Need to invest in tech to grow, remain relevant or disrupt?

The days of having a dream, a few developers and basic IT support are long gone – just look at the AI-march saga: 2 years after ChatGPT came in to change the world forever, a Chinese team with DeepSeek just upturned the entire apple cart.

The lesson? Tech today moves 10x faster than it did 10 years ago, so whether you’re a:

• Startup looking to build and scale a digital product to disrupt an existing market

• A mid-sized company struggling with operational inefficiencies

• Or a corporate enterprise needing to modernise and compete in a shifting digital landscape.

True innovation now requires tech as a core strategy.

This is where the Chief Technology Officer (CTO) becomes essential. But what exactly does a CTO do, when does a company need one, and how does this role impact a business?

What is a CTO?

CTO stands for Chief Technology Officer, and it’s a senior executive responsible for defining and implementing a company's technology strategy – kind of like a CEO, but for your tech development.

Unlike an IT manager who primarily focuses on operations and support, a CTO is a business leader who ensures that technology serves as a growth enabler, a competitive advantage, and a foundation for long-term success.

A CTO’s role can vary, depending on company size, industry, and business model, but the fundamental responsibilities include:

• Setting technology vision and strategy by creating a long-term roadmap, investing in emerging technologies, and making critical build vs. buy decisions to balance in-house development with outsourcing.

• Leading product and engineering by overseeing software and hardware development, ensuring security and scalability, building strong technical teams, and driving agile development and innovation cycles.

• Overseeing infrastructure, security and compliance to ensure that systems remain scalable, robust, and future-proof while managing cybersecurity risks, data privacy, and regulatory compliance. It also includes overseeing cloud strategies, DevOps, and IT operations where needed.

• Driving innovation and competitive edge by evaluating AI, automation, and next-generation technologies, aligning tech initiatives with market demands, and identifying opportunities for digital transformation to improve efficiency and growth.

In short, a CTO is an extremely senior, experienced and strategic technical person – normally an engineer or highly skilled R&D specialist who can sit with senior management and answer questions like what tech a company needs to invest in in order to meet their strategic goals.

When Do You Need a CTO?

Most later-stage startups will know that VCs often require you to have a CTO to qualify for funding. It shouldn’t come as a surprise, especially in the tech space, which is where the CTO role originated from – some of the first companies to employ CTOs were then-disruptors like Microsoft (Nathan Myhrvold, 1996) and Apple (David Nagel, 1980s).

On the established business side, we at Octco speak with many established South African corporates daily who say they’re aware of all the technological advancements out there, but initiatives almost always fall flat because they don’t have the insights to prove investments align with their strategy.

The truth is that the need for a CTO depends on business complexity, technology reliance, and growth stage:

1. For Startups and High-Growth Companies

A CTO is essential for startups and scale-ups where technology is the core business driver. Strong technical leadership is crucial to building a scalable product, avoiding costly early-stage tech mistakes, and hiring the right engineering talent.

Without a CTO, startups risk making poor decisions in architecture, security, and infrastructure, which can become major liabilities as they grow. Investors also expect experienced technical leadership, often making a seasoned CTO a key factor in securing funding.

2. For Established Corporations

Traditional businesses require a CTO when digital transformation becomes critical for maintaining competitiveness. Companies facing industry disruption, outdated technology stacks, or inefficiencies need a technology leader to modernise infrastructure, integrate AI and automation, and ensure smooth scaling.

Additionally, with increasing cybersecurity risks and regulatory requirements, CTOs play a crucial role in data protection, compliance, and risk management to safeguard business operations.

Lastly, corporates require a CTO’s insights for future-proofing and venture building: Either building new tech products or entire new companies within your own stable or investing in startups so that you “own” a share of the new innovations in your industry.

The Challenge: Most Companies Can't Afford a Full-Time CTO

Hiring a full-time Chief Technology Officer (CTO) in South Africa represents a substantial financial commitment. Salaries for CTOs vary significantly based on factors such as company size, industry, and location.

For instance, the average annual salary for a CTO in Johannesburg is approximately R2.3 million. Because of the more competitive tech employment market in Cape Town, you could get lucky and find a decent CTO for R1–2 million per year.

The Solution: Fractional CTOs

A Fractional CTO provides high-level strategic expertise without the long-term financial commitment. Fractional means that instead of employing a CTO full-time, you hire a top-quality engineer to act as your CTO for a few hours a week – getting you the insights and tech leadership you need, but at a fraction of the cost.

This model is ideal for:

• Startups that require experienced technical leadership but do not yet need a full-time executive.

• Corporations undergoing a digital transformation and needing technology leadership on a project or interim basis.

• Companies that need specialised expertise in areas such as AI, cloud migration, or product development.

And, if you didn’t know, Octoco’s name is an anagram for “Outsourced CTO Company”, meaning we offer Fractional CTOs, including product development consulting, CTO support services, hardware engineering services and software engineering services.

See some of the SA companies we’ve helped in our CTO and venture case studies.

Need a CTO to help guide your tech investment and strategy?

Whether full-time or fractional, Octoco’s team of engineers can help provide the leadership necessary to build scalable, efficient, and future-proof solutions.