With the booming technology industry, the role of the Chief Technology Officer(CTO) has grown progressively and every entrepreneurial mind out there wants to grasp the best perks from the market. The CTO has scaled the corporate hierarchy to play a vital role in the advancement and success of the company. Moreover, the CTO is seen as the face of the organization. For any business or organization to evolve, a CTO provides technical advice and leadership which enables their organization to scale and interpret the organizational culture by joining hands with the team.
As an integral part of any business or organization’s development, a CTO provides technical advice and leadership that helps the organization scale and interpret the organizational culture by joining hands with the team. He could be the technical co-founder, technology partner, or simply a technology expert with an entrepreneurial mind and experience. A CTO ensures that the product expansion is on track, meets the targets, follows budgets, and manages technical debt, ensuring a positive cash flow.
69.3% of businesses reported that 10–30% of their products fail to meet their customer requirements. This is the reason why onboarding the Chief Technology Officer(CTO) becomes essential for a startup, accounting for their expertise in the technology and experience they hold into consideration. According to the state of the CTO survey 2020, 51% of the respondents joined startups as Chief Technology Officer.
Understanding the role of a CTO and its value addition to the organization
A CTO is the lead of a company’s technological needs and research and development (R&D). The short and long-term needs of the company to organize and make investments catered to reach its goals. CTOs are assigned to lead a startup’s Technology or Engineering departments by continuously optimizing the product and technology framework.
A CTO is a prerequisite for technology advancements, which is critical for organizations that require continuous decision-making related to the field. In short, the CTO has the utmost difficult job of all. They handle the technological side of the business that is the foundation of products. Even if backed up with strong funding and product ideas, the tech team is responsible for turning ideas into reality. He is also responsible for determining which technology to use and weighs the pros and cons of each tech stack.
The three CTO personas
With the changing technology, CTOs need to fill in different shoes in the startup ecosystem. The role of the CTO has evolved into three primary personas:
CTO as a Creator
Startups at the budding stage of a tech-enabled company need a technology leader who is essentially responsible for development and delivery of the product. A CTO stands at par with the company’s decision-makers taking the organization forward in the realm of technology. From building a team, product/service development to strategizing and operating when the startup is still in stealth mode. The authoritative structure, pillar of the startup, and the business enabler are expected out of a CTO here. At this initial stage, the CTO is responsible for :
- Ideation and Brainstorming
- Market Research and Product Discovery
- Define Technical Architecture
- Estimating Timeline
CTO as a Nurturer
The startup advances to a mid-level stage when it receives some funding and is looking to develop its product idea further. The CTO’s role focuses on people and project management skills, also understanding how technology can affect the startup and how they can leverage the same to gain a competitive edge. A nurturer CTO needs to make sure that the development carries on like a well-greased machine. In this role, a CTO looks at :
- Building and Expanding teams
- Development and Launch
- Feedback Analysis
- Plan Iterations
CTO as a Disruptor
In the third stage, where a startup has matured with a large-scale team and operations, the CTO’s role transcends to that of bringing change to the organization and sometimes the existing business model as such. The CTO helps plan new approaches with the next version to expand or scale the product further. They now need to dismantle or upgrade from old processes and existing systems that have served organizations in the past.
The CTO needs to hire higher-level managers who come with their expertise and internalized processes from their past experiences. They also need to inject new thinking and energy into the technology team. The task is to rebuild and regroup the technology team and guide them with a new path that addresses new challenges that the startup is focusing on and the responsibilities of the CTO here include :
- Update existing machinery
- Bring forth newer versions
- Scale the product with growing business perspectives
- Instill renewed confidence in teams
When should startups hire their CTO?
A forthright question at this point is “Should you hire a CTO?” To which a resounding “yes” is the answer! Several factors need to be considered while making a C-suit hire. Some of which include:
What funding stage are you at? A CTO plays a versatile role in the different life cycles of the startup. The major reason behind this is startups need adequate time to share their vision and long-term plans to calibrate over time. This makes seed time an ideal phase to hire a CTO as they will help build the idea, product, and concept from ground zero.
At the seed stage, the CTO is responsible for all things technical, that get the product up, and running. The CTO’s role will evolve into delegating, building Technology/product teams, and strategic planning. They are also responsible for creating the minimum viable product, which goes on to become the foundational base of the product.
In the mid-level stage, a CTO steps in diverse roles from hiring engineers, tech talent to building the complete product development team, be it remote or in-house. They also take part in product planning and ensure that product development goes as planned. As startups scale and diversify their products and offerings, the responsibilities of a CTO keep evolving.
What type of CTO are you looking for? The role of a CTO advances rapidly in comparison to that of a CEO or COO. Given, the emphasis of having an official who can scale just like your company, their role branches out along with the company’s growth. The positive significance of being an asset CTO for startups is their high level of diversification in career and education. It is imperative to find a CTO who is passionate about their work, feels a strong sense of achievement, and has a future-forward outlook.
In the current market scene for startups, compensation is a unique topic because the salary ranges depend on which stage of funding the startup is in, and how much equity is offered to the CTO. Henceforth, it becomes important to search for a CTO who is passionate about their role and would feel a strong sense of accomplishment when scaling the company. Above all, a strong CTO is worth every penny you pay them when you see the success and value addition they bring to the organization. Several startups balance their CTOs’ compensation by offering lucrative equity in the organization.
Challenges of finding a CTO
Hiring a CTO has often been a huge challenge for startups and even bigger organizations. The greatest hiring challenge is due to the rare talent supply and high demand for asset CTOs. They have a bigger role to play, a bigger team to manage, and more responsibilities to handle. Hence, the hiring process should not be taken lightly.
An important skill that differentiates CTOs from senior developers or even technical co-founders is the leadership skills that they must possess. According to a survey conducted by STXNEXT in 2020, 78% of techies took five years or more to become CTO. 42% of techies at least took a decade to become a CTO.
With the pandemic ensuring lockdowns, things have drastically shifted; hiring a C-suite position has become even more challenging. But the pandemic went on to also open doors towards a bulk of foreseeable opportunities; especially in the tech head search. Being in the leadership search for years, Purple Quarter too experienced initial pandemic-induced hiccups but eventually overcame the obstacles of remote recruitment by helping a mid-level startup locate the right CTO by understanding their challenges and requirements for the coveted role.
Finding the Right Talent
One of the biggest dilemmas a manager faces is, should you endorse from within or look outside for new talent? Often, talent from outside will bring new ideas and strategies to the table enhancing the growth and trajectory of the company. Basically, new perspectives on approaching solutions with the latest technological expertise come with seeking talent externally. Startups might need to hire remote developers, and scrutinizing someone virtually is a task that comes with expertise. With enormously advancing technology, it becomes indispensable to hire an industry-best CTO with a product vision and expertise in handling, development, and product innovations.
Having proven technical expertise is no doubt a top priority on the hiring manager’s list. A CTO may be required to oversee the company’s data, security, maintenance, and network. A CTO with full-stack technical knowledge can understand the potential issues that arise during development and offer solutions. CTOs should have a strong knowledge of the company’s specific business needs to create a viable framework that uses agile technology solutions to achieve the company’s goals.
You need someone who can see the big picture by balancing a forward-thinking approach with details at hand, all of this while figuring out the right combinations and synergies for your organization. It’s the ambitious plan, strategic long-term goals, and out-of-the-box thinking that bodes well for an able Tech Leader. In the years ahead, the CTO’s role will continue to straddle the line between internal and customer-facing technologies. With remote working becoming the de facto due to the outbreak of coronavirus, technology leaders and businesses that utilize technology solutions efficiently will be successful.
Struggling to find the right CTO for your Organisation? Purple Quarter can find the ideal CTO with its bespoke approach. Find more at https://www.purplequarter.com/contact-us/