MBA2493 How to Find a CTO or Technical Co-Founder

Fri Jul 12 2024

Struggling to find the perfect CTO or technical co-founder for your software startup? If you're a non-technical entrepreneur with a brilliant SaaS idea, finding someone to handle the tech side might seem like an insurmountable challenge. How can you meet the right person who not only possesses the necessary skills but also shares your vision and drive?

Summary

Podcast Summary: MBA2493 How to Find a CTO or Technical Co-Founder

Podcast: The $100 MBA Show
Host: Omar Zenhom
Episode Title: MBA2493 How to Find a CTO or Technical Co-Founder
Release Date: July 12, 2024

Introduction

In episode MBA2493 of The $100 MBA Show, host Omar Zenhom delves into one of the most critical challenges faced by non-technical entrepreneurs: finding a Chief Technical Officer (CTO) or a technical co-founder. Drawing from his extensive 20+ years of entrepreneurial experience and his journey in building and selling a multi-million dollar software company, Webinar Ninja, Omar provides actionable strategies to secure the right technical partner for a SaaS (Software as a Service) business.

Understanding the Challenge

Omar begins by addressing the common predicament of non-technical founders who possess a solid business idea and market understanding but lack the technical expertise to bring their vision to life. He emphasizes that finding a CTO is akin to finding a life partner due to the high stakes and the significant investment of time, money, and energy required.

“Trying to find somebody to go into business with or to be responsible for something majorly part of the success of the business... is like finding a partner in life.”
[01:25]

Strategy 1: Hiring a Senior Executive from a Successful Company

The first strategy Omar recommends is targeting senior technical executives from well-established companies who might be seeking new challenges. These individuals typically have extensive experience, having moved up the ranks over the years, and possess the expertise needed to lead a technical team.

Profile to Look For:
- Senior executives such as Head of Engineering or Lead Engineers.
- Professionals with a decade or more of experience.
- Individuals feeling constrained by corporate red tape and seeking more dynamic opportunities.
Approach:
- Offer equity or shares as compensation, especially if budget constraints prevent offering competitive salaries.
- Consider hiring part-time advisors initially to assess fit before committing to a full-time role.

Omar shares his personal experience of hiring a highly skilled CTO on platforms like Upwork, paying premium rates to secure top-tier talent who could contribute significantly even on a part-time basis.

“Generally you get what you pay for. And it’s going to cost you more time and aggravation than it’s worth to try to find that diamond in the rough.”
[06:50]

Strategy 2: Leveraging Networking Opportunities

The second approach focuses on expanding and utilizing one’s professional network to find potential CTOs or technical co-founders.

Methods:
- Conferences: Attending industry-specific conferences such as MicroConf or SaaS-focused events. These gatherings are fertile grounds for meeting experienced technical professionals seeking new ventures.
  
  “One of the fastest ways to find a technical co-founder or a CTO is to just go to a SaaS conference.”
  [12:10]
- Online Platforms: Engaging with technical talent on social media platforms like Twitter (referred to as "X") by interacting with their content, initiating conversations, and building relationships virtually.
  
  Omar cites the example of Ali and Wilson from Senja IO, who successfully built their business partnership entirely online.
  
  “They met each other on X. Ollie’s the marketer and the sales guy. Wilson is the engineer and the developer...”
  [10:30]
Benefits:
- Building a robust network increases the chances of finding a compatible technical partner.
- Even if a direct partnership doesn’t materialize, connections can lead to referrals and introductions to other potential candidates.

Strategy 3: Promoting from Within the Organization

The third strategy involves identifying and nurturing existing talent within one’s own team to step into the CTO role.

Steps:
- Identify Potential Leaders: Look for developers or engineers who have demonstrated leadership qualities and a deep understanding of the product.
- Provide Opportunities: Offer them roles that allow them to take on more responsibility, such as leading projects or making technical decisions.
- Support Growth: Invest in their professional development to equip them with the necessary leadership skills.

Omar shares how his last CTO was an internal team member who naturally evolved into the role through demonstrated reliability and technical prowess.

“Maybe they needed a little coaching on your side when it comes to the leadership part of things, but they’re very solid from a technical point of view...”
[20:15]

Key Insights and Takeaways

Proactive Networking is Essential: Waiting for the perfect CTO to find you is unrealistic. Active participation in both physical and online networking events exponentially increases the chances of meeting suitable candidates.
Quality Over Quantity: Investing in highly experienced technical professionals, even at a higher cost, can lead to better long-term outcomes than trying to hire less experienced talent.
Leverage Existing Team Members: Often, the ideal CTO may already be within your organization. Providing growth opportunities can foster loyalty and ensure alignment with the company’s vision.
Flexibility in Compensation: Offering equity or flexible working arrangements can attract top-tier technical talent who are motivated by the potential for growth and ownership rather than just salary.

Notable Quotes with Timestamps

On the Importance of Recruitment:

“Your job as the founder is basically recruitment is to be a super recruiter. Finding the best people to build your baby, to build your dream business...”
[29:45]
On Networking Efforts:

“You gotta make an effort. You can’t just sit in your home office and they're just going to stumble upon you by chance.”
[03:30]
On Hiring the Right Talent:

“Generally you get what you pay for. And it's going to cost you more time and aggravation than it's worth to try to find that diamond in the rough.”
[06:50]
On Internal Promotion:

“Sometimes people are right under your nose. They just need to be offered a position so they can flourish.”
[18:25]

Conclusion

Omar Zenhom wraps up the episode by reiterating the paramount importance of effective recruitment in building a successful SaaS business. He encourages founders to remain vigilant and proactive in their search for technical talent, emphasizing that the right team can be the decisive factor in outperforming competitors.

“The best team always wins. That's your differentiator between your competition, the people that are behind the product.”
[28:10]

He also highlights the value of flexibility in hiring and the potential of nurturing existing team members to step into leadership roles. Omar’s pragmatic approach offers a roadmap for non-technical entrepreneurs to bridge the technical gap and steer their ventures toward success.

Learn More:
For additional resources and insights from Omar Zenhom, visit The $100 MBA Show.

Transcript

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Omar Zenhom (0:55)

Hey O welcome to the $100mb place to be to build a business you want with our practical business lessons. I'm your host, your coach, your teacher Omar Zenholm, and in today's episode you will learn how to find a CTO or a technical co Founder One of the biggest dilemmas for a lot of entrepreneurs who want to start a SaaS business, a software as a service business, is they're not technical. They're not a developer and engineer themselves, but they have a great idea. They think they can solve a problem in the market. They know the market well. They just don't have the technical know how to be able to build it as well as build a technical team around it. This begs the question, how do you find a cto, a Chief Technical Officer, or a technical co founder that you can partner up with? Well, you're in luck. I built a software company called webinar ninja for 10 years, been lucky enough to grow to 30,000 users and was acquired recently by Proprofs. And I'm a non technical co founder. So I'm going to share with you three ways that I have found works the best when it comes to finding a CTO or a technical co founder for your business idea. There's a lot of ways to do this, but these three ways are the best I found in my experience. Speaking of experience, I've had more than one CTO in the course of 10 years. I'll explain why, I'll explain how I found each one, and how to go about finding your technical partner in building your dream SaaS business. Let's get into it. Let's get down to business. Just to be totally clear, trying to find somebody to go into business with or to be responsible of something majorly part of the success of the business, like the technical aspects of a software company, which is basically the product, is like finding a partner in life. It's very, very similar. Because the stakes are high. You're going to have to invest a lot of time, money, energy into this relationship for it to work. And finding this person is just as hard as finding a partner in life. But there are some tried and true ways that I have found that makes it a bit easier and gives you a game plan so that you are moving in the right direction in finding this person next. Just like meeting friends or meeting your partner in life, it's just not gonna happen by accident, okay? You're gonna have to make an effort. You can't just sit in your home office and they're just going to stumble upon you by chance. No, you're going to have to be actively getting out there. When I say getting out there, I'm saying in the physical world, but also in the online world. There's a lot of examples of founders, and I'll share one today, that have met just online and never met in person. So understand you're going to have to flex your networking muscles a little bit to find the right person. So let's start with the first way I recommend. Let's take a look at the profile of the person we're trying to find. First of all, when you're trying to find somebody who is highly technical, that's very good at what they do and fits what you're trying to build with your software business, you want to find somebody that is experienced, has done this before, and is motivated, meaning that they're interested in being a part of a startup. If we're looking at this profile, who would that be? Well, that leads us to our first kind of way to find your technical co founder or cto. And that's somebody who's a senior executive at a very successful company and has moved up the ranks over years. So they have the experience. They might be the head of engineering at a company or a lead engineer, and they've been doing this maybe for a decade or more. But their job may be a little boring because there's a lot of red tape. They're working for maybe a company with 50,000 employees and things are kind of mundane. So they're looking for a new challenge. They're looking for you a startup that's fun and exciting, that they can get behind and work on. Now they're in a very good paying job. You're not going to be able to pay for them. Maybe at the start if you are bootstrapping, if you are low on funds, but if you are solid financially, you might be able to move them over and they'll take a pay cut because this is an exciting opportunity for them to be a part of something greater than they ever been part of. So they might get equity in your company, they might get some shares. That's appealing to somebody in this position. But let's say you can't afford just to hire them outright. Well, you could do what I did. I actually just went to Upwork and I tried to find the most experienced engineers that are actually the most expensive. The ones that are actually asking for the most amount of money, like 250, $300 an hour. Why? Because this person is very good and they're going to be able to do 10x the work in the same amount of time as somebody who's not as senior. Trust me, I've gone through this so many times and I've made hires trying to find the diamond in the rough. And when it comes to engineers, in my opinion, generally you get what you pay for. And it's going to cost you more time and aggravation than it's worth to try to find that diamond in rough, that person that no one has found that's, you know, inexpensive and talented. So I filtered for that criteria. I found somebody that is really expensive but really, really good at their job. And they became our CTO and did it part time, about 15 to 20 hours a week. Now this was enough for us to be able to use their expertise to plan our infrastructure, to plan out our technical roadmap, to help us hire great engineers, to build the structure of our technical team, to make technical decisions like what services should we use? And I wish I had them for more than 20 hours. But 20 hours actually did a lot for us. And I had somebody I can rely on that was technically sound. They didn't leave the job they were in. They weren't full time and dedicated to us, and we paid them a premium. But we were okay with that split. Now we interviewed a lot of people. It took us maybe two to three months to actually find the person that we eventually hired and then another two months or so to go through the process of getting them on boarded and for them to hit, you know, full steam ahead. The second way you can find a CTO or technical co founder is through networking. Remember I told you, you gotta flex your networking muscles. Well, for a period of six years straight, I went to every single conference I can go to to learn from from other experts to build my network by meeting interesting people in my field in the SaaS world. We were literally traveling, you know, seven, eight months out of the year to go to these conferences. And in that process we found a really, really interesting person that would make a great full time cto. Literally met them at a conference, they were speaking at the conference, got to know them a bit, and in the months ahead we were able to kind of come to an agreement and we found our next cto. Now you might be thinking, well, I can't do a lot of travel, Omar. Well, there's a lot of people that do this online. One example I could share with you is are Ali and Wilson, who are the founders of Senja IO, which is a great testimonial tool if you want to gather testimonials for your business. They met on X and they haven't met in person. Even though they've built their business over the last two and a half years or so, they're making some decent revenue. $32,000 in MRR in monthly recurring revenue. If you're curious about them, you can follow them on X. And they build in public so they share their journey. Ollie's handles hello, it's Ollie on X and he links to Wilson's handle in his description so you can find there. But they met each other on X. Ollie's the marketer and the sales guy. Wilson is the engineer and the developer and they've built an incredible tool. So meet interesting people. How do you meet people online? Well, you talk to them, you comment on their threads, that leads into DMs and then you maybe have a video call. This takes a bit of time, but it's worth it because you're investing in your network even if it doesn't work out, maybe they know somebody that might help you, or maybe you just met somebody who's interesting that doesn't happen to be your next cto. If you're a non technical founder, one of the fastest ways to find a technical co founder or a CTO is to just go to a SaaS conference. I'm not joking here. This is one of the easiest, fastest ways to do this. And all you gotta do is go to one of these amazing SAS conferences going on. I'm actually speaking at a great SAS conference in October called microconf and I'm going to the Europe chapter in Croatia. But they also have a US chapter that happens in different cities each year. And the people that attend these conferences, whether it's microconf or SAS, stock or the plethora of other SaaS conferences, if you just Google them, is they're filled with technical founders, they're filled with people that are working on things on the side. And by the way, you might be able to be their founder, meaning they might be working on a great tool, but they just don't know how to market it, sell it, grow an audience around it. There are so many engineers that I've met that are working on some amazing ideas, but they just don't know how to sell them and they're stuck. So just going to these conferences, having lunches with people, chatting with people in the hallway, you can find a great match, a great person that you can team up with. The third way to find a CTO or technical co founder is within your organization. Now, this is probably more suited for a CTO role because you've been, you know, around for a while, you've been established and you just need some leadership in this area. And usually this is somebody in your engineering team or maybe product team. It might be a developer that is showing ambition, that is into becoming a leader at some point. Maybe they've already shown leadership initiatives within your team. They might be kind of your CTO right now, but not by name, but just by action. For us, the last CTO we had was amazing and it came within our team. They were an engineer that really knew his stuff, was reliable, cared about the product and cared about bringing the team together to deliver a great outcome. Sometimes people are right under your nose. They just need to be offered a position so they can flourish. Maybe they needed a little coaching on your side when it comes to the leadership part of things, but they're very solid from a technical point of view, the thing you actually need. This is why I recommend if you're building a SaaS company, you can't find a CTO yet, but you want to get started on the project, you want to start building the software, hire a lead developer, somebody who can make the decisions and lead other developers, or a senior developer, somebody who can help you with the hiring, help you with some of the technical decisions. And if they are a good fit from a leadership point of view, from a chemistry point of view, between you and them as well as the rest of the team, they might be able to grow into this position of cto. There you have it, three solid, proven ways for you to find your next CTO or technical co founder. One, Hire somebody super senior that's looking for a new fun project. They can be part time, they could be full time. It could be a six month contract just to feel each other out and see if you know you're a good fit. The second way is through your network and growing your network by going to conferences, meeting people online, and thirdly, within an existing great member of your team that can grow into this role. Thanks so much for listening to the $100 MBA show. If you found today's episode helpful, useful, insightful in any way, the best thank you you can give us is to hit follow on your favorite podcast app is to follow us is to subscribe to the show. Whether you're on Spotify or Apple Podcasts. This means the world to us because by subscribing you help us reach new listeners on whatever platform you're listening to. Thanks so much in advance for subscribing to the show. Before I go, I want to leave you with this at the end of the day, the biggest learning I learned in 10 years of building a software company is your job as the founder is basically recruitment is to be a super recruiter. Finding the best people to build your baby, to build your dream business because the best team always wins. That's your differentiator between your competition, the people that are behind the product. So get used to trying to find amazing talent, meeting people, getting out there, have your talent radar switched on at all times. Thanks so much for listening and I'll check you in the next episode. I'll see you then. Take care.