Going Fractional?

Drew: Hello, Renegade Marketers! If this is your first time, welcome, and if you're a regular listener, welcome back. You're about to listen to a recording from CMO Huddles Studio, our live show featuring the flocking awesome B2B marketing leaders of CMO Huddles. In this episode, Alan Gonsenhauser, Katrina Klier, and Marshall Poindexter share how they approach fractional CMO work, from setting expectations upfront to agreeing on what success looks like before anything gets delivered. They walk through how they do quick discovery, get on the same page with CEOs and founders, and use focus and process to make real progress in a fractional role. If you like what you hear, please subscribe to the podcast and leave a review. You'll be supporting our quest to be the number one B2B marketing podcast. All right, let's dive in.

Narrator: Welcome to Renegade Marketers Unite, possibly the best weekly podcast for CMOs and everyone else looking for innovative ways to transform their brand, drive demand, and just plain cut through, proving that B2B does not mean boring to business. Here's your host and Chief Marketing Renegade, Drew Neisser.

Drew: Welcome to CMO Huddles Studio, the live streaming show dedicated to inspiring B2B greatness. I'm your host, Drew Neisser, live from my home studio in New York City. Over the last five years, several members of the CMO Huddles community have explored being a fractional CMO, and we're going to call that the F-word for the moment, and we'll come back to that. Some have had a wonderful experience. Some have turned it into a business. Some not so much. Some stick with it. Some jump as soon as they land a full-time offer, and some have parlayed fractional roles into a full-time position. So there's a lot of variables involved in this role, but I know it's of great interest to our community. Oh, by the way, I do have to mention this. There are some who believe that fractional CMOs could degrade the overall value of full-time CMOs. So yeah, there's that to unpack as well. Fortunately, we have three former CMOs, now full-time fractionals or interim CMOs, to help us understand what it takes to succeed in this role and a whole lot more. With that, let's bring on Alan Gonsenhauser, founder and CEO of Demand Revenue, and a returning guest who has previously appeared on the show to discuss customer-led growth. Hello, Alan. How are you, and where are you today?

Alan: Hey, Drew. It's great to see you and be here. Thank you for the invite. I'm doing great, fantastic. Just got back from a trip, and I'm in the Boston area, a little bit west of Boston.

Drew: All right, we're covering the East Coast. So you've been doing this a while, and you have advised a wide range of companies. How do you approach step one, building trust and alignment quickly as a fractional?

Alan: Yeah, first, let me just say I love what I do. I've been doing it for four and a half years, and it's been really fantastic and continues to be. I start by asking questions. I don't make assumptions. I like to take the advice my grandmother used to give me. She used to say, "Listen to the people." So I start by asking a lot of questions and interview folks—all of the marketing folks, but also the board, the C-suite. I speak to each of the C-suite members because when I come on as an interim or sometimes fractional, I join the ELT, and so I ask them, you know, what are the successes? What are they most proud of? And what are the gaps? What gaps do you see in the business? And with each person, whether they're in marketing or the board or the C-suite, I give them three magic wishes. If they could change anything, what would they be? And I usually take about a month to do that because I don't want to come on like a ton of bricks, like, "Hey, look, I know everything. I'm going to make a lot of changes." I want to listen to people first and see what they're proud of and see what the gaps are. So, you know, with that process, I really learn a lot, and that helps me form what I do next.

Drew: And do you think—so it's interesting because that could have been the same formula that you used as a full-time CMO. Is there anything different about that process or the mentality? Because part of it is, if you are full-time and you're an employee, the good news is I know I'm going to be around with you for a while. Yeah, talk a little bit about if there's a nuanced difference in that process versus if you were the full-time CMO.

Alan: Well, they know that I'm interim and that at some point it will end, but I really focus a lot on building relationships. And a lot of these relationships have continued past the actual project. Like in one case, I was fractional CMO at FinThrive for six months, and then when the full-time CMO was hired, I stayed on for another 14 months as her mentor, coach, and advisor because I also coach many CMOs. And I also started working with the chief customer officer, so I try to develop relationships with people and tell them, "Look, I'm not here to risk your job. I'm here to find the best of the best, work together," and it's all about building that trust upfront. And they do report to me, even though it's not going to be a permanent thing, but I really focus a lot on asking questions and building the relationship upfront and making people feel that they don't have something to fear from me, and then I can help mentor them and move them to the next level as well. And that's worked really well across many engagements so far.

Drew: No, and I could see it. And you sort of turn this negative into—somewhat that you're going to go away—is that, well, you know, I have a way of sticking around, and so that part is good, and I'm here to help you grow in your career.

Alan: Exactly.

Drew: So are there types of companies that you've noticed that tend to be the best fit? And we should focus on you because I know you have a narrow—there's, you know, you tend to work with PE firms, right? And you sort of got that niche. Talk a little bit about why that niche seems to work really well for you.

Alan: There are a lot of startup companies, but startup companies are a lot more price-sensitive. And, you know, I've worked at different-sized companies. I have worked at startups. I've worked at Fortune 100. I've worked at very large companies. I've worked at mid-sized companies in different industries. And what I find is private equity investors, although in upper mid-market—so these are businesses probably over $150 million into the billions—they're not as many of them, but when they have a need, they have a lot of pain. They're not as price-sensitive. They're very pain-sensitive. So they want to fix some things that are going on, which either may involve mentoring and coaching the CMO or coming on as an interim/fractional CMO. I've, like, for example, with one very large private equity firm in the last four and a half years, I've worked with six of their portfolio companies, and they go invest with others. So I like working in that model. And the PE firms that I've worked with do care about brand, and they do care about customer-led growth, and they do care about, you know, CMOs being someone that can convene people together and help them with their go-to-market alignment issues, which I find is an issue with a lot of companies. So if someone is just looking for demand and tactical assistance and that's what they think of marketing, and I don't feel like they can really be educated on what marketing should be, I wouldn't take that role. So I've really enjoyed, you know, partnering with the board, you know, the PE firm, the CEOs, and the C-suite to help communicate what marketing really is, how holistic it is now, and it's not just a coin-operated demand engine, and, you know, take their fears away from brand by explaining in financial terms what the advantage is.

Drew: I just want to—so for fractionals that are thinking about it, particularly if you're getting started, you know, yeah, I've talked about this over the years about the business of expertise, the need for, yes, horizontal and vertical focus. And the thing about—I'm just going to sing your praises in this—is all of your content also relates to what it means to be a CMO at a PE firm. So it informs your website, it informs your content. It gives you—you know, you're the PE fractional guy. Yeah. And that's what a brand is. Yeah. And so it's really hard at first when you're starting an independent consulting practice to focus, but that is the definition of strategy. You've got to say no. If you don't have anybody you say no to, then you do not have a strategy.

Alan: So narrow down, pick a niche, don't try to boil the ocean.

Drew: Yep. And by the way, you get better at it each time. And there are certain things—by the time you walk into your seventh PE, you know, you say, "Okay, these are the ten things I know about your business already without even—"

Alan: So a lot of the same problems too, right? I mean, one of the first questions I ask is to learn about churn. Is there a churn issue? How bad is the churn issue? What's your net revenue retention? You know, do you have an aligned view of your ideal customer profile? Is everybody on the same page? And I get a lot of that through the questioning. I often find a lot of the same problems, especially if they've done a lot of mergers and acquisitions. They may have a lot of dirty data and a lot of tech debt, and you see similar things across the different portfolio companies and industries.

Drew: Yep. Well, David C. Baker calls that the ability to "drop and give me 20"—another 20 things that you know walking in the door anyway. All right, we now need to bring in Katrina Klier, who is the CEO of Sage Strategy Group and an industry expert who has graced the stage before to discuss many topics, including the CMO's path to the boardroom, content strategy, and relating marketing to your CEO and CFO. Hello, Katrina. Wonderful to see you again.

Katrina: Hi, Drew. Thank you so much for having me today. Nice to be here.

Drew: How are you, and where are you dialing in from, Katrina?

Katrina: I am enjoying this beautiful late summer, early fall day in metro New York City, and it is beautiful and sunny outside. And it's always a good start to the day.

Drew: It is, and it's sunny in here too. I just want you to know, here we are on Restream, and we are sunny. So okay, I'm curious. You heard what Alan had to say, and is there anything in those comments that you want to build upon or fervently disagree with?

Katrina: It makes a lot of sense. You know, doing fractional work of whatever flavor—you're a fractional CMO, CFO, whatever it is—and in a room, fractional or cousins of each other, the discovery and the things that you need to understand are really important to get right. And I would argue, to a certain extent, it's not that different than if you had a regular operating job and jumped in full time. It's just that I think when you're fractional, you're moving faster because you're usually operating in a tighter time window, and you need clarity quickly. I found that when you're not a full-time employee, people tell you more.

Drew: Well, that's another thing I was wondering about. You probably get more honest answers and confidential stuff because they know you're going to be gone. So I can tell her because it won't be a problem. And I think that's really another interesting part. It's sort of, you are the expert with a briefcase from out of town, as the old cliché goes, but there is something to the consultant notion of coming in and getting maybe more raw information.

Katrina: Yeah, you know, I think they usually are like, okay, this person is here to help us do whatever. And sometimes the helpers help us figure out what that is that we need to do. And so I think when you come in in this capacity, you're often viewed by the rest of the executive team—not always, but oftentimes—as okay, this person is here to help and here to make sure that we get where we want to go in an efficient and quick manner. And I think they size you up differently than when you're a full-time employee. When you're a full-time employee, you're getting sized up politically first, usually, and capability-wise second. Can I say that out loud? That probably wasn't a very diplomatic thing to say.

Drew: Fine. It's all good here. I'm sure none of your customers are listening. We're fine. But I'm curious, so it's interesting because you talked a little bit about trying to figure out what the priorities are here, and it is a little bit different if you're full time because, you know, you've got three months, six months, nine months you can talk about. You've got one year, two year, three years. And you can start to build horizons and align actions with, you know, we're going to get this far in this timeframe. How do you sort of—imagine it varies, but sort of get to some prioritization? So when you step into that role, you know, it's clear we're going to do this.

Katrina: Well, I think it varies by client and by company, right? Sometimes the CEO and the board and the executive team are very clear about what they need to do. Like, they're very clear about we got to this amount of revenue, we know our marketing foundation isn't going to scale past this, we need the foundation to scale. They're very clear about that. Sometimes, oftentimes, they are less clear. They might know they need to scale. They don't really know what that means necessarily because they haven't had someone like me or Alan or Marshall come in and help them figure that out. They need someone to help clarify it for them. And so asking those bigger questions to make sure you understand the business strategy, but then also the conversations around that strategy that are going on. So I always ask things like, tell me about your last board meeting and what questions around go-to-market came up that you wish you'd had a better answer for, and what were they? And I think that's an important one. Another one is really understanding the growth targets that are on the table and any other financial target that's on the table. So maybe it's we're going to grow, but we know our margins are going to take a hit—not be negative, but take a hit—for the next two, three quarters because we need to hit this number. And then we need to continue to grow, but we need to hit the EBITDA number without fail exactly as it intends to grow. You need to really understand those financial metrics because your marketing strategy needs to fuel those. And if you don't understand them, you can do a lot of things, but you won't be able to tie it back to that strategy. So you need to get clear on those things, like what commitments have been made to the board, to investors. Also, are there any big things hanging out there that you just need to know about? Is there a big tech change, like you're going to clear out a whole bunch of tech debt as an example, if you're a tech company? Or are you in the middle of a rebrand that somehow nobody mentioned? Things happen, right? You know, or they just assume it's going to be okay, and they don't always bring it up. But just getting clarity on all those different things, but specifically the financial metrics and where is the company planning to be so that you can build the strategy to get there. And then you can anchor the strategy, anchor the asks, anchor resourcing back to this is how we're going to get to those metrics. That's super important. And I'm always surprised how many people skip that part.

Drew: Yeah, no, I love the question about the last board meeting. I want to sort of—I've seen this happen more often than I can, like, sort of live with, which is somebody on the board or the CEO says we're going to grow 25% next year. It's a completely arbitrary number. You grew 9% the year before, nothing is changing from an infrastructure standpoint. Nothing is changing from a budget. It's just this goal is 25%, and I wonder, as an interim, do you—and because you can look at the numbers and people can create a spreadsheet to say, oh, we're going to acquire this number of customers and we're going to get them in, but that's not reality. That's just a spreadsheet. How have you sort of dealt with that? And as an interim, do you get to push back more on things like that?

Katrina: I don't know if you get to push back as much as you get to ask clarifying questions, I think, more easily, right? So sometimes you get these big growth numbers that can seem really arbitrary, and you've got to know your homework, right, to be able to say, okay, you want to grow 25%. Last year we grew nine. The market's growing at 12. We were under market last year, so I get the need to accelerate. So if you want to grow 2x the market with a flat investment, then tell me about your inorganic growth strategy because you're going to buy something, because that's the only way you're going to get to that number. And so you can—maybe a little more diplomatically than that—but you can ask about the mix of inorganic growth, so acquisitions and partnerships, and organic growth, because there's more than one way you can get to a growth number. It isn't necessarily all organic growth. Most companies have an acquisition strategy, or they're looking to sell or something. I mean, there's always something going on in that way, in that world. So asking the clarifying questions—but, you know, you can ask the clarifying questions, and I found most people are happy to have that conversation. Occasionally you'll bump into the person that's like, I just don't think marketing is beneficial, and I think we should be able to grow this, but we haven't had the ability to do that. But then you just have to unpack that more. Like, okay, well, tell me more about that. How did you get to that conclusion? And, you know, what led you to believe that? And have you seen other companies in this space cross that hurdle? And what do we know about them? And, you know, you just got to kind of precision question in a diplomatic way because there are things in there you're going to need to know.

Drew: Okay, got it. I just have to say this for the record: growth is not a strategy. Okay, with that, I want to welcome Marshall Poindexter, fractional CMO and head of client success at yorCMO, who has previously joined us on the show to discuss many topics, including B2B brand values, sales and marketing alignment, and B2B rebranding. Hello, Marshall. Welcome back. How are you and where are you this wonderful day?

Marshall: I am outstanding, Drew. Thanks so much for having me today. And I'm working out of my home in the greater Milwaukee, Wisconsin area.

Drew: Got it. Okay. You heard both Alan and Katrina, and I'm wondering if that sparked any thoughts on your side.

Marshall: Yeah, you know, one of the—well, I want to actually bring up two topics to add to their excellent comments. One of them is, it's really important if you're considering being a fractional CMO, or if you're a CEO that's considering partnering with a fractional CMO, for everyone to understand the difference between what is a marketing consultant and what is a fractional CMO. And then the other question is, if you're a CMO considering this path, are you going to be an independent fractional CMO like Alan and Katrina, or are you going to partner with a fractional CMO firm, which I've chosen to do? So the first question: a marketing consultant is somebody who is working on a project for a client on a very time or scope-based basis. It's very short-term typically. I mean, it might be as long as five, six months, but not usually, you know, longer than, you know, a several-month kind of a project. But a fractional CMO is somebody that is being given full responsibility for the marketing function in that company, and you're just not spending full-time hours with that client or with that company. You're spending maybe 10, 15 hours a week creating a strategy, orchestrating the strategy, directing the execution of it, but you have full responsibility for goals around that. So it's different than just focusing on a particular problem. And the other thing I wanted to add is, if you're an independent fractional CMO, you know, you are responsible for finding all of your own business, doing all the work, doing all the administrative work around or behind that relating to billing and things like that. But when you join up with a fractional CMO firm, in some cases, they may have an in-house business development team that you can partner with. They're going to help with all the administrative back-end billing, and then they may even have vetted partners that can help with some of the execution of the work. So I just thought I would bring up both of those points because I think those are important for both CMOs and CEOs considering fractional work to wrestle through.

Drew: Interesting. I am struggling with the notion that the CMO job could be done in 10 to 15 hours a week. Help me. How do you manage the expectations? Because you can't do a full-time CMO job in 10 hours a week, right? So how do you work that out with your customers?

Marshall: It's a great question, and so it's really critical to have process and focus and to have execution resources in the client company. So what that means is there may be, you know, mid to low level marketing folks within that company, maybe a marketing coordinator, maybe a mid-level marketing manager, maybe some marketing specialists who just don't have somebody who has senior expertise to guide and lead them in the strategy and then the execution. So maybe there's in-house resources, or maybe that company has, you know, an agency or agencies that actually will do the execution work. Without that, you're absolutely right. I mean, there's no way that you can create the strategy and execute it on 10 or 15 hours a week. But if you're creating the strategy and following a process—yorCMO, who I partner with, follows the EOS or Entrepreneurial Operating System process. So it's very modular. It's very adaptive and very process-oriented in terms of setting high-level goals, you know, doing 90-day sprints in service of those goals, retiring rocks in service of those goals, and, you know, figuring out all of the key metrics upfront and the scorecards upfront that you're going to be measured against and how you'll show the client that you're making progress. If you don't have that, you can't do it in the 10 to 15 hours a week. But if you're going to be a fractional serving multiple clients, you have to rationalize the time that you're going to spend with each of them. That's how it can get done. That's how I get it done. That's how my peers get it done and serve multiple clients fractionally at the same time.

Drew: I'm a huge fan of EOS, and we executed that when I ran the agency and also use it for CMO Huddles. I think the key point for other fractionals, if you're thinking about that, you have to have a process, and if it's not EOS, you need something else, because it is the framework that you are going to be selling your consulting practice against. If you are simply walking in and saying, "Oh, I think this is the problem, and this is the problem," it's going to be harder, and it's going to be harder from a time management standpoint, right? Because once you have that process—and like in the EOS case, you put the rocks on a page, and we've got these things, you know, there's a method for if the CEO says, "Oh, but I want to do this," great, well, we'll consider it next quarter.

Marshall: Absolutely. And the other thing I'll also reiterate, Alan did a great job talking about—you need to have focus. You know, my focus in building my fractional CMO practice is, you know, companies that are $5 to $50 million in annual revenue, so they're early to mid-stage, and I'm specifically focusing on biotech, med tech, and health tech software, devices, or services companies. And again, these are companies that, you know, want the expertise of a CMO, but they don't quite have the resources to hire a full-time in-house CMO who, you know, where they have to pay salary, benefits, and equity. They just don't have all the resources. So they need that bridge. They need somebody who can help them get there, who can build out the marketing function, help them move into new markets, maybe hit a revenue target, or get over that revenue wall as they've, you know, started to get that basic product-market fit. And so that's why there's been this explosion in interest for fractional CMOs, as well as fractional executives in finance and IT and all these other functions. You've got fractional executives at the C-suite level in a lot of these companies because they need the help. They just don't have the resources to hire full-time in-house yet.

Drew: It's so interesting. So at the end of this process, and you've sort of built it up and shown the value of marketing and built a thing, is the ultimate out—you know, your exit—when they hire a full-time CMO?

Marshall: Many times, that is true. So many of my peers have been involved in situations where they're actually helping to hire the full-time in-house permanent CMO. But I also had peers who have been fractional CMOs with their clients for three, four, or five years. So for some companies, this model just is a better model, right? They can redeploy those resources elsewhere, and if the fractional CMO is okay with that, you know, and they've got the good relationships and they're delivering value, then great, right? So it really depends on the needs of the client. But you're right, many times, you know, it's the bridge that leads them to that full-time permanent CMO role as they scale and grow.

Drew: So we've heard a couple of themes that I think are really important that I'm just going to reiterate. One is that you have a focus in terms of—in your case, it's both size and sort of the business size and the verticals. And it's similar to Alan. You both had that. His is, you know, higher and PE-backed. So that helps you from an outreach standpoint. That helps you build up expertise. And then the second thing is the process that we've talked about. Ultimately, this all comes down to managing expectations, again, right? You're not working 40 hours a week. You're not working 60 hours a week like most CMOs are, right? So unless you're somehow a miracle worker, you're getting one-fifth of what you could have done as a CMO done. Is that a fair assessment?

Marshall: I mean, again, you're setting pretty aggressive goals, right? So, you know, you're setting—you want to increase revenue by, you know, 25%, like we were talking about in Katrina's example. And, you know, that's not something you can do usually in six months, right? It's going to take a longer period of time. Or you're going to move into a new market, and, you know, you've got to figure out how to get into that market and how to connect with those buyers, right? So again, these are aggressive goals, and that's the approach that we take at yorCMO. But, you know, even Ellyn and Katrina, they're setting aggressive goals with their clients too. So, you know, you're still getting a lot done, but it is focused, right? You're not getting pulled into a lot of the day-to-day political stuff. You're not getting, you know, things thrown at you that you might if you were full-time or in-house. And if you do get the CEO saying to you, "Well, what about this? Or why can't we do this too?" you have that conversation. You say, "Okay, if we do that, then this major goal is going to have to change, right?" And so it just kind of forces that prioritization exercise, which we've already talked about.

Drew: Priorities and focus, ladies and gentlemen, that is the key to success. All right, well, we're going to come back with Marshall and Alan and Katrina in just a second. I think it might get a little spicy, but right now it's time for me to talk about CMO Huddles. Launched in 2020, CMO Huddles is the only community of flocking awesome B2B marketing leaders, and that has a logo featuring penguins. Wait, what? Yes, well, a group of these curious, adaptable, and problem-solving birds is called a huddle, and the leaders in the CMO Huddles are all that and more, huddling together to conquer the toughest job in the C-suite. There's a pun in there. Alan, Katrina, Marshall, you are all incredibly busy marketing leaders. I'm wondering if you want to share a specific example of how CMO Huddles has helped you.

Marshall: So I can actually share the example with these two folks right here, Katrina and Alan. They've become good friends. We have built friendships and relationships because we met in Huddles, and we have been able to, you know, help each other. They've helped me. You know, we've dialogued about challenges. I've gotten advice from both of them in different ways, and I would not have had those relationships if I hadn't met them through Huddles. And the value that they've provided to me, both as a friend and as a colleague, is incalculable. I mean, I would have had to probably pay thousands of dollars to consultants to get the great advice I've gotten from them.

Drew: I love it. All right, Alan, Katrina, anything to add?

Alan: It's, you know, for me, I totally agree with what Marshall just said, and it's, you know, it's a wonderful community. And in these communities, I don't look so much at what I get out of it. I love to pay it forward. I love to help people. And I've had an opportunity to meet with a bunch of folks that come to me for advice, whether it's fractional or private equity or something else. And I just love the ability to kind of pay it forward and help people along with their journey or the challenges and the problems they're trying to deal with. And this is a wonderful community for that.

Drew: We really appreciate that you do that. It's inspired another program that we're launching very soon, a mentoring program where three- or four-time CMOs are going to be helping out first-timers. So Alan, thank you for your work there. Katrina?

Katrina: Yeah, what I've loved about Huddles is I've been a member of the community as, like, a public company CMO and then also has, like, leaned into being a fractional CMO, and it's been equally valuable in both cases. I think just the wealth of knowledge, the depth of expertise of the members on so many different things. I mean, Al and I have had conversations on pricing and positioning. Marshall and I have had lots of conversations around, "How do I set up a fractional business? Like, what do I need to think about? Like, who else should we talk to?" I've had countless conversations when I was in my public company role with people around, "Can somebody poke holes in this team structure? Does anybody know a vendor who can solve this problem? Hey, I need to hire a rockstar to head product marketing. Who knows somebody?" Like, you know, all of those things. It's kind of like your best friend, mentor, advisor, board of directors, on-call group, and they're amazing.

Drew: I love it. Well, thank you. Thank the three of you. If you're a B2B marketing leader who wants to build a stronger peer network, gain recognition as a thought leader by being on a show like this, and get your very own stress penguin, join us at CMOHuddles.com. Okay, we have a question from the audience. We need to answer this: as a fractional CMO, any tips on how to be successful without making it full-time? And I know Marshall, you and I talked about that, but what's the trick there? Alan, how do we manage that?

Alan: You know, I would say set expectations at the beginning, especially if you have multiple clients. Say, "Look, for me," you know, it depends if you're doing fractional or interim. I do a lot of interim, where it's three to four days a week, but if you're fractional, you have multiple clients. What I try to tell them is, "Look, Tuesday is going to be your day." Doesn't mean we won't talk on other days, but let's try to set up all the meetings on Tuesdays and Wednesdays so you can kind of carve out your time. You will, you know, sometimes have other things—maybe there's a board meeting or an ELT meeting or something like that. But I try to coordinate the timing up front, especially if you're going to be involved in multiple engagements. In my case, I would say I don't know how I describe myself because I'm an interim, I'm a fractional, I coach CMOs, and sometimes I do projects for my clients. So I'm kind of a—and sometimes due diligence. So it's a combination of those things. But if it's less than three to four days a week, I try to carve off specific time periods. And how to do that? People are pretty reasonable.

Drew: And Lynn Capozzi, thank you. Nice to see you, one of our early Huddles. Thank you for that question. I hope that answered it. If it didn't, keep—hit us with another one.

Katrina: Can I chime in on that one? I think it's important, if you're considering being a fractional CMO, that you do a little personal soul-searching, because it's not a model that's really for everybody. Quite honestly, it can sound exciting, but I think you'll be successful as a fractional CMO and/or a consultant if you're somebody who is self-motivated, who's a self-starter, who can really manage your time across projects well on your own, right? You know, if you're somebody who is a CMO, you've got 10, 12 big projects going plus managing a team, and like you're in the zone—like you've got—you're okay with that, like you can make it all happen—then you're probably going to be more successful as a fractional CMO. And if you're someone who can timebox and say, "I need to get these things done in this allocated calendar time"—and if there's other things besides timeboxing, but that's a more common one. I've used that a lot. If you're good with that, then fractional CMO can be something that I think you might want to explore. The other thing is, I think a lot of us, at least all three of us, do a mix of fractional or interim CMO. We do some project-based work, and we do some paid coaching and mentoring. And if you like that mix, then being a fractional CMO is nice because you can mix it up in a way that works for you and balance your client load so that you don't feel like you're working two full-time jobs.

Drew: So I want to go back to the spicy part of this thing and just throw this thing down there, you know, because I can't help it. And you guys are really smart, and you've been doing this for a while. So if the notion of fractional or interim actually became dominant, what it might say to the marketplace is, "Oh, you don't need a full-time person. You could do this in 10 to 15 hours a week." And we know that's lunacy, right? I mean, you cannot run—or correct me if I'm wrong—you cannot run a marketing department of—I'll hit you on this, Ellyn—of a $50 million company, $150 million company with multiple staff, and build a team and build out the process and integrate with sales, and do all the things that we know that full-time CMOs do. So is there a risk? As you know, you keep—we do things like this, we promote this notion of it. So how? What's the story that we can tell the CEOs that say, "Interim, fractional, fine, but understand it's not the same as having a full-time CMO. And it may not be in your interest to explain that because you're selling the opposite." But help us navigate this, this world as a community of CMOs.

Alan: I never compete with full-time CMOs. I work with large companies. All the things you just mentioned, Drew, I actually do on an interim basis. I become them, but the expectation is always, I'm not looking for a full-time job. I'm looking to help the companies, and I will do all of those things, but at some point they'll hire a full-time person. What I love doing, and I have some examples of this, is staying on as the full-time CMO's coach, mentor, and advisor, because I love doing that, and I've done that over 150 times, actually, you know, starting at Sirius Decisions and Forrester. But you know, I don't say you don't need a full-time CMO because I think that's very important. However, in smaller companies, startup companies, you know, to Marshall's point earlier, if they can't afford a full-time CMO with all the benefits and the equity, it may make sense there. But in the space I play in, I never compete with the notion of a full-time CMO.

Drew: So the distinction, perhaps, between an interim and a fractional—one level is interim is larger company, fractional in some cases, at least, or smaller companies?

Alan: Can be. Although when I worked with Linus Health, I was interim for six months, and that was more of a startup healthcare company that was about a million or two million in ARR. But the thing is, I was doing that like fractional. I was only one day a week with that, which is not enough. No, but I was kind of their CMO for six months. And I wouldn't recommend that because to be an interim CMO, you really, you know, all my other engagements with large companies have been three to four days a week.

Drew: Okay, so that's important. And Marshall, weigh in here.

Marshall: Yeah, I actually did really wrestle with, "Am I, like, somehow denigrating the marketing profession by pursuing this?" Right? What the conclusion that I came to is, no, I'm not, because there is a need. There are CEOs, there are companies that need the expertise of the CMO who just aren't ready for a full-time, in-house one. And you're absolutely right. A company with 5 billion, 10 billion in revenue, with a marketing team of 150—a fractional CMO option is not going to work for them, right? But for companies that want to scale, want to grow, want to eventually get to that point where they're the $5 billion company, they need a CMO with the expertise and experience to lead them to that or and bridge that gap. And so I am providing a service that is valuable. Otherwise, you know, Alan, Katrina, and I wouldn't, you know, have any work to do, or our fractional CMO friends wouldn't have any work to do, but we do because there's a need. And it's not just CMOs. Like I said, it's other fractional executives too. There are needs for them. So the world has changed. This model is in demand.

Drew: Interesting. I've just—I have to take you back to Silicon Valley a few weeks ago. A couple of recruiters, Kate Bullis and Hugh Marshall, and a CEO stood up and said, "I was so disappointed in my VP of Marketing. I had to fire her." And, you know, we sort of—we all asked her a bunch of questions, and ultimately we got to the point was she really wasn't ready for a CMO, and a fractional might have been a perfect thing for her to help guide her. And I think that's really important about this thing. I mean, if you read Allison Hartsoe Terry's books, "Stand Out Startup," she's all in on the CEO at an initial stage being the sort of marketing visionary and not bringing in a head of marketing early. So it is, but fractional would help, particularly for a CEO who has no clue.

Alan: Everybody thinks they know marketing too. They know what marketing is, but nah.

Drew: Wait... I watched the Super Bowl. You mean, that's not...

Katrina: I think people get hung up on the time as opposed to the impact. So it's less about two days a week, five days a week, one day a week, whatever it is. It's less about that and more about does this person bring the expertise that can get you to the impact more quickly? Because, you know, the three of us, at least, have been around marketing for a long time. As we all joke, like, we'll never say we've seen it all because you're gonna—Baby's gonna say, "Hold my beer," and send you a zinger. But you see a lot, right? You've seen a lot more than someone that most of these companies can afford to hire full-time. And so you can get them further faster. So it's less about how many days a week and more about do you bring that level of expertise that you can just get there faster because you've done it a lot of times. Yeah. So you just get things done in two days a week that a Director of Marketing would take five days a week.

Drew: So I want to clarify. So first of all, speed to value. I get that. That's a really good promise for interims or fractionals, but I don't—why wouldn't a full-time CMO who has the same amount of experience be able to do the same thing? Is there something about being a fractional that enables you to either take shortcuts or not have to deal with certain things that enables you to have an impact faster? Because it seems to me that every CMO would want to have speed to value.

Alan: You're not tied to the politics if you're interim or fractional. And I don't think, you know—and in my case, I don't think it's an "if." I don't think it's an "or." I think it's an "and." I think it's, how can an interim CMO, especially when there's a gap in leadership and you don't have a CMO—and a full-time CMO in place—and I'll get into these situations a lot, it may take six to nine months to find the right full-time CMO. They don't want marketing to stop during that period, so you can provide the continuity. And then once the full-time CMO starts, you can work with that individual to help them be successful. I just want to say one thing that Katrina said earlier about the financial metrics and results. I couldn't agree more. Actually, I started in finance before I went into marketing, and I always get along with CFOs. But you know, I can't overemphasize what Katrina said earlier about having the right metrics and being able to convert what marketing does into the financial impacts to the organization.

Marshall: Well, and as a fractional CMO, you have the opportunity to work with a CEO and their team who understand enough about marketing and its value, and maybe they just haven't had that partnership with a CMO. And you get to prove to them, "See, this is how a CMO and their expertise can help you grow," and then maybe make more investments and then make a permanent investment, right? Sometimes, you know, a CEO needs that to see that in action, and you can help educate them. Now, in the sales process, I'm very clear, though, there are some CEOs who will not change their view of marketing as they think marketing is all tactical. That's not going to be a good fit for a fractional CMO, because you're going to bring strategy, you're going to create that strategic vision, and then you're going to execute it with the resources available. So it's just an opportunity to help, you know, raise the visibility and the impact of the marketing function through the outcomes that Katrina mentioned.

Drew: So is it fair to say that in—so again, it's hard with a startup, because they might not have the budget in two years or three years for a full-time—but what you're in some ways doing as a fractional, not an interim, because it's different, as a fractional, you're sort of saying you're creating aha moments where they go, "Oh, that's what marketing can really do. Oh, I get it now. That's the kind of impact." So there's a lot of sort of ground-level education that you're doing with the C-suite to get them to go, "Oh, wow." And so if we had a full-time person doing this, we'd be able to do even more than we're doing now. And is that—because this is the part that, you know, a lot of folks are asking, which is, how do you make sure fractional doesn't mean full-time expectations with part-time pay?

Katrina: Well, I think you have to be clear too. You know, a question I get a lot is, "What happens when you disappear, Katrina? What happens when you go away?" And so you have to provide this off-ramp for your client in a way that's meaningful to them and that doesn't create a big speed bump in everything you just worked so hard to help get them to. And so I think all three of us have kind of productized, if you will, what we do slightly differently, but with a similar theme of, like, you kind of step down the work that you do. Like, I go in, like, do an assessment, build your foundation, get it all humming, get the pieces together. That's kind of phase one. Phase two, now I'm going to help you bring in a more senior person to lead this team. We're going to get it running. We're going to make it work. We're going to build out the right talent. We're going to get it really rolling. We're going to get the metrics zooming. And then step three is, I'm going to take a step back into, like Alan said, more of like that mentor-type role. I'm still here because that leader—it's a lonely job. When you run a marketing function, if you've not done it a lot of times, you don't have people to talk to, really internally, about stuff or to bounce the strategy off of, necessarily. And so we can then provide that safe space so that person can really then grow into more of that executive that the company wants them to be and that they want to be too. Being methodical about that and knowing what those tipping points are at your client for when they're ready for that next stage of your offering, I think, is really important, because don't expect the client to just figure it out on their own. Like, you owe it to them to help them on that journey. I think that's my view, anyway, but I think that's important, because I think that's a fear. Marketing is not particularly well understood by most CEOs, because it's not their background, and an investor, same thing, not their background, and it's a newish kid on the block for fractional executives. You know, fractional CFOs have been around a really long time, and people kind of understand what that means, but they also know what a CFO does.

Drew: Right, and a balance sheet. I mean, it's the same at every job. You look at the balance sheet, you manage your cash flow. You know that job. Almost every CFO can go from any CFO role to another, CMO, and look at the business and do an analysis. Not the same for CMOs. So we're getting close to the end, but I want to—there's a few quick things that if you were to look at your last three or four engagements, just on average, how long were they?

Marshall: So on average, my engagements and the engagements of my peers at yorCMO are anywhere from one to two years. Some of my peers have had engagements as long as three, four, five years, okay? And, you know, these are high-level goals, big goals that are going to take a while to get to. You know, in some cases, the engagement length is as long as a full-time CMO role might be at a similar company. So that's why I think a lot of CMOs are now considering this as a path, because if you can kind of go into an engagement knowing, "Okay, this is going to be a two-year gig," and I have some say and control in this, as opposed to going into a full-time role and then they tell you when it's over, it can be appealing.

Drew: Right. Go ahead, Alan.

Alan: No, my case, I'd say six to 18 months on average. But now I have three proposals out with past clients who want to bring me back for one thing or another. So, you know, it's like Arnold, "I'll be back." You know, it's—I view these as ongoing relationships, right, with all the clients I work with, and they often bring me back for other things, even if I've been interim for, you know, say, six months or, you know, up to 18 months. The one thing I'd add in terms of the transition, you know, when you hire a full-time CMO, I always give them a great transition, you know, optimally. I like to stay on for another year to be their mentor and coach, because I love doing that. But sometimes, when the new CMO starts, they may not have the confidence to have someone that's been in the whole infrastructure. So it really depends on the individual. I like to encourage that, but not everyone is comfortable with that. So it really depends. It's really kind of situation, right, if that makes sense.

Drew: It does. Okay. We have one question we're going to try to answer before we get final words of wisdom. This is, how are you managing questions and expectations around implementing AI and being seen as BG, as in, before generative, versus AG, after generative, marketing leader? Is that coming up?

Marshall: It is coming up. In fact, more and more of my prospective clients, or clients, are asking for input on, "How do we put AI in motion? How do we make sure that the company is being found, being found on AI tools?" You know, that's something that we're starting to offer. We're starting to think about, "How can we help them from an automation perspective?" and staying current on that, whether you're a fractional or a full-time, is a critical skill today. So we're getting those questions, and we're helping them begin the process of putting that in place, wherever they're at in the process.

Drew: And by the way, thank you for that. So all right, we need to wrap up with final words of wisdom for other CMOs when it comes to fractional CMO-ing. And I think we'll start with Marshall.

Marshall: I'll go back and say again, this path is a viable path today, and you have to really think about, do you have the right personality to do this? What support are you going to need in this kind of approach? Do you want to have a firm that's going to help you with some of the back-end billing and, you know, help you with business development? Or do you feel confident you can do that on your own? But I also think you have to know, where are your talents and skills? Do you work well with early- to mid-stage companies? Do you like being part of that early vanguard to help them get rolling with, you know, marketing? If that is a fit for you, then being a fractional CMO could be a really great option.

Drew: I love it. Okay, Katrina.

Katrina: I would echo that as well. I think be clear about the work that you like to do. The nice thing about being a fractional CMO is, to a certain degree, you pick your clients, so that's helpful. So be clear about, like, you know, "I like mid-market companies at major growth inflections that have a mix of organic and inorganic growth." That's my zone, right? But that may not be somebody else's zone, right? So rather than just saying, "Yeah, I do marketing, and yeah, I can do everything," that's not helpful when you're talking to a CEO. They have specific business strategy challenges that they need to solve. So you need to map what you're really good at to what they're trying to solve, and have the confidence to just lean into that, and it will help. It'll help clarify your role when you get there. It will help prioritize the work that you do, and you're probably going to enjoy it a lot more.

Drew: Yeah, and you're going to be a lot better at it. No doubt, having a zone is one of the highlights of this, and it's really hard when you start because you want revenue, and you're doing this because you want revenue. All right, let's see, who does that leave? Alan, final words of wisdom.

Alan: So yes, I agree with Katrina. Narrow down your niche. What are the problems you've solved in your career so many times over and over again, you can almost solve them in your sleep? There are a lot of companies that need that. But narrow down, and I'll just say it's the best thing that happened to me. I love what I do. And decide what you want to do when you grow up. Do you want to keep full-time roles? Or do you want to build your own business? But I found building your own business is wonderful. It's very, very lucrative. It gives you a lot more flexibility, and you really can help organizations grow and get a lot of variety. So if you think it's right for you, it's a fantastic place to be.

Drew: Yeah, and you really are running your own business, and I think that's an important part of that. That means you are both, you know, Chief Sales and Marketing Officer. The niche—I can't emphasize enough how that niche and your focus or zone allows you to focus your website, focus your content, focus your discovery process. So ultimately, you are the expert, and when you are the expert who can walk in day one and help them, as Katrina talked about, you know, really get somewhere fast, the value will be obvious, and you'll be able to get more business. And the other thing is, as your expertise grows, your rates can grow, and that's really important in this thing, because what happens when you have four clients? You don't have time. Here's what you do: you raise your rates, and then you'll have two, but you'll be making more money. All right. Well, thank you. Alan, Katrina, Marshall, you're all great sports. Thank you, audience, for staying with us.

 

To hear more conversations like this one and submit your questions while we're live, join us on the next CMO Huddle Studio. We stream to my LinkedIn profile. That's Drew Neisser, every other week.

Show Credits

Renegade Marketers Unite is written and directed by Drew Neisser. Hey, that's me! This show is produced by Melissa Caffrey, Laura Parkyn, and Ishar Cuevas. The music is by the amazing Burns Twins and the intro Voice Over is Linda Cornelius. To find the transcripts of all episodes, suggest future guests, or learn more about B2B branding, CMO Huddles, or my CMO coaching service, check out renegade.com. I'm your host, Drew Neisser. And until next time, keep those Renegade thinking caps on and strong!