Technical Financing Overview
In this article, I’ll introduce a few technical financing concepts. I tried to make this into one short article, but I quickly learned that each topic is worthy of it’s own blog post.
When I first learned about technical debt, I made the assumption that all forms of technical debt is bad and should be avoided. That understanding had served me well enough for a while since I had inherited plenty of tech debt to start with.
While this blog post is able to be read on its own without any prior knowledge, it is a part of our Lessons in Factorio series, so if this is your first time reading one of this series’ blog posts, I recommend starting from the first one and working your way through them. The first post can be found here: Why I Learned from Factorio: Lean Networking
In the same playthrough as the Shipping the MVP in Networking article, I started to learn that some level of tech debt was necessary. If you check out that article, you’ll see my pains as I attempt to pay off every project in full. I was able to connect the dots then to fiscal financing. In a sense, when shipping the MVP, you’re intentionally taking on some tech debt so that you could have a product out the door sooner. Some debt is bad, and some debt is good.
I managed to take a 1 year project and complete it in just 3 months thanks to the voodoo magic that is technical financing. It’s interesting if you think about technical debt. If there is such a thing as technical debt, then there should be technical capital, technical interest rates, and technical financing as well.
Technical Financing Concepts
Over time, I’ve picked up 5 concepts that have helped me come up with the idea of technical financing:
- Interest rates for technical debt is not equal.
- There is such a thing as having technical capital.
- You can refinance your tech debt.
- You can intentionally take on tech debt to raise your immediate technical capital.
- There are technical loans you can take that have a higher ROI than the interest payments. Therefore you can intentionally take on tech debt to raise your overall technical capital.
With these concepts in mind I was able to leverage technical debt to my advantage. You can read all about how I leveraged these techniques to deliver a 1 year project in 3 months so that you can also learn to utilize these concepts to help you in your endeavors in this blog post, Story Time: Leveraging Technical Financing.
Thank you for checking this out. I hope you learned something new or enjoyed reading this. If you had any comments, questions, or just wanted to share your thoughts on this article, you can contact me at firstname.lastname@example.org
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