What Is a Fractional Executive? 8 Benefits + How To Hire
Learn about fractional executives, the different types (including fractional CEOs), the benefits of hiring one, and how to hire the best fractional executives.
An increasing number of companies are hiring fractional executives to access exceptional talent and scale faster. Some even get a fractional CEO on board to run the company.
But why switch to fractional execs? How do you benefit from hiring one?
We'll explain what you can expect from someone in a fractional executive role and highlight how Go Fractional helps you hire the best talent.
Further Reading:
- Find out how Fractional Recruiting can supercharge your business growth.
- Explore how to hire a Fractional CTO and what qualities to look for while assessing candidates.
What Is a Fractional Executive?
Fractional executives are seasoned professionals who provide guidance and expertise to businesses in a fractional (part-time) capacity.
They often have extensive experience and leadership skills from working as a C-suite executive (CEOs, COOs, CTOs, etc.) in multiple companies.
What sets them apart is that fractional executives dedicate only a portion of their time to your company, typically, working up to 20 hours per week. The typical fractional engagement period spans 3--18 months, though some engagements may last longer.
The benefits?
You can tap into their talent and expertise without the cost and commitment of hiring a full time executive. They bring skills, industry knowledge and networks to help you address specific challenges and drive growth --- especially in the firm's early stages.
(We'll cover all the benefits in greater detail later.)
Fractional Executives vs. Interim Executives, Advisors, Consultants & Freelancers
You might think that factional execs sound similar to other roles, like interim executives, advisors or freelancers, but there are differences between these.
- Interim Executives fill a temporary leadership gap while a company searches for a permanent hire. Fractional executives may stay on for indefinite periods. Note: Interim executives may work full time or on a fractional basis.
- Advisors/Consultants are typically hired to provide guidance on strategy, operations, or industry-specific challenges. Fractional execs can be recruited as advisors, but can also take responsibility for execution.
- Freelancers are self-employed professionals who typically work on employee-level jobs on a project-by-project basis. Fractional execs are highly qualified professionals who provide executive-level expertise on a part-time basis.
What Are the Different Types of Fractional Executives?
Fractional executives include but aren't limited to:
- Fractional Chief Executive Officer (CEO): Sets the company's strategic direction, oversees operations and finances, leads the executive team, and ensures overall business success.
A fractional chief executive officer will also:
- Execute key business strategies and plans to increase revenue and profitability
- Streamline and enhance operational procedures
- Promote positive media and public interactions
- Provide strategic updates and insights to the board of directors
- Analyze performance against business goals
- Develop leadership capabilities within the executive team
- Address and mitigate business disruptions
- Founder Coach
- Founder
- Investor
- Sales
startup CEO & COO; 3x founder & investor; zero-to-one expertise
- Chief Technology Officer (CTO): Oversees the development and execution of technology strategies, manages the technical infrastructure, drives innovation, guarantees alignment with business goals and objectives, and supports growth through the effective use of technology.
- Fractional CTO
- Backend
- Fullstack
- Product
Over 2 decades of startup experience, early Etsy, CTO of Atoms
- Chief Marketing Officer (CMO): Develops and implements strategies to drive brand awareness and positioning, conducts market analysis, oversees marketing initiatives and their effectiveness, and works closely with other departments to align marketing strategies with overall business objectives.
- Fractional CMO
- Advisor
- Executive Coach
- Content Marketing
Facilitating Growth With Clarity & Speed
- Chief Operating Officer (COO): Formulates strategic plans and ensures effective execution, oversees finance and budgeting, drives operational efficiency, mitigates risks, assists with team management, and aligns all operational activities with company objectives.
- Fundraising
- Venture Capital
- Founder Coach
- GTM Strategy
Executive Coach to CEOs, Fundraising Expert, and Fractional Strategy Leader
- Chief Product Officer (CPO): Leads product strategy and development, guarantees successful product delivery, aligns product development with customer requirements, market trends, and business goals, and manages product life cycles.
- Product Strategy
- Head of Product
- Product Leader
- Hiring
Ex-Airbnb product leader, supporting founders & early-stage teams
- Chief Financial Officer (CFO): Manages financial planning and analysis, monitors financial performance, oversees activities like budgeting, forecasting, risk management, and reporting, and facilitates transparent and effective monetary governance.
- Fractional CFO
- Analysis
- Strategic Vision & Leadership
- Forecasting
Maximizing Financial Potential, One Strategy at a Time
- Chief Information Security Officer (CISO): Oversees the company's information security, develops and implements policies, strategies, and protocols to protect data and assets, analyzes threats and vulnerabilities, manages incident responses, and oversees regulatory compliance.
- Chief Revenue Officer (CRO): Develops and executes revenue strategies aligned with market dynamics and company objectives, optimizes pricing models for maximum profitability, manages revenue forecasting and reporting, and focuses on sustainable business growth.
- Chief Information Officer (CIO): Manages information systems and technology resources, identifies opportunities for digital transformation, optimizes IT investments for maximum ROI, and oversees data governance.
- Fractional Data Scientist
- Advisor
- Leadership
- Team Building
I am a Data and Analytics leader with 15 years of experience building data functions and driving revenue in Finance, D2C and B2B technology industries.
- Chief Human Resources Officer (CHRO): Develops and implements HR strategies, optimizes talent management and employee engagement, confirms compliance with labor laws, and creates a positive organizational culture.
- Head of People
- VP People
- HRIS
- HR Consulting
"Elevate Your HR Vision - I Am Your Strategic Partner for Growth."
When Should You Hire a Fractional Executive?
Here are the scenarios when you should consider leveraging fractional leadership. We've also included examples of how a seasoned executive like a CEO can contribute in such situations.
- You (as a founder) don't have the time for strategic planning due to day-to-day operational tasks. In such a scenario, a fractional chief executive officer can create a three-year strategic growth plan with quarterly milestones and KPIs, and implement it while you manage daily operations.
- Your senior team lacks skills in specific areas like operations or marketing. In this case, a fractional CEO can lead workshops and mentoring sessions to upskill your executive team.
- Your organization needs the expertise of a C-suite executive, but you don't have the budget for a full-time hire. Here, a fractional CEO can oversee critical projects like product launch strategies or company restructuring, working part-time to save costs.
- You need to replace a senior team member quickly. In this case, a fractional CEO can fill an interim leadership role, maintaining stability and executing key projects while you recruit a permanent replacement.
- Your current operating model doesn't meet expectations or you face a specific challenge. A fractional executive director can audit your business processes, recommend lean management practices, and provide fresh perspectives.
- You are facing specific challenges or transitions, such as mergers, restructuring, or rapid growth in a startup. A fractional CEO can lead the company through complex integration processes, streamline operations during restructuring to improve efficiency, and develop strategic plans to manage and sustain rapid growth.
- You are a medium-sized business looking to scale. Here, fractional CEOs can devise strategic growth plans, optimize operations, and use their network to secure new partnerships and funding opportunities, driving sustainable growth.
- You are a large company facing leadership gaps or market challenges. In this case, a fractional chief executive officer can take over struggling divisions, introduce new product lines, and implement turnaround strategies to increase profitability.
Why Hire a Fractional Executive for Your Business?
Fractional executives provide companies with strategic guidance and cost-effective experienced leadership that's necessary to drive growth.
Here are seven compelling reasons to leverage fractional executive services:
1. Access Cost-Effective Expertise and Leadership
Hiring a full time executive may not always be economical for every business owner, especially for businesses in the early stages.
Fractional executives provide a cost-effective alternative to full-time senior executive positions, delivering strategic leadership at a fraction of the cost and time commitment.
For example, hiring a full-time chief marketing officer may cost you, on average, $360,000 annually, which includes salary, taxes, equity, and bonuses.
If you go with a recruiting agency, you might have to pay another $100,000 as recruiting fees.
On the other hand, a more qualified fractional CMO may charge an average of $15,000 per month, amounting to just $180,000 annually.
You also don't have to offer your fractional leader bonuses, equity, or other employee benefits --- making them far more affordable than a full-time senior executive.
2. Work with Seasoned Industry Experts
Fractional executives have extensive experience and deep industry knowledge that allows them to identify and address specific challenges quickly, ensuring smoother and more effective operations.
Additionally, they bring strategic insights that can align your team's efforts with broader business goals, driving growth and innovation.
Moreover, these seasoned experts provide mentorship, enhancing your team's skills and fostering a culture of continuous improvement.
For example, with their wealth of knowledge and expertise, a fractional CTO can:
- Help the team improve product performance and reliability
- Speed up project execution
- Carry out strategic planning and align development with business objectives
- Identify and resolve operational inefficiencies
- Optimize your tech stack for improved performance
- Mentor and educate your team on best practices and industry trends
This way, you can accelerate product development while leveling up your existing leadership team.
3. Leverage Hands-On Talent That You Don't Need Full-Time Yet
As your business expands, you may need specialized expertise in a specific area, but the requirement may not justify a full time hire.
For example, suppose your e-commerce business is expanding into medtech, and you need the expertise of an experienced executive with medical know-how.
However, you don't need someone on board full-time.
In this case, opting to hire a fractional executive can be a strategic choice.
4. Obtain Faster Results
Unlike traditional executives, who spend most of their time building team relationships, fractional executives prioritize tackling immediate challenges and generating results.
Here's why this is important:
They dedicate more time and energy to addressing pressing issues, while you delegate relationship-building responsibilities to the teams they mentor or collaborate with.
5. Get Fresh and Experienced Perspectives
Fractional executives typically participate in high-level projects in high-growth companies. They also collaborate with multiple organizations concurrently while dedicating time to their own ventures.
What's more?
Since a fractional leader is external to the organization, they can assess situations objectively.
They bring a new perspective from a wide experience, empowering them to offer practical suggestions you can implement ASAP.
6. Trial an Executive Hire Before Committing
Engaging a fractional executive offers a risk-free way to evaluate their suitability before making a long-term commitment.
You can analyze their skills and assess their compatibility with your company culture before committing long-term.
But that's not all.
When your specific requirements for a position are unclear, having someone in a fractional role can help clarify your specific needs.
Having them work on a project can help you understand the requirements for such a role. When ready for a full-time hire, this'll help you define the job specifications.
The seasoned executive can also help craft job descriptions and interview potential candidates.
7. Get Valuable Guidance for Business Growth and Expansion
Remember: Fractional executives have extensive experience working with successful companies.
So they understand what's vital to a company's sustainable growth and can deliver exponential results based on their previous accomplishments.
Fractional executives can help you:
- Develop a long-term growth strategy prioritizing value delivery, innovation, customer retention, and satisfaction.
- Identify bottlenecks and inefficient processes within your organization and execute solutions.
You can leverage their expertise to optimize productivity, reduce costs, and set up processes that enable growth. Their insights can also prove invaluable in navigating changing market trends or financial challenges.
8. Quickly Adapt to Changing Business Environments
During economic downturns, fractionalization can help businesses navigate workforce adjustments.
A fractional C suite executive can offer expertise and support in transitioning between stages without the long-term financial and contractual obligations associated with a full time employee.
But that's not all.
A small business can quickly replace its departing senior employees with fractional executives, preventing disruption and allowing the company to continue operating seamlessly.
Now, let's look at how you can fill your executive role.
How to Hire a Fractional Executive Through Go Fractional
The best way to hire fractional executives is through a fractional hiring platform like Go Fractional.
We offer a curated network of exceptional fractional executives dedicated to helping you grow your business.
Discover the ideal addition to your team from our diverse community of accomplished fractional leaders in engineering, finance, product, marketing, operations, and sales.
With fractional hiring, you can skip the time-consuming executive search process and find the right talent more efficiently.
How Hiring through Go Fractional Works
- Start by connecting with Go Fractional and specifying your candidate requirements, such as industry experience, skills, and availability.
- We will then find executives that perfectly meet your executive search criteria.
- Next, you can set up interviews and discussions with the prospective candidates.
- Once you identify the right candidate, we handle contract negotiation, administrative tasks, and ongoing support.
This way, you get experienced fractional talent who can start working for you immediately.
So, if you need an executive who has already solved the problem you're facing, has a track record at successful companies, and can elevate your team, hire through Go Fractional.
Now let's look at the next important consideration: the cost of filling fractional executive roles.
How Much Does a Fractional Executive Cost?
The cost of hiring a fractional C suite executive depends on various factors, including the duration of their engagement, scope of work, expertise, position, and more.
At Go Fractional, we provide personalized pricing for our fractional executive services, ensuring that each executive receives a customized arrangement based on their experience and expertise.
We offer monthly retainers, ranging between $10,000--$20,000.
Go Fractional follows a monthly invoicing system, charging a fixed price for each member.
You'll receive a single invoice regardless of the number of fractional executives you collaborate with. We'll also communicate with you regularly to make sure everything is progressing smoothly.
Understanding the cost is crucial, but to maximize the value of your investment, it's essential to know how to work effectively with your fractional executive.
Let's take a look:
3 Best Practices to Set Fractional Executives Up For Success
When you work with seasoned executives on a fractional engagement, you may run into certain challenges. However, if you follow our best practices, you'll keep those to a minimum.
1. Establish Clear Goals
Someone in a fractional executive role can only do so much if they lack clearly defined goals.
For example, presenting a fractional CMO with a general need for marketing assistance can undermine their ability to deliver the best results.
To get the most out of your hire, you must establish clear and specific targets, such as increasing website traffic by 20% within three months through social media marketing.
Additionally, you should schedule meetings and develop comprehensive proposals to establish clear boundaries and specific objectives for the person in the fractional role.
2. Watch Out for Communication Gaps
Since fractional executives have reduced working hours, certain updates may slip through the cracks.
Fortunately, the best fractional executives understand this and have the know-how to stay updated and informed effectively.
At Go Fractional, our fractional executives often arrange one meeting and two in-person syncs weekly. Plus, our talent will adjust to any communication processes your company already has in place.
3. Develop Strong Relationships
Full-time executives usually dedicate a decent amount of time building trust and relationships across the organization. But this is more difficult to do on a reduced-hour schedule.
Follow these handy tips to build strong relationships with your part-time executive:
- Keep your experienced executive informed about organizational updates and initiatives.
- Provide necessary support to help them perform effectively.
- Regularly evaluate their contributions.
- Communicate openly and encourage feedback.
- Establish trust by empowering them to make decisions and complete tasks without micromanagement.
Unlock Your Organization's Growth with Fractional Executives
A fractional executive's expertise and flexibility allow you to identify new opportunities for growth, innovation, and collaboration at a fraction of the cost of filling a full-time executive role.
Ready to leverage top-tier fractional leadership?
Go Fractional! We'll connect you with the best fractional leaders right away.
