Dear SaaStr: What Makes a Bad CTO?
While there is no legal definition for CTO 🙂 or bright line between CTO and VPE, I’d suggest a start-up CTO really only has to do a few things — which are very hard:
- Assemble a small team (3–9) of very good engineers
- That are super agile
- That can ship a lot of very functional, very clever code that supports early, very rapid growth (from a very small base); and
- That can react and positively respond to a whole ton of issues, from downtime, to security, to API issues, and so much more. That often were never anticipated and aren’t part of the job spec.
So … a “bad” CTO is one that can’t recruit a strong “pizza box” team. A bad CTO is an OK engineer him or herself but can’t get 3 other great engineers to join him/her.
A “bad” CTO isn’t agile enough, and can’t push out quick releases and features to save big deals, fix terrible bugs, etc. A “bad” CTO sometimes wants to do this, but just isn’t good enough. Or a “bad” CTO is a bit too unmotivated / whatever to do what it takes to keep up.
A “bad” CTO doesn’t care about growing very, very quickly. So much changes once you have your first few customers. It’s exciting — but also tiring and very stressful. A great CTO embraces this change, participates actively in it, and drives it. A bad CTO resists the change that come with scaling the early customer base.
A “bad” CTO doesn’t think it’s their problem when things have to change, a lot. When the customer base changes. When the product ends up having to go in a very different direction than everyone thought at first.
This skillset is critical but then later … but a lot of it does not scale. The skills it takes to build a clever hack with a small team, and iterate that hack very rapidly to respond to customer and market needs … are not the same skills it takes to scale from 10–100 engineers. To refactor the codebase. To ship truly enterprise-grade software. To walk into a room full of CIOs and instill confidence.
Sometimes, CTOs can grow into true VPs of Engineering. But usually, they don’t want to. They want the company to bring in a true manager to scale the team beyond 1–2 pizza boxes. While the CTO can focus on doing super agile, next generation things.
In SaaS, plan to recruit a true VP of Engineering around $5m-$8m in ARR. You’ll need her by then. They can take over the routine stuff. Once you transition into a phase where more of it is … routine.
(note: an update of a classic SaaStr answer)
And for an example of a great startup CTO, here is one: