Non-tech founder: all you want for Christmas is a CTO! (or not)
By Soline Kauffmann-Tourkestansky - 26 May 2017
You have this great idea in mind, have done your market research and know it will be big, but there is one hiccup: the tech part.
As a non-tech founder, you may not be a hardcore geek, but you can put 1 and 1 together: some of the last unicorns are tech companies and so, without the tech, adios startup. So this Christmas, no socks or gadget – all you want is the best CTO for your business. But are you really asking for the right present? Like with everything in entrepreneurship, working step by step may be the best approach. Here are 5 points you may want to have in mind when thinking about finding your CTO.
- You don’t need the tech, or at least not now
Sounds counter-intuitive? Think again. As a founder, there may be this huge urge to develop the product from day 1. The reality is, in most case having the actual product immediately when you start does not matter. The business does. The tech should remain a tool, which serves a company to generate revenues. As such, your objective when starting your company should be to postpone the tech investment until you have proven all the non-tech related business hypotheses (who are your customers, are they eager to buy, at what price, etc…). Of course, it won’t last forever and you will have to show some tech at some point, but not from day 1.
So before you even start thinking about developing your product, think first about testing some business hypothesis with tools that already exist. Take Shopify: the e-commerce company, which develops computer software for online stores, started with using an open source web application to build its first online stores. Nowadays, it reports $10bn in total gross merchandise volume. Failure to generate relevant business-related KPIs means your business is not strong enough. Greater tech or external investment won’t change much, as Quirky (which raised $185M from various VCs) and Homejoy (who received $40M from the likes of Y Combinator) learnt.
Educate yourself to understand and speak #geek
Now that your business hypothesis is tested, it’s time to think about the tech. But before you go out hunting for your unicorn CTO, educate yourself in the following:
- First, have a strong understanding of how the tech will serve your business. This will drive the human and financial resources you will allocate to the tool. You need to be clear from the start, and define business-related KPIs your tech tool will drive (churn, average spend, on-app time, etc…);
- Second, have an understanding of how product development works and how to communicate with your future tech partner. This is very important in order not to burn resources and spirits because you will not have expressed clearly the business needs, or will have pivoted too often.
Hire a developer or a mercenary before hiring your CTO
Non-tech founders will likely start looking for a CTO too soon. An experienced CTO means 10+ years experience, which means a whopping salary you cannot likely afford. She or he might also not necessarily have the tech skills you need if she or he has not updated its skills. Do not consider offshoring, It might seem less costly, but you may lose in agility as things will be lost in translation and you will bear the challenge of time difference. Hiring a freelancer might be an option, but they won’t stick around.
Instead of looking for a CTO, you may first want to have a smart coder in your team, who may not be experienced, but who is definitely talented, and first and foremost, understands your business. A good alternative when you are in the first scaling phase is to use “mercenaries”, professional tech agencies that will build, execute and deploy your product very fast. Theodo is one good example of such tech agency: the Theodo team starts from inception, by first understanding your business challenges, then defining how the tech tool will support your needs. Once this is clear, Theodo then assembles a team of developers best suited for the job and develops your product in a record time.
A CTO is a human, not a robot
When it is finally time to hire a CTO, choose smartly. As a non-tech founder, you may be overly dependent on your CTO’s knowledge at a critical moment of development. The main – and often unspoken – problem in a non-tech/tech interaction is the unbalance of knowledge power in the relationship. If you cannot trust that your CTO is competent, nor a good human being, don’t move forward with the relationship and seek other options. For Fabrice Bernhard, Theodo’s co-founder and CTO, the right CTO should demonstrate three skills: “humility to surround him or herself with advisors, business acumen and the ability to attract talent”. The third part is very important and often disregarded. Your CTO is first and foremost the person who will recruit the best developers, therefore, he or she needs to be technically credible in the eye of its peers.
The scaling banana split: CTO and VP product
Congratulations. If you’ve gone through all of the above with your startup, it likely means that you now have an elite group of killer developers. At this point, it’s time to apply the Jeff Bezos two-pizza rule: beyond roughly 8 tech team-members, you may want to consider splitting the tech leadership in two and look for a CTO – who will be in charge of the technical excellence -, and the VP Product – who will lead product development management. This strategic split will allow your CTO to focus on his expertise and be fully dedicated to the product, rather than focusing on project management. CTOs who manage to be both technical leaders and project managers are rare, so make it easy on them, and think about on-boarding the best complementary skillset.
With that, Happy Holidays!