Responsibility/ethics of startups during graduate studies It's a common meme that people often embark on and develop business projects while in graduate school. However, it's unclear how frequently this actually happens in "real life".

More importantly, how responsible/ethical a choice is it, in say, a funded PhD program? I know that typically there is a guideline for hours worked for such a position, but that's almost a joke in comparison to implicit requirements like standards of research quality and publication rate.

Assume that you are a student earnestly engaged in both the PhD topic and an unrelated side project, and you want both the PhD and the business to succeed (i.e., graduate, publish, launch side project as successful startup). To me it seems like the worst-case scenario in that situation would be running into a tough problem in research, while still putting in occasional hours on the side project, as that would look terrible.

I'd also like to hear about the details. How/when to disclose? How to maintain rapport with advisor? What are the ethical concerns? Is this feasible? How do these goofballs in the success stories get away with this? ;)
Well, I did something like that, and I must say it eats up all your time. As said in one of the comments, it is only likely to succeed, if there is a close relation between thesis and company, otherwise you won't find enough time for both of them and fail.
If your thesis is closely related, you should inform your advisor very early in the process, because most advisors think all ideas emerging from their institution are their ideas or at least inspired by them. Despite of that, a good advisor could open some doors and be of help.

Legally, you might even be forced to do this (depending on the situationin your country), e.g. in Germany most contracts do not allow side business without anouncement to your employer. Of course, as long as it can be considered a hobby, noone can sue you for that.

You do a great job if the PhD-programm can sell it as a success story, because their funded project resulted in a new start-up.