| 14 min read

A Full Guide on CTO as a Service [Roles, Duties, Costs]

Alex Morgunov , Project Lead

Imagine yourself having an idea of a startup. Or desire to scale your current business. Or maybe check whether your development team delivers the tasks in time. Any business is a complex system. Sometimes vendors have to deal with lots of things and spheres that aren’t in their capacities. And you probably have some questions as well. 

This is where hiring CTO-as-a-service may come in handy. You just look for a CTO for hire that can analyze your product and give some advice about its technical or business implementation.

What is CTO as a service

CTO as a service, or CaaS, stands for part-time tech and business advisory of Chief Technology Officer to assist a startup or a company.

The core benefit of a startup fractional CTO compared to an inhouse CTO is the price effectiveness of such a service as a company only pays for the services needed.

Benefits of CTO as a service

Types of CTO services

CTO types depend on the technical chief technical officer duties and the form of cooperation with a CTO.

For example, if you only need a CTO consulting, you can hire a part-time external CTO, while the complex tech and business support will require full-time in-house employment.

There are 5 key CTO types:

  • Full-time internal
  • Full-time offshore
  • Part-time offshore, or fractional
  • One-time services
  • Interim services

Full-time internal

Full-time internal CTO can provide your company or project with thorough technical and business support. Chief technical officer responsibilities comprise full-time support in the development, planning, and even soft skills management in real-time.

However, hiring a CTO as a full-time team member will create additional expenses for your company, such as HR expenses, office rent, and different labor taxes.

Full-time offshore

Hiring an offshore full-time CTO allows you to get all the advantages from full-time collaboration while still paying budget CTO salaries. Thus a specialist becomes literally an inhouse expert. But still, a remote expert working 40 hours a week for the company. 

Part-time offshore or Fractional CTO services

Part-time CTOs work the required and agreed number of hours. This way a company can evaluate the needed services and time for them and pay only for that time. Fractional CTO is naturally the most cost-effective cooperation model with an external CTO.

One-time CTO services

This kind of CTO will be focusing only on the required spheres of responsibilities and processes. Such specialists are usually hired for CTO duties like troubleshooting in particular technical areas or conducting an audit.

Interim CTO services

Interim CTO is a technical specialist that is hired to temporarily assist with technical and business responsibilities while the company is hiring a full-time internal CTO.

When a company is looking for a new Chief Technical Officer it is required to work without a CTO and you risk your technological processes and decisions. To avoid such risks and remain active and supported, it is possible to rent a CTO. Moreover, such a technical consultant may not only temporarily replace your team member, but also help with hiring the new CTO.

Types of CTO as a service

When you need an external CTO 

It doesn’t matter whether you just starting your business or have lots of large working products. CTO can assist businesses with lots of tasks. While the role of the CTO is often related to the technical consultations, you can also hire a CTO when you:

  • have an idea of a product but don’t have enough technical expertise to choose the right technologies and a team
  • are not sure whether particular  technologies are suitable for your business 
  • need an audit for your product 
  • have an MVP and want to represent it to investors
  • are a mature startup that requires a smart solution to outperform and stand out of the competitors
  • when your business is ready to scale and needs the right tech or business decisions to do this 
  • when your business is already big enough, but you face some issues with internal infrastructure or industry-specific regulations
  • see that your current organizational and technical tools are outdated and need to be upgraded
  • need a temporary CTO to provide the balance inside your company while you looking for a permanent replacement 
  • want to branch your business or integrate new technology and need more details and planning
  • don’t need or can’t afford a full-time CTO
  • require an unbiased consultation
  • get advice on an MVP tech stack
  • your team needs somу senior guidance

CTO’s roles and responsibilities

CTO can assist you during different stages of your product development to soft issues like team conflicts. Let’s have a look at the CTO responsibilities list.

Discovery phase

Most startups have bright project ideas but do not know how to implement it. In this case, you can hire an external CTO as a service for startups to help you with the discovery phase of your product, which may include such steps as:

  1. Architecture development
  2. Designing the technical solution
  3. Finding the best matching tools
  4. Clarification of the project goals 
  5. Selecting the set of features for the MVP development
  6. Assessment and reduction of risks
  7. Competitors analysis
  8. Choosing the optimal  tech stack

You can read more: Project Discovery Phase or How to Avoid Failure

Technical solutions

The role of CTO combines both deep development expertise and business knowledge. Technical solutions are one of the most important among the Chief Technical Officer roles and responsibilities. Such specialists help to solve the most difficult technical issues and implement rare solutions. 

Generally, a CTO can assist a company with such tech solutions:

  1. Choose the functionality in accordance with business requirements
  2. Find solutions for technical challenges
  3. Find the most cost-efficient and effective technologies
  4. Evaluate the effectiveness of the current tech stack
  5. Dealing with technical issues that the client’s team cannot solve due to lack of expertise
  6. Extending functionality
  7. Architecture creation and improvements
  8. Selection of technologies for effective scalability
  9. Complex integrations

Project Planning

External CTOs are often involved to plan the development process, prioritize the features, and select the features that need the biggest focus. For example, such a role of a CTO often includes plan creating and optimization – highlight the process and functionality to simplify and make the whole business more cost-efficient.

This applied particularly when the project aims to scale. For example, when the number of requests grows and a system can’t already cope with them.

CTO as a service can assist with the following planning aspects:

  1. Improving the development processes
  2. Prioritizing the features
  3. Enhancing the architecture
  4. Creating a development roadmap
  5. Estimating budgets and timelines

Project scaling

A scaling stage is when an expert becomes a must. For instance, a product can be big enough to scale but still, fail with the technical aspect of scaling. Here a good CTO will help you with business analysis, evaluate the current business needs, and create a complete scaling strategy.

During the scaling process, CTO can help you with:

  1. architectural and technical decisions
  2. Finding the most cost and time-effective sol
  3. Risk-less project expansion
  4. Analyzing the possible approaches
  5. Cloud, hosting and other optimizations
  6. Creating an overall technical scaling strategy

Project pitch

what is a CTO in business? A CTO has to be not only a senior developer but a person with a broad range of expert knowledge. This specialist is kind of a business analyst and business development manager with deep tech knowledge.

That is why vendors often hire CTOs as a service in their funding rounds to convince their investors.

CTO can not only represent an idea of the project but show investors the expertise in effective development and share the project’s technical solutions and business benefits.

When pitching your product, a CTO can assist you with:

  1. Prepare a tech pitch deck 
  2. Explain the technical value of the project for investors
  3. Describe the business benefits
  4. Prove that the project’s team has a deep expertise
  5. Answer any technical questions of investors

Hiring

When it comes to young startups, founders and a CTO often serve as recruiters and hire the future team. In the later stages, startup CTO helps human resource specialists to recruit the best matching candidates.

 A CTO can advise with such recruiting aspects as:

  1. Creating criteria for the technical employees
  2. Evaluating the technical expertise of future employees
  3. Conducting technical interviews
  4. Determining the developers’ soft skills and check whether they are good team players
  5. Motivating the team in case of  issues

Project audit

To maintain the high quality of the product and keep it reliable, an audit should be conducted once in six months or so. Hiring an external CTO to conduct an audit has a huge perk. Thus it is possible to get an unbiased opinion.

The other option here is to hire a specialized audit company. But if a project is still not huge and has some budget limitations, this option would lose to hiring a CTO as a service.

During the project audit, a CTO can assist you with:

  1. Evaluation of the code quality
  2. Verification whether the team works correctly
  3. Project quality and functionality assessment
  4. Checking the effectiveness of outsourced teams
  5. Monitoring the delivery process
  6. Preparing the list of recommendations on improvements

Soft issues

Unfortunately, it’s not that rare when issues occur, back-end developers can blame front-end developers and those blame someone else. Thus founders see that there are definitely problems in the team, but can’t define them. An experienced CTO as a service can look into the situation and find ways to solve the problems.

Lots of misunderstandings inside the team can affect the development process. The CTO can deal with soft issues and work on morale.

In that case, a CTO can help you with:

  1. Emotional support of the team
  2. Conflicts analysis and resolving
  3. Team management
  4. Development of new collaboration processes

UX

A good technical officer will never work only with the tech aspects of the project. But also will recommend how to make an application convenient and easy-to-use for your customers. 

CTO can assist you with:

  1. UI analysis from the customer’s point of view
  2. UX analysis in terms of convenience and logic
  3. Prepare recommendations to improve  convenience and user-friendliness

Benefits of an external CTO service 

Costs

Lots of startups, small and medium businesses need CTO. But they simply cannot afford to hire one full-time. That’s why hiring a part-time or outsourced CTO can be a great solution. You get all the required services for a budget price. For instance, in Europe and Asia, the average CTO startup CTO salary is quite budget-friendly.

No need to hire

Working with an external CTO, you don’t have any additional expenses. For example, hiring an in-house CTO, you’ll be required to bear recruiting expenses, pay office rent, and labor taxes. While outsourcing CTO responsibilities., you pay only for the work and services you request.

Bigger pool worldwide

Outsourcing gives you a bigger choice of experts. Moreover, as mentioned, hiring an offshore CTO allows reducing the development expenses.

Independency

By hiring an outsourced CTO, you get a professional who can work unbiasedly. 

Increased agility

It’s possible to build a business without hiring a CTO. However, that would be a long journey with a trial and error method. At the same time, even a few technical consultations may clarify the core business and technical issues. And you can get some fresh ideas on how to start or develop your business much faster. 

benefits of an external CTO

How to choose a CTO as a service: Must have skills of your CTO

You’ve decided to hire a CTO. What criteria to pay attention to while hiring an ideal technical specialist? Check the below CTO qualifications. 

Years of experience

It’s not all about the years. Let’s face it: even if a person has been 15 years in software development, he or she can still remain a middle or even a junior developer. But still, the practical background is not a single, but one of the core points to consider.

Choosing a CTO, follow these tips:

  1. Choose a person with no less than 5 years of experience, perfectly 6-7 years
  2. Make sure your CTO has a practical background
  3. Pay attention to the spheres you CTO worked with
  4. Check if a candidate has at least a year of experience in each front-end, back-end, and mobile development

Tech expertise

Analyzing your CTO’s technical skills, look at the technical competencies that your project needs. For example, if you are working on the web product, it’s not required (however would be an advantage) for your CTO to have experience in mobile development. Versatile expertise will tell you that your CTO is an experienced professional to work on your product.

Therefore, your future technical consultant should have:

  1. Expertise in the technologies your project uses 
  2. Minimum one year of practice in each technical area
  3. Broad understanding of all the technical terminology

Business-oriented mind

There is a big difference between an experienced developer and a CTO.

CTO should understand not only the technical but also the business component of the project. This is a person who offers solutions based on his experience and selects tech solutions that will really help to solve the current business problem. 

Communicative

CTO’s are the people who manage the work of other employees,  present their business and technical ideas to the founders and a team, and pitch the product to the investors. Without solid soft skills, a CTO won’t be able to perform the required tasks.

Critical analysis skills

Following the development trends and desire to use new technologies is great. However, every CTO should be able to think critically about the hype solutions and trends to choose only those technologies that can help to boost productivity and create a successful product. 

Big picture thinker

While the rest of the team can focus on the product details that are working on, CTO should be able to think strategically to see the whole picture to do the right steps achieving the final goal.

must-have skills of CTO

Where to find a CTO as a service?

Outsource companies

As a rule, outsourcing companies offer development and quality assurance for outsourcing. CTO as a service is still not that common service in offshore companies. However, outsourcing a CTO becomes more and more trendy each day.  Surely, outsourcing may be risky sometimes, so we recommend you to  study companies’ portfolios, find feedback from other companies’ clients, and discuss your future collaboration in detail. This will help you to choose a responsible CTO.

Recommendations

Recommendations from your co-workers or partners may be very helpful when you are looking for such a responsible employee as CTO. Start by asking people you know for advice. Maybe some of them already hired CTO as a service or know someone who did? These people won’t lie to you if something in this collaboration went wrong and, vice versa, they will probably recommend you a chief technical officer who makes their business flourish. Someone’s success will be proof of the seniority and professionalism of your future CTO.

Networking

How does it work? You just communicate with others: visit tech events, software-dedicated conferences, or simply communicate with other businesses. All these actions will definitely help you to meet new people and, who knows, maybe your perfect technical specialist is already among them? 

How to find a CTO as a service

Our experience

Engaging a CTO in Stripe Integration

The most recent case when we rented out our Chief Technical Officer was to conduct a complicated Stripe integration for a startup.

Our client needed the custom and complicated integration of Stripe, and the expertise of his own development team wasn’t enough to build such a complex architecture for Stripe. There was a challenge as far as our client’s business required a very specific Stripe integration with the fund’s withdrawals, onboarding, and validation.

Involving CTO in Developing Difficult Features

Lately, our client wanted to develop an interesting and pretty unique feature that was important for users’ convenience. The internal development team of our client claimed that implementation of the feature as a client wants it to see was impossible. 

Thus founders hired a CTO as a service from Sloboda Studio to consult the team. Having analyzed the project and requirements, our CTO found 2 possible strategies to implement the functionality and drafted instructions for the inhouse team of a customer. Thus, this vital feature was brought to life.

Our solution:

We studied the technical features of integration specifically in their product and planned how to implement this into the existing architecture.

Final Thoughts

CTO is a good solution to assist you with almost every business and technical question. 

Such a service may be good for different types of companies but is perfect especially for startups. As it is the most cost-effective way to have an expert with such a deep knowledge and experience in the team.

A CTO as a service can help you with:

  • Choosing the right technologies
  • Solving complicated technical tasks
  • Determining core features
  • Finding the right business and tech approaches
  • Hiring new employees, team creation and support
  • Pitching your project to investors and many more

In Sloboda Studio, we are involving a CTO in most of our projects, especially in startup development. Besides, we offer a separate service of an external CTO for your product.

You are welcome to contact us, to know more about this service.

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