How to Build an Engineering Team: A Fractional CTO's Framework

Building an engineering team is one of the highest-leverage activities a startup founder undertakes. Get it right, and you create a compounding advantage. Get it wrong, and you spend years digging out.

After 25+ years building engineering teams—from founding teams to 50+ person organisations—I've developed frameworks that reduce the chaos. This guide shares the key decisions, in sequence, that separate successful team-building from expensive mistakes.

The Hiring Sequence: Which Roles to Hire First

The Critical First Hire

Your first engineering hire sets the tone for everything that follows. Make it count.

What to look for in hire #1:

• Full-stack capability — Early-stage needs generalists who can handle anything
• Ownership mentality — Will work independently without constant direction
• Communication skills — Will interact with non-technical stakeholders
• Growth potential — Could become a technical lead or engineering manager
• Culture alignment — Will help define the culture, not just fit it

What to avoid:

• Specialists who only want to work in narrow areas
• People who need heavy management
• Those uncomfortable with ambiguity
• "Rock stars" who don't collaborate

Your first hire is essentially a co-founder of your engineering culture. Don't compromise on this hire to save time or money.

The Sequence That Works

Having built teams from zero to 30+ multiple times, here's the pattern that consistently works:

Hire 1-2: Strong Generalists Full-stack developers who can handle anything. They'll be the backbone of your team for the next 18 months.

Hire 3-4: Complementary Skills Once you have a foundation, add specific skills you're missing. This might be:

• Frontend specialist if your generalists lean backend
• DevOps/infrastructure if your generalists lean application
• Mobile developer if you're building mobile products

Hire 5-6: First Senior Hire Time to add genuine seniority. A senior developer with 8-10+ years experience who can:

• Mentor junior developers
• Lead technical discussions
• Provide architectural guidance
• Potentially grow into a lead role

Hire 7-10: Scaling the Foundation More developers at various levels, building out the team you've established. This is also when you might add:

• Quality/testing expertise
• Data engineering
• Security focus

Hire 11+: Specialisation and Structure Now you're big enough to have distinct teams or domains. Specialisation becomes possible without creating silos.

What to Defer

Don't hire these roles too early:

Engineering Manager — Until you have 6-8 developers, management is usually better handled by a technical lead (internal) plus fractional CTO (external) guidance. Full-time managers with small teams create overhead.

Specialists — Deep specialists (ML engineers, security experts, performance engineers) make sense at scale. Early-stage, you need people who can do many things adequately rather than one thing perfectly.

Dedicated QA — In early-stage, developers should test their own code. Dedicated QA makes sense once you have enough code and process to justify it (usually 10+ developers).

In-House vs Offshore vs Hybrid: Decision Framework

When In-House Makes Sense

Choose fully in-house if:

• You're building core product functionality that defines your competitive advantage
• Fast iteration and tight collaboration are essential
• You have budget (UK developers cost £50,000-£120,000+/year)
• You're in a location with developer talent
• You value culture-building and long-term team investment

Advantages:

• Direct communication, no time zone challenges
• Full cultural alignment
• Easier to build institutional knowledge
• Higher retention and loyalty

Disadvantages:

• Highest cost option
• Slower to scale (hiring takes time)
• Limited by local talent pool

When Offshore Makes Sense

Choose offshore if:

• You're building well-defined, non-core functionality
• Clear specifications are possible before work begins
• Budget constraints are significant
• You have experience managing distributed teams
• Time zone differences are manageable for your work style

Advantages:

• 50-70% cost savings vs UK rates
• Faster scaling possible
• Large talent pool access

Disadvantages:

• Communication overhead
• Time zone challenges
• Cultural differences
• Harder to maintain quality
• Higher turnover

Warning: Many founders underestimate the hidden costs of offshore. Management overhead, communication friction, and quality issues often erode the savings.

When Hybrid Makes Sense

Choose hybrid if:

• You want core team in-house with selective outsourcing
• You have clear separation between core and non-core work
• You can invest in good management practices
• You want cost efficiency without fully distributed challenges

Typical hybrid model:

• 3-5 senior developers in-house (core product, architecture, leadership)
• 3-10 offshore developers (execution of well-defined work)
• Clear handoff processes and documentation

This model works when:

• In-house team specs work clearly
• Offshore team executes reliably
• Someone manages the interface actively

Making the Decision

Factor	In-House	Hybrid	Offshore
Budget available	High	Medium	Low
Iteration speed needed	Fast	Medium	Slower
Spec clarity possible	Low	Medium	High
Management capacity	Standard	Higher	Highest
Core IP work	Yes	Partial	No
Long-term investment	Yes	Partial	No

Most successful startups I've worked with use hybrid models: core team in-house, tactical help from offshore or contractors for specific projects.

Interview Process Design for Non-Technical Founders

If you're a non-technical founder, you can still run an effective interview process.

The Four-Stage Process

Stage 1: Initial Screen (30 minutes, you)

• Culture fit and motivation
• Communication ability
• Career goals alignment
• Red flag identification

You can evaluate all of these. No technical knowledge required.

Stage 2: Technical Screen (60 minutes, technical evaluator)

• Coding ability
• Problem-solving approach
• Technical knowledge
• Code quality

This requires a technical evaluator. Options:

• Your fractional CTO
• A technical advisor
• A trusted senior developer
• A technical recruiting firm

Stage 3: Practical Assessment (2-4 hours, async)

• Take-home project OR
• Pair programming session

Real work reveals more than interview answers. Keep it reasonable in scope—you're evaluating approach, not extracting free work.

Stage 4: Team Fit (60 minutes, multiple team members)

• How do they interact with future colleagues?
• Would people enjoy working with them?
• Does their style match your team's culture?

What Non-Technical Founders Can Evaluate

You can assess:

Communication: Do they explain things clearly? Can they translate technical concepts for non-technical people?

Problem-solving approach: When presented with a problem, do they ask clarifying questions? Do they think out loud in a structured way?

Ownership mentality: Do they talk about "I did" or "we did"? Do they take responsibility for failures as well as successes?

Growth mindset: How do they talk about learning and improvement? Are they curious?

Cultural alignment: Would you enjoy working with this person daily?

Questions Non-Technical Founders Should Ask

1. "Tell me about a technical project that didn't go well. What happened and what did you learn?"

2. "How would you explain [your product concept] to a non-technical friend?"

3. "What would you do in your first week if you joined our team?"

4. "What's something technical you recently learned and why did you learn it?"

5. "How do you approach a problem when you don't know how to solve it?"

You don't need to evaluate the technical accuracy of their answers. You're evaluating how they think and communicate.

Team Structure Evolution: 3 to 30 Engineers

Team of 3-5: The Commando Phase

Structure: Flat. Everyone does everything. No formal roles.

Communication: Direct. Everyone talks to everyone. Stand-ups are natural.

Leadership: Technical lead (usually strongest developer) + founder.

What works: Speed, flexibility, direct communication, shared context.

What breaks: Nothing yet. This is the sweet spot.

Team of 6-10: The Growing Pains Phase

Structure: Emerging specialisation. Maybe frontend/backend split.

Communication: Still mostly flat, but needs structure. Daily standups become essential.

Leadership: Technical lead becomes more formal. May need engineering manager.

What works: Still fast, but process begins to matter.

What breaks:

• Onboarding becomes harder
• Context no longer naturally shared
• Some decisions slow down

What to implement:

• Regular team meetings with agenda
• Written documentation of decisions
• Code review process
• Defined deployment process

Team of 11-20: The Organisation Phase

Structure: Distinct teams, usually by domain or product area.

Communication: Needs formal channels. Team leads communicate cross-team.

Leadership: Engineering manager essential. Team leads for each team. Technical architect role may emerge.

What works: Scale. Can tackle larger problems.

What breaks:

• Communication overhead increases
• Silos can form
• Coordination becomes challenging

What to implement:

• Team charters with clear ownership
• Regular cross-team syncs
• Architecture review process
• Formal hiring process
• Career levels and growth framework

Team of 21-30: The Department Phase

Structure: Multiple teams, potentially organised by function or product.

Communication: Formal. Written communication essential. Team of teams structure.

Leadership: Director/VP level. Multiple engineering managers. Staff+ engineers.

What works: Capability. Can build complex systems in parallel.

What breaks:

• Speed (coordination costs)
• Innovation (process can stifle creativity)
• Culture (harder to maintain with scale)

What to implement:

• Engineering principles and values documented
• Technical roadmap process
• Cross-functional planning rhythms
• Internal mobility paths
• Engineering brand and recruiting pipeline

Common Hiring Mistakes at Each Stage

Mistakes at 1-5 Engineers

• Hiring too junior: You need people who can work independently. Don't save money by hiring juniors who need management you can't provide.
• Hiring too senior: Very senior engineers may be frustrated with early-stage chaos and limited resources.
• Hiring specialists: You need generalists who can handle anything.
• Rushing: Bad first hires create years of problems. Take time to get these right.

Mistakes at 6-10 Engineers

• Not adding process: What worked with 5 doesn't work with 10. Introduce lightweight process before it's painful.
• Hiring for current needs only: Think about what you'll need in 12 months.
• Ignoring culture: Culture solidifies at this stage. Be intentional.
• Skipping management: Someone needs to own team health, even part-time.

Mistakes at 11-20 Engineers

• Creating silos: Teams that don't communicate become teams that can't collaborate.
• Promoting wrong people: The best coder isn't necessarily the best manager.
• Over-engineering process: Add process gradually, not all at once.
• Ignoring technical debt: At this scale, debt starts to seriously hurt velocity.

Mistakes at 21-30 Engineers

• Losing founder involvement: Engineering needs executive attention even at scale.
• Bureaucracy creep: Process should enable, not obstruct.
• Neglecting culture: Active culture maintenance is now essential.
• Poor architecture: Conway's Law means org structure affects system design. Be intentional.

Retention: When You Can't Outpay Big Tech

Most startups can't match FAANG salaries. Here's what works instead:

What Engineers Actually Value

1. Meaningful work — Impact matters more than scale. "I built this" beats "I contributed to this."

2. Autonomy — Freedom to make decisions about how to work.

3. Growth — Learning new skills, taking on new challenges, career progression.

4. Good management — People leave managers, not companies.

5. Work-life balance — Sustainable pace beats hero culture.

6. Equity — Ownership in something that could become valuable.

7. Compensation — Important, but rarely the deciding factor for engineers who choose startups.

Retention Tactics That Work

• Clear growth paths: Define what advancement looks like.
• Regular 1:1s: Invest in relationship with every engineer.
• Technical challenges: Keep work interesting.
• Learning budget: Time and money for skill development.
• Conference attendance: Connection to broader community.
• Flexible work: Remote options, flexible hours.
• Transparent communication: Trust builds loyalty.

When People Leave Anyway

Some turnover is healthy. When good people leave:

• Exit interview honestly: Learn what you could improve
• Part on good terms: Alumni network is valuable
• Fill the gap thoughtfully: Don't rush replacement

Getting Team-Building Support

Building an engineering team is one of the areas where a fractional CTO provides highest leverage. They can:

• Design your hiring process
• Participate in technical interviews
• Help define team structure
• Mentor first-time managers
• Advise on compensation benchmarks
• Troubleshoot team dynamics

If you're building your first engineering team—or scaling an existing one—and want experienced guidance, a conversation can help clarify your approach.

The decisions you make about hiring in the next 12 months will shape your company for years. Making those decisions with experienced support significantly improves outcomes.