During the past years, I’ve interviewed a lot of developers, technical leaders, and CTOs. There are a few key things I’ve learned about hiring a good CTO for your startup. Does every successful technical team need a Chief Technology Officer at one point in time? What are the skills needed for being a good CTO?
I talked to Vincent Battaglia (co-founder of Ludus), Marijn Vandevoorde (Engineering Manager at madewithlove), and Jonas Van Schoote (CTO at interim at madewithlove) on topics like startup growth, CTO as a service, the different CTO profiles, the CTO skills needed, whether or not your business even needs a CTO, and how to find a good one if you do.
What is the role of a CTO
Let’s start by getting everyone on the same page and define the role of a CTO and their responsibilities. You’ll notice the opinions and definitions will vary a lot because the role of the CTO is influenced by the size and maturity of your startup and technical team(s) and the stage your startup is in.
We’ve written an elaborate post on the different skills needed to be a successful CTO. Usually, the CTO is external facing, strategy focused (similar to a CEO), while a VPoE (Vice President of Engineering) is internal facing, tactically focused (akin to the COO).
But simply put, a CTO is part of the decision making team on both the technology and business side. The CTO’s biggest goal is making sure business objectives and roadmaps are represented in your (SaaS) product through the most optimized architecture and best usage of technology.
A good CTO can context-switch between the technical side, people skills, and strategic product thinking. The exact relation depends on the products they manage. Technical skills are key, of course, but it’s also important to have knowledge in product, marketing, fund raising, and more.
A CTO requires different skills in different stages
The CTO in the early stages of a startup
At the beginning, you probably don’t actually need a CTO but instead a technical co-founder who will be responsible for everything technical in the startup. We like to refer to this profile as the hacker whose main challenge is to deliver the MVP as soon as possible so that the team can start testing the product and finding product/market fit.
This person will obviously need to be able to code the first version of the product themselves and should have very broad skills (front-end, back-end, servers, integrations). Don’t give this person the CTO title but instead lead engineer or software developer.
- Required skills: backend, front-end, infrastructure, devops, servers
- Nice to have skills: people management, design, ux/ui, sales
The CTO in the post-MVP stage, growth or scale-up
The application has probably reached the stage the founders were aiming for at the start. Now, the most important skill for your CTO is to be able to build a (technical) team and create an environment where the team can perform at its best. The archetype we think of is Head of Engineering and they could receive that title as well.
The role requires being a good leader (not necessarily a people manager, more like a guide and mentor) and putting processes and structures in place to share knowledge and streamline the product and engineering delivery capabilities.
- Required skills: technical complexity, growing teams, lead-engineering, guiding teams, product knowledge, SaaS experience
- Nice to have skills: DevOps, backend, front-end, people management, setting technical vision, similar domain experience (especially when niche)
The CTO in the later stages and big (unicorn) companies
A valuable CTO in the later stages needs skills that are roughly the same as above but with the added role of managing managers. The people skills are a lot more important, as well as the ability to think strategically. We think of this CTO profile as the visionary CTO.
You can compare this with a political role, being the representative and the defender of the technical team towards the management team and the board. It’s possible that CTOs in big companies are not very technical, with some of them never having written a single line of code since it’s not really required at this size.
- Required skills: people skills, management, setting technical vision and strategy, SaaS experience
- Skills nice to have: technical knowledge, tech lead, product management
Does every SaaS start-up need a CTO or are there workarounds?
A technical co-founder is required, but they don’t need to carry the CTO job title. In a 2- or 3-person startup, having a dedicated CTO doesn’t make much sense and can hurt you in the future.
Even bigger teams can do perfectly fine without a CTO. With a mature, self-organizing team, lower complexity, and a reasonable team size, your start-up can get away with no CTO. However, there are some things that need to be done properly.
Periodic strategic advice from someone external to the company is a valid substitute. People management can be done by engineering managers or team leads, and (in some cases) a strong product leader (the CPO perhaps?) could fill in for some of the missing strategic roles and product thinking.
However, if the organisation wants or needs to grow quickly, a reliable CTO is often unavoidable.
Where should your CTO start? What are some of the first tasks the CTO should take on?
There is no right or wrong answer. This greatly depends on the product, team maturity, and technical debt. Everything should start from the product vision. If there is no product and company vision, define that first.
Then it’s about seeing what an ideal situation would look like, especially from a technical point of view. How can the technical solution fulfill the company vision?
Creating the product vision is a hard task. A lot of technical decisions depend on whether something is part of your core product offering or not. It will become more and more clear over time and a CTO will only speed up that process. A good CTO will start writing everything down as soon as they have something solid in mind.
Another strategy is having the CTO start by trying to assess the current state and the product vision. With a clear, short term "todo" list, they can buy time to work on the long term vision and prioritise strategic initiatives.
How do you evaluate the performance of a CTO?
There is no out-of-the-box set of metrics to measure the performance of a CTO. We usually look at how smoothly the technical team runs and how they make progress.
It’s easiest to evaluate the CTO through thorough feedback from the team they manage, but the perspective of the business is equally important here. Having a clear roadmap and some steps that have been taken successfully on it are also a good indicator.
As a general rule, looking at soft skills rather than hard skills will do wonders. Apart from being good at all things technical, it’s important that your CTO can communicate well and be nice to work with. The CTO is a T-shaped profile and there are a lot of factors that influence their performance.
What does a good assignment look like when hiring a CTO? How do you test unproven people?
A technical assignment during the hiring process is not an easy challenge. When hiring, the emphasis should be on the interviews. Your hiring and management team should have lots of those, preferably with specialists in the field.
It’s a good idea to bring in a lead engineer to discuss the current technical vision, an engineering manager to discuss evolving team structures, and a product manager to discuss product vision and team collaboration. The main role of the CEO during the interviews is to see whether the candidate can sell an idea to the board and how they interact with other key members of the company.
If you want an objective check, creating a technical assignment can be a good idea. However, make sure you know exactly what you are testing and how you can score their output objectively. Creating a hypothetical situation and asking the CTO-to-be how they would react is a great start.
For example: “You are now in charge of a product where bugs are constantly reported by customers and the product is out of service at least one time a week. What would your first week at work look like?”
Asking about their experience, with questions like “What is the biggest problem you ever had at work and how did you solve it?” can tell a lot. Dig deep to understand their role in the process, what the person did, not just the team they worked with. What is their philosophy when it comes to leading engineering teams?
Who should become your CTO? A freelancer, an agency, or someone in-house?
Hiring a CTO is a challenging task. The good ones usually already have a successful career and are not willing to take a leap of faith by joining a new startup. But there are options; you can decide to work with freelance CTOs or agencies that offer CTO as a service.
Alternatively, with good leadership, you can grow promising back-end developers, technical leads, or even your technical founder to meet the needs of the ever-changing role of CTO.
In general, you should expect to hire someone from outside the company, specifically given the experience requirements mentioned previously. It’s common to promote someone into the role, but rare that it’s the right person for the job and not another victim of the Peter Principle, the concept that states people will rise to the “maximum level of their incompetence.”
The in-house CTO
The ideal solution for most companies is to have a CTO in-house. However, the role and responsibilities change over time and having the same person complete the constantly evolving tasks of the CTO is not always the best idea. As CEO, it’s important to keep in touch with what problems the technical team is encountering to ensure your CTO is still well suited for them.
The freelance CTO
A freelance CTO can guide you, especially when having to make tough decisions. It can be a good thing that this profile is not a direct part of your company and business, but it also comes with risk. This person might leave sooner than you hope and, by combining other revenue streams, they might not always have their full focus on your product.
It’s also hard to be a part-time CTO, especially for bigger products and teams. Make sure to have your agreements set on paper and dare to invite them to all levels of decision making so they can make the most impact. The freelance CTO will cost you more but is often a good idea for growing companies that don’t require a full-time commitment.
An agency offering CTO in residence as a service
Fulfilling the role of the CTO properly all revolves around offering the right strategic advice. An agency comes with relevant market experience, multiple people to look at your situation, and an outsider view to expand your horizon.
When our CTOs in residence join a new client, they are often part of an advisory board, defending you and any decisions before the primary stakeholders. When difficult matters rise to the surface, we gather other experts to discuss the problem internally before offering a solution to the client.
Once the product vision, technical roadmap, and development team are up to speed, we will start the search for an in-house CTO to replace ourselves. We like making ourselves redundant and — since honesty is a core value of ours — we see great results with the teams that work with us. We truly believe offering CTO as a service is the best way for ambitious startups to achieve rapid growth.