Over on the BlueBlog Alex has, as Duncan said, “another great post.” This time Alex has tackled Software Engineering Tips for Startups, providing eight insightful points that outline the new rules of software engineering for startups.

AdaptiveBlue practices what Alex preaches; as I mentioned in the I Write Code movement, we have rock star software engineers. Alex, Karen, and Jeff never cease to amaze me with what they’re able to build. In the post Alex states that “coding becomes sculpting” in the sense of an agile development culture that “starts with a shapeless form and continuously refines the
code.” The reality is that our small team sculpts and creates code in the artistic sense, each stroke skillfully crafted to advance the piece.

As I was reading Alex’s post it dawned on me that there’s a business counterpoint for every item raised. Sure code’s critical but it will forever require breakthrough business ideas, new utilities for society and the next big thought to retain its importance. While well written code may be poetry, in the absence of consumer value or utility it’s poetry that’s nothing more than efficient if / else statements.

Here they are.

1) Must have utility.

Traditionally a start-up’s business formulated around the value delivered by providing a solution to a problem. The problem was identified, the innovative solution proposed, the business plan written, the business started, and then code was written. Alex declares that now “working code is the launchpad for the business.” Not so.

As we’ve seen, working code does not a business make - the web 2.0 landscape is spotted with piles of compiled code that, well, sit there. The big change with respect to the launching pad for the business has been the shift from the need to deliver a value to the ability to create utility. With millions of Zombies running around Facebook and Twitter’s social sixth sense the presence of utility has proven to be the launchpad of a business.

2) Must have a business minded co-founder

Having a technical co-founder is critical, but like a few years back a purely technical founding team will still have a hard time fund raising. Having MBAs isn’t critical, nor is having business “professionals”, however one of the techies on the team better exhibit a business mind or good luck getting funded.

And without a business minded co-founder, good luck maintaining the business. With funding occurring after code is written and after utility is validated it’s more critical now than ever to manage cash-flow, the life blood of a start-up. No cash? No business.

Startups must have a business minded co-founder to match the technical co-founder (often, as in our case, they can be the same person). Someone who who can make sure that the technology is mapped onto utility and future value correctly.

3) Hire strong business minds who are net native

Startups can not afford to hire business minds who are not net native. The web continues to change the world and those who understand the new state, respect the pace of change, and can think deeply about where it’s going are the minds you need on your team. If the individual is not emerged in this world they won’t. get. it. And that’s going to kill your company.

It’s a mistake to hire the best business mind if they’re not net native. Pop quiz: would you rather hire the top HBS graduate or Noah or Noah?

4) Keep the business team small and outsource whatever you can

The world is more connected than ever before, take advantage of this. Keep the team small and outsource everything except the most critical pieces. The catch is that you have to leverage the new world we live in and outsource to the right places: LinkedIn, APIs, your community and passionate users, and your blog (and Digg, Techmeme, etc.).

Save your rock stars to dig into the critical pieces as they arise: market research, product management, industry analysis, and business pitches. In any start-up talent is the most critical resource, do not save money here. “Hire a few of the best guns you can find, pay them well, give them stock options, make them happy and jazz them up about the company.”

5) Ask tough questions during the interview

As with programmers, it hurts both parties to hire the wrong person so do your homework up front and make sure that it’s the best fit possible. If it isn’t, wait. Just as hiring isn’t the place to save money, it’s not the place to save time. Be picky.

History is a great predictor of future potential - what have they done in the past? In this space. Sometimes the best interview occurs when the candidate isn’t present. Do they have a blog that they’ve written to regularly? Read it from first post to last. While some can fake it through an interview nobody can fake it day in and day out and if they’re not rock stars you’ll discover it in their recorded thoughts.

Ask tough questions about business. While it’s critical that they’re net native it is important that they’re sound on business.

6) Avoid hiring managers

A picture’s worth 1,000 words:

7) Instill an agile culture

The pace of this world is unreal. There’s no need for detailed planning, complex models, or thorough analysis because there will be only two absolutes: (1) They will be wrong; (2) Opportunities will pass you by. As with programming, “the new process is to evolve the system.”

Work towards a three horizon plan. The third horizon is a strategic vision for the future and an understanding of what the business potential is. The second horizon should be filled with slightly more detail - rough concepts and plans and the capabilities and resources necessary to get there. The first horizon is about the details and building out the capabilities to realize the second horizon. This is about execution.

It’s important that the three horizons flow together. Don’t make decisions today without understanding how they’ll fit into your vision for the future. Don’t hold onto a vision for the future that’s not realistic given today’s reality. Be agile and react to the ever changing market and adjust the 2nd and 3rd horizon plans accordingly.

Do not reinvent the wheel

Stand on the shoulders of giants and innovate only the pieces that are important. Everything else that’s not your differentiated value/utility? Borrow liberally from what currently exists.

Do not spend hours developing a forecasting model. Google a template. Funding questions? Ask the VC! The internet is fun and useful. Use it often.

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