Interestingly enough, I had a clarifying experience today that directly addresses this question.
For the last couple weeks I've been in discussions with a start-up firm (VC-funded) to conduct some research with/for them. In the course of the conversation, the offer to join their firm as an officer on a part-time basis (keeping my university position) was made. At first it was very attractive since it would immediately increase my income by 20 to 30% and give me a shot (however remote) at a huge payday down the road. Over the last several days, I realized that by becoming an officer of the company, even on a part-timbe basis, I'd face pressures, responsibilities, and liabilities that went far beyond just doing the research that would help the company develop its technology. And that by taking on these responsibilities and liabilities, that I would be giving up a large part of my independence. And that made me very, very uncomfortable.
So, I negotiated a deal that makes much more sense to me. If the company gets their VC funding, there is a very good chance that I will still get to do the research, which has the potential to be very interesting and will allow me to meet many of my university responsibilities. As far as the big payday goes, I have two pathways there: sharing in patent royalties through the university and stock-options in the company by serving on the board of advisers. The payday (if it happens) won't be nearly as big, but still nothing to sneeze at.
This arrangement keeps a nice moat between me and the start-up company so I can keep my independence and the ability to sleep at night.
