Do startups and small businesses really need a CTO?

I recently spoke to Will Grant, a director at D4 Software, which runs CTOforhire.uk.

We discussed company culture, the skills shortage and digital trends.

Why did you decide to pitch technical consultancy like a SaaS (software as a service)?

We wanted to somehow ‘package up’ our experience and make it available ‘pay as you go’ to people.

It gives customers the best of both worlds – strategic insight and advice with a low financial commitment. 

If you said “consultancy” to a startup they’d probably run a mile. That’s because they’d expect it to be overpriced and deliver no practical benefits. Just a lot of hot air.

But the more startups we worked with, the more we realised that what they needed most wasn’t more code, more features and more tech. They needed advice.

We don’t mean that to sound arrogant, we actually did this because we felt bad about entrepreneurs spending their life savings on an idea we felt had zero chance of working. Or in many cases, even launching.  

The best code is no code at all. There are no bugs, it runs fast and it’s very cheap.

If you can achieve the outcome that your customer wants with an automated email or an online google form, then you should do that first and scale up when you really need to and there’s proven demand for it.

So, we spend most of our time figuring out how little tech a startup can get away with: then implementing that. It takes a lot of experience, but it’s not a full time job, so CTO for hire is the perfect way to package it.

It’s healthy for us as a business too – as we grow the ‘CTO for Hire’ client base – if clients turn our services ‘on and off’ month to month, it makes us less reliant on one single customer and more resilient to fluctuations in workload. 

We also wanted to make sure that startups who use our services could go on to raise investment without a full time CTO.

We have secured a relationship with Ascension Ventures and their CEO Jean de Fougerolles, as a Venture Capital fund who recognises that we are as good as a CTO for early stage / MVP startups.

The virtual CTO is priced liked software-as-a-service

Leadership and culture are a big part of digital transformation. What have been the biggest changes to tech and I.T. roles over the past few years? 

There are several big technology trends that are still unfolding throughout our economy, like the railways and electricity before them.

The biggest challenges that tech leaders face, particularly in large organisations, have been shifting people’s mindsets to the new realities of software, the internet, and mobile. 

One of the biggest trends is what we call “software is eating the world”. It comes from an essay written in 2011 by venture capitalist Marc Andreessen.

It says that almost all companies and industries are becoming software companies. 

From music, to fashion, to logistics, to financial services. Software is now an indispensable part of what they do. And in many cases, it’s the only way they can differentiate themselves.

With that in mind, all incumbents need to be thinking about how to deliver software more rapidly and to a better quality. 

For example, retail banks are now software companies: think back to 2012 when RBS failed to update a computer system correctly and the bank couldn’t process electronic transfers for a few days.

The branches were open, but the bank was effectively shut down because its software wasn’t working.

Traditional retail banks are now software companies with local support offices in every town, but for some of them, awareness of how to build and run a good software product hasn’t broken through to board level yet. 

Another big trend that’s happening right now is the move to mobile.

The smartphone is already bigger than the PC ever was, and it’s growing at a shocking rate.

Right now, any new systems that are being developed need to be designed for the mobile device first. But sadly many companies are still treating mobile as an afterthought.

Every CEO has thought about taking a coding course (probably). But what else should they be doing?

While programming computers is, of course, the highest form of art there is – I’m not totally sold on the “everyone needs to learn to code” meme.

In our experience, no software project went wrong because the developers didn’t know how to write code.

It’s almost always about planning, communication, resource, external factors like markets and deadlines – and very rarely about the code itself. 

So yes, it helps a CEO understand what their engineers are doing all day, but does it make them more innovative and successful: probably not.

What are your thoughts on the much talked about ‘skills shortage’, within marketing and business more generally? 

What seems to be happening in our economy, is that there’s a race to the bottom and the top.

So there’s lots of poorly paid jobs around, and then there are smaller and smaller groups of very smart people making lots of money. Not just tech geeks, but entrepreneurs, financiers, pop stars, football players, you name it. 

This is probably (at least partly) caused by the leverage that the internet gives you. You can go global from anywhere.

Hiring and retaining good people has been the hardest part of my job for many years.

I’m not sure it’s a skills shortage, I think it’s more that the freedom and democratisation of the ‘career’ process brought about by the web has meant we all have an enormous pool of opportunity to draw from. 

In the ’90s, you would maybe hire an engineer because they had the right skills. Now, you can search LinkedIn for 100 people with exactly the right skills, but finding someone who is right for your business is still really hard. 

Google, Facebook, et al have attempted to ‘brute force’ the retention issue; give their teams so much free stuff (dental, healthcare, every meal, gym, laundry, etc) that they feel locked in.

Maybe accepting that people will move on is a more realistic approach.

Make their time at your company a two-way thing, and make people feel like they can naturally move on with no hard feelings.  

But – we’ve had areas of the economy that have operated like this for years.

Take video games. Most of them don’t make money, but the ones that do, make a lot of money.

So we have a model of game publishing companies that take bets on games, learning from their mistakes all the time, and hoping that sooner or later they’ll win big. 

If we want our industries to keep up in this “winner takes all” economy, not just in terms of ‘skills’ in the traditional sense, but also in terms of developing individuals with experience and networks of contacts: we need to keep taking bets.

To benchmark your own digital skills against industry peers, take Econsultancy’s Digital Skills Index.