Even Airbnb struggled here. The startup didn't have a tech-savvy core team member at the company's genesis — CEO Brian Chesky and CPO Joe Gebbia are both talented designers, but neither could code, so the team was considered technologically weak for several years. And that didn't appeal to investors
. Chesky remarked this is one of the major factors that prevented them from getting substantial funding for two years
. Chesky and Gebbia were able to recruit a co-founder/CTO, Nate Blecharczyk, but it took time and plenty of effort; Blecharczyk went back and forth on whether he'd join, leaving the other two to flounder and live off dry cereal
This imbalance puts the power in the hands of qualified CTOs to demand increasingly generous compensation, making it even more difficult for cash-strapped startups to attract and retain qualified talent.
Given the advantage CTOs have, they're able to jump ship comfortably if things don't work out — meaning they don't have as much at stake in the company. This creates further complications for the core team. Non-technical founders are susceptible to the Dunning-Kruger effect
. Put simply, in the absence of domain knowledge, its' hard to know what "good" looks like. As a result, entrepreneurs find it hard to trust advice they receive from someone who doesn't depend as much on the company's success.
A successful in-house team needs the right people and personalities working together. The team needs to be motivated and inspired, and it can be challenging to create this level of efficiency in short periods of time with limited capital — not to mention the fact that entrepreneurs are (and should be) wary of ceding large amounts of the available cash or equity to anyone they don't fully trust.
Inevitably, most founders wait to fill this vital role, choosing to outsource technology needs, which greatly constrains the consistency and quality of product development.