Can You Hire a CTO for a Startup

First of all, congratulations! 🎉 If you ended up here doing a web search like “CTO for startup” or “Technical Director for hire”, you are in a good place. I have been a software company CTO equivalent myself, so I will explain it to the point. So what Chief Technology Officer, or VP of Engineering, or whatever the role is called, does in a startup?

CTO’s role, same as of all C-level executives, is conceptually really simple and so are the responsibilities. In software companies you at very least have two areas of responsibility - “business” and “technology”. The CTO is the person managing and being ultimately responsible for everything technology. This is it, you cannot create a comprehensive list of all the activities involved, this is by design.

Let’s suppose, you are the CEO.

👉 There is a need to evaluate Zooplazoopl technology released this morning combo with Flexible Scaled AgileOps - this is your CTO’s problem.

👉 You feel like you need to hire developers to move faster - discuss with the CTO, he’ll figure it out.

👉 The service is down - the CTO is responsible.

👈 The CTO tells you that the MVP is ready but nobody is interested - you are responsible.

👉 You need your company development gears to turn - good that the CTO takes care of it.

This gives you a fair idea of what CTO does.

Is Hiring a Technical Director Just for Money Possible at All?

TL;DR - no it’s not, but there is so much BS on the Internet about it.

Splitting roles in a startup is a business partnership, and just like marriage, it’s all about trust and doing each own part. Obviously, this cannot be decomposed into processes or elementary activities. It’s about doing whatever is necessary and knowing that the other person is doing their best in the same time. This is about motivation and being intrinsically interested in your product's success.

There is another important part of the picture. Let’s suppose we have a “strong average” software shop of 20 decent developers. How many do you think are going to be CTO capable in terms of expertise, talent, ambition, and personal traits? My answer is something from 0 to 3. Being a software development director is nowhere near average, and just being a decent senior-level developer won’t make it. Add here that some people who actually can, do not want or no longer want to be responsible for the business function. One of my friends, and an ex-CTO too, left when faced with the need to fire employees not based on merit. People who are fit for the job are either busy being high-level technical managers in their own place with 2x-5x senior-level architect salaries or spending a couple of years in major tech companies waiting for their options to vest. They are working for boutique consultancies charging north of $500/h, fully analogous to what lawyers do. Some of them, those who feel entrepreneurial, are independent consultants like me. The rates are lower in this case as they don’t include the shop’s cut.

If you do a search for something like “Freelance CTO” you will find a plethora of articles on websites claiming to provide all sorts of services starting from “Fractional CTO” to “CTO for MVP” and such. Who are they? Just as observed above, they tend to be one of the following.

1. Software shops doing projects on fixed scope or providing outsourced services.

2. Freelancer marketplaces.

3. Independent consultants.

The articles on websites #1 and #2 and are produced by marketing staff trying to scrap a long SEO text from sources on the Internet without having a clue at best or just key phrases stitched together at worst. They have no relation to reality and the best you can do is forget everything you read there. If you need an alternative definition, this is a better source.

“A chief technology officer (CTO), also known as a chief technical officer or chief technologist, is an executive-level position in a company or other entity whose occupation is focused on the scientific and technological issues within an organization.

A CTO is very similar to a chief information officer (CIO).

…

A CTO should be aware of new and existing technologies to guide the company's future endeavors.”

Speaking about #2 and #3 or Freelancers from marketplaces and independent consultants - there is nothing intrinsically wrong with them. In fact, I’m like this. You might find what you are looking for but success is not guaranteed. Is it the same as having a partner CTO? No.

Is it Possible to Succeed Without a CTO?

Yes, but if you don’t have a real CTO equity partner, actually you are the CTO even if you have a staff position with this name and a person withing the team with this title. Equity partner motivation is different from employee’s and nothing can really fill the gap. But! You sure may still be able to do all parts yourself with the help of salary workers, outsources and consultants.

You are going to encounter some challenges though.

Controlling the work of the outsourcing or in-house team

Have you actually tried to manage a team of builders erecting your house? Controlling software devs is much more complex in both technical and business sense. You might structure your organization and processes just right, but this is another sort of challenge.

During many software development projects audits, I saw all sorts of shoddy and shady stuff, including mock HTML+JavaScript pages being presented as a finished functional subsystem with a 5 digits invoice being sent after the demo. I would say you need to be a rock star manager to generally make things work and a messiah to eliminate at least half of the slack if you don’t have extensive experience both in software development and managing the activity. Using external expertise and control can help as well.

Setting right priorities and direction

You might feel that you are naturally capable of doing it, huh? Suddenly, this might be even more challenging and dangerous. Let’s think about it together. For example, you are developing a web service application. You want to release a reasonably good project to secure your ability to work on it further. If this is your understanding, you might be in a good place already. A worse understanding would be to release something beating other products on the market. The terrible understanding would be trying to produce the best product in the world. Will a person interested in maximizing the scope give you this “just enough” advice? There are many aspects to it like technology used and who benefits from the choice, vendor or technology lock-in, or being too flexible and thus not productive, making your project bigger via inventing unnecessary problems and many more. There is a relevant joke, you know.

The lawyer son runs into the home and yells to his lawyer dad: “Dad, do you remember the case you could not win our entire life the same as granddad before?”

“Yes, son” said the concerned lawyer.

“I just won it, and it was so easy that I can't cannot believe how you weren't able to do it for decades!”

So the dad slapped his own face in despair and cried: “This case fed our family for generations, and you are coming here to my face to tell me you won it?!”

Maintaining the balance of power to remain in control

“Hold on, you have to be joking. You are joking, right?”

No, I’m absolutely not. There is a proverb

“No building since the Great Pyramid of Giza has been built on schedule and on budget”

Often, this is not intended, but also often it is. Why? It's as simple as one-two-three.

In construction:

1. They sing sweet songs, and sign unrealistic plans to win versus the competition.

2. They demolish the previous building and dig a huge hole in the ground you can neither use nor leave.

3. Who’s the boss now?

In software you have pretty much the same, in place of the hole in #2 it’s needing them to fulfill your own commitments in a timely manner, or only them knowing the changed code base now, or them being prepaid for work not yet done or other similar stuff. Anyway, you often cannot replace them without losing massively in time, or money, or you might no longer have the budget because they consumed it.

In the end you are not only in a dire situation, you also cannot really control them or make sure they do what it takes to release. Please be sure that those with dirty hands know exactly what they are doing. Suppose, they just billed you extra 500 hours for bug fixing. Did they even spend 50? This is especially common for the overseas teams.

How can you remediate this? Not going to lie, this is not something everybody will solve. Ideally you need experience both developing software and contracting dev services. You might use external expertise the same as you would in construction.

Building what doesn’t work or is a bad idea

Isn’t your idea good enough? It might be. More often it’s only true to some extent. Actually, this is where software is much more complex than construction and is more like engineering. Most startups pivot. Let’s suppose you are doing a lightweight MVP that was agreed to be 500 hours of work. It actually turns out to be more like 1500 hours. But! It’s also apparent for the dev team that things will not work as anticipated at all after 300 hours. These are realistic numbers. Will they tell you after 300 hours or wait till the 1500 hours of work is done?

There are, or course, ways to remediate this like having the experience yourself or using a (good!) consultant, using some agile methodology, and spending enough (much) time being involved with the product.

These are just probably the most important challenges, but there are others like being able to pick the right people, technologies, keeping it simple, being lean and such.

Conclusion

So, these were my 2 cents on some of the challenges you might encounter on your journey as a startup founder. I would recommend you to find a decent CTO and secure this healthy equity-based business co-owner motivation for them. If you decide to effectively be the CTO yourself, you will need to delegate. If what you just read resonates with you, you can contact me, the first consultation is free. If I won’t be able to help, I will just say so. If you solve the problem somehow in a way not covered here or do not agree, write me back, let’s have a meaningful discussion. No matter what you decide, I wish you persistence and luck in your endeavor! 🚀