The growth or fixed scope work opportunities
Hey,
I'm Sergio Pereira, and this is the Remote Work newsletter 👋
Last week I wrote about my Fractional CTO career, and the steep contrast between the periods without clients vs the periods with too many clients. For the first time ever I'm lucky enough to be experiencing the latter and writing about it. It's a privilege I don't take for granted!
Today let me tell you about fixed scope projects. It's a new pocket of opportunities that's coming in my direction in very significant numbers.
The client requests used to be:
• Please be our Fractional CTO and hire a team to build our MVP.
Now it's increasingly:
• Please be our Fractional CTO and build our product using whatever means you want (AI tools, contractors, agencies, etc).
This came across as weird in the beginning, however the number of such requests keeps growing (I'm writing these lines after 2 meetings with such clients, who reached out to me during my time off). And I have several thoughts about this:
1/ Clients are delegating risk (above anything else)
It took me a while to fully internalise this. If a client hires me on a retainer, and hires a few contractors by the hour, or a couple devs on full time salaries. Any of these things means paying for time. From the client's standpoint, they'll pay regardless if the product gets built or not. It used to be the norm that everyone accepted, but seems like not anymore.
If the client knows exactly what they want to build, and exactly the budget they can afford, then they can find people who'll build it and get paid (in part or totally) only upon successful delivery of the product.
Fixed scope projects aren't a new concept, of course. In fact, as a Fractional CTO I've been hired many times after such MVP teams did a crappy job. What's new here is that clients want a bundle of CTO + team of builders. In their perception, they bundle they reduce the risk of under-delivery and delegate the whole risk to me. I'm still adapting, but given the volume of such requests I can tell there's a business opportunity for me here, and I reckon I've been procrastinating on it.
2/ AI tools are a big enabler for non-technical Founders
No, I'm not talking about Devin, not even Cursor. I'm talking about ChatGPT itself. Non-technical Founders can now write solid product specs and acceptance criteria with very low effort, and that's how I'm getting 40-pager RFQs written by one person over a weekend. This is new!
Some Founders can actually produce design mockups for all screens of their product, which they generate with some AI tools too. It's a whole new world where non-technical folks are empowered to write the specs to a deep level of detail, but seem to require help when it comes to build the thing.
3/ Software development agency horror stories
Founders seems to be quite burned with stories of dev shop engagements going wrong. Either they've gone through those themselves and want to avoid such issues again. Or even many first time Founders are proactive to avoid toxic agencies in the first place, just by hearing and reading those stories.
These horror stories include things like:
• Communication struggles
• Endless delays in product delivery
• Terrible code quality
• IP appropriation
• Cost escalation
All of these things can cause a startup to fail, and Founders are increasingly aware of them, so they take proactive steps to avoid them in the first place. Opting for fixed scope engagements and payment upon delivery is tempting.
4/ Opportunities and risks for you
This is a new world that certainly challenges the typical employment conventions of getting a full time job at a company. At least in early stage startups, Fractional work has been trending for a couple years, and now fixed scope projects seem to have become a stepping stone before they decide to actually build a team of full timers.
Now, this may be a risk for people who are less hands on and long for managerial roles. This result oriented approach leaves little room for management layers and heavy processes.
On the flip side, it can be a huge opportunity for hands on profiles who are very proficient with tools like Cursor and can reach the acceptance criteria fast. This impacts especially those whose CV isn't super attractive and would get easily dismissed on a CV review.
As always, change comes with risks and opportunities. It's all a matter of adaptation.
As I wrote on last week's newsletter, I'm now having more opportunity than I can handle. I'm building some sort of network around me to either team up on some clients, or simply refer clients.
I was out most of this week, and I returned to an inbox with over 200 messages. I'll go through them all next week, and I'll figure out some more structured way to approach this. Thank you all, and stay tuned :)
Thanks for reading this newsletter until the end. You can read all past editions here. Make sure to share it with your friends and colleagues so they can read it too.
See you next Friday,
Sergio Pereira,
Startup CTO & Remote Work Lover