Harnessing Experience at a Fraction of the Cost
As a startup, one of the most important decisions you can make is ensuring you have access to experienced technical leadership. While hiring a full-time CTO can be expensive, there’s a better alternative than going it alone: the fractional CTO.
Who Cares if it Scales?
Across the country, in every accelerator, exec team meeting, advisor session, and board meeting, startups are asked the same question:
“But how will it scale?”
My answer: “Who cares?”
When the hat gets too big
“We all wear a lot of hats around here.” I’ve heard this enough times that it might as well be printed on a poster and issued as part of the Entrepreneur Starter Kit, along with a case of ramen noodles and a framed picture of Larry Page and Sergey Brin.
Any company, no matter how small, includes basic functions like sales/marketing, finance/accounting, HR, product development, and customer support. Leading the company means ensuring that every one of those areas runs effectively, so every leadership team has to cover a lot of ground in the early days. And if your founding team didn’t come with those skills built in, then someone has to do two or more jobs (i.e., wear more hats).
As your company grows, the needs in each area naturally grow, as well, but not all at the same pace.
The function’s criticality should dictate the seniority of the leader.
Signs that it’s time to delegate a function:
- The function is critical to your company strategy but outside of your wheelhouse. In the early multi-headgear days, founders can get away with playing to their strengths while competently covering the other parts of the business.
- Trying to cover the function part-time has become an impediment to the company’s growth. When company progress is delayed because certain areas aren’t getting enough attention, then it’s time to hire a new leader.
- The team is too big to manage part-time. When a functional team reaches the size where you can no longer manage them with part-time direction, then it’s time to offload the work.
When your investors tell you to
Investors want a strong leadership team, and they aren’t shy about taking action when necessary. It makes sense from the investor’s point of view: they have an investment to protect and they can’t have your underpowered team screwing it up.
Before your investors tell you to
If you want more control over your team-building, consider hiring ahead of your needs. Going to investors with a strong leadership team that’s clearly ready for the next phase of growth can speed up the financing process.
What does a CTO do?
The CTO is the technology leader for a company. For most companies, this means that he owns all technology, including corporate IT, infrastructure, and networking.
Being CTO means more than being the lead engineer for a company: it means that you’re the lead technologist and technology strategist.
Why startups change CTOs
Startups break up with their CTOs for:
- Personality conflicts within the leadership team
- Poor performance
- The company outgrew the CTO
Personality Conflicts
Every business person thinks that they have to have a technical co-founder, but what they really want is an engineer, and often any old engineer will do. Founding a company together isn’t just a transaction; it’s a commitment.
Would you marry someone you’d just met at a tech meetup? Then why would you decide to start a company with them?
Poor Performance
Great engineers don’t always make great leaders. The skills that we value in a great engineer are very different from the skills required of a good leader.
If you have a great engineer on your team, don’t ruin his life by making him a CTO.
Outgrowing your CTO
The problem is that Todd’s primary qualification for being CTO is that he was the first one on the team who knew how to code. As a company grows, writing code quickly becomes the least of the CTO’s responsibilities.
If your engineering team is larger than ten people and your CTO is still writing code, you have some serious prioritization problems.