Best Practices

Why Do Startups Need CTO as a Service and How to Hire?

Updated on
April 18, 2024
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Many founders have brilliant ideas they can’t wait to test. But turning them into actual products is challenging. They need funds, time, and expertise, which, unfortunately, are lacking in most startups. That’s when they turn to the chief technology officer (CTO) as a service to build their solutions.

Considering that 38% of startups fail because they run out of cash, engaging an outsourced CTO is a smart move. It helps the founder operate on a tight budget while resolving technical challenges. Instead of hiring a full-time CTO, the founder uses CTO services to plan, develop, release, maintain, and support software projects.

The question is — how do you find an outsourced CTO who can complement your skills and bring your ideas to life?

I’m Stan Burenko. I lead Uptech’s business development team. In recent years, I’ve helped founders with their technological needs so they can focus on growing their business. By matching them with capable IT experts, Uptech has helped GOAT, Cardless, Aspiration, and other startups successfully release their products.

In this article, I’ll show you how to leverage CTO as a service to fill technical gaps.

CTO as a service

What Is CTO as a Service?

CTO as a service describes an approach where startups acquire the service of a Chief Technology Officer without hiring them in-house. Instead, founders collaborate with independent CTOs on a contractual basis and according to their needs. This means that founders pay for consultation, project management, and other services the CTO may provide throughout the engagement.

What does a CTO do in a Startup?

Like the founder, a CTO may wear many hats in a startup but focus on the technological side of business. Primarily, the CTO is responsible for guiding technological implementation in the right direction while meeting cost and time constraints. The position also involves adopting the right technologies, mitigating risks, coordinating development efforts, resolving technical issues, and more.

If you’re building a digital product, the CTO’s role becomes more prominent. To ensure a successful app release, CTOs devote their attention to:

  • ensuring apps are built on scalable and secure tech stacks;
  • addressing uncertainties and guiding software development teams;
  • leading and managing developers to implement software projects;
  • reviewing software codebase to ensure they comply with data security requirements;
  • coaching, managing, and guiding the development team towards delivering innovative solutions.

The list of what CTOs do is almost inexhaustible. But generally, CTOs act as the tech consultants that founders can rely on for technological matters. Besides serving as a leader, the CTO often involves themselves in day-to-day development and operation.

Guarantee a 100% secure solution for your users. Get Uptech fintech security checklist with all the regulations and policies applicable to fintech startups and enterprises.

Types of CTO Services

Before you hire a CTO as a service, let’s explore the different types of arrangements available.

CTO as a service

On-demand CTO as a Service

Also known as one-time CTO as a Service, this arrangement is suitable for startups that have a very specific issue that needs solving. For example, you want to integrate generative AI into an existing app but don’t know how. You can engage an external CTO for that specific project. Once completed, the CTO leaves your team and returns to being an independent contractor.

Part-time CTO Services

Another option in securing CTO service is to opt for a part-time or fractional arrangement. Unlike on-demand CTOs, fractional CTOs stay with your team for a longer period. They provide more stability when startups are in the early phase of development.

For example, you can hire part-time CTO services from offshore IT companies to guide your team on complex technical decisions. Under this arrangement, CTOs may work on specific workloads or hours to ensure your project progresses according to schedule.

Temporary CTO as a Service

Temporary or interim CTO suits startups that are expanding their operation and currently looking for a permanent CTO. While waiting to fill the vacant position, the interim CTO acts as the key person that team members consult for technological advice. Besides ensuring business continuity, the temporary CTO may also assist in recruiting suitable candidates as a full-time replacement.

Why Outsource CTO Responsibilities?

Traditionally, startups hire a CTO in-house to lead the software team and oversee other technological workflows. However, with rising costs and talent scarcity, founders turn to outsourced CTOs. Here’s why.

CTO as a service

Fill in tech expertise gaps

According to MIT Technology Review, tech companies might struggle to fill in 85 million vacancies by 2030. Bringing a CTO on board, although temporarily, can help you overcome a talent shortage. The CTO could take charge of identity talents offshore and assemble a team to work on your projects.

Avoid recruitment hassle

Hiring a permanent CTO is challenging. Capable tech talents who can take up the responsibilities are few and far between. Besides, you face competition from larger enterprises for the small pool of top CTO candidates. Outsourcing to CTOs based in nearshore or offshore destinations broadens your options. It also saves you time interviewing, evaluating, vetting, and persuading the right candidate.

Cut employment costs

If you hire a full-time CTO, you must commit to their salary, social benefits, bonuses, and other perks. Besides, you also pay for office space, equipment, training and other work necessities the CTO needs. Engaging CTO service frees you from such commitment. You pay the external CTO as you go or for a pre-agreed sum.

Want to learn more about the product development cost? Learn what influences the final cost and how much outsourcing product development costs.

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Mitigate tech-related risks

While founders want to accelerate development, it’s important to be wary of cybersecurity, compliance, and other risks. An experienced CTO can analyze your software architecture, tech stack, and other components to ensure you’ve addressed all concerns.

Get on-demand support

Startups eventually face complex challenges that their internal team struggles to solve. Securing the service of external CTOs provides immediate support to minimize disruption and ensure customer satisfaction.

CTO as a service

When Do You Need a CTO as a Service?

If you’re experiencing these scenarios, you might want to hire a CTO as a service.

CTO as a service

You need help deciding the right tech stack for your app

The CTO can recommend a tech stack that best fits the app’s features, purpose, and platforms. For example, if you’re building an app for Android and iOS, the CTO would recommend using a cross-platform tech stack to build an MVP quickly. Also, the CTO will ensure that all software technologies are secure and compliant with data privacy acts.

You struggle to identify features for your MVP

An MVP should consist of fundamental features that are most important to users. Yet, feature selection is not always a clear-cut process. The CTO would offer their perspective after discussing with your business analyst to remove unnecessary features. This way, you can launch the MVP quickly and at a lower cost.

Check our article with the list of 7 most popular prioritization frameworks.

You need to streamline your internal software process

Understandably, building a startup can be messy. You might already have released an app, but you need a scalable IT workflow to expand your business. Enlisting a CTO’s service allows you to standardize software development processes and remove inefficiencies. The CTO would analyze tools, communication, policies, and other aspects affecting your software team.

You don’t have time for the technological side of the business

Not all founders know how to code. Even if they do, coding is not the best way to spend their time. With a reliable CTO, you can focus on branding, marketing, pitching, and other business activities. A temporary or on-demand CTO can take charge of development, compliance, tech recruitment, and other IT task so your team can be more Agile.

You need a CTO but are not ready to hire one

At some point, your startup grows to the extent that you need the expertise a CTO offers. Yet some founders might find it too costly and want more flexibility in compensation. That’s where CTO as a service for startups comes in handy. You can leverage the CTO’s experience and skillsets without committing to expensive hires.

Responsibilities of the Chief Technology Officer

The CTO’s responsibility varies from one startup to another. However, one thing they all have in common is that they juggle strategic leadership and hands-on development work. Here’s what a CTO does when leading your startup.

Discovery phase

The discovery phase helps you achieve a product-market fit. The CTO plays a key role in aligning ideas and features with real problems that users face. At this stage, CTOs take charge of:

  • Designing and implementing software architecture.
  • Determining key features for the MVP.
  • Interviewing potential users to discover pain points and needs.
  • Analyzing UI/UX requirements.
  • Selecting and assessing tech stacks.

Project planning

After identifying the user’s needs, the CTO finds ways to design a fitting technical solution. CTOs also help startups overcome technical challenges that might arise. In essence, here’s how a CTO addresses your technical requirements.

  • Allocating resources while considering the startup’s other commitments.
  • Recommend cost-friendly, scalable and functional software technologies.
  • Propose solutions that align with business goals.
  • Setting project milestones and schedule
  • Identifying and mitigating technical and compliance risks.

Software Development

When hired by an early-stage startup, the CTO participates in development works until a team is formed. Their task includes,

  • Coding, integrating software modules, and testing.
  • Overcome technical challenges with their own experience and expertise.
  • Improve software architecture with revised workflow and third-party integrations.
  • Preparing for deployment.
  • Provide post-release support and feature updates.

Team Recruitment

Besides spearheading software development, the CTO may take charge of recruitment efforts. CTOs are in a better position to recruit tech talents because of their experience. Here’s what they do as a recruiter.

  • Creating interview questions and assessments.
  • Actively search for potential candidates to fill up technical roles.
  • Interview shortlisted candidates to ensure they possess the required skill sets.
  • Onboard new hires and coordinate tasks.
  • Resolve issues and ensure software teams perform to their potential.

Learn how to hire the right developer for your startup with minimum risks.

Project Audit

Once the CTO puts together a team, they’ll resume a more supervisory role. Periodically, CTOs may audit the project the team is working on so your product meets quality and compliance requirements. The task involved:

  • Performing code reviews to ensure they adhere to best practices.
  • Evaluating projects for functional, security, and quality issues.
  • Ensuring development stays on track for the agreed timeline.
  • Coordinating with nearshore or offshore developments.
  • Identifying bottlenecks and implementing remedial measures.

Project scaling

Following a successful release, a CTO’s presence in startups is pivotal for stability and expansion. They help founders create strategies to support growing customers with cost-effective software technologies. For example:

  • Identifying and migrating workloads to secure cloud infrastructure.
  • Prepare contingency plans for failure recovery.
  • Optimize availability with distributed content delivery networks.
  • Strengthen security to prevent data breaches.
  • Applying generative AI services to automate repetitive tasks.

Project pitching

Often, founders need to convince investors of their technological capabilities to produce a solution. The CTO, with the technical experience they bring, can increase the chances of securing the funding. Here’s how.

  • CTOs can answer technical questions that investors ask.
  • They can explain complex tech ideas in a business-friendly style.
  • A CTO’s presence is evident that you don’t lack tech capabilities.
  • They can ensure the pitch deck includes relevant technical points.

6 Things to Consider When Hiring a CTO as a Service for a Startup

If you’ve decided to hire a temporary or on-demand CTO, consider these traits and qualities when interviewing candidates.

CTO as a service

Tech expertise

A CTO should have a good command of the tech expertise your startup needs. While software development is a broad discipline, those fit for a CTO role are often competent in several disciplines. For example, you need a CTO with a strong command of Javascript, CSS, and HTML when developing web apps. But it also helps if the CTO is familiar with mobile tech stacks like Kotlin and Swift.

Uptech team offers developers with the best tech expertise to help you level up the business capability. Check our software product development services!

Years of experience

Most CTOs have at least 7 years of technical experience under their belt. However, it’s important also to consider their accomplishments and fieldwork during those tenures. For example, some developers have limited exposure after years of working, while others have a solid track record in various industries.

Business-oriented mindset

While CTOs are senior developers by profession, they must also possess business acumen. This is important because a good CTO bridges the business-technological gap for startups.


Before contracting a CTO as a service, check out what other clients say about their experience working with him or her. That way, you can learn more about the CTO’s commitment to excellence, professionalism, consistency, and other qualities.

Soft Skills

Unlike developers, CTOs must be able to express their ideas, provide feedback, and instruct teams effectively. Therefore, communication and leadership are important qualities they should have. Moreover, CTOs also serve as the startup’s tech representative when meeting investors, partners, and other business stakeholders.

Industry expertise

Some CTOs are a better fit for you if they have worked in a similar industry. For example, fintech and healthcare startups require CTOs who can navigate compliance requirements like the Health Insurance Portability and Accountability Act (HIPAA), General Data Protection Regulation (GPDR), and Payment Card Industry Data Security Standards (PCI-DSS).

Explore our guide to building a HIPAA-compliant app with 7 essential steps.

Where to Find a CTO as a Service?

Some founders might be tempted to engage CTO as a service on freelance platforms like Upwork and Fiverr. Considering the CTO’s role, I discourage hiring fractional CTOs from such platforms because you might end up with a poorly-fitted candidate. Instead, it’s better to hire from these sources.

Outsourcing companies

The easiest way to find a fitting CTO as a service is to explore outsourcing IT companies. Unlike freelancers, established outsourcing agencies have a solid track record of providing CTO services. You can also check reviews from clients they serve on independent platforms like Clutch and GoodFirms.

For example, Uptech is an outsourcing company that augments startups with our software specialists. Our strong portfolio underscores our capabilities. We also offer different collaboration models, including on-demand and dedicated CTO as a service, to fit your budget requirements.


You can also find exceptional CTOs by asking people in your professional network. For example, you might know other founders who have enlisted external agencies to build their apps. Reach out and ask to be introduced to their fractional CTOs. Chances are, they might connect you with a reliable agency. That’s how some of our new clients found us—through our existing clients.


Another way to get in touch with CTOs is to meet them at trade events or tech conferences. Some CTOs attend as participants, while others are present to market their services. Either way, spend time visiting these events, and you might be able to find good fractional CTOs.

How Much Does It Cost to Hire a CTO as a Service for a Startup?

It depends on several factors, such as the experience, skills and region they’re based. CTOs operating from developed countries like the US tend to charge more than their counterparts in developing or emerging economies. Here’s how much CTOs earn annually in different countries.

Besides cost, it’s also important to consider cultural fit and language when hiring a fractional CTO. Preferably, you’ll want your CTO to share similar language, work ethics and culture to smooth collaboration and prevent miscommunication. For these reasons, startups outsource their CTO responsibility to Ukraine. This way, they can balance quality and cost while accessing a broad pool of IT experts.

Check our comprehensive guide to IT consulting rates in 2024. Fin out the average software consulting rates and factors influencing technology consultant fees.

CTO as a service


A CTO plays a crucial role in bringing startup ideas into functional, secure, and engaging products. Yet, founders have difficulty filling the position because of cost, talent shortage, and other hiring difficulties. CTO as a service offers an alternative, providing founders the technical support they need more affordably.

I’ve explained how getting an on-demand CTO allows you to delegate technical responsibilities and focus on other business areas. I’ve also shown important qualities that reliable CTOs should have and where to find them. And Ukraine, offering the advantages of cost, quality, and cultural fit, is a good destination to start with.

Over the years, startups worldwide have turned to Uptech as their on-demand CTO. For example, we helped Angler AI build an AI-powered platform that helps businesses acquire and manage clients. We worked with Angler AI, just like a CTO would, to identify key features and create an intuitive platform their users find useful.

If you need a CTO to accelerate your product development, we’re ready to help. Schedule a call with us now.