Fractional executive. A term you may not be too familiar with but a trend I'm starting to see more and more amongst the start-up and scale-up communities.
An “FE” can be defined as a professional leadership executive who works on a part-time or as-needed basis for companies. They're typically hired to fill a specific role or achieve a specific mission as opposed to a full-time permanent hire. For example, it could be an NED or Board Advisor or an interim functional leadership role.
This isn't a new concept but has certainly become more prominent in the post-Covid working environment. But why?
Well, firstly there is no longer a hard and fast way to work. More people are seeking greater flexibility in their career (particularly since Covid), whilst also having impact. A fractional executive role is a great way for an individual to work with one or several companies on specific “mini missions” rather than be tied to one company for several years.
Secondly, it plays to the strengths of those with non-linear career paths. There are many great “all rounders” out there - those with a strong multidisciplinary skillset or multi-industry backgrounds for example.
It could be a great operations leader who also knows their way around a balance sheet and has previously led fundraising campaigns. Rather than being pigeon holed into a rigid role, it could be that their combined strengths align perfectly to an early-stage start-up needing some organisational restructuring and support on financing. We had an example recently of a CFOO (combining CFO and COO duties) candidate who was helping 3 cleantech start-ups during their teambuilding and series funding phases.
The benefits don't just lie on the candidate side. As a start-up / scale-up leader, you can benefit tremendously from a fractional executive or a “Player Coach” as Forbes describes it, particular in at early-stage when you find yourself juggling so many tasks whilst battling with finite resources.
- You can utilise an FE to overcome specific short-term challenges or meet urgent milestones, whilst giving yourself more time to assess whether this area actually needs long-term permanent attention or not
- They can help you to identify blind spots or open new ideas, that may then influence what is needed in any of your future permanent hires
- They can take the weight off your shoulders, allowing you to get on with your core priorities
- Adding more leadership pedigree, even in an interim capacity, can reassure the Board that you're seeking counsel from experienced individuals in the field
- You can benefit from a transition/handover process once a permanent hire has been found
- You and the FE could be a match made in heaven and this could evolve into a permanent role
You may argue “Why not just hire the permanent role?" Well in an ideal world, that would be best but we know that in reality, this is not so easy for a start-up. There are limitations on budget and it can take considerable time to hire and onboard permanent talent and one badly thought out hire can be catastrophic.
The “FE” model can be an invaluable tool to use alongside your permanent hiring strategy. As a start-up leader, you undoubtedly need to build a great leadership team to drive your growth but you may not know exactly how this looks yet or you do, but you may not need it all at once, and therefore this can be a great half-way house to meet short-term needs whilst carefully planning those permanent hiring priorities that will make you successful!
Hyperion helps to build leadership teams for cleantech start-ups and scale-ups across Europe and North America. We advise clients during their early growth stages, pinpointing the specific needs at each phase of growth. If you're a start-up leader embarking on growth, then we can support you. Contact me at email@example.com or subscribe here