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No-nonsense perspectives on startup growth

Ignore what you’ve heard: techies make great CEOs

The boffin fallacy is bollocks

Ignore what you’ve heard: techies make great CEOs
Rhea Moutafis

Data nerds, computer geeks, science morons, I’m speaking to you. It’s the ever-prevailing cliché: the antisocial introverts who spend their days hacking away at some nerdy project that nobody understands. The freaks that push the frontiers of tech every day but still can’t keep up with the Kardashians.

The cliché goes further. If techies lack basic human skills like communicating effectively or cracking a funny joke, then they won’t make good managers. And don’t even think of appointing such people as a CEO.

Of course, this is a stereotype. Most techies I know — including myself — are interesting, multi-faceted people with exciting hobbies and beautiful personalities. Most techies I know score as high in human skills as they do in their area of technical expertise. Most techies I know would be fantastic managers and CEOs.

But that’s not the point. The underlying problem is that these clichés exist and that enough people still believe in them. That’s what is called the boffin fallacy: the belief that techies can only be good at tech, and cannot excel in other domains.

As a consequence, techies get encouraged to pursue an academic career or to stay in their companies’ R&D departments. The prevailing idea among many investors, advisors, and even colleagues is that techies are not as qualified as MBAs for launching their own company or embarking on a corporate career.

This culture of keeping techies out of business is especially strong in Europe and the Middle East. But it has some foothold in the US and parts of Asia, too.

This culture, however useful it may have been in the past, is causing serious harm. Not only does it push too many career paths into pre-modeled shapes. It also hurts the overall economy and its capacity to innovate. It’s about time we debunk the myth that techies can’t be great CEOs.

The economic growth of the last decades has been fueled by tech

It’s a fact: without technological innovation, we would be nowhere close to the living standard that we have attained. For the last two decades, much of the growth of the biggest stock indexes is due to tech companies. At the moment, this is more apparent than ever: without the tech giants, the stock market wouldn’t have done much worse during the ongoing pandemic.

When you think about who is leading these stellar-performing companies, they’re all holders of a tech degree. Larry Page, Sergei Brin, Jeff Bezos, and Mark Zuckerberg are all techies turned entrepreneurs. That’s no coincidence.

That’s not to say that less technical people can’t lead their companies to outstanding growth. Tim Cook, for example, has been business-oriented since the days after he’d earned his bachelor’s degree in industrial engineering. Other career CEOs do similarly remarkable jobs.

Nevertheless, the sheer ubiquity of techies in the C-suites of top-performing companies proves that they’re not incapable in the business world. Funnily enough, this phenomenon often doesn’t serve as an example to other companies and investors.

Rather, they see these CEOs with a tech background and extreme success as rarities and conclude that the average techie isn’t capable of anything like that.

The boffin fallacy

The boffin fallacy, in short, is the false belief that techies — typically people who have a degree in STEM, and who work in a tech-related area — are boffins. A boffin, data nerd, computer geek, or science moron, is believed to be incapable of doing marketing, finance, human resources, and any other business-related activity.

Most people acknowledge the existence of techies that excel at business, like the CEOs mentioned above. But they think that those are outliers and that the statistical norm is that all techies are boffins.

This couldn’t be further from the truth. Not only do techies lead the top-performing companies of today. History is equally full of examples of tech entrepreneurs.

Benjamin Franklin, for example, invented lightning rods, bifocals, the iron furnace stove, a carriage odometer, and the harmonica. He also was the owner of a print shop, a newspaper, and a general store by the time he was 24, and eventually became one of the wealthiest men of his time.

Thomas Edison, inventor of the lightbulb, is another stellar example. He didn’t only power scientific breakthroughs, but also brought investors like J. P. Morgan on board, and distributed his devices to the masses.

Other examples include George Eastman, Marie Curie, and many more. These are no statistical outliers — they’re a clear demonstration that techies are capable of being entrepreneurs.

Why techies make good CEOs

In a world where decisions are based more and more on data, and where analytic capabilities and quantitative rigor gain more and more momentum, leaders with a technological background have a clear edge.

People without a tech background often put their soft skills forward as an advantage. Yet they fail to realize that soft skills are relatively easy to pick up and learn on the job, while quantitative skills take years of study.

I’m not saying that humanities are less skillful or sophisticated than sciences. I have enormous respect for people who are in the humanities — in fact, I almost pursued a degree in classic philosophy myself.

However, an engineer working on microprocessors won’t find it that hard to understand how to manage people, set up the financial system of a company, or do the legal stuff. Conversely, an HR manager or an accountant won’t be able to contribute a thing to the architecture of a microprocessor unless they’ve taken a few classes.

That’s not to say that techies know everything about humanities. They, too, get lost when two philosophers discuss the ins and outs of a passage in Aristotle’s Proverbs. It just so happens that microprocessors contribute more to today’s economic growth than the works of Aristotle.

In a data-driven economy, techies clearly have an advantage when it comes to their skillset. Not only can they make use of it when it comes to the product of a tech company. They can also learn the business side of things at least as quickly as a non-techie — if not faster, since business operations are becoming more and more quantitative, too.

Credit: Kumpan Electric / Unsplash
Techies are extremely skilled people. However, there are cases when they’d better stay at the lab.

Tech founders are the better CEOs, but they’re quieter, too

VC capital firm Andreessen Horowitz, which backs companies such as Stripe, Lime, and Airbnb, puts it in excellent words: tech founders are often better than hired CEOs because they know the company from the inside out, they’re more courageous when it comes to changing the business strategy, and because they’re committed to the long term.

The first point is pretty obvious: the founder was there from day zero, they hired the first employees, and know the product in all its details. They also know the customer base pretty well and know about all the strengths and weaknesses of the company. This puts them in a unique position of expertise.

The second point comes as a consequence of the first: since founders made the base assumptions upon which the company operates, they’re more courageous when it comes to change them.

For example, when Steve Jobs rejoined Apple, he pivoted it from a computing to a personal product company. In hindsight, this was a genius move, but at the time most people thought he was mad. He had the courage because he’d built Apple in the first place, and because he knew what market needs the company was capable of serving.

The third point, long-term commitment, may not apply as much as it used to. These days, many companies get founded with a possible exit in mind. There are, however, many other founders who view their company as their life’s work. Not only are these types of founders less willing to sell their companies; they’re also more willing to make short-term sacrifices for long-term gains.

If these tech founders happen to confirm the cliché of being more introverted than their corporate counterparts, so be it. Research shows that introverts are better leaders anyway. Business success, so it seems, doesn’t depend on how loudly you talk, but on how good your decisions are.

How to tell if a techie isn’t fit for the C-suite

From this perspective, it seems almost absurd to appoint CEOs to tech companies if they don’t have a technical background themselves. Indeed, the research backs up this standpoint. There are only a few situations where it might be better to replace a technical founder with a career CEO.

  • They don’t listen to advice

Some founders are so in love with their own ideas that they don’t want other people to mess around with them. As a result, they might block out all advice.

Note that I didn’t say that they don’t follow advice. Some of the greatest business decisions have been taken against all advice. From Mark Zuckerberg who decided not to sell Facebook when he had the opportunity, to Reed Hastings who changed the DVD-service Netflix to a streaming service, tech history is full of decisions where founders preferred to trust their gut more than their board.

Founders should take advice into account, however. Even if they finally decide against it, they should at least have thought through all the options. Founders who don’t listen to anybody have slim chances of succeeding.

  • They don’t understand business goals

A techie-turned-entrepreneur can’t live only for their product; they need to understand the business side, too.

It’s not like in academia, where researchers throw a party if they’ve secured a research grant for the next two years. At this point, they don’t need to think about money until the next time they apply for a grant.

In industry, once you’ve secured funding, you get to work. You can’t take investments forever — instead, you want to be profitable at some point. Some founders are so in love with product development that they fail to recognize this extra dimension. If this is a chronic problem, it might be better to hire somebody to handle the business side of things.

  • They understand business goals but fail to implement them

Some founders — and, frankly, some managers and CEOs from all walks of life, too — seem unable to build a culture where goals and milestones get reached. A culture where every employee feels welcome and accepted, and where teams work productively and effectively.

Worse even, they might create a culture that is dominated by fear. This can lead to situations where employees don’t talk about problems anymore because they’re scared of being reprimanded. Eventually, this kind of leadership creates places where nobody wants to work.

The good news is that this last problem can be resolved in many cases through additional training. But again, if the founder seems unable to learn for a prolonged period of time, it might be better to let them to the product and hire someone else for business operations.

The bottom line: it’s still hard to make it, but confidence in techies is growing

Although there are many points indicating that tech founders are the better leaders, the boffin fallacy persists. That’s bad news for techies because it means that however qualified you are, investors, advisors, and even colleagues just might not believe in you.

As a founder, however, it’s important to have people who believe in you. Not only does this boost your own confidence — and believe me, without confidence it’ll be hard to make it anywhere. If customers don’t believe in you and your product, why should they buy your product? And if investors don’t believe in you, why should they ever hand you a check?

The status quo is that the boffin fallacy is everywhere you look. And as long as this persists, we’re pushing perfectly qualified people into R&D departments and research labs instead of letting them change the world.

There is a silver lining though: in Europe, as in parts of the Middle East and Asia, US investors are getting more and more present. This may be an indicator that confidence in tech founders is growing in Europe, the sad heart of the boffin fallacy, and other parts of the world.

It’s still hard to make it as a techie. To some degree, it will always be hard to make it anywhere. But slowly, people seem to be letting go of the boffin fallacy.

Times are changing, folks.

This article was written by Rhea Moutafis and was originally published on Start it Up. You can read it here.

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