MIND THE GAP

Understanding the roles of fractionals, independent consultants, interim professionals and contractors can be challenging due to the nuanced differences in their work arrangements and responsibilities. While it may seem like the term fractional has gained in popularity in recent years, it has been around in some form or fashion for years.

But how do you position yourself in the independent landscape, and where do you find resources and clients?

CLOSE THE GAP

Fractional consultants typically work part-time for multiple clients, offering specialized expertise without the commitment of a full-time hire.

Independent consultants are self-employed professionals who provide expert advice and services to businesses on a project basis, often with more flexibility in their engagements.

Interim professionals are self-employed, highly skilled professionals who temporarily assume a particular role and perform their duties for a set amount of time until the project is complete or a full-time person is hired.

Contractors are usually hired for specific tasks or projects, often with a clear end date, and may work through an agency or directly with a company.

The complexity arises from the overlapping nature of these roles and the varying legal and tax implications associated with each. To navigate these distinctions, resources such as the Small Business Administration (SBA) website, industry-specific forums, and professional networks like LinkedIn can provide valuable insights. Additionally, consulting industry publications and legal advice from employment law specialists can offer guidance on the contractual and regulatory aspects of these roles.

You are not alone. The number of independent workers in the United States has accelerated since 2020. It is estimated that there are 72.1 million fully or partially independent workers in the US, or about 45% of the workforce. People venture into independence for different reasons. Some don’t want to work for others ever again while some use it as a side-hustle on the path to a full-hustle.

While people use the terms fractional, contractor, and consultant interchangeably, there are subtle differences. This table is a directional guide to help you distinguish your services to the ideal client.

You can be all or only one of these. It’s up to you. I offer all four services making it clear to my prospect the use case for each. The case for providing all four is that you offer the same skill and expertise but at different levels of commitment and investment.

There is another category that I won’t get into but that you should be aware of. The role of the Advisor is to provide your expertise in limited interactions. This could take the shape of a board advisory position. Some of these are paid or compensated with company equity (shares in the company), which occurs primarily in the startup community. Don’t overlook these opportunities to be compensated by showing up and sharing your expertise. I was a named advisor for a medical device startup where I received equity in the company.

Freelancing falls under contractor. The critical difference is that a freelancer is contracted for a specific project and will invoice by project. For example, a freelance graphic designer hired to work on a marketing campaign will work on that campaign and invoice it when completed. A contractor may work on multiple projects as needed. A freelancer is somewhat “on call” and is not obligated to accept the work, whereas a contractor is contractually obligated to do work defined within the contract.

Don’t get hung up on the words; focus on your expertise and how you want to structure your business and your time. For example, if you’re a fractional that offers 50% of their time, you could be a fractional to two companies. But probably not more than that. Or you could do one fractional and some contracting work.

Let’s examine each structure and consider how you could position yourself or your company. This is a guide—there are no hard and fast rules. How you are paid depends on the company and the law. Interim professionals, for example, could be salaried employees for one year. For instance, I was a fractional director for a school and they preferred to pay me every two weeks for three months via their payroll system rather than be invoiced. This worked for me because I didn’t have to wait 30 days to be paid for each invoice. Even though I was a fractional director, they put me in the system as a contractor for payment reasons. Same rules apply and it was more flexible for them.

Be sure you understand how the law and taxes apply to your situation.

Communities for Independents

Find work for independents

Other resources for independents

I advocate using productivity tools to help run your business. Here are the types of tools you should invest in.

Customer relationship management (CRM) can help you manage the client relationship, from prospect to paid work. Look for tools with automation, templates, and a client portal. Honeybook is my go-to, but also look into Hubspot, 17 Hats, and Zoho.

Project management will help streamline workstreams and keep you on track with milestones and deliverables. Honestly, any tool will do as long as it works with your style. If you have a client who wants access to the project plan, look for a platform that has a client-access view and a private view for your notes. In the past I’ve used Smartsheets. Unfortunately, there’s no free version.

Information management and planning tools can centralize all of your company documents, ideas, and so much more. I am an enthusiastic fan of Notion. I manage my business and my life in the FREE version of Notion. I get if you’re a Google Workspace person. There are integrations. I don’t recommend Notion to manage projects however. By the time you get it set up, you could have used Asana or Base Camp.

Scheduling. For the love of all that is good and pure in this world, stop sending emails back and forth to find a time to meet! There are dozens of free and paid tools. Two that I like are Calendly and TidyCal. If you have a Gmail account, this functionality is built in.

Check out my tech stack if you want to know the tools I use.

THE GAP DĒMĬSTəFĪED

If you are thinking of making the move to independent or you have and finding it a challenge to navigate this new world, don’t boil the ocean. The different structures are merely to provide flexibility for your client to access your expertise. The future of work is changing. It offers the ability for small companies to scale up slowly while getting the expertise they need at the investment level that makes sense for them.

You started doing independent work to create flexibility in your life, you are doing the same for your clients. Decide what structure(s) you will offer, make it clear to your prospects, use resources to streamline your work and get things done.