In the SaaS industry, there's this debate as spicy as a chili-margarita going on: will your startup be more successful if the CTO is also a co-founder? Do technical-founders limit growth or are they essential for success? It’s a question that has sparked countless discussions in boardrooms, coffee shops, and Slack channels.

On one hand, you have the allure of a tech visionary who’s fully committed to the company’s success. On the other, the pragmatism of an external hire who brings fresh perspectives and a cool head to the table.

The role of a CTO in any organisation is multifaceted. Leading the tech team is just a small chunk of what they are tasked to do. Technical leaders are shaping the future and scalability of the product. They dictate the technical vision, build the infrastructure of your product  but also influence the company culture, and often act as a bridge between technical and non-technical stakeholders. Whether they come with the added title of co-founder can significantly impact the trajectory of the business, especially during its most vulnerable phases. To understand what works best, we need to dig into the dynamics of different growth stages and how emotional attachment, vision, and strategic thinking play into the equation.

Related: What to do in your first weeks as a (fractional) CTO

The early days: passion meets pragmatism

In the scrappy, exhilarating early phases of a startup, having a CTO as a co-founder can be a game-changer. Why? Emotional attachment.

A CTO who’s also a co-founder isn’t just clocking in for a job — they’re deeply invested in the project. They’ve likely spent sleepless nights dreaming of exciting new features and highly-scalable solutions. This emotional connection often comes with a compelling vision and the grit to see it through. When everyone else is worried about getting revenue from that first batch of clients or running out of coffee in honeymoon phase of your startup, a CTO is probably still brainstorming ways to streamline deployment processes or enhance user experience.

But this passion isn’t just about the tech stack. A co-founder CTO embodies resilience — the kind needed to weather the countless pivots and course corrections that are part and parcel of early-stage businesses. They’re not just building technology; they’re materializing a vision.

Growth mode: when emotional ties become anchors

However, as startups transition into scale-ups, the landscape, and especially the role of the CTO, changes. The raw enthusiasm of the early days needs to be tempered with strategic oversight. And this is where a co-founder CTO’s deep emotional attachment can occasionally become a liability. The product may need to evolve in ways that feel counterintuitive to their original vision. Or perhaps the company needs someone who can step back, assess, and ruthlessly prioritise without the weight of founder’s bias.

Non-co-founder CTOs, in contrast, can bring fresh perspectives and experience. A hired CTO often has more CTO experience than a founder-CTO. They’re often skilled at evaluating the technology landscape with a more dispassionate lens, which is crucial when aligning with the company’s long-term goals. They’re also typically better equipped to navigate the politics of a larger organisation, where managing people can outweigh managing code.

Striking the right balance

So, what’s the right choice? As always, there is no right answer. It -always-  depends on the phase your business is in and the kind of leadership you need. In the chaotic inception phase, a co-founder CTO’s passion and vision can be the rocket fuel that propels the business forward. Of course it's good for your progress if your technical leader works around the clock, fixes issues on the spot and builds that one feature your client really desperately needs tomorrow.

As the company matures, though, you might benefit from bringing in a CTO who can provide a fresh, pragmatic perspective, and who actually stays away from the codebase. The bus factor of your company increases, reducing the risk of relying on one person for technical challenges.

If you’re an investor or CEO navigating this decision, it’s worth reflecting on the company’s current and future needs. Does the existing leadership have the emotional stamina for scale, or is it time to bring in new energy? Whatever the answer, it’s clear that the CTO’s role is pivotal.

Early on, you need a CTO who dreams big and loves deeply. Later, you need one who thinks strategically and executes relentlessly.

Final thoughts

Deciding whether your CTO should also be a co-founder isn’t just a question of skill sets or titles but about alignment, timing, and understanding that the needs of a company evolve over time. Your CTO will have to wear multiple hats during the early and later stages of your startup.

Early on, you need a CTO who dreams big and loves deeply. Later, you need one who thinks strategically and executes relentlessly.

Whether you’re hiring, investing, or simply pondering the mysteries of startup dynamics, remember: The best CTO for your company is the one who fits your current stage while preparing you for the next. And if you’re lucky, they’ll also know where to find the best chili margarita in town, of course.