Technical Debt in Swedish Tech Startups: Uncovering its Emergence, and Management Processes

Sammanfattning: Technical Debt (TD) is a concept referring to technical deficiencies and sub-optimal decisions made in software development that may save time in the short term but lead to long-term obstacles. The concept also implies increased future costs, often growing with interest, caused by slower development rates and the need for refactorings. The high-paced environment of tech start-ups often leads to companies taking shortcuts in their development process, prioritizing iteration speed and time-to-market over longterm scalability. Oftentimes resulting in the accumulation of TD through sub-optimal technology choices, modularity, or architecture. Start-ups also play an important role in the innovation of many industries, hence, their contribution to differing markets and new products is valuable. Poorly managed TD in start-ups may lead to large obstacles when initiating a scale-up phase, leading to a possible development in industries slowing down, and it is therefore important to create the best possible conditions for start-ups to succeed in managing their TD, which is where this study aims to provide aid. A multiple-case study was performed with several tech start-ups in the Stockholm area on how TD has emerged and has been managed through its journey. The findings show that start-up companies are often inclined to deliberately accumulate TD in the early stages, in order to facilitate swift market establishment and proof of concept for their product. Further, the negative consequences of early accumulated TD were found to be limited. However, TD should not be left to grow for too long even in a start-up phase, since the findings show that this often results in large costs. Instead, start-ups should plan for there factoring of early accumulated TD by expecting a technological pivot. Furthermore, in the continuous management of TD, the results show that team composition, including personality traits and in-house competence, often impacts the success of managing TD more than meticulous planning, motivating the management in the start-ups to more thoroughly consider how they build their teams, and what competencies are present in the company, or needed.