Loading...
Answers
MenuAs a non-tech founder, do I pay a software development company to develop my mobile application, or get a tech co-founder or an investor?
I have designed a rather complex (in process and function) messaging application to develop but very simple for users to use, but i am worried that the complexity of the development required might be too overwhelming for a tech co founder. I am looking for an adviser relevant to my problem to consult with.
Answers
In my experience a technical co-founder's primary responsibilities are to be a visionary first, a hacker second and a manager third. first you recruit a tech co-founder to help visioneer what your product can, will and should do. then you have them support the one key part of the development process (prioritizing around the area of the technology with complexities or is part of your secret sauce) and then that person also manages whatever internal or external developers/technicians that are needed to launch or sale the product. Personally I think the evolution of the IT support model is better positioned as an "AND" play - meaning you find a competent technical partner that is cost accessible, scalable and reliable in terms of experience with similar startups and products. From there you continually look for a good fit CTO/tech co-founder and if you discover them early that is excellent, but do not force the issue (it is easier to scale down or replace a third party vendor, an equity holder not so much.)
Over the last 12 years my firm has helped 300+ entrepreneurs over thousands of projects plan, build, launch and scale their applications (all told raising about $700M in venture financing). So I've seen pretty much ever permutation of co-founder/CTO/product manager you can imagine in the startup space through the lens of my software development company. So if you'd like to connect and chat about how best to plan out the road ahead feel free to reach out.
the other issue with bringing in a tech co-founder is can you find one you can work with at that level and get along with personally. You don't want to solve your technical problem only to generate difference of vision issues down the road.
A software development company also brings with it at least two major advantages. !) In many cases they can bring an entire team to build and test your app giving you a range of technical ability which would tend to improve the quality to the end user. 2) They may have existing contacts you can leverage from on the deployment and marketing side that would give you aa leg up there.
I have been building and coaching startups since 1972 and wrote the global bestselling "Startup Owners Manual" and to me, outsourcing your technology in a tech-driven company is like outsourcing your aorta and hoping somebody else's aorta keeps you alive. Your technology/code and your ability to constantly tweak/upgrade/pivot/expand the code base are the heart of your business...i'd strongly encourage you to find a strong technical co-founder with the view that 66% of a good company is worth a lot more than 100% of a crap pile. Hope that sparks your thinking...let me know. Bob
Look the problem other way round. Do you really cannot do it without a tech co-founder?
Trying to raise money as a non-technical founder was an uphill battle. A decidedly non-technical founder. This is not a woe-is-me cry for non-technical founders to get more respect in the industry.
You can read more here: https://www.groovehq.com/blog/non-technical-founder
Besides if you do have any questions give me a call: https://clarity.fm/joy-brotonath
Related Questions
-
What does it mean to 'grandfather you in' in the tech world?
It stands for allowing someone to continue doing or use something that is normally no longer permitted (due to changing regulations, internal rules etc.)Otilia OtlacanOO
-
What is the average series A funding round at pre revenue valuation for a enterprise start up w/cutting edge tech on verge of our first client.
With all respect to Dan, I'm not seeing anything like that. You said "pre-revenue." If it's pre-revenue and enterprise, you don't have anything proven yet. You would have to have an insanely interesting story with a group of founders and execs on board with ridiculous competitive advantage built in. I have seen a few of those companies. It's more like $3m-$5m pre. Now, post-revenue is different. I've seen enterprise plays with $500k-$1m revenue/yr, still very early (because in the enterprise space that's not a lot of customers yet), getting $8m-$15m post in an A-round. I do agree there's no "average." Finally, you will hit the Series A Crunch issue, which is that for every company like yours with "cutting edge tech" as-yet-unproven, there's 10 which also have cutting edge tech except they have customers, revenue, etc.. So in this case, it's not a matter of valuation, but a matter of getting funded at all!Jason CohenJC
-
If I am planning to launch a mobile app, do I need to register as a company before the launch?
I developed and published mobile apps as an individual for several years, and only formed a corporation later as things grew and it made sense. As far as Apple's App Store and Google Play are concerned, you can register as an individual developer without having a corporation. I'd be happy to help further over a call if you have any additional questions. Best of luck with your mobile app!Alec MorganaAM
-
What do (bootstrapped) startups offer to new sales hires? Commission only? What are some good examples to keep people motivated and still survive?
Generally bootstrapped startups should avoid salespeople, for a few reasons: a. they typically can't afford the base and overall comp required to attract sales people who can actually sell / or afford to support them with marketing, management, etc b. it will be very difficult to find the rare person with the right mix of sales and startup DNA along with the critical domain knowledge, consequently the startup is likely to settle c. the founders need to be very involved in the selling and customers will demand it That said, if the plan is still to hire a salesperson, find someone who has demonstrated sales success in startups and is excited by the early stage in company building. Create a comp plan heavily leveraged on sales results (unless you are in an industry where 100% commission is a common practice, would recommend against $0 base as this creates the false impression that your hire isn't passing time with one company while looking for another job with a richer comp plan - you want your rep focussed). Sell the vision and opportunity to be part of a growth story. I have written a several blog posts on hiring sales people into start-ups. You might find these useful: http://www.peaksalesrecruiting.com/ceo-question-should-i-learn-to-sell-or-hire-a-sales-person/ http://www.peaksalesrecruiting.com/start-up-sales-and-hiring-advice-dont-stop-selling-once-you-hire-your-first-sales-rep/ http://www.peaksalesrecruiting.com/hiring-start-up-sales-reps/ http://www.peaksalesrecruiting.com/startups-and-salespeople/ Good luck!Eliot BurdettEB
-
How much equity should I ask as a CMO in a startup?
Greater risk = greater equity. How likely is this to fail or just break even? If you aren't receiving salary yet are among 4-6 non-founders with equivalent sweat investment, all of whom are lower on the totem pole than the two founders, figure out: 1) Taking into account all likely outcomes, what is the most likely outcome in terms of exit? (ex: $10MM.) Keep in mind that 90%+ of all tech startups fail (Allmand Law study), and of those that succeed 88% of M&A deals are under $100MM. Startups that exit at $1B+ are so rare they are called "unicorns"... so don't count on that, no matter how exciting it feels right now. 2) Figure out what 1% equity would give you in terms of payout for the most likely exit. For example, a $10MM exit would give you $100k for every 1% you own. 3) Decide what the chance is that the startup will fail / go bankrupt / get stuck at a $1MM business with no exit in sight. (According to Allman Law's study, 10% stay in business - and far fewer than that actually exit). 4) Multiply the % chance of success by the likely outcome if successful. Now each 1% of equity is worth $10k. You could get lucky and have it be worth millions, or it could be worth nothing. (With the hypothetical numbers I'm giving here, including the odds, you are working for $10k per 1% equity received if the most likely exit is $10MM and the % chance of failure is 90%.) 5) Come up with a vesting path. Commit to one year, get X equity at the end. If you were salaried, the path would be more like 4 years, but since it's free you deserve instant equity as long as you follow through for a reasonable period of time. 6) Assuming you get agreement in writing from the founders, what amount of $ would you take in exchange for 12 months of free work? Now multiply that by 2 to factor in the fact that the payout would be far down the road, and that there is risk. 7) What percentage share of equity would you need in order to equal that payout on exit? 8) Multiply that number by 2-3x to account for likely dilution over time. 9) If the founders aren't willing to give you that much equity in writing, then it's time to move on! If they are, then decide whether you're willing to take the risk in exchange for potentially big rewards (and of course, potentially empty pockets). It's a fascinating topic with a lot of speculation involved, so if you want to discuss in depth, set up a call with me on Clarity. Hope that helps!Ryan DravingRD
the startups.com platform
Copyright © 2025 Startups.com. All rights reserved.
