Why Don't More Software Developers Start Companies?
I’ve often wondered why more developers don’t start companies. After all, most of us are already deeply involved in the process of building products—whether it’s user-facing applications, internal tools, or managing infrastructure. Our daily work revolves around the creation and support of product lines.
We understand how products are built because we’re in the trenches: participating in strategy meetings, design hand-offs, and product sprints. We often have ideas to improve existing products or even create entirely new ones. How many times have you used an app and thought, “I could build this… easily”?
Yet, despite this close proximity to product development, a surprisingly small number of developers—fewer than 0.3%—ever start their own product companies. Why? The usual reasons are well-known: fear of failure, risk aversion, lack of time, financial instability, and more.
It’s true that running a business involves more than just building a product, but the lines between these roles are blurring. Technology has dramatically lowered the barriers to entry, and it’s time more developers realized that they should be starting their own software companies.
Two Fundamental Reasons
When we boil it down, there are really only two fundamental reasons people don’t do something: they don’t want to, or they don’t know how. Lack of motivation, fear, anxiety, perceived difficulty, and low priority—all these factors fall into one of these two categories.
I’ll be honest—the “don’t want to” reason is less interesting. This article is more about those who fall into the “don’t know how” camp, particularly in the context of today’s technological landscape. But let’s briefly touch on the former.
Don’t Want To
Maybe most developers simply don’t want to start their own companies. They might be content in their current roles, enjoy a great work-life balance, and have no desire to commit the significant resources needed to succeed in entrepreneurship.
That’s understandable, and certainly true in many cases. But consider this: surveys indicate that 80% of developers are not satisfied in their current role, and that almost everyone wants to be their own boss.
Given these stats, it’s safe to assume that if developers knew they could start a company, many would at least be interested. If you’re a developer with zero interest in starting a business, you’re probably not reading this article.
Don’t Know How
This is the heart of the matter. Many developers don’t start companies because they think they don’t know how. But in reality, they likely already possess many of the skills needed—they just haven’t connected the dots yet.
The Idea
One common misconception among developers is that to start a company, your idea needs to be a groundbreaking innovation that will revolutionize an industry. Some believe that all the good ideas are taken, while others think their idea is so good that it can’t be discussed without an NDA.
The truth is, ideas are cheap and plentiful; it’s the execution that matters. The best approach is to pick something you’re capable of building, in a market that already exists, launch quickly, and gather feedback. Real-world data is far more valuable than waiting for inspiration to strike.
Skill Gaps
Sure, building a product isn’t the same as building a company, but developers have already done the hard part. They’ve acquired a skill set that allows them to learn and program other skills. Today, nearly every aspect of running a business—from incorporation to customer support—can be streamlined or entirely automated with modern tools and a bit of code.
And don’t forget: 90% of the processes at established companies aren’t necessary when you’re just starting out. Focus on the basics and build from there.
Lack of Resources
Time and money are legitimate concerns, and I’m not going to pretend otherwise. If you’re young, don’t have dependents, and can afford to take some risks, consider this:
- If you have no income, savings, or access to capital, don’t start a company—get a job first.
- If you have a job, keep it, and work after-hours until you’re making enough to cover your living expenses.
- If you can cover your living expenses for more than 12 months, consider going all in.
Hard Work
Ironically, the one thing you must do to start a business is the one thing you never hear people use as an excuse—hard work. Developers are no strangers to hard work; they spend years perfecting their craft, solving tough problems, and constantly learning new things. Starting a company is just another challenge to tackle.
Conclusion: The Future Belongs to Developers
The perceived complexity of building a software business is often overestimated. Starting a company isn’t as hard as it used to be, and this is truer today than ever before.
Modern developers have everything they need to build successful software companies. They’ve already acquired an insanely valuable skill set, one that can be leveraged in nearly all aspects of running a business.
The future of entrepreneurship is about merging the right skills with the right tools, allowing technology to do the heavy lifting. Developers are uniquely positioned to take advantage of this shift. If you’ve ever considered starting your own company, there’s no better time than now. The tools are in your hands; all that’s left is to take the leap.