two-time entrepreneur, offered some advice on the blog Both Sides of the Table for early-stage fundraising:
- Target your search. Don’t just pitch haphazardly to any and all VCs you run across. Find those VCs that match well with your product or service.
- Then, connect. Social networking tools aren’t your best bet when contacting VCs. Do it directly, through a portfolio company or through other respected entrepreneurs.
- Early impressions. Conventional wisdom says entrepreneurs shouldn’t meet with VCs until they’re ready to raise funds. But by forming relationships early, you’ll expand your network and open yourself up to worthwhile advice.
- The human touch. Of course it’s easier and more comfortable to fundraise by email or by phone. But easy and comfortable have never been the hallmarks of success. Investors are investing in you—you have to meet in person.
- High and low seasons. There are two stretches every year when fundraising is difficult—July 15 to August 31 and Thanksgiving to New Years. Since momentum is crucial to raising capital, you’ll want to schedule around those times.
- A simple story. Simplify your idea and narrate the story to your VC. The pitch is all about storytelling.
- Stay relevant. You’ll have to work to ensure you stay on the radar of your VC. Sending high-level emails about your company’s progress is one way to do that.
- Form a habit. Fundraising is never the most enjoyable part of starting a company, but it’s absolutely critical to its success. You won’t be able to get away with only pursuing capital every 18 months. You need to be thinking about it weekly.
- Fire a test shot. At the end of the meeting, it’s a good idea to ask the VC for a general idea on the viability of your company. Depending on the answer, you’ll know where to focus your attention.
If you are or have been an early-stage researcher, would you consider pursuing a startup? Is the culture supportive enough to do that?
Let us know in the comments!