How To Hire A Chief Technology Officer (CTO) in 2023
The role of the Chief Technology Officer (CTO) has grown in importance as the Retail Technology industry develops rapidly. The CTO has risen through the…
The role of the Chief Technology Officer (CTO) has grown in importance as the Retail Technology industry develops rapidly. The CTO has risen through the corporate ranks to play a critical role in a RetailTech’s growth and success. For your eCommerce or RetailTech, a CTO provides technical guidance and leadership to assist in scaling the organisation and interpreting its organisational culture by working together with the team.
What is a Chief Technology Officer and How Do They Add Value to a Company?
A CTO oversees a company’s technological requirements as well as research and development. They evaluate your short and long-term organisational and investment needs to help you achieve your objectives. CTOs are tasked with leading the Technology or Engineering departments, while continuously optimising the product and technology framework. They mainly report to the company’s Chief Executive Officer and Board.
A RetailTech CTO is required for technological advancements, which is essential as the market is always evolving, due to changing consumer habits which require continuous decision-making in the field. The CTO has one of the most difficult and influential jobs in your organisation. They are responsible for the technological side of the business which is the foundation of the products. If the tech team don’t perform to the standard you need, having lots of funding and great product ideas will be a waste. Your CTO is also in charge of deciding which technology to use and weighing the pros and cons of each tech stack.
Ideal Engineering Team Structure For Your Growing RetailTech
While each company’s team structure is different, the graphic below depicts a typical startup team structure. It’s also worth noting that in some startups, the CTO can be a cross-functional role, including taking on the job responsibilities of their team members as they work and connect with all areas of the business.
User Experience Team – This team will deep dive into your users. They establish your company’s identity, branding, target user requirements and scope. Before constructing a wireframe that delivers the product’s frontend, the User Experience Team comes up with content scope, functional scope, information architecture and interaction design.
Backend Engineers – They are in charge of data structures and coding. One way to improve this is to hire people that specialise in middle stack. They connect the frontend to the backend, which includes user input handling and sanitation, rest API endpoints, data massaging, and more.
DevOps Engineers – In any RetailTech or eCommerce startup, they are essential hires. They make sure that your demos go well, that your software is up and running, that issues are identified before it goes to production, that the backend infrastructure is in place, the deployment process is smooth, and they monitor the resources your tech stack is using.
Data Scientists – Data is key in your RetailTech startup. They collect and analyse massive amounts of structured and unstructured data, which they then interpret. Data Scientists aid your company in gaining a better understanding of your product and target audience.
As specialised RetailTech recruiters, we’ve found that the engineering team is usually the largest, therefore the CTO is in charge of the company’s largest department by headcount.
Challenges of finding a CTO
Hiring a CTO has long been a difficult task for startups and even larger companies. Due to the limited talent supply and high demand for asset CTOs, hiring is the most difficult task. In a RetailTech or eCommerce scale up, they now have a more important job to play, a larger team to lead, and more obligations to manage. As a result, the hiring process should be invested in seriously.
CTOs must have leadership skills which set them apart from senior developers or even technical co-founders. According to a 2020 survey by STX Next CTO, 78% of techies needed five years or more to reach the position of CTO. While 42% took at least a decade.
Things have changed dramatically as a result of the pandemic and hiring a C-suite role has become much more difficult. However, the pandemic also opened the door to a plethora of prospective opportunities, particularly in the field of tech headhunting. At Storm5, our micro-niche Engineering Associates are uniquely positioned to find the best CTO’s in the RetailTech space due to our extensive database of Senior engineering talent. Being experts in their specialism, our consultants can truly speak the language of our clients and candidates alike by staying close to their markets.
When Should I Hire My CTO?
Most people question, “Should I hire a CTO?” before they ask when, and our answer is always a clear “Yes.” However, there are several variables to consider before making such a major hire. You should consider the following questions:
What funding stage are you at?
What type of CTO do you want?
How Much Should You Pay Your CTO?
The Funding Stage
At different stages of a startup’s lifecycle, a CTO plays a varied role. Most startups hire their first CTO during the seed stage. The key reason for this is that companies need time to convey their vision and long-term strategies for scaling. This makes the seed stage the ideal time to hire a CTO since startups will be in the process of developing their idea, product, and concept. CTOs are frequently in charge of everything technical at the seed stage. Frontend, Backend, DevOps, and anything else that gets the product up and operating.
A CTO position would transition into a role that delegates and develops the Technology/Product team further after your startup receives more investment. As your startup grows and expands, you’ll see that your CTO’s job responsibilities increase to include strategic planning and alignment.
The Ideal CTO
In comparison to the CEO and COO, the CTO’s position grows as the product advances. As a result, having someone who can scale at the same rate as your company is essential. You should never hire someone who is too far ahead of their time. Their job will expand in conjunction with your firm, and a high level of career and educational variety is a solid sign of a competent CTO for a startup.
How much should I pay my CTO?
At current market value, CTO salaries can range from (USD) 165k to 370k. Compensation for startups is a unique topic because salary ranges vary depending on the company’s funding stage and how much stock the CTO is granted. As a result, it’s imperative to hire a CTO who is passionate about their work and who will have a great sense of accomplishment as the firm grows.
When you see the benefits reaped in terms of your company’s success, a competent CTO is worth every penny you pay them. Some companies compensate their CTOs with shares, which is necessary for the startup to strike a proper balance so that the CTO feels fairly compensated for the company’s success. For example, in a pre-product company, 15-20% stock would be reasonable, however, in later phases, monetary compensation would be expected to be higher than equity.
Storm5 connects senior RetailTech and eCommerce talent with innovative businesses around the world. We believe it is important to communicate the excitement of your product to experienced industry professionals who can assist you in taking your company to the next level. Due to our niche recruitment specialisation, we take pride in providing the best talent and culture fit for RetailTech firms. We have a large network of the best RetailTech CTOs in the market, as well as other Engineering talents, to help you build out your teams. Get in touch with us for your next hire!