Can a leader be effective working 10 hours/week?

👋 Hey all. It's the 8th episode of The Part-Time Tech Podcast! For the newsletter portion, we’re doing something a bit different this time. Based on feedback from you all, the article will be a standalone case study that can be understood regardless of whether you want to watch or listen to the podcast. It’s a bit longer than other posts, but I wanted to do a dive deep on how a fractional engagement can be very successful.

While the example in the case study is for engineering, the lessons can be applied to nearly any type of function or role in a company.

If you prefer to watch or listen, you can still head to YouTube or listen wherever you get your podcasts.

Links ⛓

• We interviewed Sahil Lavingia (Part 1, Part 2) back in December about running his company Gumroad completely async with part-time contractors only. His goal was to issue dividends to all contractors and investors. Last week they issued their first $1 million dividend. Successful companies come in many different shapes and sizes.

• Shameless plug: I’m working on another side project called https://wedontworkremotely.com/ for people who don’t want to work remotely.

• ICYMI: How to launch your independent consulting business toolkit

David Cherrie is the CEO of Arcade, a SaaS startup that helps sales teams stay engaged through gamification and rewards. Last year, I did a 6 month consulting engagement with Arcade as an interim, fractional Head of Engineering.

This engagement was my first true look at fractional leadership and how it can create win-win situations for both the leader and the company. It was a really satisfying job for me on a personal basis, and as you’ll hear from David, fractional leaders helped Arcade level up in a relatively short time period as well. As I like to say “we left the company in better shape than we found it”.

This engagement is a fantastic case study in how fractional leadership can be a perfect tool for both companies and talent when wielded correctly. Let’s dive in.

Watch on YouTube, or listen wherever you get your podcasts.

Case study: Can a leader be effective working 10 hours/week?

Arcade was founded in 2016 and is a SaaS platform to help make work fun and reward sales teams. Today it’s roughly a 20 person startup. Their original audience was retail based sales teams, but as the pandemic hit, it made sense to pivot towards completely remote and digital software sales teams.

Like many other startups encountered, COVID presented both opportunities and difficulties for the team. Arcade was simultaneously shifting the core of their team from Australia to the US. So in the midst a pivot, a global pandemic, and this new remote world, the engineering team was struggling to ship product reliably and there was some turnover as well.

David Cherrie, founder and CEO, knew they needed to find engineering leadership to help the team through a completely new phase of growth and strategy.

Evaluating Options

The most natural inclination when you have a gap in leadership is to write a job description and go hire full-time for those roles. Hiring a new head of engineering would’ve been a reasonable next step for Arcade. David instead chose a different route.

When working through some go-to-market challenges he had, David went to his investors and was recommended a sales leader (a previous co-worker of mine, we’ll call him John) who could help advise Arcade for a few hours per week. Advisory or fractional hires were not something he had considered before, but given the high praise and track record for John, David gave it a shot. The engagement ended up being extremely successful and David was encouraged by the outcomes.

So when it was time to consider how to shore up the engineering side of the house, John recommended me.

I was not in a position to consider any full-time roles, but had the exact experience Arcade needed at the time in growing and and strengthening engineering teams. After a few brief conversations, David knew that hiring me me as a fractional leader made more sense than hiring someone full-time at the moment. Some of the reasons why:

While the goal was certainly to have a full-time engineering leader for the long haul, it made more sense in the immediate term to bring on someone part-time.

In terms of cost, David knew I wasn’t cheap, but he understood that opportunity cost was the bigger cost given the circumstances. If I could deliver on the outcomes I was promising, it would be well worth it.

Contract terms and expectations

The contract was at-will, but we set the expectation it would last for up to six months. I was to charge hourly for approximately 10 hours/week as an independent contractor, and I was compensated primarily with cash, and a small bit of equity as well. For startups where cash is king (especially during the tumult of COVID), some equity helped bridge compensation gaps.

The compensation was a bit more than I was making on a pro-rated basis at bigger tech companies. Keep in mind I was not receiving benefits which made it easier to pay more in cash.

Six months felt like the right amount of time to get enough done with the team but not create any dependence on me as an interim leader. It also gave me some time to help recruit the next full-time leader. Personally, it also lined up perfectly with when my daughter was to be born and I wanted to be ‘on leave’.

We aligned our expectations ahead of time on what I would and wouldn’t be able to do. My goals were to help coach individual team members, elevate engineering practices, hire, and support product strategy. The constraint of 10 hours/week meant I could not be hands-on-keyboard and coding or fixing individual problems. It meant I had to lead through influence, leverage, and building the team rather than fixing individual problems on my own.

Value proposition

While fractional leaders are typically cheaper on an absolute basis than a full-time leader, they can still be expensive. When asked how he thought about the costs, David was extremely pragmatic.

First, he worked to understand the outcomes each leader was committing to deliver. Then he assessed as a startup what the opportunity cost would be of not hitting those outcomes, and whether they had an alternative.

In our case, I was committing to helping strengthen the engineering teams productivity, personnel, and work through some major strategy shifts, and helping them identify their long term leader. The opportunity cost of not doing this was catastrophic. The alternative to a fractional leader who could do this well was spending several months with no leader trying to make the full-time hire. When viewed in this light, if David believed I was trustworthy, the hire was a “no-brainer”.

In a startup, every month you’re burning through significant runway, even if you’re lean, and hiring cycles can be brutally long. By using fractional leaders through his network, David was able to get myself and other leaders in immediately that would help deliver on those outcomes.

Getting to work

My biggest concern was helping the team to be ‘self-healing’. At 10 hours/week, I could not be a firefighter fixing everything so from the beginning I had to figure out what my exit plan was six months in the future.

I started with a lot of listening to evaluate where the team was at, find root causes of issues, and see where I could help the most. I was also lining up David’s assessment of the team to my own personal assessment and identifying any discrepancies.

When it was pretty clear what certain issues were, rather than fix them directly, I worked to figure out how to get the team to self identify those issues, and enable them to solve them on their own.

This took the form of team retrospectives, some changes in mindset around what the responsibilities of engineers was, and also setting expectations with David about what his role was in supporting and working with the team.

I also provided some “state of the union” type reports to the team that identified issues, strengths, and action plans. As a new and interim leader, you have a great opportunity to inject some new energy and bias for action.

My day-to-day looked like a mix of 1:1s with the team and David, getting or setting clarity on team objectives, interviewing, and helping set guidance on engineering practices with the team.

Outcomes

So how did it all work out? By the end of the six months…

So, can a leader be effective with 10 hours/week? The answer, unequivocally as we’ve seen is… it depends!

All-in-all, I believe my time with Arcade reflected some of the best of how fractional leadership can create win-win situations for startups and talent alike.

Especially in today’s environment where financially prudent growth is more important than growth-at-all-costs, companies need to expand their toolset of how they reach great talent. It won’t be the right tool for every job, but wielded correctly, it can be extremely impactful and cost-effective.

Would you ever consider hiring fractional leaders? Would you work fractionally? Feel free to drop a comment or reply to this email why or why not.

Chapters

(0:00) Arcade and Background
(5:06) Struggles
(7:54) Turning to fractional hires
(13:06) Why fractional worked for Engineering
(14:55) Different levels of fractional
(18:26) Time forcing functions
(21:50) Compensation and Opportunity Cost
(27:30) Limitations and Candor
(34:12) Contract to hire and fractional