What happens if you’re founding a startup and you don’t have a CTO?
As a co-founder of an IT company like techdev, I often get approached by startup founders with one of the following requests:
- Can you build the software?
- Can you do it for equity?
- How much does this cost?
- How do I find a CTO?
and other, similar questions. To me, this feels very weird as I’m typically faced with the exact opposite problem – finding people who are good at business development, marketing, etc.
As a result, I decided to write down this guide to how to deal with these situations before even approaching people like myself.
The issues I see the most are obviously related to a lack of technical expertise in the founders team. This wouldn’t count that much for startup ideas and business models that don’t require a lot of tech or IT to run, but we’re not really talking about those anyway. So what are the real issues when you don’t have anybody technical on your founders team?
- Not knowing whether a product is even feasible
- No idea about the complexity and effort when implementing it
- No funding from investors who want to see complementary founding teams
- Nobody to actually build the prototype / MVP
While these issues are difficult to overcome without actually getting somebody technical on board, your next steps strongly depend on which issues you really have. It shouldn’t be about just having somebody. We’ll get to that later in this article.
So what is it that you can do about not having a tech person? First and foremost, don’t panic. (Ok, you’re not, or you wouldn’t be reading this article) You’re not the only one, and there’s help.
1. Get Your Homework Done
First of all, the most important thing you can do is to get your homework done. What I mean with homework is mostly that you should evaluate what kind of product or service you really want to create and that you can actually sell to your potential audience. This is something you’d actually also want to do if you had a CTO already.
What does it mean?
Design your product: define specifically what problem(s) you’re solving, for whom and how
This way you’ll know specifically what to give to your first tech people on the team and you can get going immediately.
Market your product: try selling different variations of your product via your marketing channel
You’ll find out what works in the market and what doesn’t and can adjust both your product and the go-to-market strategy
While it may sound weird to market something that you don’t have and won’t even be able to produce out of the box, this strategy will give you very good insights into the market potential of your product before you invest heavily in building something that only you think is a great idea. Apart from that, it will make it much, much simpler to actually find somebody to co-found or join your startup if you can tell them specifically what it is they’ll be building.
One warning, though: Don’t define the tech stack yet, but leave this to the guys you hire! There’s no point in defining that you want Ruby on Rails or node.js at this stage. Even if you read a lot about tech choices – they typically don’t matter that much (except if you have very specific use cases like video streaming) and it will make it more difficult finding somebody to help you.
Depending on your product, you may be able to build a significant part of it yourself, given that you’re willing to spend some time and sweat on learning. I wouldn’t go as far as suggesting you need to learn programming Ruby or Java, but many showcases don’t require that much interaction, so they can be built with WordPress and a little PHP. In addition, while building a prototype you can showcase to potential customers and maybe even investors, you’ll learn how to structure your product definition and requirements so they can actually be built.
If you’re scared that anything you do will be shoved in the trash once you build the MVP, don’t be! This happens all the time as your product evolves and you should be willing to start all over at some point anyway.
As a funny anecdote I can tell you that a friend of mine has effectively become a Linux admin after starting a hosting company two years ago. Before that, he had never developed software or used a console. He got quite far doing some of the stuff on his own and in addition, now he knows what his business actually is about.
3. Get a Technical Advisor
A technical advisor is somebody who doesn’t work with you full-time (and therefore doesn’t get a full salary / equity) but just dedicates a couple of hours a week or month helping you with your startup. Typical tasks can be in this range:
- Define a technical realization concept for your product
- Validate your ideas regarding complexity
- Make effort estimates
- Ask the right questions
- Review your current solution
- Help you hire
But obviously you can ask for anything else you may need, too. Sometimes you’ll have to pay them to get a good advisor, but it can be more than worth it if you use their time wisely.
How to find a technical advisor?
So where and how exactly can you find such advisors? Apart from pinging me you can also go to tech meetups or conferences and simply ask. People who are able to talk about technical topics in a structured and understandable way (like speakers on conferences or meetups) are very good candidates and – guess what – many of them are up for something new.
4. Outsource Completely
Instead of trying to find a technical co-founder and team members yourself, you can of course also hire a software company to accompany your foundation. I’ve been through that on the technical side already and I can tell it can really work. However, outsourcing in the sense of dumping some wireframes over to some freelancers through Upwork or Outsourcely will most likely not produce the results that you hoped. It will only work well for you if you’re willing to spend time and effort on working closely with them. In addition, you’ll have to think a lot about very tiny details in the workflows of your products that outsiders generally cannot answer.
Another way of outsourcing your product development is to get somebody to take charge of all of it. Basically, you don’t just hire a bunch of developers, but the entire team to design, develop, test and potentially also run your product. That way you’ll get rid of most of your troubles at the disadvantage of having to put some cash on the table.
One remark here: Do not expect IT companies to make a pure IT-for-equity deal with you out of nothing. They typically won’t do it and, in addition, it’s not good for you either. If you’re not willing to spend any money (whether it’s yours or VC money) it means you’re probably not betting enough on your idea / product. As a result, you might lose commitment upon the first difficult obstacles. Once you have real skin in the game you’ll be more persistent, more demanding and more disciplined towards your goals. This also goes the other way around for the IT folks. They will prioritize work for you just like other work they get paid for.
That said, hybrid deals can be a very good compromise, i.e. you get a discount on IT services from your provider while giving away the rest of the value in shares. Be aware that this means you do a funding round, so you may want to time a deal like that together with the other investments that you get.
Last but not least, you should also consider hiring somebody. This can range from an unpaid university student as an intern to a seasoned CTO. Just be aware that the requirements you have to those are very different, so your expectations should be as well as your hiring process.
Many startups have made good experiences hiring a student or similar as (paid or unpaid) intern. Some of these have become CTOs later on. So far so good, but please allow them to learn on the job, give them time and freedom to try out new things and don’t expect your product to be technologically very mature upon the first try, i.e. you may have to redo it all once your product starts to grow.
In addition, good tech interns are hard to find. You may have to go through a lot of interviews. In addition, vetting people who have little track record can be extremely difficult. We’ll come to that a little later, but I’ll probably have to write a separate article on this one.
As opposed to a low-paid intern, a more senior developer will pose a higher risk for you at the advantage of – ideally – a much shorter ramp-up and delivery time. Here, as well, vetting a very technical person when you don’t have a lot of technical expertise yourself will be hard. Points 2 and 3 may help you a lot here, in addition to have somebody you know review the candidates’ GitHub repos or sample work. (Btw. especially for a job in an early-stage startup, I wouldn’t hire a developer without an active GitHub account or similar)
The difference between a senior developer and your CTO is that your CTO will get equity in return for having to represent the company in front of investors, partners and potentially customers with their technical expertise. Therefore, they not only need to be good developers. They should also be able to explain technical terms and issues to very tech-unsavvy people. This of course forms a different pattern in terms of requirements and makes it much more difficult to find somebody.
As your CTO will most likely be in your startup for a long time, you’ll also have to hire somebody you get along well. Ideally, you’ll have to have somebody you’ve worked with for a while so you know you have a similar way of thinking.
A couple of general hints:
- Hire a lot for mindset; e.g. if people are very much stuck to the one and only technology, they’re probably not a great fit
- Value simplicity – some IT people will want to come up with solutions that are very flexible, generic, and simply beautiful. While that’s a nice goal in itself, for your startup you’ll probably want to hire somebody who just gets the job done, even if it’s “only” in a decent way, not awesome
- It’s easier for tech people to have somebody to talk to, so consider hiring at least two people if you don’t hire a CTO
- As mentioned earlier, let the people you hire choose the technologies they can do most with, don’t impose tech stack decisions on them because you wanna be fancy
I hope I could give you some advice on how to deal with a situation where you don’t have a technical co-founder. I have some thoughts that apply to many or all of the topics above that I want to summarize here.
Never ask just one person or source on what they think.
Don’t waste peoples time with half-baked ideas or nothing more than an idea. It won’t work. (I always have to think of this one when people approach me with business ideas).
Take Them Seriously
Your tech people aren’t just some random people you tell what to do. They add the same amount of value as anybody else on your team.
Please leave a comment or ping me on Twitter, especially if you feel some of your issues are underrepresented in this article.
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