Get CTO Co-founder or outsource development?
Hi everyone!
I'm new here and this is my first post, so please be kind😁
For context: The past 10 years I've been working in the digital marketing world. Co-founded an agency here in Norway and served clients on everything from strategy to implementation. Main responsibility; strategy, marketing, and sales.
Now I have this SaaS-idea I want to get up and running. Basically a Hotjar-kinda-tool in the Privacy/GDPR-space.
GDPR is big in Europe. The privacy laws are getting tighter and tighter, companies getting fines regularly, creating a massive new market (The #1 fastest growing company in the INC 500, OneTrust, is in this space).
Since I'm the non-technical co-founder, the marketing/sales guy who doesn't know how much time it actually takes to build something and just sells the idea long before it's been built🤷♂️I now have 13 pre-sales for my b2b SaaS-product and still debating whether I should look for a co-founder or just outsource the development.
I know what my product needs to do, who my ideal customers are and how to market and sell it. But not sure about the development side of things.
In Norway, where I live, we have many different government programs that will help you fund your start-up and cover parts of the development cost. So that's a pretty big incentive for just outsourcing the whole thing (and not having to give up equity).
On the other hand, I understand that it's probably wise to have a CTO in a tech-company, if for nothing else than being the product lead and overseeing the outsourced development.
So, what are your thoughts (and/or experience) with this dilemma?
What would you do if you were to go down the CTO/Co-Founder route?
And how would you go about it, if to outsource the development?
Any pros, cons, tips, or further resources are very appreciated!
Peace!
Hello! As you know, hiring an outsourced CTO for a very small company would be the best solution. Because the CTO is an important part of the company. A CTO solves the technical tasks of a project, manages time properly, and reduces the risks of the company
You can find out more about CTO outsourcing in this article.
I absolutely love the fact that you have 13 pre-sales before you've built the product.
Long term you definitely need a CTO in house, but short term I think the best solution is to outsource until you get some cashflow going. And even then the CTOs role might be to manage the outsourcing, because having an in-house team with technical expertise in ALL the areas might not be cost effective.
What I've seen as the biggest issues for non-techincal founders (and even for teams with a tech co-founder) when they outsource is the misalignment in expectations, and the only way to get through that is with structured and consistent communication. In our agency we do a story mapping workshop to kick things off which PUTS everyone on the same page, then communicate everything by email, which KEEPS everyone on the same page.
In conclusion, I'd recommend outsourcing, but work with someone that gives you confidence that you also understand what's going on on the technical side.
From reading founder interviews, getting a technical co-founder worked well for people (some tried outsourcing, but eventually got a tech co-founder). I think the reason for this is incentives; a technical co-founder sees the product as "his/hers", they know that if they make it succeed, it will be "their" vs. "their client's" success. Plus, they know the rewards can be limitless if it works vs. just getting a fixed sum after finishing the project.
Great point - and thanks for the comment! The aligned interests and ownership is really powerful! You get what you incentivize ;-)