In speaking to many early-stage startup founders, what’s immediately clear is that they are struggling to recruit beyond their networks, and that lack of brand awareness and overly generous salaries may pose a problem. When the hiring pressure is on to get the senior hires you need, it may be time to consider what fractional leaders can bring to the table.
For those who aren’t familiar with the term and hiring practice, fractional leaders are experienced leaders that join executive teams on a fractional or part-time basis so that companies can benefit from their experience without the full-time price tag.
In a competitive job market with rising salaries, fractional leadership is becoming a popular choice for startups looking for senior executive leadership roles and people leaders. The financials make a lot of sense: according to Builtin Boston salary stats, the average total compensation for a Chief Technology Officer (CTO) in Boston is $262,672, with the average total compensation for a Chief Marketing Officer (CMO) in Boston adding up to $373,436.
Let’s face it: full-time, experienced executive talent is expensive, and what’s more, it may be more resource than you actually need. For some startups, senior expertise and not full-time operational input is an ideal situation.
The New Recruiting Reality
The expense and difficulty associated with hiring senior talent in today’s competitive landscape was the original driver behind the move from full-time to fractional leaders. However, along the way, many startups have realized that they don’t necessarily need full-time executives in certain roles anyway.
If you can’t afford and don’t need a full-time CFO, why not invest in a two-day-a-week finance leader? With the cost of living crisis, you might even find that some senior leaders who may have hung up their boots are willing to return on a part-time basis.
How do you find this type of part-time C-suite to continue your business growth? First and foremost, you don’t need to appoint expensive in-house recruiters with six-figure salaries.
The best approach, known as Recruitment Process Outsourcing (RPO), is fractional in itself. By outsourcing strategic recruitment initiatives, you can add a flexible and data-driven layer to your talent acquisition program which works long term.
The Ultimate in Flexible Hiring
A combination of fractional leaders plus RPO providers will give you the expertise and flexibility you need to hire in this very volatile market. RPO allows startups to have a planned resource that can scale up or down to meet the volume, giving startups the ability to plan commercially and have a team ready to deliver quickly. RPO allows a company to focus on a short 6-month gap, or work on a specific role without needing to go to an outside firm each time you have a need.
An RPO partner will also be able to spend the time to really learn and understand your growth goals as a startup so that they can handpick the right talent. This process is called talent mapping and it gives the RPO providers a better understanding of where relevant talent may be located based on the nature of the required skills and experience.
The other big strength of RPO partners is their unique understanding of market conditions, and their ability to apply market intelligence to find fractional leaders. It’s this sort of proactive approach to recruiting that is proving to decrease the time-to-hire, and locate those fractional leaders that can really make the difference to startups at a fraction of the time.
The Retiree Recruiting Revolution
Fractional leadership may also be an innovative approach to meeting talent demands in a market where there are more roles than candidates. As we face the potential of recession and begin to deal with the rising cost of living, many of those plus 50s who left work to enjoy their retirement mid-pandemic may well be looking to re-enter the workforce to top up on savings.
As a recent article in the Washington Post revealed, many older workers have been convinced to re-enter the workforce because of more flexible working arrangements that are now on offer. With a record number of retired workers returning, startups may be able to strike some mutually beneficial fractional employment contracts with senior executive help that only wants to work part-time. Outside of just finance and marketing, consider fraction HR leadership today as well.
The combination of lower costs and high quality means that for startups, fractional leadership may offer the best of both worlds to help speed scale and growth. If you’re looking to better understand how RPO can help in your search for fractional leaders, get in touch today.