Most startups begin without a chief technology officer (CTO) due to their limited size and budget. However, the necessity of this position increases with the growth and scale of a company. So, what should you do when the time comes for the inevitable need to hire a full-time CTO, and you still don't have enough money? This is where CaaS comes in!
CaaS stands for CTO as a Service, and it provides a business solution for problems many startups face when scaling. CaaS, with its wide range of services offered, seeks to provide entrepreneurs with everything they need to grow their startups into something bigger.
Is a CTO essential for a company? Can a company function without a CTO? Keep reading to find out!
In this article:
What Is CTO as a Service?
A chief technology officer (CTO) is a senior executive in charge of managing the technological requirements of a company. The foundation of a successful startup depends on the quality of the people on the team, and CTOs are responsible for hiring and managing teams and directing technological business goals.
Now that you know what a CTO does, let's explain what CaaS is.
CTO as a Service for startups is a new trend that allows a company of any size or budget to hire this specialist. CaaS aims to make this position accessible to companies that can't afford an in-house CTO. Unlike other chief technology officer services initially created for larger companies with bigger budgets, this service is designed to accommodate a startup's limited budget.
Think your company can function perfectly without a chief technology officer? Perhaps. But before you say no, here are all the ways a CTO can boost your company's performance.
Benefits of CTO as a Service
- Observing industry market trends and business transformations. Due to the large number of projects a CTO manages with a solid technical background, it's critical to establish and implement development strategies that follow modern development techniques and best practices, focus on target business markets, and implement initiatives that help improve customer experience.
- Team building support. A CTO strives to ensure technical leadership, mentoring, coaching, and professional development help for teams, recruiting new personnel and addressing technical gaps in the search for the required technical specialists.
- Reducing operational risks. By monitoring budgets and resource planning, the CTO aids in the establishment of robust operations, business processes, and infrastructure. Also, they engage in business crisis management and security issues through overall governance and risk management, product management, and planning.
- Creation of a digital transformation strategy. By supervising the transformation of each business process and suggesting how technology might aid a company's success, a CTO helps develop a technology strategy within a company.
Now that you know all the benefits of CaaS let's see which services are available.
Types of CTO Services
There are multiple types of interim CTO services, ranging from hiring a full-time CTO to paying a one-time fee for the services. It's important to be familiar with all the different types of services, so you can choose the one that suits your project goals and budget the best.
Let's examine these services and how each one benefits your business.
- Full-time internal CTO. This service allows full-time access to the CTO, who will work onsite with your company. They will become part of your team and help your company focus on technological innovation by fulfilling technical aspects of the project and business responsibilities.
- Full-time offshore CTO. This option ensures high-quality CTO services while keeping additional expenses minimum. An offshore CTO works remotely, and you'll need to organize remote meetings and video calls to communicate with him.
- Part-time offshore or fractional CTO. This service also provides high-quality external CTO services at a minimum cost. The fractional CTO works only for an agreed number of hours when required.
- One-time CTO services. If you need a CTO for one specific project, you can opt for assistance with a fixed cost for that particular project only. Companies often choose this type of service for duties such as troubleshooting in particular technical areas or conducting an audit.
Interim CTO. An interim CTO is a technical consultant hired to assist temporarily during a transition while the company is searching for a full-time internal CTO. If you need to hire a CTO for a limited time, this service is ideal.
Now that you're familiar with the services you can choose let's explore the most common cooperation models with CaaS.
Model of Cooperation with CTO as a Service
There are three main models of cooperation with CTO as a Service. In this section, we explore each of the three models, explaining when companies should choose either option.
This model is suitable for a company in need of a one-time business advisory for technical issues regarding design and development. The CTO is paid a one-time fee for each consultation session.
CTO consulting services are excellent in situations such as when a company cannot decide on a tech stack for product development or when a technical team is not able to quickly and efficiently solve issues that arise during product development.
CaaS Fixed Price
This model is best for companies that need ongoing business support. This model is perfect if you prefer to have a CTO with whom you can plan ongoing strategies. You will pay quarterly or biannually for the services provided by your technical consultant.
If you need ongoing support in product development processes and technology management but you're not looking to hire a CTO, then CaaS fixed price is the right choice for your company.
CaaS Time and Material
This model is best for companies that base their business on product development. This approach allows you to purchase services as needed. You will pay your CTO hourly, and this type of service works well if you need help developing a new product or other tasks related to technological innovation.
Each CaaS model is different and comes with certain benefits. Companies should base their choice on their specific business needs. However, one question remains. Which option is better—hiring an in-house expert or choosing CaaS?
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In-House or Outsource CaaS?
If you're unsure whether to hire an experienced CTO or choose CaaS, here are the pros and cons of both options that will help you decide more easily.
Constant control. Hiring an in-house specialist will allow you to control and manage all processes in which that person is involved.
Deep understanding. The in-house CTO works on a company project from the very beginning. Therefore, an in-house specialist will know everything about your product from A to Z.
Great costs. Hiring an in-house CTO is not cheap. Not only will you spend money during the hiring process, but you'll also have to cover other costs for your new full-time employee, such as salary, vacation time, etc.
Time. It can take some time to hire a high-quality CTO. Experienced specialists already have good jobs, so you must persuade them to switch to your company.
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Cost efficiency. Outsourced CTO as a service will undoubtedly help a company save some money. You won't spend any money on the hiring process, salaries, or other costs associated with full-time technical employees.
Quick CTO specialist change. Not satisfied with the work your CTO does? It is much easier to find a new one if you choose CaaS since you're not looking for a full-time employee.
Focus on essential business activities. By choosing CaaS, you'll be able to delegate some of your tasks and focus on more important business activities.
Communication problems. Hiring a remote, offshore CTO can be slightly challenging if the person lives in a different time zone. So, make sure to check the person's availability and work hours upfront.
Management issues. Business owners sometimes find it difficult to stop being fully in control of everything when it comes to projects. However, there is no need to handle everything by yourself with a reliable CTO.Before making a final decision, identify your company's needs and capabilities, such as the budget. Hopefully, keeping these pros and cons will help you decide more easily.
It becomes obvious from the pros and cons that companies often hire a CTO at the start of a project. But what if you already have an ongoing project, and you're wondering if a new employee can handle it? Here are several reasons why CaaS is an excellent choice for current projects.
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How Does CTO as a Service Work in a Current Project?
If you already have an ongoing project, but the company doesn't have a CTO, or it's not clear who will handle technology management, then CaaS is right for you.
Here is how CTO as a Service can help you with an ongoing project.
You can get a high-quality project audit by involving the CTO as a service in an existing project. A CTO can identify the main problems with your product, study the issues that lead to a decrease in conversion, assist in developing a plan to fix issues, and find ways to change all processes in your favor.
An experienced CTO can assess the performance of the existing in-house team, point out flaws, and assist in the employment of new staff. The CTO will identify experts who can quickly join a new team and take on new product development responsibilities.
A CTO as a service can assist a company in creating a project roadmap, which consists of a list of tasks that must be performed to reach your long-term objectives. Regardless of the project's complexity, developing clear roadmap aids in the building of full-time collaboration.
Finding a skilled and experienced CTO is an excellent opportunity to expand your team's knowledge. The CTO probably worked on numerous projects and digital products, so they will have plenty of advice to share.
Speaking of a skilled CTO, how can you know if you've found one? Here are the essential skills your CTO must possess.
How to Choose CTO as a Service: Skillset of a CTO
A skilled CTO should be equipped with more than technical skills. This section explains how to choose the right CTO for your company based on their skill set.
The more experience a professional has in this field and the more projects they have worked on, the better.
To ensure you're hiring top talent, it is recommended you read the reviews of other companies the CTO worked with previously.
Technical Skills and Knowledge
To ensure that the CTO has the appropriate knowledge, look through their portfolio, including projects they worked on previously.
In addition to technical skills, a good CTO has to possess leadership qualities and excellent communication skills.
Have you finally made up your mind and decided to choose CaaS? Check out the roles and responsibilities your new CTO will take on.
CTO's Roles and Responsibilities
These are the most common roles and responsibilities of a CTO within a company:
- Assistance during the discovery phase
- Technical solutions
- Project planning
- Project scaling
- Project pitch
- Project audit
- Soft skills management within a team
- UX/UI Design
Any project and company can benefit from CTO as a service, considering the wide range of tasks and responsibilities a CTO can take. Find out the easiest way to hire CaaS for your company!
How to Hire a CTO as a Service
The hiring process of CaaS consists of multiple different stages. It’s necessary to properly prepare for the process, do thorough research, and, ultimately, make the right decision.
The first stage of hiring a part-time CaaS is the preparation stage. The Geniusee team has prepared a short guide to help you and your team prepare for the process of finding and hiring a CTO as a service:
- Decide whether your project really needs CaaS.
- Think about what tasks the CTO should perform.
- List the basic business requirements for a CTO.
- Determine if you need a full-time CTO or a part-time CTO.
- List basic interview technical questions.
Select a responsible CTO for your organization by examining several outsourcing companies and their employees. Pay attention to customers’ reviews and experiences.
You can also try to find a freelance specialist. It is a cheaper method, but the CTO you hire might perform more poorly compared to those offered by verified outsourcing companies.
Asking your friends, partners, or coworkers for recommendations can be quite beneficial when seeking a responsible employee such as a CTO.
After getting to know the hiring basics, it’s natural to wonder how much it will cost to add a CTO to your team. Let’s figure it out!
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How Much Does Hiring a CTO Cost?
CTO as a service cost depends on different factors, such as the experience of the person but also their location. We researched CTO average hourly rates in different regions.
- Eastern Europe ($50-120/hr)
- Western Europe ($80-200/hr)
- South America ($45-110/hr)
- Asia (<$65/hr)
We recommend you consider employing a CTO located in Eastern Europe. With nearly a million highly qualified professionals, this region has evolved into one of the world's major IT outsourcing centers.
While the rates in Eastern Europe are pretty cheap, the quality assurance is also promising. This region has strong and established technical expertise due to its availability of technical educational institutes.
Now, let's take a look at how one of the notable companies from Ukraine can help you hire the right CTO for your company.
Geniusee is a custom software and product development company aimed to help FinTech, EdTech, and other businesses worldwide thrive through tech partnerships. Founded in 2017 in Kyiv, Ukraine, the company accumulates the tech expertise of 150+ skilled professionals who have already delivered 100+ notable projects in FinTech, EdTech, retail, and other industries.
From complex cloud computing implementation to hiring a dedicated team of experts, Geniusee carefully selects specialists according to the requirements of your project. The dedicated team is fully focused on the project and works on it exclusively, full-time, reporting directly to you.
What is the advantage of choosing the Geniusee team over classic hiring? You get a loyal team of external personnel, a flexible approach, entirely predictable costs, and total budgetary control.
Hire Geniusee's dedicated team—70% of our customers have a genius team of specialists who are selected according to the project's requirements.
A chief technology officer helps a company make better decisions about its technology stack, avoid aberrant costs, and deliver the product to the market faster.
A CTO as a service will help you with:
- selecting the appropriate technologies;
- solving complex technical problems;
- deciding on core product features;
- determining the best commercial and technological methods;
- recruiting new personnel, forming teams, and providing full-time support;
- pitching your project to investors, and so on.
If you need to hire quality CaaS, feel free to reach out to see how the Geniusee team can help with a solution.
FAQ about CTO as a Service
- What is CTOaaS?
CTO as a Service is a new trend that makes it possible for a company of any size or budget to hire a CTO specialist. CaaS aims to make this position accessible to companies that can't afford an in-house CTO. Unlike other chief technology officer services initially created for larger companies with bigger budgets, this service is designed to accommodate a startup's limited budget price.
- Are there any restrictions on the type of technology or software that can be used?
There are no restrictions on the types of software that can be used. You coordinate with the CTO all the tools and software necessary for your project and use them in your project freely.
- What type of business is CTOaaS suitable for?
Often this service is relevant for startups and small businesses. Turning to the services of a CTO, startups can get expert advice on the best architectural and technical decisions, professional development team management, operational coordination of tasks, and technical advice on various IT services.
If a company is in the process of growth and plans to attract investment, it is very important to convince investors of the product's potential. The chances of success are much higher if you have an experienced workshop specialist on your team. And by outsourcing this service, you will also receive financial benefits for your business.