Interview with Joe Buchanan, CEO and Founder of FractionL
We’ve seen a lot of buzz around fractional executives recently. Fractional CFOs, Fractional Chief Marketing Officers, etc. seem to be all over LinkedIn. We decided to catch up with Joe Buchanan, Founder and CEO of FractionL, the leading fractional executive placement firm. FractionL matches seasoned executives with part-time jobs.
Joe gave us some background on the industry and its current state. Our interview is below.
Craig
Hi Joe, thank you for the time. Reditus has been working with FractionL since we began, about a year or so now. Why don’t you start by telling our readers a bit about FractionL?
Who are you, what do you do, and how are you positioned in the fractional services market? And, for that matter–what is a fractional executive?
Joe
Next to the Remote Work revolution, the emergence of part time or fractional workers was a significant change that came from the pandemic. CEOs realized they had full time executives that were not truly productive 40 hours a week. As a result, they often gave these team members tasks below their pay grade.
FractionL was the first community of executives who thrive working for 2-4 companies at once. Fractional work is a lifestyle that provides great pay and flexibility. Startups and SMBs are fast adopting the cost-effective practice of hiring part time executives.
These Fractional CXO’s provide deeper experience at a fraction of the cost. Startups who’ve hired a Fractional CXO find this preferable to competing for expensive top full-time talent.
The community has one significant common need, business development. Fractional CXO’s spend 25-30% of their time searching for their next client. FractionL has become the leading source of business development for CXOs.
Many marketplaces for part time or consulting talent require participants invest huge time and energy to start a relationship. FractionL is more like a traditional recruiter who provides vetted, high-performance candidates directly to CEOs.
Craig
How about a quick history lesson on the fractional market–how old is it, and what does its trajectory look like?Joe
Consultants and advisors have been around for hundreds of years. But the first Fractional Executive was the Fractional Chief Financial Officer.
Fractional CFO’s would work at startup companies who needed deep venture capital experience for a few days a month. They had no need for a full time Chief Financial Officer. This emerged about 20 years ago.
COVID made great executive talent in marketing, sales, operations and HR available on a remote basis. These new Fractional COO’s, Fractional CMO’s, Fractional CRO’s, etc. did not want the full time grind anymore. Affordable fractional talent makes such great sense for early stage and SMB companies.
Craig
And how long have you been doing this?Joe
FractionL will be 3 years old in June 2024.
Craig
Reditus works exclusively with FractionL, and we’ve definitely benefited from your background and expertise in lead generation. I know how many messages you’re sending out weekly on our behalf, and how many meetings we get each week as a result. We’re about to ask for your insights into the market for fractional leaders. But first, can give us some overall stats so we understand how deep you are in this specific market?
Joe
Typically we promote our members to their individual target clients so results vary by market.
We send as many as 100 emails a day on behalf of each member. We achieve email read rates above 50%. Reply rates vary by channel.
On LinkedIn we see a 5% reply rate and CEOs schedule meetings about 2-3 times weekly. Roughly 1% of messages result in scheduled meetings.
Craig
Since you represent C-Level executives, I suspect you talk to thousands of CEO’s each year while placing your CxO’s. What do they tend to think of hiring fractional executives vs full time hires? What do they like about the model, and what are their concerns?
Joe
Most business owners start out loving the concept and their fractional CXO. But quickly they realize that they have to manage the executive differently. The CXOs don’t respond 24/7 nor are they available at the CEOs immediate request. So it requires adaptation by the CEO.
They appreciate the skill sets and fresh perspectives, and the impact a fractional has on their cash flow. But, the challenge all CXOs have is demonstrating and documenting the value they create. This is easier to see when an executive is full time and onsite with a company.
Craig
So what’s the current state of the fractional executive market? What types of fractional CxO’s are getting jobs? Which roles are harder to fill, and why?
Joe
CRO is the fastest growing and most popular fractional category at 65% of our requests. The market in general is in a slow period as funding has slowed so much. But the demand for affordable sales activity remains strong.
The hardest roles to fill are operations and HR, as there is no clear demand for the role until a company reaches escape velocity. They usually go full time at that stage.
Craig
Any other observations or trends you care to share?
Joe
The barriers to fractional executive expansion include a lack of accessible talent/skills on a part-time basis and the managerial skills required to lead a hybrid team of full and part-time execs.
Craig
In case we have any CEO’s reading–what’s your pitch? Why should they consider a fractional exec?
Joe
Fractional executives, the deeply experienced CXOs, can see around corners and will point out pitfalls many young CEOs miss. That can be game changing. They also can tell if your idea has legs pretty quickly.
Craig
If someone is interested, and wants to explore hiring one of your fractional executives, how do they do that?
Joe
www.fractionl.us has case studies, pricing and “How to’s” available to help CEOs make a good choice.
The most helpful tool is our comparison chart.
Craig
Awesome. Thanks, Joe. You are in no small way responsible for Reditus’ growth–we appreciate all the support, and your time here today.
Joe
Reditus has a great model for building sustainable sales activity for the long term, great for long sales cycle businesses.
