When we think of startups, we frequently make the mistake of automatically assuming that we’re talking about tech businesses. It’s a fact that many startups are technology-driven companies started by entrepreneurs who, in addition to an appetite for risk, have a background in software engineering. In businesses like this, at least one of the founders should be an engineer lest they face a task orders of magnitude harder than their engineer-equipped competition.
Being innovative in a certain domain requires a certain understanding of that domain. This truth becomes even more evident in areas that usually require years of education and experience to become a master.
You would be at a disadvantage starting a textile business without knowing a little something about fabrics and sewing, although you might be able to get yourself off the ground with enough dedication and time. You would be kidding yourself if you started a company to manufacture carbon nanotubes without a formal education in chemistry.
But luckily, for the rest of us entrepreneurial folks who don’t code, sew, or remember Avogadro’s number, there are lots of businesses that involve implementing technology, but are driven by business innovation and not hardcore technological innovation. In these businesses, where progress is the result of new ways of thinking about old problems, fluency in HTML is less important that being able to clearly communicate requirements to people who are fluent in it.
In many areas of business, particularly the highly-regulated securities markets, the narrow constraints of those regulations prevents even the most innovative, creative, disruptive engineer from leading from the front. (Whether that’s right or wrong is the subject of a different post.) In spaces like this, a business is better off with founders drawn from related businesses than a killer software developer.