A guide to fractional executives and how you should work with one
To many around the world, the word “startup” still has an aura of sexiness about it. From Airbnb to Canva, Grab to SpaceX, the most successful startups-turned-big-tech garner a lot of attention across the media spectrum. But beneath the hype and the glamour of these now household names, many may not realize how challenging it is to start a company from zero, and the time, skills and resources required for them to actually make it past the first year.
To scale up, startups always require input from experts alongside strong leadership, which can really make or break an emerging company—unlike in older, larger companies where hiccups can go relatively unnoticed or consequence-free for months. As is widely recognized, a startup’s chance of success is more about the people than the product. So what happens when the financial resources to hire someone with the hard skills needed to take your company to the next level simply aren’t there?
This is where fractional executives come in.
What in the world is a fractional executive? I hear you ask.
Like the name suggests, a fractional executive is someone who provides their expertise to a company for only a fraction of their time, for a certain period each day or each week. Rather than hire full-time, salaried executives—who are often out of reach for startups—more and more companies are turning to fractional executives to fill the gaps in their founding team.
The benefits for startups
Apart from being more cost-effective, engaging the services of a fractional executive gives a company access to a seasoned professional who has years of experience in highly specific areas. As leaders with highly efficient management styles, these specialists are masters of communication and time management, and are able to drive decision-making and deliver results quickly and smoothly. There will also be plenty of opportunities for your team to learn from them, which could decrease the need to hire fractional executives in the future.
But how are they different from business consultants? you might be wondering.
Well, unlike a consultant, who remains independent from your company, a fractional executive performs their duties in much the same way as an actual executive—except with fewer hours. They’re invested in your growth goals and responsible for delivering the outcomes necessary to get you there. Also unlike a consultant, who would usually only work a set number of hours, a fractional executive will generally always be available for key meetings and urgent matters. After all, they’re an executive member of your team working toward the long-term success of your business—simply in a part-time capacity.
Examples of fractional executives
The type of fractional executive you hire will depend on your needs and your company’s stage of growth. Some examples are:
- A fractional CFO specializing in fundraising who provides strategic services to early and mid-stage companies
- A fractional Head of HR who founded an inclusive HR and workplace design consultancy firm
- A fractional CTO specializing in cloud architecture
- A fractional CMO with experience at top tech companies such as Uber
What are some of the pros and cons?
By only working with them for the exact amount of time required you’ll avoid filler tasks that sometimes come with full-time roles
|Potential short-term mindset
Ensuring they don’t have a short-term mindset and optimize for long-term success is key
The hiring process is greatly simplified compared to a full-time position, significantly reducing time-to-hire
|Potential poor fit
They could potentially be a bad fit for your team and multiple executives may need to be trialed before finding the ideal executive
|No office politics
With limited time to get the job done, there’ll be no time for getting caught up in office politics
|Synergy is crucial
Your team needs to find synergies with them and understand and accept the value of a fractional executive
Why we work with fractional executives at Livit
As I mentioned in my post about why we self-approve time off work at Livit, we don’t do management the traditional way. In our post-pandemic era many types of flexible work arrangements have emerged—and I’m not just talking about remote work and distributed teams, but organizational structures and employment terms that are challenging the default “full-time, 9-to-5-only” setups.
At Livit, we embrace a variety of employment and collaboration setups and encourage our recruitment team to challenge the status quo with every new hire. Always considering the three aspects of:
- full-time vs part-time;
- permanent vs limited;
- employment vs consulting
enables us to hire a much wider breadth of team members—which is a win-win for us and for every new member of the Livit crew.
So far we’ve worked with four fractional executives, from a CMO to a CFO. While some of these relationships dissolved when it was clear we weren’t fully aligned in terms of expectations (financial or collaboration-wise), others evolved into almost full-time commitments and long-term co-founder-like partnerships.
5 steps for success
|What it should look like
|Go through a comprehensive GTKEO (getting to know each other) process. Fractionals will usually have a workbook or questionnaire for you to complete or will interview you on various points to make sure you’re aligned.
Two awesome questions digital marketing expert Giulia Cian Seren suggests are: What would make this collaboration worth three Michelin stars for you? What would make it feel like nails on a blackboard?
|2. Be clear
|Be crystal clear on everything: on what the role is (eg. are they expected to execute decisions and be more hands-on, or are they expected to train and mentor?); on where you are right now, where you want to be, and how they can help you get there; and on expectations (eg. reports and meeting attendance).
|Share your internal documentation (which obviously requires having it in the first place! – more on that in another piece) so they can quickly understand how the team works and how certain processes are conducted. This can include: Policies and SOPs they need to be familiar withWhat tools are being used for whatHow you’re going to communicate with them; how often they’re available and during what hours; and how responsive they’ll beWho among your existing team is the PIC for which processesExamples of things they should get approval on before carrying them out, and examples where a simple FYI will suffice Access levels and how they’ll obtain that access
|Early on, evaluate the relationship thoroughly and often. Although it might be tempting to simply assume that being an experienced executive they’ll know exactly what to do—and they usually do—every working relationship benefits from evaluation.
|If you’re feeling like the invoices are stacking up higher than the value delivered, do not hesitate to address this right away.
My final tip
Integrate your fractional executive with the rest of the team and your work culture. Any executive will have a far stronger impact if they understand and value how the team operates.
So where are the best places to find one?
- Network referrals are always the safest way to go
- Failing this, try these platforms:
- Shiny | Fractional talent marketplace
- Business Talent Group | On-demand talent
- Passionfruit | Hire a world-class fractional CMO
- Continuum | On-demand executive talent
- The Free Agent | Fractional strategic leadership recruitment firm
- Fractional Executive Solutions | Fractional executive agency
Can you hire Livit as your fractional executive?
Yes you can!
- Fractional Human Resources Business Partner
- Fractional Head of Remote
- Fractional People Officer
So if you’re ready for us to help you scale up please get in touch!