How the CTO role evolves from Startup to Large Enterprise
Generally speaking, there is no single definition of a Chief Technology Officer's (CTO) role and responsibilities. In this article, I will outline my observations of the types of CTOs in different companies in the industry.
The responsibilities of a CTO are largely defined by the size of the company. Let’s break it down into four company sizes: startups, scale-ups, mid-sized companies, and large enterprises.
What is the Role of a CTO in a Tech Startup?
In a startup, the CTO is often a co-founder who plays a hands-on role in developing the company’s technology which may or may not involve managing a small technical team. As the first and often the only developer in the team, they are responsible for building the company’s tech infrastructure, selecting the appropriate technology stack, creating an architecture, and actually developing and shipping the minimum viable product (MVP) to customers. Often, this means building something cheap and dirty as fast as possible in order to validate the idea with real users.
As a co-founder, the CTO is also involved in the business side of things, such as communicating with potential users and preparing pitches for investors.
Once the startup finds its product-to-market fit, the CTO shifts focus to upgrading the product to a more reliable and future-proof architecture. This involves handling scalability problems and adding features at the same time. Often, the product will have to catch up with its users in terms of performance, which is actually a good problem to have because it means there are actual users 🙂 At this stage, the CTO needs to manage a small team of developers, which means finding and hiring those developers, delegating tasks, and leading the team. While the development team is still small, the exact process is not really important, although there are no reasons not to use some form of Agile or XP, so experience with Agile development frameworks is a plus.
In summary, at this stage, the CTO is a well-rounded software developer who can evolve into a technical manager or who has already managed teams before.
What is the Role of a CTO in a Scale-Up?
Co-founders of startups are thrilled to learn that their company has achieved Scale-Up status because it means they have found a product-to-market fit. However, the CTO might not be too thrilled about this news, and here’s why.
Scaling up is an uphill run with obstacles. At this stage, growth is crucial and requires a significant expansion of teams, while also preserving the company culture. Hiring can be time-consuming, so it’s important to build an efficient, multi-stage recruiting pipeline that involves HR and existing teams. I have hired myself and helped hire dozens of developers, and it’s a tough job that can easily become full-time. Therefore, being organized is essential.
It is a good time to establish coding standards and culture, streamline development workflows, and define development processes. It is not uncommon to see a new role appear: VP of Engineering. This person takes the lead on some of these objectives, while the CTO focuses on the software product vision with a small team of top technical talent. This can also happen when the company outgrows the CTO, who is a co-founder, thus requiring a more senior executive who is better suited to the challenges.
Recently, I also noticed another trend of CTOs evolving into CPTOs (Chief Product Technical Offices) in the case where a CTO had a product management experience in the past.
One another important activity of a Scale-Up CTO is dealing with far-from-perfect legacy code that was inherited from the MVP times.
Overall, at this stage of growth, a CTO must possess a broad skill set that ranges from good hands-on skills to leadership and management. It is not uncommon to split the CTO position into two separate roles, CTO and VP of Engineering.
What is the Role of a CTO in a Mid-Sized Company?
In mid-sized companies, the Chief Technology Officer (CTO) plays a more strategic role. They work closely with the CEO, product, and marketing executives to align the company’s technology strategy with its overall business strategy. The CTO is responsible for identifying emerging technologies that could benefit the company, managing the company’s technology budget, and overseeing the implementation of new technology initiatives.
At this level, being a top-notch developer is not enough, and may not even be necessary. In addition to technical expertise, a CTO will also require a strong understanding of how businesses operate. They must have the ability to outline strategies, oversee infrastructure, communicate effectively with partners and subcontractors, lead internal teams, keep track of technological trends, and oversee IT budgets.
What is the Role of a CTO in Large Enterprises?
In large companies, the CTO’s role is typically focused on managing a large technology organization and ensuring that the company’s technology is meeting its business needs. They are responsible for developing and implementing the company’s technology strategy, managing relationships with technology vendors and partners, overseeing the company’s technology budget, and managing the company’s cybersecurity and data privacy efforts.
The role of a Chief Technology Officer (CTO) in large companies is more than just being a strategic planner, thinker, and overseer of IT and infrastructure. It also involves navigating through political, hierarchical, and cultural landscapes, particularly since many large enterprises are international and involve employees from various nations and cultures.
Large companies are complex and require a CTO who can effectively manage a large technology organization, develop and implement a technology strategy that aligns with the business needs, and manage relationships with technology vendors and partners. In addition, the CTO is responsible for overseeing the company’s technology budget, and managing cybersecurity, and data privacy efforts.
However, the challenges of working in a large enterprise go beyond just technology. It is crucial to understand the political, hierarchical, and cultural landscapes of the organization. Navigating through these landscapes requires plenty of interpersonal skills and cultural sensitivity, especially when dealing with employees from different backgrounds and cultures.
In summary, a successful CTO in a large enterprise must possess a broad range of skills, including technical expertise, leadership and management skills, and cultural sensitivity. They must be able to navigate through the complex political and hierarchical landscapes of the organization while ensuring that the company’s technology is meeting its business needs.
What is the Role of a CTO in a Consultancy/Software Agency?
We didn’t cover one of the examples, which is CTOs in Software Agencies. In that case, the role is a mix of being a fireman (i.e. fixing things that do not work on multiple projects during the critical stages of their respective timelines), a process strategist, and a pre-sales.
An important part of the Software Agency’s CTO will be a liaison with the client’s technical contacts as well as vendors.
Hands-on skills are very important, but so are communication and management skills and the ability to quickly understand their client’s business needs.
How important is it for a CTO to be hands-on?
In my opinion, being hands-on is important for CTOs of all levels and company sizes. However, as the company size increases, your level of involvement in actual development will decrease to practically zero. At the same time, the ability to lead and communicate efficiently with non-technical people increases dramatically.
Conclusion or can a startup CTO grow with a company until it becomes a Large Enterprise?
I don’t think it’s too common for a CTO of a small company to become a CTO of a large enterprise. The difference in skillset is too significant, and one must be a really talented and dedicated individual who is able to navigate the challenges of scaling a startup and help their company achieve success.
However, it is not uncommon for a CTO of a small startup to become a CEO of the same company, for example, Mark Zuckerberg @ Meta, and Drew Houston @ Dropbox.
In any case, being a CTO of a company of any size is a challenging and demanding position, which is incredibly interesting and rewarding!
