PhD vs. MBA: Which is More Valuable for an Entrepreneur?
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I’m going to say it before you even think it. Yes, with both a PhD and MBA, I’m overeducated. People marvel (or snark, depending): “You have both a PhD and an MBA? You must really like school.” The fact of the matter is, I like learning and sometimes that involves school, but mostly it involves learning by doing.
For those of you unfamiliar with what it really takes to get a PhD, a PhD in the life sciences is basically a long, poorly paid apprenticeship. After you are done with your one and a half years of classes, you work in unpaid practicums, or for minimum wage as a research assistant, for four years. As a graduate research assistant, the annual stipend from the National Institutes of Health is currently $22,920 — and you are not working a cushy 40 hours a week. Try more like 60 to 70. So, it’s a factual statement to say a PhD is essentially a glorified way to work for minimum wage for years. The notion that you are chillaxing reading books and pontificating in an ivory tower should be put to rest.
People want to know: which was most helpful in starting my company? They seem truly disappointed when I say “both!” They want to know: vanilla or chocolate? Pick one! But, truly both have been essential to pymetrics, in large part because of the nature of the company. To give a bit of background: I am CEO and co-founder of pymetrics, a neuroscience-based recruiting platform that matches best-fit candidates with compatible careers. We are a life sciences technology, so it would be hard to do without the decade that my co-founder and I both put into learning the technology through a PhD and then a postdoc (more poorly paid work). It is not something you can learn in a 6 week class. There are some very hard skills that you learn by doing over and over again: experimental methods, data analysis, assessment, etc.
However, my MBA is equally valuable to the success of our company. When I told my fellow PhD brethren that I was contemplating an MBA, the disdain was palpable (and often audible). “What a waste of time… an MBA is a BS degree.” (And they did not mean bachelor of science.) Well, it is expensive, but to say that an MBA is a waste of time is truly short-sighted.
For the bankers and consultants out there, an MBA might not be the transformative and completely foreign experience it was for me. Five years of either probably gives you a solid foundation in the business world. However, for the rest of us non-bankers and consultants (and in my program, that was about a third of the students), I would say it was a tremendous learning experience. If you had never set foot in corporate America, like myself, it was invaluable. Where else do you learn accounting, marketing, basic finance, operations, etc. in such a short period of time? For those scientists out there who scoff at an MBA, I would say that they don’t realize what they are missing. And often that is to their detriment, because a business is contingent on having basic business skills which, unfortunately, are not covered in the 1.5 years of classes or the 4 years of poorly-paid research work of a PhD program.
Aside from skills like pricing and building a financial model, the other aspects of an MBA that were truly essential were two-fold. One was realizing that business, unlike science, is tolerating and making decisions in the face of (often significant) ambiguity. Science is precise and exact. In fact, if you make a claim that cannot be 100% substantiated by scientific evidence, you are seen as a poor scientist. And, in all fairness, that should be the case in science because it is the endeavor of building a body of knowledge that (hopefully) we can deem as truth. All those scientific laws out there – relativity, thermodynamics – would be pretty awful if they only worked in 70% of cases. In science, you seek knowledge and truth, and the closer you can get to that, the better. And, as a result, the time scale of science is very very very very slow. Did I mention it was slow? Very slow.
The world of business does not and cannot operate that way. In business, is all about making decisions with imperfect information. Things need to happen today so one cannot wait for perfect (or close to perfect) information. As many wise business people say, perfect is the enemy of good. So as a scientist turned entrepreneur, I had to become comfortable with ambiguity and uncertainty. However, to this day I think my scientist self gets the better of me at times, because it is truly hard to engage in the act of aggrandizing and outright fabricating (often in the name of ‘outlining the vision’) the way that I sometimes see other business people do.
The other thing that was a very valuable learning experience for me is that while we sell a science / technology product, business development and sales are all about the personal relationship. While you need to have a product that works and does what you say it does in order to sell it, the converse is not true: a working product will not sell itself without the personal relationship. Discovering this was a learning experience for me – and somewhat of a pleasant one, because I have always valued relationships. There is so much psychology to business development – understanding people’s motivations, understanding what is driving them to try our and buy your product – that it really does not come down to just having a technology product that works.
Ultimately, relationships are what drive the business forward because, as a startup, people are taking a gamble on you. The people that vouch for you – whether it be investors or clients or users – do so not necessarily because they’ve technically vetted your product. They support you because you have inspired trust and faith in them. Again, this is not how the scientific process works.
I see my work as the culmination of the two very different parts of my background mashed together. My scientific knowledge gave me the insight to see how I could apply neuroscience concepts to a problem that was made evident to me in business school: recruiting and retaining quality talent. Without both parts of my experience, pymetrics would not have come to fruition.
This is not to say that everyone must immediately rush out and get as many degrees as possible in the hopes of divining their life’s mission and purpose along the way. The bottom line is this: if you pursue the things that you love, life often finds a way to show you how you can contribute the passions that drive you to a bigger cause.
Frida Polli, Ph.D, MBA is co-founder and CEO of pymetrics, a company that uses neuroscience to match best-fit candidates with compatible careers. She’s a mother to an awesome daughter, Ele. This article originally appeared in Forbes Online.