An important statistic that might be interesting to startup founders.
Nowadays, everyone wants to start a tech startup.
Everyone wants to build the next Facebook, Google, Uber or Airbnb. It is understandable why everyone is so excited about the tech space in this day and age given the massive success of all the major tech companies that are around us today.
The shortest and fastest way to become a billionaire today, besides inheriting a billion dollars from wealthy parents or receiving a charitable “donation” in your bank account, is probably by starting a tech startup.
However, most people who want to start a tech startup aren’t technical. In other words, they do not know how to code and are unable to build a software product on their own.
Therein lies the irony, where an increasing number of people who can’t write software are rushing to start software companies.
As its name suggests, a tech startup leverages on technology to build products that offer solutions to everyday problems. The technology part of a tech startup is arguably one of the most important factors of the company.
Hence begs the question, can non-technical founders succeed in building a tech startup without knowing how to build the technology based product themselves?
To find out, let’s get a better understanding of what constitutes a strong founding team in Silicon Valley, the birthplace of most successful technology startups in the world today.
According to this fireside chat session with Brian Chesky, co-founder and CEO of Airbnb, silicon valley investors generally prefer technical-heavy founding teams with a majority of technical co-founders.
In other words, that means they would prefer the founding team of a technology startup to be made up of more technical founders, presumably software engineers who could code and build the product themselves.
In the fireside chat, Brian Chesky mentioned that investors were reluctant to invest in Airbnb during its early days because they perceived him and his 2 other co-founders as a “weak” team. This is because the founding team of Airbnb, by silicon valley’s standards, isn’t technical-heavy enough.
Airbnb is founded by 3 co-founders, namely Brain Chesky (currently CEO), Joe Gebbia (currently CPO) and Nathan Blecharczk (currently CTO), the only technical co-founder among he trio, who joined a couple of months later.
The Airbnb founding team was made up of 2 designers and only 1 software engineer (technical). Brian Chesky and Joe Gebbia were designers and didn’t know how to code. Nathan Blecharczk was the only one who was technical.
In the fireside chat above, Brian Chesky cited Airbnb’s “technically weak” founding team as one of the reasons why silicon valley investors, who were more used to funding founding teams that consisted of a greater percentage of technical founders, were reluctant to fund them during the first two years.
Of course, there were also other factors at play at that time such as the global recession of 2008 and the fact that the idea of people welcoming a stranger into their homes was not widely popular at that time.
In the end, they got their lucky break because Paul Graham from Y-Combinator was touched by their persistence and decided to give them a chance at the now famous Y-Combinator accelerator program. He likened them to “cockroaches” for their determination and persistence, from raking up close to 30,000 USD in credit card debts and selling cereals for 30 USD during the Democratic and Republican National Conventions.
From then on, the rest was history.
Nevertheless, one key takeaway we can get from this intimate sharing session from Brian Chesky about Airbnb’s early days, besides the value of persistence, is the fact that silicon valley investors generally prefer a founding team that is made up of more technical founders.
Although silicon valley investors have a preference for tech startups with a technical-heavy founding team, it is still possible to build a successful tech startup if you are persistent enough and manage to get the right talent on board to build out your vision, just like the guys at Airbnb.
In South-east Asia, the majority of successful tech start-ups are actually started by founders who aren’t technical at all. In fact, most of them don’t even have a technical co-founder in their core founding team!
However, the definition of a “successful” startup, in this context, can be relative.
To understand what we mean by this, let’s take a closer look at the founding teams of some of the most successful tech startups in Malaysia.
Together, they started Youth Asia, a market research company that paid users to do online surveys through their online portal Youthsays. They also organised youth events and conferences such as YOUTH ’08 & YOUTH ’09. That company eventually evolved into Says.my and merged with Catcha Media to form Rev Asia.
At the same time, they started a group-buying clone of Groupon as a spin-off – Groupsmore which eventually got acquired by Groupon USA to become Groupon Malaysia.
COMBO TYPE: Creative + Operational
Strictly speaking, both of them weren’t technical. Khailee mentioned that he picked up web designing when he was young and was able to build websites. However, he also mentioned that he wasn’t really a web developer and was going around looking for technical talent to build a ruby on rails web app in a talk he gave at Awesomeness Fest.
Khailee seems to be more of the creative talent and product guy among the dynamic duo, always coming out with crazy ideas and solutions to a problem.
Joel, on the other hand, seems to be the more organised, process-oriented one, always coming up with standard operation procedures and streamlining the process of executing on their goals. Perhaps his background in engineering contributed to his ability to meticulously organise and streamline processes so they could execute fast on any idea that comes to mind.
You can hear more about their story here:
According to Chok Kwee Bee (an early investor) in an article by Digital News Asia, Joel Neoh is “one of the best managers I (Kwee Bee) have worked with”.
From the article, we know that she also said that:
“It is rare to find someone like Neoh, who is entrepreneurial and has strong execution skills. He pays attention to details and delivers the results.”
(you can find the article here)
The other powerful founding team duo to rival that of Joel Neoh and Khailee Ng comes in the form of Timothy Tiah & Cheo Ming Shen. Both of them started a company called Netccentric, which is now listed on the Australian Stock Exchange (ASX).
According to Timothy Tiah himself in a blog post from 2015,
“I’m (Tim) a good executor. I’m good at getting things done but I also tend to be really small picture. When a problem happens I go solve it immediately. Firefighting every day, like I’m a fireman.”
On the other hand,
“Ming handles problems differently. He’s not interested in solving a problem once. He’s interested in finding the root of the problem and building a process to solve it forever. He has the ability to see things before they happen in business. When he knows what we need to do, he has the ability and resolve to really focus on what’s important and block out everything else.That’s the difference and that’s why I think he’ll make a great CEO.”
You can find the blog post here.
Both of them were also not technical co-founders, but still managed to build a successful technology start-up in southeast asia.
COMBO TYPE: Big-Picture/Vision + Operational
According to this intimate sharing session at Startup Grind, we know that his background was in accounting. He too, wasn’t a technical founder.
TYPE: Rockstar Team Builder
According to his answers to a couple of questions in this Ask Me Anything (AMA) session by Techinasia, he seems to be a super connector and team builder who excels at hiring out a rockstar team, which includes technical talent to build out his ventures.
In addition to that, Ganesh Kumar Bangah of Mol Global and Anthony Tan of Grab are also non-technical founders. With the backing of investors, they either outsourced the development of their initial product or hired an internal technical team to do so.
So far, most of south-east asia’s most successful technology startups seem to be founded by non-technical founding teams.
Both Mark Zuckerberg and Dustin Moskovitz were considered technical founders. Although both of them did not major in computer science during their time at Harvard, both of them knew how to code. Mark Zuckerberg had started coding since he was 10 years old, building a chat app for his family called Zucknet and a program that learns a user’s taste in music which Microsoft wanted to buy for 1 million dollars.
He also coded most of the first version of Facebook by himself.
Dustin Moskovitz, on the other hand, din’t have much programming experience before he joined Mark Zuckerberg in building Facebook. However, he did know his way around Unix, knew the programming language C, did a fair amount of web development in HTML, and attended Harvard’s Intro To Computer Science (CS50).
He picked up Perl and PHP (the language the first version of Facebook was built in) in a couple of days when he decided to help Mark Zuckerberg out by reading the book and went on to become Facebook’s first Chief Technology Officer (CTO) and then Vice President (VP) of Engineering.
During Facebook’s early days, both of them were instrumental in scaling out Facebook code base and adding new features to the platform. Facebook was trying to build a digital social graph of everyone on the planet, which is a huge technical challenge even with today’s technology.
If they weren’t technical, it is unlikely that they would be able to achieve that feat and iterate on features as fast as they did.
COMBO TYPE: Both Technical
Similarly, Larry Page and Sergey Brin were both technical. They wrote the PageRank algorithm that allowed Google to beat all the other search engines at that time like Yahoo and Alta Vista to become the behemoth that it is today.
COMBO TYPE: Both Technical
Bill Gates and Paul Allen were also both technical. They started coding together in school and wrote the code that they eventually sold to Altair – (BASIC) together. That turned out to be the start of the company that eventually became Microsoft, the most popular operating system for personal computers in the world today.
COMBO TYPE: Both Technical
While Steve Jobs wasn’t technical, he had an engineering genius as a co-founder in Steve Wozniak. Steve Jobs was inspired to build what was probably one of the first personal computers in the world when he saw what Steve Wozniak had built as a pet project – a central processing unit that could connect to a television monitor and a keyboard.
Steve Jobs’s acute sense of design and vision for coming out with revolutionary products, paired with Steve Wozniak’s engineering and technical genius, made them a formidable founding team that was able to spark the personal computer revolution with the introduction of the apple II.
If Steve Jobs did not have a technical co-founder like Steve Wozniak, it is not clear whether he would be able to bring about the personal computer revolution without the technical skills required to do so by himself (Computers were big machines that took up an entire room and were only used by big businesses and universities at that time, the concept of a personal computer was revolutionary).
COMBO TYPE: Visionary + Technical
Jack Ma, on the other hand, was not a technical founder. He admitted himself in talks that even today, he isn’t very tech savvy. He also jokingly said that his lack of tech savvy-ness made him the perfect candidate to test his company’s products. This was because, if he din’t know how to use it, it would mean that it was too complicated for the common man like him.
However, Jack Ma had 18 friends as co-founders, presumably some of whom picked up the technical skills required to build Alibaba into what it is today. Jack Ma and his team also struggled tremendously during Alibaba’s early days, to which he admitted that the 1 Billion USD investment by Yahoo and the technical help received as a result of the Yahoo investment helped catapult the company’s technology by a far cry.
TYPE: Rockstar Team Builder
Elon Musk, on the other hand, is an incredibly smart and technical founder. When he started his first technology company, Zip2, the site would only be up during the day because they only had one computer to host the website on and he needed to write code for it during the night.
When he started his rocket company, Space X; he learnt about rocket science by reading books and talking to various experts on the subject. He was also planning to get his phd in physics before deciding to dropout to start an internet company first so he wouldn’t miss the opportunity to do so.
Without the deep technical knowledge that he had with software, physics and rocket science; it would be hard for him to be able to revolutionise entire industries like he did.
TYPE: Technical Genius
As their name suggests, technology startups rely heavily on technology to build their products and solutions. Hence, it would be almost impossible to build a true technology startup without technical people in your team.
If the technology in question isn’t too advanced and you have the money to outsource it to good development firms who can deliver or hire out an internal rockstar team, then it would still be possible to build a technology startup with no technical co-founders.
However, if you’re trying to build a zero to one startup like Facebook or Google that requires the use of advanced technologies in order to build out your product, then it would almost be impossible to start a successful tech startup without a good technical co-founder.
At the very least, you would need one technical genius like Steve Wozniak in your co-founding team for you to be able to pull it off.
From the session by Y-Combinator representatives in the video above that was recorded during the 2016 Global Entrepreneurship Summit earlier this year, it is quite clear that they are looking for founding teams with strong technical abilities.
After all, the only three things you’re supposed to do during the course of your 3 months at Y-Combinator is code, talk to users and exercise. Without technical co-founders in your founding team, you wouldn’t be able to iterate on your product and keep improving your product while getting feedback from your users at all.
From the looks of it, the most successful global tech startups that are valued at more than 100 Billion USD like Facebook, Google and Microsoft are mostly started by technical founders. It was their technical ability coupled with their vision that enabled them to keep iterating on their product cheaply until they finally built an amazing product that solved a huge problem in the world.
In the event that the main founder isn’t technical, they often have an amazing technical co-founder such as Steve Wozniak was to Steve Jobs to compensate for their lack of technical skills to build out their vision.
However, if you happen to be in a unique market like China at just the right time, it is also possible to start a successful billion dollar tech company by sheer willpower, grit, determination and the backing of up to 18 co-founders who are willing to do anything to make the company succeed just as Jack Ma did with Alibaba.
On the other hand, we’ve seen that it is definitely possible to start a successful regional startup that often comes in the form of localised versions of globally proven tech-enabled businesses which are more business-centric than tech-centric even if there are no technical co-founders in the founding team at all.
In such cases, it is possible to outsource the development work for such platforms or hire out an in-house technical team to build and maintain the product because they are often not as technologically intensive as zero-to-one startups that require constant technological innovation in order to meet the demands of their product.
What matters more in such business-centric technology enabled startups is the speed of execution on the business development and operation side. As a result, founders with strong organisational skills who are able to build teams and execute fast would have the advantage as the technology required to build such start-ups isn’t as complicated as that required by the likes of Google or Facebook.
Given the choice, it is always best to be technical.
This is so you can reduce the cost of prototyping and getting your MVP out to test the market. If you are technical, you would also be able to bootstrap your startup and keep re-iterating until you get traction and product market fit, from which point you would also probably be able to command a higher valuation if you were to take in Venture Capital funding.
Besides that, being technical would also help you make better decisions regarding your startup’s technology stack and help you better communicate your ideas with your technical team.
If you are building a zero-to-one technology-centric startup like Facebook or Google, then you probably have no choice but to be technical or have a good technical co-founder in your founding team to have any chance of succeeding.
This is because you will need all the technical chops you can get to keep iterating on the product until you find product market fit or to solve complex technical challenges while building your product (which requires a certain degree of technical innovation to build).
However, if the startup you plan to build doesn’t rely on technology as much and is a more business-centric one; then you can probably still build it successfully even if none of the founding team members are technical as long as you are able to execute it efficiently.