As you build a new business, typically there are only a few people on the team. Regardless of how talented these few people are, we all have a finite set of skills. Conversely, new businesses have needs that are constantly changing and flowing.
You may need engineers for six months, finance gurus for the following four months and then sales reps the next month to get the product out the door. Think of fractional services as outsourcing part-time positions for startups. Sure you need legal work done, but you wouldn’t have an attorney be your second or third hire.
Strategically using fractional services is an efficient way for entrepreneurs to get vital projects done by reliable specialists.
The most common type is probably fractional chief financial officer services. Often, company founders need to be focused on the product, service and finding customers. If you aren’t careful, this hyper focus can be detrimental to the financial health of the company. CFO services allow entrepreneurs to concentrate on their creation, but still maintain sound financial accounting. These services usually involve tracking performance-related metrics, and helping out with taxes and payroll.
In my experience, investors favor these services. To them, it ensures you have someone keeping close watch on the financial pulse of your company. An interesting thing about these services is they can be done by a single person or a team of individuals. Depending on your unique needs, you can find the fractional style that suits you.
Another valuable x-factor about using fractional services is that these interim employees will leverage their network for you. The people performing these services are battle tested and have a wide range of industry connections that will undoubtedly help you out.
Other less common services include chief technology and chief information officers. The technical knowledge required to exist in many industries today is so deep that it takes a tech specialist to scale and grow. These people or organizations can objectively evaluate your personnel, technology and processes, and implement thematic change across your organization.
In no way am I advocating against hiring full-time skilled individuals. There will always be the need to bring on talented permanent workers. But keep fractional services in the back of your mind when it comes to interim projects outside of your team’s skill set.