The CTO profession has emerged after World War II, where large corporations set up research laboratories and required a certain person to be responsible for the technological part of the research. At that time the vice president of any company did not carry out any critical tasks and the CTO was the one responsible for hiring new employees, constant research, and product development. However, in the 1980s, the role of the CTO changes. Computer and science technologies started gaining momentum and the position of the Chief Technology Officer in large companies became something essential for the company growth.
Why do companies need a CTO?
- To have a technical team player, who helps in decision-making
- To have a person with the right technical skillset
- To possess the right vision with the help of a technical approach
- To enhance the company’s technical knowledge and product delivery
So, is the Chief Operating Officer’s role needed in the company? Is a CTO really important for your business despite its size? Can the company function without a CTO? Let’s proceed further!
Why a CTO might be an irreplaceable team player?
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A CTO is believed to be an irreplaceable key player in the company’s growth and processes. According to a source, at the beginning of 2021, the average salary of a CTO was $163,255. The average age for a CTO is equal to 52 years to become a CTO, a person needs at least 15 years of major software development experience, a technical degree, and certifications in business administration and computer sciences. Most of the CTO’s receive only the BA degree (59%).
Indeed, a CTO is a valuable person, who carries out the organization’s objectives and knows how to lead a business with regards to the technological part of software development. However, being highly needed at an organization, the average CTO stay at the job is approximately 1-2 years (33%).
The companies that usually employ CTOs are mostly private (51%).
Being of great value to any company, highly in-demand counting 57,088 job openings only in America, how can a startup find itself a CTO? What should a startup know about a CTO to obtain one?
Who is a CTO?
What does CTO stand for? The Chief Technology Officer (CTO) is the technical person, who carries out the duties with regards to the company’s technological needs together with research and development practices. How does a CTO understand what the company needs? Every organization has to meet objectives to scale, so by analyzing long-term and short-term needs, the CTO uses the company’s budget to invest in the areas of his/her concern. Thus, the CTO has an onward-looking and strategic planning role. The Chief Technology Officer reports directly to the Chief Executive Officer, CEO for short. So, what does a chief technical officer do?
What does cto stand for in business? The Chief Technology Officer has the technology and engineering departments under his/her management as this position is usually the highest technical and executive position in the company. Therefore, to make everything work like a clock, the CTO develops policies and procedures to enhance the company’s products and services using technology. The responsibilities of a CTO include technical aspects of the company that impacts business growth externally and implement both services and products that serve clients and customers.
Sometimes a CTO is compared to CIO – Chief Information Officer. But these two roles aren’t alike. The main user focus of the CTO is on the external customers, technology trends, and product engineering, while the CIO focuses on internal users, core systems, automation of procedures, and infrastructure. See the vivid comparison below.
There are different types of CTOs based on different company focus. Let’s find out what these are and what they stand for!
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What Types of CTO Can be Found in Startups?
Gartner speaks about four basic types of Chief Technology Officers. These are:
- Digital Business Leader
- Business Enabler
- CTO as COO of IT
Let’s discuss what each type of these personas offers for a business.
Digital Business Leader
The digital business leader uses the newest technologies, which can potentially transform an organization’s business model, products, and services. Here, a CTO should be completely aware of
- the up-to-date technology trends on the software development market
- how competitors use these technologies to establish innovations within their organizations
- how to apply technologies within the organization and bring positive changes
That’s why a CTO pushes any beneficial technology forward to adjust it with the main business functions, creates digital business strategies, and becomes a team leader for the team that will work with the current technology trends and produces top-notch products.
The responsibilities of the CTO cover:
- create new business models and capabilities (identify, rationalize, and roadmap) by partnering with CIOs
- drive innovative and strategic thinking for the company (enterprise architecture, innovation management, and R&D) by leading the organization
- bring investments that emerge on innovations and technology by being an authoritative figure in budget decision-making
- translate customer and market needs into digital products and services by working with business functions
There are companies that produce their own technologies and a CTO can be the one responsible for these technologies. This way the CTO as a business enabler should assure of the operating and evolving technology as the business grows. Also, a CTO becomes the leader of engineers building a custom product.
The highest priority to be met by a CTO business enabler is to
- ensure that business and customer needs are fully met
- establish a delivery mechanism that will focus on both leaders and a row of commands that is responsive
This role is often a part of what the CIO does, but the CTO is still guiding technology decisions.
Business Enabler responsibilities include:
- Make technology investment decisions
- Build and pilot the company’s own digital business product
- Collaborate with product and engineering teams on product development and other processes
- Assess risks before introducing new information and operational technology into the company
An IT-Innovator is the guru of technology trend knowledge and has a certain vision on how to apply changes through being a leader of software architects, innovation managers, technology specialists, and others in software development services provision. Being a CTO IT-Innovator, the professional has the executive position and reports directly to the CIO.
Typical responsibilities of IT-Innovator are to:
- be central in technology innovations
- create the technology strategy, which will use the main and new technologies to transform software development operations
- be a team leader for engineers, who work according to the Agile or DevOps methodologies
- use the hybrid multi-cloud, edge computing, containerization, and automation to modernize the infrastructure
CTO as COO of IT
CTO becomes an everyday Chief Operating Officer (COO) in large organizations with numerous software development processes. Here, the CTO’s primary aim is to adhere to the existing business model and deliver software development services in an agreed-upon manner. Thus, a CTO becomes involved in operations such as purchasing and supply of technologies and services.
CTO as COO role includes:
- Management of operations due to service and vendor management, shared software development services, data center, telecommunications, and security
- Control and maintenance of incidents that occur in external and internal systems to ensure both systems perform fine
- Be a part of modern technology supply, future optimization of major CRM or ERP systems
Therefore, here are the four main types of CTO roles with their responsibilities and duties. However, what makes a good CTO? Are there any skills to pursue?
The Main Skills for Good CTO
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As the average CTO position requires 15 years of experience, the person applying for the position has to possess certain skills that were developed through the years. These skills include:
- Technological knowledge and technical education
- Knowledge of technical trends
- Effective Communication skills
- Strategic Thinking
- Ability to hire professionally
- Coding skills
- Team and time management
- Mentoring skills
For instance, the CTO is a person who always needs to learn the new trends and technologies to advance the business and stay creative in the field. He/she should analyze the technology market, form strategic thinking to benefit his/her organization. Also, the CTO has to have brilliant communication skills and some knowledge in the hiring process to ensure only the best customers and engineers will work with him/her. In addition, the CTO has to code and be a good mentor to advance the technical knowledge of engineers and ensure their positive software development outcomes. And, the cream of the crop, the CTO has to be a good manager of his/her time and his/her team as people interaction will occupy most of the time in the company.
Where Can You Find CTO for Your Startup?
How to be cto? The road to becoming a CTO is quite long and a high percentage of future CTOs once were Software Engineers and Tech Leads with brilliant career growth and lots of valuable software development experience.
According to the Global CTO Survey 2020 report, the fastest way to becoming a CTO is to start with a small organization (in this case, a startup) and claim the title. If you start claiming this title from a larger company employer – think twice as this process may take you more than 10 years. Would you put your ambitions ahead and try? Or try the more convenient way, taking into account startups? See the percentage of people becoming CTOs based on the company size below.
If it’s understandable how to become a CTO, let’s find out how to find a cto? And, particularly, how to find a cto for startup?
How to hire a cto? From the recruiter’s perspective, the process of CTO hiring starts with searching for a cto on the job market or from the specific pool of candidates that exists in the company. Then, these candidates are being connected with to find out about their knowledge, overall experience, salary and job expectations, technologies they know, communication and leadership skills which are called the soft and hard skills. When recruiters find quality cto for company, the candidate is being asked to attend interviews (some even pass interviews several times) until the one that suits the company best is being given a job offer. That is the common recruitment process present at any organization. However, the bigger the organization the more circles of interviews a CTO should pass to get the job offer. An average search of a candidate lasts from two weeks till 3+ months of constant research and communication with applicants to find the most reputable cto.
To make the search process more automated, recruiters tend to use valuable sourcing platforms. For example, there are various candidate search platforms that are very helpful in looking up for CTO and making the process shorter and more optimized. Let’s name a few.
Using Linkedin for headhunting
Linkedin is a platform for a community of different professions and career paths that allows people to find a job or learn new skills, and recruiters to headhunt for the most valuable candidates.
On the platform, the sourcing for candidates is done with the help of the add-on recruiter search tools, where you create the chief technical officer job description and either wait for candidates to apply themselves or source for the one, who matches your particular CTO job requirements the most. Then, the recruiter sends an email to the candidate with an offer to connect, to have a chat, or attend an interview to get to know him/her better.
Also, the headhunting process can be done manually. Here, the recruiter has to insert the chief technical officer’s position and the searched location into the search string and open up every profile that has been matched with the request. However, this process is relatively tiresome and occupies more time than the usual automation tools Linkedin provides.
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Upwork to find the best-rated engineers
Upwork is the world’s biggest marketplace for freelancing However, not only freelancers can be found, but also candidates, who would like to work full-time in-house or remotely. To do so, just post a CTO job description on the Talent Marketplace and connect with the potential employee, who can take your business to the next level. This process is rather passive as requires waiting for proposals to come your way.
Upwork is a good choice of candidate search platform for startups as the new business requires reasonable candidate experience and candidate salary expectations. The cost of this basic hiring process will be free of charge compared to Linkedin, which requires a monthly payment. Another benefit of Upwork is that software engineers have ratings and you can always check the rating of the candidate you are talking with right now.
Facebook is considered to be rather a personal mass media platform. However, from just a means to chat and connect with people it transformed into a platform that also helps in business promotion tools with all sorts of marketing and PR possibilities.
At Facebook, software engineers sign up for communities of their interests, where recruiters can post job descriptions and connect with the relevant candidates right away. Also, there are recruitment channels created specifically for the purposes of job posting and candidate sourcing. These channels are easily accessible (with the admin approval) and have an extensive candidate pool that only scales. Besides, here you can find a chief technical officer for your startup in a cost-free way.
The same goes for Twitter, which also allows posting job descriptions, links to the company job requirements, and other recruitment materials to headhunt an experienced software engineer, who can be your company’s CTO.
Other ways to hire a CTO for a startup
If you as a startup have a limited budget for hiring and still need to find a CTO, try to outsource one from the software company somewhere nearshore or offshore. As a matter of fact, outsourcing offshore development team and nearshore development team may require the same human efforts but the costs spent are extremely lower. For instance, there are countries that specialize in Outsourcing software development and software development teams. Find out more about which countries are top to outsource here. In addition, view numerous valuable tips on how to find and hire an offshore software development team the right way here.
How to Find a CTO for your Startup?
To ensure the process of hiring goes smoothly, follow these steps:
1. Set clear requirements about what kind of CTO you would like to hire. The more you understand who you need the better you will carry out the task of hiring.
2. Search for a developer, who might be your potential CTO, at competitive startups. Sometimes, employees of the other companies tend to look for better perspectives and develop their future career paths in one direction. Maybe, your competitors have brilliant tech-savvy developers but cannot make them CTOs, while you can and will.
3. Use platforms to find the best candidates. There are numerous platforms on the internet you can use for your search. Some of them we have discussed earlier.
4. “Sell” your startup to the potential CTO and make him/her interested. You should speak about why your startup is the best for the CTO, what you do, what’s the purpose of your business, and what the CTO will get at the end. Speak the truth, never lie. The more the candidate likes your startup, the more chances you have for his/her to choose you.
5. Make a developer your technical adviser part-time first. Maybe, it is wise to make one of your tech-savvy guys a part-time tech adviser before making him/her a CTO. This way you won’t have to hire and invest your time and money into the process. In the end, the tech guy will give you valuable insights according to the tech focus of the startup and still be a developer, who carries out deployment tasks.
To get more insights on the topic, we also recommend reading our article How to hire developers for a Startup in 6 Easy steps.
Learn more on how to create a tech startup in the USA!
Do you really need a CTO for your business?
If you have a business that needs to enhance its processes, think about what positive changes a CTO can bring. According to CMSWire, whether you need a CTO depends directly on your businesses’ technological side: how much technology drives your business? And, it also depends on how large your business is. Hence, in a startup, a CTO is the main architect, developer, and person, who carries out all basic tasks in the new business. This person might be crucial as startups can hire a limited amount of people to do the job. A CTO in middle-sized companies is rather a leader, a technologist, and a problem-solver, which also makes this person very important. He/she might play an important role in the company’s technological focus and decision-making. A CTO in larger companies performs the role of a visionary, a thought-leader, and a spokesperson, who sets the technological direction and enhances the technological output of the company. He/she might be quite a useful person as well.
Thus, the question is, why won’t you need a CTO? The Chief Technology Officer is an outstanding part of any company, who drives technological innovations and directs your business according to the latest tech trends. With the CTO on your team, you will surely grow and scale.
If you don’t have a CTO right now, Inoxoft can offer software development for startups, startup discovery phase service, and also consult you on what kind of in-house team will let you grow and develop in the future. Contact us right away and our expert will give you a piece of advice you need!
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To conclude, a CTO is a person, who is involved in the technological development of the company, which is web and cloud development and mobile application development. This job is an important one as without a Chief Technology Officer the company is deprived of technological trends knowledge, technological vision, scale, research and development, and further growth. Thus, having a person, who will direct the whole software development team with regards to modern technologies is obligatory. For this reason, even startups need to hire themselves a CTO to become successful. However, startups are young businesses, who develop at a steady low pace with little budget but great will and optimism that their services are in demand and will be that way. Hiring a CTO for startups is the same as for any other company in the software development market. But it requires more wit and finding better ways to ensure low-cost risks for the company funds. Thus, Startups might even outsource one if this is going to be the perfect solution. In any case, the process of hiring should have a plan, a structure, and the requirements to follow. This way, the results will come sooner.