Fractional executive

A fractional executive is an experienced leader, such as a CFO, CMO, CTO or COO, who works part time for several companies at once, often a day or two a week per company. Startups use them to get senior judgment before they can justify or afford a full-time hire, to cover a gap after someone leaves, or to set up a function and then hand it to a full-time hire. They are usually paid a monthly retainer, sometimes with equity.

Pricing varies with seniority, market and commitment, but fractional executives commonly charge a monthly retainer in the low thousands to low tens of thousands of dollars for a set number of days per month. A fractional CFO supporting a fundraise or board reporting may cost more for a few months, then scale down. Compare the cost to a full-time salary plus equity, recruiting time and the risk of a bad senior hire.

Fractional makes sense when you need senior expertise but not a full week of it, such as financial planning before a raise, setting up marketing foundations or defining a technical architecture. It also helps when you are unsure what the full-time role should look like. Once the function needs daily leadership, has a team to manage or is central to your strategy, a full-time executive usually becomes the better choice.

A fractional executive works part time on an ongoing basis, often for several companies at once. An interim executive usually works full time for a limited period, stepping into a vacant role, such as an interim CEO or CFO during a search, a turnaround or a sale. Fractional suits ongoing part-time needs, while interim suits a gap or crisis that needs someone in the seat every day.