How to launch a startup: When do you need a technical co-founder?

How to launch a startup: When do you need a technical co-founder?

The co-founder duo is widely regarded as the "nuclear family" of startups.
Sometimes, it's the visionary, and the technical doer, like Steve Jobs and Steve Wozniak. Sometimes, it's two technical doers, a la Larry Page and Sergey Brin.

Other times still, it's two visionaries whose names become synonymous with the company itself, as was the case with:

  • The founders of Silicon Valley, Bill Hewlett and Dave Packard
  • Brothers-in-law William Procter and James Gamble
  • 7th grade best friends - and ice cream fanatics - Ben Cohen and Jerry Greenfield

These pairs of people were each working on wrangling entirely new fields. Jobs and Wozniak popularized the very concept of personal computers, while Google was built around the novel PageRank Algorithm crafted by the two Stanford Computer Science PhD graduates. While Ben and Jerry's was a bit less of a blue ocean, it's clear that with technology companies, technical co-founders are vital members of a founding team when working to productize new technologies.

However, it's worth asking whether or not a technical cofounder is necessary for all tech companies.

When do you need a technical co-founder?

There is plenty of data illustrating the benefits of working with a founding team. One report found that 80% of all billion-dollar companies launched since 2005 have had two or more founders. However, a not-insignificant 20% of these successful firms were founded by just one founder.

When figuring out how to launch a startup, bringing on a technical co-founder is a massive investment. There will be few times in your company's life when you will ever consider giving away as much as 50% of your equity. In order to be comfortable trading significant amounts of equity for an individual, they need to be extremely valuable, and able to do something that nobody else can do.

This is the case if you are developing a novel technology that requires deep (or unique) expertise. In cases where you are merely applying existing technologies with a new business model or in a new setting, you are likely better off purchasing or licensing the tech and keeping your equity.

Ask yourself: New tech vs. new application of an existing tech framework?

Bring on a technical cofounder if you are developing a novel technology. If you are applying an existing technology in a new way, you might be able to go it alone.

The key is knowing which group you’re a part of.

What are examples of new technologies?

Startups that utilize new technologies are ones that have a novel technological component that differentiates them from their competitors.

These could be:

  • An artificial reality (AR) mobile app that lets users try on different outfits and view them via their phone
  • Machine learning companies with an algorithm at the core of their service offering
  • A platform that links up all of the smart home enabled devices in someone’s home

In all of these examples, the tech is not just core to the business - it is unique to that company. In these cases, it's vital to bring on someone that has a deep understanding of how the technology works, and is with you making decisions about the company from day one.

What are examples of not new technologies?

Startups that use existing technologies in new and interesting ways, companies that find their competitive advantage not in the tech they use itself, but in how they take advantage of tech that already exists, may benefit from waiting to bring on a technical co-founder.

Some incredibly successful examples of these that we've seen are:

  • A two-sided marketplace that brings together those with home music studios, and those looking to rent studio time
  • A social media startup that focuses on the elderly as their main customer base
  • A productivity tool that helps product managers better prioritize their backlog

In all of these examples, the most important factor in the future success of the company is the founder's knowledge of their market, and ability to tailor their service offering to fit their user's needs.

For example, there are many ways to build your own two-sided marketplace without code. As such, there are few reasons to trade equity at such an early stage when a product can still be built by founders themselves, and product/market fit has yet to be found.

Founders that take advantage of existing technologies to test their assumptions, and build a user base early will find everything from searching for a technical co-founder to actually raising funding that much easier in stages thereafter.

So what are your options for launching your startup?

1. Do it yourself with no-code software development

The first option is to build out your product yourself. Fortunately, a lack of cash by no means equates to a lack of opportunity.

A recent review of startup data on Crunchbase showed that nearly 46% of startups that have raised $10 million or more in funding, and over half of all startups that have successfully exited were built by single founders.

Best of all, given the abundance of no-code tools, non-technical founders are more equipped than ever to actually build out the companies they imagine. The benefit of no-code development is that it allows you to quickly start testing your minimum viable product (MVP), gain traction, and take your startup to the next stage. Depending on your needs, this next stage could be getting to a point where more conventional development options might make more sense.

How to get started: We recommend beginning with a broad no-code resource like Bubble via their learning manual, AirDev’s own Bubble resources, or if you’re entirely new to no-code, starting with Ryan Hoover’s seminal piece on the rise of no-code.

2. Bring on a technical co-founder

In your process to determine if you need to get a technical co-founder, the most important part starts months before you ever interact with potential co-founders. Your success in finding, and convincing, a technical co-founder to help build out your vision is directly correlated with how many steps you’ve taken to flesh out your idea ahead of time.

How to launch your startup from the ground up

The more coherent your startup idea - customers clearly identified, market research already conducted, user stories written - the more likely your vision, and the product your potential co-founder helps build, will match up.

What should you build out ahead of time?

The most actionable resource we've found to go through this process is Alex Cowan's Venture Design Process. Alex is a 5x entrepreneur, and professor at the Darden School of Business.

His Venture Design Process is a collection of Google Docs templates, Coursera lessons, and explanations of every stage of taking your business from 0 to 1, incorporating methodologies from lean startup to design thinking and beyond.

The process covers all of the major components you should figure out early on to help explain your business to a potential technical co-founder. This includes:

  • Personas
  • Problem Scenarios
  • Value Propositions
  • How to Run Experiments
  • Prototypes
  • Promotion

With all of these in hand, your search for a co-founder should prove exponentially easier. You'll be able to vet technical experts based on their understanding of your overall business model, and help mitigate fears they may have of disproportionately bearing the burden of building far more than the technical architecture. Most importantly, the process provides you with more opportunities to think through and iterate on your idea, a process that will likely need to take place time and again before even thinking of taking your idea to market.

Where should you look for a technical co-founder?

The search process is no easy task. The Founder Dating Playbook from First Round Review gives a fantastic overview of how to start that search, and the gravitas with which you should approach the process.

Michael Seibel, CEO of YCombinator put up a great video overview of how to start that process. He recommends turning to friends that develop as a part of their everyday job first, and making them real offers. That includes equity breakdowns, and plans for if and when they can be paid a salary. If not friends, turn to coworkers that meet similar criteria.

And if these options aren’t available to you, or you haven’t found a co-founder willing to work from this group, it’s vital to build out a network of potential technical co-founders. The quickest and easiest way to do this is to go get another job at a technical startup. Ideally, this is at a startup with 50 people or less as it provides the most likely opportunities for you to cross paths with engineers time and again. Any larger, and teams start to break off into silos.

Realistically, this process can take years.

Conducting the search properly is a skill in and of itself in the same way learning to build products is a skill.

But should you choose to go down this route, there is an abundance of literature that indicates just how much more resilient companies with multiple founders are when compared to single founders. That same Crunchbase review (mentioned above) also found that the average number of founders at startups that had raised more than $10 million was 1.85 founders per startup.

It may still make sense to bring someone on early, and for them to be equipped with the technical know-how to grow with your company, and absolutely vital if your product or service relies on a new technology.

When should you hire a freelancer?

Just as with bringing on a technical co-founder, your success in finding technical talent to successfully launch your startup depends on how much clarity around the product you’ve been able to build before ever interacting with freelancers.

The more coherent your startup idea, the more likely that your vision, and the product returned by the developer, will match up.

Doing this kind of work ahead of time has two additional benefits:

  • Prevents scope creep. Outlining things like your feature set ahead of time means your developer is much more likely to be able to stick to deadlines set before beginning development.
  • It's cheaper. Actually designing your venture before looking to others lets you test whether your idea is actually worth pursuing, and removes the option for a freelancer to charge for the scoping process.

With all of these in hand, your search for a freelancer should prove exponentially easier. You'll be able to more easily vet developers, and reduce costs by ensuring developers are spending their time exclusively on the things you cannot do - technical development.

Where should you look for a freelancer?

The preliminary work to explain your business is the difficult part. However, with this information in hand, you can turn to any freelancing site to look for developers. Whether that's a site like Makerpad Experts for no-code freelancers or a site like Toptal or Upwork for traditional developers is up to you.

If you find a developer that seems they might be a great fit, reach out! Share with them the resources that you've created, and if you want to move forward, work with them to set the scope, and timeline for the project.

At the end of the day, you're looking to this person for their technical expertise. As such, they will have insights on the technical requirements, and limitations of what it is you're trying to build. Set expectations for check-ins, and when you expect to see the final deliverable. Work with them to clarify these things ahead of time, and have them written into the contract you both sign before moving forward.

And once it is signed, it's important to trust the process. Development can take time. Refer to the check-in schedule you set before development began, and be prepared to help with any questions they may have along the way.

With this in mind, actually going through the process of finding, vetting, and trusting freelancers is an inherently risky process, and can take up significant amounts of time. There's one other option that still remains for founders.

When should you hire a software development agency?

Alex Turnbull built Groove, a platform B2C companies can use to build stronger relationships with their customers, with the help of a development agency. In the article on why he decided to turn to an agency over other options, his decision was reached after thinking:

"Four months from now, I could have a living, breathing product in the market that would let me collect user feedback, get validation and push this business forward. Or, I could still potentially be sitting here with nothing."

This is the benefit agencies provide. Having a team that you can work with ready to dedicate the resources necessary to realize your idea makes for a significant advantage over competitors.

Alex wrote that article over five years ago, and in the time since, a new type of development agency has sprouted that takes advantage of no-code tools to build products at the same, or even higher levels of quality for clients as traditional, more expensive development firms.

When does a no-code software development agency make sense?

While traditional agencies build over the course of months, no-code agencies provide founders with options to realize their product in mere weeks. This translates to lower costs, and more opportunities to learn and iterate quicker in the early stages of builds.

Interested in launching quicker and iterating more frequently? Let us help!

Airdev has helped sole non-technical entrepreneurs, fast-growing startups, and Fortune 500 enterprises build custom, scalable applications at a fraction of the cost and time of traditional developers.

If you're looking to bring your product to life in 1 - 5 weeks, get started here.