The Complete Fractional CTO Pricing Guide 2025

Fractional CTO pricing typically ranges from $8,000 to $25,000 per month, with most companies paying $12,000-$15,000/month for standard engagement. That's 50-70% less expensive than hiring a full-time CTO, while getting access to more experienced leadership.

But pricing varies significantly based on your company stage, industry, complexity, and needs. A pre-seed startup might pay $8,000/month for strategic guidance, while a Series B FinTech company might invest $20,000+/month for comprehensive CTO services including compliance oversight.

This comprehensive guide breaks down everything you need to know about fractional CTO pricing: the different models, what drives costs, typical packages by stage, hidden costs to avoid, and how to calculate ROI.

By the end, you'll know exactly what to budget and what you should get for your investment.

Why Fractional CTO Pricing Matters

Before diving into numbers, let's talk about why getting pricing right matters.

The Full-Time CTO Cost Reality:

Base salary: $250K-$450K
Benefits and taxes: +25-30% ($62K-$135K)
Equity: 0.5-2.5% (worth $500K-$2M+ at exit)
Recruiting fees: $50K-$90K (20-25% of salary)
Total Year 1 Cost: $362K-$675K+

The Full-Time Risk:

6-month average hiring time (burning runway)
40% chance of executive hire not working out in first 18 months
If it doesn't work, you've spent $200K-$400K+ and lost 12-18 months

Fractional CTO Alternative:

Start in 2-4 weeks (not 6 months)
Pay $96K-$300K/year (60-75% cost savings)
Month-to-month flexibility (end engagement if not working)
Access to more experienced talent (15-20 years vs. 8-12 years typical for affordable full-time)

Now let's break down exactly what you pay and what you get.

Fractional CTO Pricing Models

There are four main pricing models. Each works better for different situations.

Model 1: Monthly Retainer (Most Common - 80% of Engagements)

How It Works:

Fixed monthly fee for specific scope of work
Defined number of hours or days per month
Predictable, recurring cost
Usually 3-6 month minimum commitment

Typical Structure:

Starter Package: $8K-$10K/month for 20-30 hours
Standard Package: $12K-$15K/month for 40-50 hours
Premium Package: $18K-$25K/month for 60-80 hours

What's Included:

Regular strategic sessions (weekly or biweekly)
Architecture reviews and decisions
Team leadership and guidance
Investor/board presentations
Hiring support
Emergency availability (within reason)

Pros:

Predictable monthly cost
Ongoing relationship and context
Priority access to CTO
Best value per hour (30-40% discount vs. hourly)

Cons:

Monthly commitment (though usually flexible)
Pay for retainer even in slower months
May include more hours than you need initially

Best For:

Ongoing strategic guidance (most startups)
Companies 5-50 employees
Seed through Series B stage

Real Example: Series A SaaS company, 12 engineers, paying $14K/month retainer:

2 days/week fractional CTO time (64 hours/month)
Weekly strategy sessions (4 hours)
Monthly board prep (4 hours)
Architecture reviews (8 hours)
Hiring support - technical interviews (8 hours)
Team mentorship and 1-on-1s with leads (12 hours)
Ad-hoc guidance via Slack (8 hours)
Emergency availability

Effective Rate: $218/hour (vs. $300-400/hour on hourly model)

Model 2: Hourly Rate (15% of Engagements)

How It Works:

Pay per hour used
Track time precisely
Invoice monthly for hours worked
No minimum commitment (usually)

Typical Rates:

Junior Fractional CTO (5-10 years): $200-$300/hour
Mid-Level Fractional CTO (10-15 years): $300-$400/hour
Senior Fractional CTO (15-20 years): $400-$500/hour
Executive Fractional CTO (20+ years, previous exits): $500-$600/hour

What's Included:

Only actual work time (meetings, reviews, deliverables)
Usually NOT including async communication (Slack, email)
Billed in 15-minute or 30-minute increments

Pros:

Pay only for time used
No monthly commitment
Flexibility to scale up or down
Good for one-time projects

Cons:

Higher per-hour cost (30-40% more than retainer)
Less predictable monthly cost
CTO less invested (transactional relationship)
Time tracking overhead

Best For:

One-time projects (architecture review, tech due diligence)
Uncertain or variable needs
Very early stage (2-5 people) with limited budget
Short-term engagements (1-3 months)

Real Example: Pre-seed startup, 3 engineers, needs architecture review before fundraising:

20 hours of work over 3 weeks
Rate: $350/hour
Total Cost: $7,000
Deliverables: Architecture document, tech stack recommendation, investor presentation materials

When This Makes Sense: One-time need, not ongoing relationship. If engagement extends beyond 30-40 hours, retainer becomes more cost-effective.

Model 3: Project-Based Fixed Fee (3% of Engagements)

How It Works:

Fixed price for specific deliverable or project
Scope defined upfront
Payment milestone-based (often 50% start, 50% completion)
Timeline: 4-12 weeks typically

Typical Projects & Pricing:

Project Type	Typical Duration	Fixed Fee Range
Architecture Review & Roadmap	3-4 weeks	$15K - $30K
Technology Stack Evaluation	2-3 weeks	$10K - $20K
Technical Due Diligence (for acquisition)	2-4 weeks	$20K - $40K
Hiring & Recruiting Strategy	4-6 weeks	$12K - $25K
Infrastructure & Security Audit	3-5 weeks	$18K - $35K
Team Assessment & Reorganization	3-4 weeks	$15K - $28K

What's Included:

All work to complete defined scope
Specific deliverables (documents, presentations, recommendations)
Usually 1-2 follow-up sessions after delivery

Pros:

Know total cost upfront
Clear deliverable and timeline
No ongoing commitment
Easy to budget

Cons:

Scope creep can cause issues
Less flexible than retainer
Higher cost for equivalent hours (20-30% premium for project risk)
Relationship ends after project

Best For:

Specific, bounded projects
Pre-fundraising technical prep
M&A due diligence
One-time strategic initiatives

Real Example: Series A company preparing for Series B fundraising:

Project: Technical due diligence prep and investor materials
Duration: 4 weeks
Fixed Fee: $25,000
Deliverables:
- Technical architecture documentation
- Security and compliance review
- Engineering metrics dashboard
- Technology roadmap presentation
- Investor Q&A preparation
- 2 follow-up sessions during fundraising

ROI: Raised $15M Series B, CTO documentation gave investors confidence. $25K investment to de-risk $15M raise.

Model 4: Equity or Equity + Cash (2% of Engagements)

How It Works:

Fractional CTO takes partial or full payment in equity
Usually equity + reduced cash (not pure equity)
Equity: 0.25-1.5% typically
Vesting: 1-2 years (faster than full-time 4-year vesting)

Typical Structures:

Option A: Reduced Cash + Equity

Cash: $5K-$8K/month (40-50% discount)
Equity: 0.5-1% with 1-2 year vest
When: Pre-seed/seed with limited cash, strong upside potential

Option B: Deferred Cash (Converts to Equity)

Bill normal rates ($12K-15K/month)
Company can't pay, converts to equity at next round
Equity valued at discounted rate (20-30% discount to next round)
When: Pre-revenue, fundraising soon

Equity Ranges by Stage:

Company Stage	Cash Reduction	Equity Grant	Total Annual Value
Pre-Seed	50-60% off	0.75% - 1.5%	$60K cash + equity
Seed	30-40% off	0.5% - 1%	$90K cash + equity
Series A	20-30% off	0.25% - 0.5%	$120K cash + equity
Series B+	Rare	0.1% - 0.25%	Usually full cash

Pros (For Company):

Preserve cash runway
Align CTO with long-term success
Get better talent than cash budget allows

Cons (For Company):

Dilution
CTO less motivated if equity value unclear
Complicated cap table

Pros (For CTO):

Upside if company succeeds
Larger equity stake than full-time role
Portfolio approach across multiple companies

Cons (For CTO):

Most startups fail (equity worth $0)
Illiquid for years
Risk of not getting paid

Best For:

Pre-seed/seed companies with <6 months runway
Strong founding team and traction
Clear path to fundraising or revenue
CTO believes in massive upside

Real Example: Pre-seed startup, 2 founders + 2 engineers, 4 months runway:

Normal Rate: $12K/month retainer
Equity Deal: $6K/month + 1% equity (4-year vest, 1-year cliff)
Engagement: 12 months
Total: $72K cash + 1% equity
Outcome: Company raised $3M seed at $12M valuation → equity worth $120K on paper
If company hits $100M exit: $1M equity value

Risk Assessment:

70% chance equity worth $0 (company fails)
20% chance equity worth $50K-$200K (modest exit)
10% chance equity worth $500K-$2M+ (strong exit)
Expected value: ~$70K-$150K (vs. $144K full cash)

When We Recommend: Only if you have <6 months runway AND strong indicators (revenue traction, founder track record, investor interest).

Average Fractional CTO Costs: By Package

Here's what most companies actually pay, broken down by engagement level.

Starter Package: $8,000 - $10,000/month

Typical Engagement:

20-30 hours per month (1-1.5 days/week)
Monthly or biweekly strategic sessions
Asynchronous support via Slack/email
Occasional deep-dive sessions

What's Included:

Technology strategy and roadmap (quarterly)
Architecture review and guidance (monthly)
Build vs. buy recommendations
Hiring support (job descriptions, final interviews)
Investor/board presentation prep (as needed)
Emergency consultation (limited)

What's NOT Included:

Daily team management
Hands-on coding or implementation
Weekly team meetings
Extensive 1-on-1s with engineers
24/7 availability

Best For:

Pre-seed to seed stage
2-8 engineers
Technical founder who needs strategic sounding board
Stable tech stack, no major architectural changes
Limited budget (<$120K/year for fractional CTO)

Real Companies Using This:

Early SaaS startups with technical founders
Solo technical founders building MVP
Bootstrapped companies with small teams

ROI Calculation:

Cost: $96K-$120K/year
vs. Full-Time CTO: Saves $240K-$350K/year
Value Delivered: Strategic guidance prevents $50K-$200K+ in technical debt and wrong technology choices

Standard Package: $12,000 - $15,000/month

Typical Engagement:

40-50 hours per month (2-2.5 days/week)
Weekly strategic sessions
Regular team touchpoints
Active Slack/email engagement

What's Included:

Everything in Starter, plus:
Weekly leadership team meetings
Engineering team all-hands (monthly)
1-on-1s with engineering leads (monthly)
Active hiring participation (screening, interviews, offers)
Code and architecture reviews (weekly)
Engineering metrics and reporting (monthly)
Vendor evaluation and negotiation
Incident response and post-mortems
Regular availability (business hours, async)

What's NOT Included:

Daily standups or sprint planning
Hands-on coding (except critical architecture)
Full-time people management
24/7 on-call

Best For:

Seed to Series A stage
8-25 engineers
Non-technical founder or technical founder too busy with business
Growing team, establishing processes
Making significant technical decisions
Budget: $144K-$180K/year

Real Companies Using This:

Series A SaaS companies scaling engineering
FinTech/HealthTech with compliance needs
Companies with VP Engineering who need strategic oversight

ROI Calculation:

Cost: $144K-$180K/year
vs. Full-Time CTO: Saves $180K-$270K/year
Value Delivered:
- Better hiring (save $100K+ in bad hires avoided)
- Architecture decisions (save $200K+ in technical debt)
- Faster execution (20-30% velocity improvement = $150K+ value)
- Total Value: $450K+/year

This is our most popular package - see full details

Premium Package: $18,000 - $25,000/month

Typical Engagement:

60-80 hours per month (3-4 days/week)
Near-daily engagement
Deep team integration
High-touch, strategic + operational

What's Included:

Everything in Standard, plus:
Daily or every-other-day team touchpoints
Weekly 1-on-1s with all engineering leads
Active sprint planning participation
Hands-on architecture work (when needed)
Extensive hiring (multiple roles simultaneously)
Board meeting preparation and attendance
Investor relations and technical due diligence
Compliance and security oversight (FinTech, HealthTech)
M&A technical due diligence
Partner and vendor relationship management
24/7 emergency availability

What's NOT Included:

Full-time presence (still 3-4 days, not 5)
Individual contributor coding work
Direct management of all engineers (they manage through leads)

Best For:

Series A to Series C
25-50+ engineers
Complex technical needs (compliance, security, scale)
Regulated industries (FinTech, HealthTech)
Rapid growth phase (doubling team in 6-12 months)
Budget: $216K-$300K/year

Real Companies Using This:

Series B FinTech with SOC2 and regulatory compliance
HealthTech with HIPAA requirements
High-growth SaaS scaling from 20 to 50 engineers in 12 months
Companies preparing for acquisition

ROI Calculation:

Cost: $216K-$300K/year
vs. Full-Time CTO: Saves $100K-$200K/year
vs. CTO + VP Engineering: Saves $300K-$400K/year
Value Delivered:
- Expert-level CTO (15-20 years experience) at mid-level cost
- Compliance/security expertise (saves $150K+ consultant costs)
- Faster fundraising (technical credibility with investors)
- Total Value: $500K-$700K+/year

Custom/Enterprise Package: $25,000+/month

Typical Engagement:

80-120+ hours per month (4-6 days/week)
Effectively full-time with flexibility
Multiple company/portfolio engagements (some fractional CTOs)

What's Included:

Fully customized scope
May include multiple fractional executives (CTO + CISO, etc.)
Full strategic and operational leadership
Essentially full-time CTO without full-time commitment

Best For:

Series B+ companies with unique needs
Multiple portfolio companies (PE/VC firms)
Temporary full-time CTO (search for permanent)
Complex regulatory or compliance situations

Cost Comparison:

Fractional (Custom): $300K-$400K+/year
Full-Time CTO: $400K-$600K+/year
Still Save: $100K-$200K/year + recruiting costs + flexibility

What Affects Fractional CTO Pricing: 6 Key Factors

Not all fractional CTO engagements cost the same. Here's what drives pricing up or down.

Factor 1: Company Stage and Maturity

Pre-Seed / Bootstrapped:

Lower End Pricing: $8K-$12K/month
Why: Simpler needs, less complexity, limited budget
Typical Scope: Strategic guidance, architecture review, hiring help

Seed Stage:

Mid-Range Pricing: $10K-$15K/month
Why: Growing team, establishing processes, fundraising support
Typical Scope: Regular strategic sessions, team leadership, investor prep

Series A:

Standard Pricing: $12K-$18K/month
Why: Scaling complexity, more engineers, significant technical decisions
Typical Scope: Active team leadership, hiring, architecture, compliance

Series B+:

Premium Pricing: $18K-$25K+/month
Why: High complexity, compliance, scale challenges, board expectations
Typical Scope: Comprehensive CTO services, regulatory, M&A, deep team engagement

Pricing by Stage Table:

Stage	Team Size	Typical Monthly Cost	Annual Cost	Why
Pre-Seed	2-5	$8K - $10K	$96K - $120K	Strategic guidance only
Seed	5-12	$10K - $14K	$120K - $168K	Team building, processes
Series A	12-25	$14K - $18K	$168K - $216K	Scaling, hiring, compliance
Series B	25-50	$18K - $23K	$216K - $276K	Complexity, regulation, board
Series C+	50+	$23K - $30K+	$276K - $360K+	Full CTO services

Factor 2: Industry and Compliance Requirements

Some industries require more specialized expertise and carry higher compliance burdens.

Baseline Industries (1.0x pricing):

General SaaS
E-commerce
Consumer apps
Marketing tech

Typical Cost: $12K-$15K/month for standard package

Medium Complexity Industries (1.2-1.3x pricing):

B2B SaaS with enterprise clients
Data/analytics platforms
Developer tools
EdTech

Why More Expensive:

Enterprise security requirements
Data privacy (GDPR, CCPA)
Integration complexity
Higher technical standards

Typical Cost: $14K-$18K/month (+$2K-$3K/month)

High Complexity Industries (1.3-1.5x pricing):

FinTech and payments
HealthTech and digital health
InsurTech
Blockchain/crypto

Why More Expensive:

Heavy regulatory compliance (SOC2, HIPAA, PCI-DSS, FinCEN, etc.)
Security expertise required
Audit preparation and ongoing compliance
Risk management
Specialized technical knowledge

Typical Cost: $16K-$22K/month (+$4K-$7K/month)

Industry Pricing Table:

Industry	Compliance Needs	Monthly Premium	Total Monthly Cost
General SaaS	Basic (SOC2 optional)	Baseline	$12K - $15K
Enterprise SaaS	SOC2, GDPR	+$2K - $3K	$14K - $18K
FinTech	SOC2, PCI-DSS, FinCEN	+$4K - $6K	$16K - $21K
HealthTech	HIPAA, SOC2, FDA (devices)	+$5K - $7K	$17K - $22K
Crypto/Blockchain	FinCEN, AML, specialized tech	+$6K - $10K	$18K - $25K

Real Example - FinTech: Series A payment processing startup, 15 engineers:

Base Cost (if general SaaS): $14K/month
FinTech Premium: +$5K/month for:
- PCI-DSS compliance guidance
- SOC2 audit preparation
- Banking partner technical requirements
- Payment security architecture
- Regulatory risk assessment
Total Cost: $19K/month
ROI: Compliance consultant would cost $200-$300/hour × 40 hours/month = $8K-$12K, plus lack strategic technology guidance

Factor 3: Technical Complexity and Architecture

Low Complexity (0.9-1.0x pricing):

Standard web application (React/Node, Rails, Django)
Established tech stack
Minimal integrations
Cloud-hosted (AWS/GCP standard services)

Cost Impact: $10K-$13K/month

Medium Complexity (1.0-1.2x pricing):

Microservices architecture
Multiple integrations (10-20 services)
Real-time features (WebSocket, streaming)
Mobile apps + web
Multi-region deployment

Cost Impact: $12K-$16K/month

High Complexity (1.3-1.6x pricing):

Complex distributed systems
High-scale infrastructure (millions of users)
Machine learning/AI components
Real-time data processing (streaming, analytics)
Custom protocols or deep infrastructure work
Legacy system migration

Cost Impact: $16K-$24K/month

Why Complexity Matters: More complex systems require:

Deeper technical expertise (rarer, more expensive CTOs)
More time for architecture decisions
Specialized knowledge (ML, distributed systems, etc.)
Higher risk of costly mistakes

Factor 4: Geographic Location and Market

Fractional CTO pricing varies by location, though less than full-time salaries (fractional often works remotely).

Tier 1 Markets (1.2-1.3x pricing):

San Francisco / Silicon Valley
New York City
Premium: +20-30% over baseline

Why: Higher cost of living, competitive market, local presence expectations

Standard Package: $15K-$20K/month (vs. $12K-$15K baseline)

Tier 2 Markets (1.0-1.1x pricing):

Seattle, Austin, Boston, Los Angeles
Premium: +0-10% over baseline

Standard Package: $12K-$17K/month

Tier 3 Markets / Remote (0.9-1.0x pricing):

Other US cities
Fully remote engagements
Discount: 0-10% below baseline

Standard Package: $10K-$15K/month

Geographic Pricing Table:

Location	Market Premium	Standard Package	Premium Package
SF / Palo Alto	+25%	$15K - $18K	$22K - $30K
NYC	+20%	$14K - $17K	$21K - $28K
Seattle / Austin	+10%	$13K - $16K	$19K - $25K
Remote / Other	Baseline	$12K - $15K	$18K - $24K

Note: Remote work has reduced geographic pricing variation. Many fractional CTOs work remotely regardless of company location.

Factor 5: Engagement Hours and Commitment Level

More hours per month = higher total cost, but lower effective hourly rate.

Light Engagement (20-30 hours/month):

Cost: $8K-$11K/month
Effective Rate: $270-$370/hour
Best For: Strategic advice only, stable teams

Standard Engagement (40-50 hours/month):

Cost: $12K-$16K/month
Effective Rate: $240-$320/hour (best value)
Best For: Most companies, balance of strategy + engagement

Heavy Engagement (60-80 hours/month):

Cost: $18K-$25K/month
Effective Rate: $225-$315/hour
Best For: High complexity, rapid growth, compliance needs

Near Full-Time (100-120 hours/month):

Cost: $25K-$35K/month
Effective Rate: $210-$290/hour
Best For: Temporary full-time CTO, complex transformations

Pricing Efficiency:

Hours/Month	Monthly Cost	Effective Hourly Rate	Savings vs. Pure Hourly
20 hours	$8K	$400/hour	0% (baseline)
40 hours	$14K	$350/hour	12% savings
60 hours	$19K	$317/hour	21% savings
80 hours	$24K	$300/hour	25% savings
100 hours	$28K	$280/hour	30% savings

Commitment Length Impact:

Month-to-Month:

No minimum commitment
Highest monthly rate (no discount)
Most flexibility

3-Month Minimum:

5-10% discount vs. month-to-month
Standard for most engagements

6-Month Commitment:

10-15% discount
CTO can plan longer-term initiatives

12-Month Commitment:

15-20% discount
Best for ongoing strategic partnership

Example: Standard package, 50 hours/month:

Month-to-month: $15K/month ($180K/year)
6-month commit: $13.5K/month ($162K/year) - Save $18K
12-month commit: $12.5K/month ($150K/year) - Save $30K

Factor 6: Fractional CTO Experience and Specialization

Not all fractional CTOs cost the same. Experience and specialization drive significant price variation.

Mid-Level Fractional CTO (8-12 years experience):

Pricing: $8K-$12K/month standard package
Background: Senior engineer, engineering manager, first-time CTO
Best For: Seed stage, straightforward SaaS, limited budget

Senior Fractional CTO (12-18 years experience):

Pricing: $12K-$18K/month standard package
Background: Multiple CTO roles, scaled teams 10→50+, fundraising experience
Best For: Series A-B, scaling challenges, moderate complexity

Executive Fractional CTO (18-25+ years experience):

Pricing: $18K-$30K+/month standard package
Background: CTO at successful exits, scaled teams to 100+, board experience
Best For: Series B+, complex situations, high-stakes decisions

Specialized Fractional CTO:

Pricing: +20-40% premium for deep specialization
Examples:
- Machine Learning/AI CTO: +30% premium
- FinTech/Compliance CTO: +25% premium
- DevOps/Infrastructure CTO: +20% premium
- Security/CISO hybrid: +35% premium
- Blockchain/Web3 CTO: +40% premium

Experience Pricing Table:

Experience Level	Years	Standard Package	Premium Package	Track Record
Mid-Level	8-12	$8K - $12K	$14K - $18K	1-2 CTO roles
Senior	12-18	$12K - $18K	$18K - $25K	2-4 CTO roles, scaled teams
Executive	18-25+	$18K - $25K	$25K - $35K	Multiple exits, 100+ teams
Specialized	15+	$15K - $30K	$24K - $40K	Deep domain expertise

ROI of Experience:

Question: Is a $25K/month executive CTO worth 2x a $12K/month mid-level CTO?

Answer: Often yes, because:

Executive CTO Value:

Prevents $500K-$2M in wrong architecture decisions (seen it before)
Attracts better engineering talent (reputation and network)
Commands investor/board confidence (fundraising advantage)
Solves problems in 1/3 the time (pattern matching from experience)

Real Example: Series B company hired mid-level fractional CTO at $12K/month. After 6 months of slow progress and wrong technology decisions, switched to executive fractional CTO at $24K/month.

Result:

Month 7-12 with executive CTO: Resolved 18 months of technical debt, restructured team, prepared successful Series C
Cost Difference: +$72K over 6 months
Value Gained: Series C raised $30M, CTO credibility was cited by investors as key factor
ROI: Infinite (couldn't have raised without credible tech leadership)

Fractional CTO Pricing by Company Stage

Let's look at typical pricing for each stage, with real package details.

Pre-Seed Stage Pricing

Typical Company Profile:

1-2 founders + 0-5 engineers
Pre-revenue or <$10K MRR
Runway: 6-12 months
Raising: Pre-seed or small angel round

Typical Needs:

Technology strategy and stack selection
Architecture guidance for MVP
Hiring first engineers
Investor pitch technical content

Recommended Package:

Tier: Starter
Hours: 20-30 hours/month (1-1.5 days/week)
Pricing: $8K-$11K/month
Commitment: Month-to-month or 3-month minimum

What You Get:

Biweekly or monthly strategic sessions (2 hours each)
Technology roadmap and architecture review
Build vs. buy recommendations
Hiring support (JDs, final interviews for first 2-3 engineers)
Async support via Slack (limited)
Investor presentation technical content

Alternative: Hourly for One-Time Projects If you just need architecture review before building:

15-20 hours over 2-3 weeks
$300-$400/hour
Total: $4,500-$8,000

Real Example: B2B SaaS pre-seed, 2 founders (non-technical CEO, technical CTO), building MVP:

Package: $9K/month, 25 hours/month, 3-month commitment
Outcome: Validated tech stack, hired 2 engineers, prepared technical investor materials, raised $750K angel round
Cost: $27K over 3 months
ROI: Technical credibility helped close angel round, avoided $50K+ in wrong technology choices

Seed Stage Pricing

Typical Company Profile:

3-12 engineers
$10K-$100K MRR
Raised seed round ($1M-$3M)
Runway: 12-18 months

Typical Needs:

Scaling engineering team (hiring 3-8 engineers)
Establishing development processes
Architecture for growth
Series A preparation

Recommended Package:

Tier: Standard
Hours: 40-50 hours/month (2-2.5 days/week)
Pricing: $11K-$15K/month
Commitment: 3-6 month minimum

What You Get:

Weekly strategic sessions (90-120 minutes)
Monthly architecture reviews
Engineering hiring (screening, technical interviews, offers)
Process implementation (Agile, code review, testing)
Engineering metrics and dashboards
Monthly engineering all-hands
Series A technical prep (last 2-3 months of engagement)
Active Slack/email engagement

What You Don't Get:

Daily standups
Sprint planning (fractional CTO guides, team leads run)
Individual engineer management (you hire engineering managers for this)

Real Example: SaaS startup, raised $2M seed, 5 engineers, technical founder CEO:

Package: $13K/month, 45 hours/month, 6-month commitment
Outcome:
- Hired 5 more engineers (grew to 10)
- Implemented Agile processes
- Prepared technical materials for Series A
- Achieved SOC2 compliance
- Series A raised successfully ($8M)
Cost: $78K over 6 months
ROI:
- Avoided 2 bad hires (saved $200K)
- SOC2 compliance opened enterprise deals ($500K pipeline)
- Series A technical credibility (priceless)

See our seed-stage packages in detail

Series A Stage Pricing

Typical Company Profile:

10-25 engineers
$100K-$500K MRR
Raised Series A ($5M-$15M)
Runway: 18-24 months

Typical Needs:

Scaling from 10→30 engineers
Team structure and organization
Engineering leadership (hiring VPs, Directors)
Technical debt management
Compliance (SOC2, HIPAA, etc.)
Board and investor reporting

Recommended Package:

Tier: Standard to Premium
Hours: 50-70 hours/month (2.5-3.5 days/week)
Pricing: $14K-$20K/month
Commitment: 6-12 month minimum

What You Get:

Weekly leadership team meetings
Biweekly or monthly 1-on-1s with engineering leads
Hiring support (especially senior roles like VP Eng, Directors)
Architecture reviews and decisions
Engineering metrics and reporting
Board presentation prep (quarterly)
Compliance oversight (SOC2, security, etc.)
Vendor management and negotiation
Team reorganization as needed
Regular Slack/email engagement
Emergency availability

Additional for Premium Tier:

Weekly 1-on-1s with all leads
Monthly engineering all-hands participation
Daily Slack check-ins
Active sprint planning involvement

Real Example: FinTech Series A, $8M raised, 18 engineers, non-technical founder:

Package: Premium - $19K/month, 65 hours/month, 12-month commitment
Why Premium: FinTech compliance (PCI-DSS, SOC2), non-technical founder needed more hands-on guidance
Outcome:
- Scaled from 18→32 engineers
- Hired VP Engineering (fractional CTO managed search)
- Achieved SOC2 Type 2 and PCI-DSS compliance
- Reduced deployment time from 2 weeks to 2 days
- Prepared for Series B
Cost: $228K over 12 months
ROI:
- Compliance would have cost $150K+ in consultants
- VP Eng hire (fractional CTO saved $50K+ recruiting fees)
- Faster deployments (20% velocity increase = $300K+ value)
- Total ROI: $500K+ value for $228K cost

Series B+ Stage Pricing

Typical Company Profile:

25-75+ engineers
$500K-$3M+ MRR
Raised Series B or later ($15M-$50M+)
Runway: 18-30+ months

Typical Needs:

Scaling to 50-100+ engineers
Multiple engineering teams and VPs
Complex architecture and infrastructure
Compliance and security at scale
M&A technical due diligence
IPO or exit preparation

Recommended Package:

Tier: Premium or Custom
Hours: 70-120+ hours/month (3.5-6 days/week)
Pricing: $20K-$35K+/month
Commitment: 12-month minimum

What You Get:

Daily or near-daily engagement
Weekly 1-on-1s with VP Engineering and other tech leaders
Board meeting preparation and attendance
Investor relations technical support
Strategic initiatives (platform migrations, architectural evolution)
M&A technical due diligence (buy or sell side)
Engineering organization design
Executive-level vendor and partner negotiations
Compliance and security oversight
Crisis management and incident response
24/7 emergency availability

When Fractional vs. Full-Time at This Stage:

Fractional Makes Sense When:

You have strong VP Engineering handling day-to-day
CTO role is strategic, not operational
You want executive-level experience at lower cost
Flexibility matters (month-to-month vs. full-time hire)

Full-Time Makes Sense When:

You need 5+ days/week engagement
Internal team needs full-time CTO presence
Board expects full-time executive team
Approaching IPO (usually need full-time CTO)

Real Example: Series C HealthTech, $40M raised, 55 engineers, preparing for acquisition:

Package: Custom - $32K/month, 100 hours/month, 12-month engagement
Why Custom: M&A preparation, HIPAA compliance, complex regulatory environment
Outcome:
- Led technical due diligence preparation
- Achieved HIPAA and SOC2 Type 2 compliance
- Restructured engineering for scalability
- Supported acquisition process (technical buyer diligence)
- Company acquired for $180M
Cost: $384K over 12 months
ROI:
- Technical diligence readiness (buyers cited tech as key strength)
- Compliance (required for acquisition, would cost $300K+ in consultants)
- Acquisition success (technical issues can kill deals)
- ROI: Contributed to $180M exit

What's Included in Each Package: Detailed Breakdown

Let's detail exactly what deliverables and activities you get in each tier.

Starter Package ($8K-$11K/month) - Detailed Breakdown

Strategic Planning (30% of time):

Quarterly technology roadmap sessions (4 hours)
Annual technology strategy development (8 hours/year)
Build vs. buy analysis for major decisions (2-4 hours per decision)
Technology stack recommendations (one-time, 4-6 hours)

Architecture & Technical Leadership (25% of time):

Monthly architecture review (2 hours)
Code review of critical PRs (2-3 hours/month)
Technical debt assessment (quarterly, 3 hours)
Infrastructure and security guidance (as needed, 2-3 hours/month)

Hiring & Team Development (20% of time):

Job description creation (1 hour per JD)
Final-round technical interviews (1 hour per candidate, up to 4/month)
Offer guidance and negotiation support (30 min per offer)

Stakeholder Management (15% of time):

Monthly CEO/founder sync (1 hour)
Investor technical content (as needed for fundraising, 3-5 hours)
Board prep (if requested, 2-3 hours per board meeting)

Ad-Hoc Support (10% of time):

Slack/email async support (limited, non-urgent)
Emergency consultations (rare, 1-2 hours/month)

Total Time: 20-30 hours/month

Deliverables:

Technology roadmap (quarterly)
Architecture decision records (as needed)
Hiring scorecards and recommendations
Investor technical presentation (if fundraising)

Communication:

Biweekly or monthly video calls (60-90 min)
Slack channel access (async, response within 24-48 hours)
Email support
Emergency phone access (limited)

Standard Package ($12K-$16K/month) - Detailed Breakdown

Everything in Starter, plus:

Strategic Planning (25% of time):

Weekly strategic sessions (90 min)
Technology roadmap updates (monthly review, quarterly revision)
OKR setting and tracking for engineering (quarterly)

Architecture & Technical Leadership (25% of time):

Weekly architecture office hours (1 hour)
Code review of critical features (4-6 hours/month)
Monthly technical debt prioritization
Infrastructure planning and cost optimization (monthly)
Security and compliance guidance (ongoing)

Team Leadership & Development (25% of time):

Monthly 1-on-1s with engineering leads (3-5 leads × 30 min)
Monthly engineering all-hands (1 hour)
Engineering metrics review (weekly or biweekly)
Team health and culture check-ins

Hiring & Recruiting (15% of time):

Hiring strategy and planning (ongoing)
Job description and role definition (unlimited)
Resume screening (up to 20/month)
Technical phone screens (up to 8/month, 30 min each)
Final interviews (up to 8/month, 60 min each)
Offer creation and negotiation (unlimited)

Process & Operations (10% of time):

Development process optimization
Engineering metrics and dashboards setup
Tool evaluation and selection
Sprint/release planning guidance (monthly check-in)

Total Time: 40-50 hours/month

Deliverables:

Weekly written updates to CEO
Monthly engineering metrics report
Quarterly technology roadmap
Hiring scorecards and pipelines
Architecture decision records
Process documentation

Communication:

Weekly video calls (90 min)
Monthly extended strategy sessions (2 hours)
Daily Slack access (response within 4-8 business hours)
Email support (response within 24 hours)
Emergency phone access (4-hour response)

This is the sweet spot for most Series A companies - learn more

Premium Package ($18K-$25K/month) - Detailed Breakdown

Everything in Standard, plus:

Strategic Planning (20% of time):

Weekly strategic sessions (2 hours)
Quarterly business-technology planning with leadership team
Board-level reporting and presentations (monthly or quarterly)

Architecture & Technical Leadership (25% of time):

Daily architecture office hours or Slack support
Active participation in critical architecture decisions
Hands-on code reviews for critical features (8-10 hours/month)
Infrastructure and scaling planning (weekly)
Security architecture and compliance oversight (weekly)

Team Leadership & Management (30% of time):

Weekly 1-on-1s with all engineering leads (5-8 leads × 30 min)
Biweekly engineering all-hands
Monthly skip-level 1-on-1s (with individual contributors)
Team performance and culture active management
Conflict resolution and HR collaboration

Hiring & Recruiting (15% of time):

Active hiring for multiple roles simultaneously
Executive hiring (VP Eng, Directors) - full search support
Unlimited technical interviews
Offer negotiation and closing support
Onboarding support for senior hires

Compliance & Governance (5% of time):

SOC2/HIPAA/PCI-DSS preparation and audit support
Security incident response planning
Vendor security reviews
Policy and documentation creation

Stakeholder Management (5% of time):

Board meeting prep and attendance (quarterly)
Investor updates and technical diligence
Partner technical discussions
Executive team meetings

Total Time: 60-80 hours/month

Deliverables:

Daily Slack updates on critical items
Weekly written updates to CEO
Biweekly metrics dashboard
Monthly engineering health report
Quarterly board presentation
Architecture documentation (ongoing)
Compliance documentation and artifacts
Hiring pipeline reports (weekly)

Communication:

Daily Slack engagement (real-time during business hours)
Weekly 1-on-1 with CEO/founder (60 min)
Weekly team meetings
Ad-hoc calls as needed (unlimited)
Email support (response within 2-4 hours)
Emergency phone/text (1-hour response, 24/7)

Hidden Costs: What to Watch For

Fractional CTO pricing should be transparent, but some engagements have hidden costs. Here's what to watch for.

What SHOULD Be Included (No Extra Cost):

All strategic and architecture work within scope
Normal communication (Slack, email, video calls)
Regular meetings and 1-on-1s
Standard deliverables (reports, roadmaps, docs)
Hiring support (interviews, offers)
Emergency availability (within reason)

What MIGHT Cost Extra:

1. Travel Expenses

Common Charge: Actual costs (flights, hotels, meals)
When: If fractional CTO needs to visit your office
Typical: $1K-$3K per visit
How to Handle: Discuss upfront. Many companies include 1-2 visits/year in base price.

2. Specialized Tools or Software

Examples: Architecture diagramming tools, security scanning, compliance software
Cost: $500-$2,000/year
How to Handle: Usually included, but confirm. Company should provide tools.

3. Outside Experts or Consultants

Examples: Security audit firm, specialized compliance consultant
Cost: $5K-$50K+ depending on need
When: Fractional CTO identifies need for specialized outside help
How to Handle: Fractional CTO should disclose and get approval before engaging

4. Scope Creep

What It Looks Like: Hours consistently exceeding package
Why It Happens: Unclear scope, company needs grew, emergencies
How to Handle:
- Monthly hours tracking
- Discuss if trending 20%+ over
- Adjust package or scope

5. Recruiting Fees (If Fractional CTO Also Recruits)

Rare, but some fractional CTOs charge: 15-20% fee if they source and close candidates
Our Take: Should NOT be charged. Hiring support is part of CTO services.
How to Handle: Clarify upfront. Recruiting fees should only apply if you engage separate recruiter.

Red Flags - Pricing Issues to Avoid:

Red Flag 1: Extremely Low Pricing ($5K-$6K/month)

Why It's Suspicious: True experienced CTOs can't profitably work for this rate
What It Usually Means:
- Fractional CTO is junior (5-8 years experience)
- Low engagement (10-15 hours/month only)
- Offshore or non-US based (quality varies)
- Side gig, not primary focus

Red Flag 2: Nickel-and-Diming

What It Looks Like: Extra charges for every meeting, every document, every call
Why It's Bad: Destroys trust, unpredictable costs
Better Model: All-inclusive retainer with clear scope

Red Flag 3: No Contract or Unclear Terms

What to Watch: Handshake agreements without written scope
Why It's Risky: No clarity on deliverables, hours, expectations, cancellation
What You Need: Written agreement with scope, hours, deliverables, terms

Red Flag 4: Equity Required for Standard Services

When It's OK: Pre-seed with limited cash, mutually agreed
When It's Not: Fractional CTO demands equity for normal monthly work
Our Take: Equity should reduce cash, not be required on top of market-rate cash

Red Flag 5: Automatic Annual Increases

What It Looks Like: Contract includes automatic 10-20% annual increases
Why It's Problematic: Your needs might decrease, not increase
Better Approach: Renegotiate annually based on scope and value

Fractional CTO ROI & Payback Period

Is a fractional CTO worth the investment? Let's calculate actual ROI.

ROI Calculation Methodology

Total Cost:

Monthly retainer × 12 months
Any additional costs (travel, tools, etc.)

Total Value Delivered:

Avoided Costs (wrong hires, technical debt, bad decisions)
Accelerated Revenue (faster time-to-market, better product)
Cost Savings (efficiency improvements, infrastructure optimization)
Fundraising Impact (higher valuation, faster close)
Opportunity Value (your time freed up for CEO duties)

ROI Formula:

ROI = (Total Value Delivered - Total Cost) / Total Cost × 100%

Real ROI Example 1: Seed Stage SaaS

Company Profile:

Seed stage, $2M raised
8 engineers
Non-technical founder CEO
B2B SaaS product

Fractional CTO Engagement:

Package: Standard ($14K/month)
Duration: 12 months
Total Cost: $168,000

Value Delivered:

1. Avoided Bad Hires ($180K value)

Fractional CTO screening prevented 2 bad hires
Cost per bad hire: $90K (6 months salary + recruiting + productivity loss)

2. Technical Debt Prevention ($200K value)

Correct architecture from start
Avoided costly rewrite that would have cost $200K+ in 18 months

3. Faster Product Development ($150K value)

Better processes and team structure
25% faster delivery = 3 months saved
Opportunity cost: $50K/month = $150K value

4. Series A Fundraising ($300K+ value)

Technical credibility with investors
Raised at higher valuation (+10% due to strong tech story)
$10M raise at 10% higher valuation = $1M difference
CTO contribution: ~30% of technical story = $300K value

5. CEO Time Saved ($120K value)

CEO no longer managing technical decisions
10 hours/week saved × $250/hour × 48 weeks = $120K value

Total Value Delivered: $950,000

ROI Calculation:

ROI = ($950,000 - $168,000) / $168,000 × 100%
ROI = 465%

Payback Period: 2-3 months (based on avoided costs and faster development)

Real ROI Example 2: Series A FinTech

Company Profile:

Series A, $12M raised
22 engineers
Technical founder (but focused on business)
FinTech product with compliance needs

Fractional CTO Engagement:

Package: Premium ($19K/month)
Duration: 12 months
Total Cost: $228,000

Value Delivered:

1. Compliance Achievement ($250K value)

SOC2 Type 2 and PCI-DSS
External consultant would cost: $150K (SOC2) + $100K (PCI-DSS) = $250K
Fractional CTO led internally with minimal external costs

2. Team Scaling ($300K value)

Hired 14 engineers successfully (grew 22→36)
Avoided 3 bad hires = $270K saved
Plus fractional CTO improved hiring speed = $30K value (reduced recruiting costs)

3. VP Engineering Hire ($100K value)

Fractional CTO led search and hire
Avoided executive recruiter fee (25% of $280K salary = $70K)
Plus ensured right hire (avoiding wrong VP = $200K+ value, conservatively $30K)

4. Infrastructure Cost Optimization ($180K value)

Optimized AWS spend (reduced 30% through better architecture)
Annual savings: $180K

5. Series B Preparation ($500K+ value)

Technical diligence readiness
Platform scalability improvements
Raised Series B at strong valuation
Technical strength contributed to $30M raise at favorable terms

6. Founder Time Freed ($200K value)

Founder CEO no longer acting as CTO
20 hours/week freed × $300/hour × 48 weeks = $288K value
Conservative estimate: $200K

Total Value Delivered: $1,530,000

ROI Calculation:

ROI = ($1,530,000 - $228,000) / $228,000 × 100%
ROI = 571%

Payback Period: 1-2 months (immediate compliance and infrastructure savings)

Real ROI Example 3: Pre-Seed Bootstrapped

Company Profile:

Pre-seed, bootstrapped
3 engineers (founders + 1 hire)
Technical founder CTO
Needs strategic validation before scaling

Fractional CTO Engagement:

Package: Starter ($9K/month)
Duration: 6 months
Total Cost: $54,000

Value Delivered:

1. Avoided Wrong Technology Stack ($100K value)

Fractional CTO prevented migration to microservices (too early)
Saved 3-4 months of wrong-direction work = $100K opportunity cost

2. Hiring First Engineers ($60K value)

Hired 2 engineers correctly
Avoided 1 bad hire = $60K saved

3. Investor Preparation ($150K+ value)

Created technical pitch materials
Validated technology approach
Helped close $800K angel round
Technical credibility: ~20% of close factor = $160K contribution value

4. Founder Confidence (Priceless)

Technical validation from experienced CTO
Avoided founder burnout from technical uncertainty

Total Value Delivered: $310,000

ROI Calculation:

ROI = ($310,000 - $54,000) / $54,000 × 100%
ROI = 474%

Payback Period: 3-4 months

When ROI Is Lower (But Still Positive)

Not every engagement delivers 400-500% ROI. Here's when ROI is lower:

Scenario: Stable company, no major challenges, just needs strategic check-in

Example:

Profitable SaaS, $5M ARR
18 engineers, strong VP Engineering
Fractional CTO for strategic guidance only
Cost: $10K/month × 12 = $120K
Value: Strategic advice ($50K), prevented 1 bad decision ($100K), infrastructure optimization ($40K)
Total Value: $190K
ROI: 58%

Still worth it? Yes - 58% ROI is excellent, and avoids downside risk of no CTO oversight.

How to Choose the Right Fractional CTO Package

Use this decision framework to select the right package and budget.

Step 1: Assess Your Company Stage and Size

Stage	Team Size	Recommended Package	Budget Range
Pre-Seed	0-5	Starter or Hourly	$8K - $10K/month
Seed	5-15	Standard	$11K - $15K/month
Series A	15-30	Standard to Premium	$14K - $20K/month
Series B+	30-75+	Premium or Custom	$20K - $35K+/month

Step 2: Identify Your Primary Need

Strategic Guidance → Starter Package

You have technical team, need occasional strategic input
No major technical decisions imminent
Team is executing well

Active Leadership → Standard Package

Scaling team, hiring actively
Need regular architecture and process guidance
Want fractional CTO engaged with team weekly

Comprehensive CTO Services → Premium Package

Complex technical challenges
Compliance or regulatory requirements
Rapid scaling or major technical initiatives
Need near-daily CTO engagement

Step 3: Calculate Your Budget

Rule of Thumb: Budget 3-5% of engineering spend on fractional CTO

Example:

Engineering team: 15 engineers
Average loaded cost: $150K/engineer/year
Total engineering spend: $2.25M/year
Fractional CTO budget: 3-5% = $67K-$112K/year = $5.6K-$9.3K/month

This is too low for standard package, so either:

Start with Starter package ($8K-$10K)
Stretch budget to $12K-$14K for Standard (worth it)

Alternative Calculation: What are you saving vs. full-time CTO?

Full-time CTO cost: $350K/year all-in
Fractional CTO cost: $168K/year (Standard package)
Savings: $182K/year

Can you justify $168K investment for strategic CTO guidance? For most Series A companies, absolutely yes.

Step 4: Match Package to Your Situation

Choose Starter If:

Team < 10 engineers
Technical founder who just needs validation
Budget < $120K/year
Stable technical environment

Choose Standard If:

Team 10-30 engineers
Growing actively (hiring 5-15 engineers in next 12 months)
Non-technical founder OR technical founder focused on business
Budget $144K-$216K/year
Need active CTO engagement

Choose Premium If:

Team 25+ engineers
Complex technical challenges (compliance, scale, architecture)
Regulated industry (FinTech, HealthTech)
Non-technical founder needing heavy support
Budget $216K-$300K+/year
Near-daily CTO engagement needed

Step 5: Commitment Length Decision

Month-to-Month:

Pros: Maximum flexibility, test the relationship
Cons: 10-15% higher cost, less CTO commitment
Best For: First 3 months, prove value before longer commit

3-6 Month Commitment:

Pros: 5-10% discount, CTO more invested
Cons: Minimal commitment, still flexible
Best For: Most engagements, good balance

12-Month Commitment:

Pros: 15-20% discount, full partnership
Cons: Locked in (though most contracts allow exit with 30-60 days notice)
Best For: Mature engagements, proven value, long-term strategic partnership

Our Recommendation: Start with 3-month commitment, extend to 12 months after proving value (and get discount).

Contract Terms: What to Expect

Standard fractional CTO contracts include these terms:

Engagement Terms

Duration:

Month-to-month (30 days notice to cancel)
3-month minimum commitment
6-month or 12-month commitment (with discount)

Hours:

Defined monthly hours (e.g., 40-50 hours/month)
Rollover: Some contracts allow 10-20% rollover to next month
Overage: Usually billed at hourly rate (typically 20-30% higher than effective rate)

Scope:

Clear definition of what's included
Examples of deliverables
Communication expectations

Cancellation Terms

Standard:

30-60 days written notice
Some contracts: If company cancels in first 90 days, pay 50% of remaining commitment

For Cause:

Either party can cancel immediately for breach
Examples: Non-payment, violation of confidentiality, gross negligence

Transition:

30-day knowledge transfer period
Documentation handoff
Team transition support

Payment Terms

Billing:

Monthly invoicing (due net 15 or net 30)
Auto-pay via ACH or credit card (common)
Annual prepay (sometimes offered with 5-10% discount)

Rate Changes:

Usually fixed for commitment period
After initial term: Renegotiate or 5-10% annual increase
Scope changes may trigger rate adjustment

Intellectual Property

Standard Terms:

All work product belongs to company
Company owns code, documents, inventions created during engagement
Fractional CTO retains general knowledge and methodologies

Important: Confirm IP ownership is clear in contract.

Confidentiality

NDAs:

Standard mutual NDA
Fractional CTO can't disclose company confidential information
Usually survives engagement termination (2-5 years)

Non-Compete:

Rarely enforced for fractional (they work with multiple companies)
Sometimes limited: Can't work with direct competitor in same market
Our take: Non-competes inappropriate for fractional; conflicts of interest should be disclosed

Service Level Agreements (SLAs)

Response Times:

Email: 24 hours (business days)
Slack: 4-8 hours (business days)
Emergency: 1-4 hours (24/7)

Availability:

Defined meeting times (e.g., weekly 90-min sessions)
Reasonable availability during business hours
Emergency availability (with limitations)

Deliverables:

Monthly reports by 5th business day of month
Quarterly roadmap updates
Board materials 1 week before board meeting

Liability and Indemnification

Limitation of Liability:

Usually limited to fees paid in last 12 months
Excludes gross negligence or willful misconduct

Indemnification:

Fractional CTO indemnifies company for CTO's negligence
Company indemnifies fractional CTO for company's actions

Insurance:

Professional liability insurance (E&O)
Many fractional CTOs carry $1M-$2M policy

Conflict Resolution

Disputes:

Good faith negotiation first
Mediation before litigation
Jurisdiction and governing law (usually Delaware or company state)

Performance Issues:

Monthly check-ins on engagement quality
Either party can raise concerns
30-day cure period for performance issues

Frequently Asked Questions About Pricing

1. Is fractional CTO worth the cost?

For most startups from seed through Series B, yes. The ROI typically ranges from 200-500%+ because:

Avoid costly mistakes: Wrong tech stack, bad hires, poor architecture ($200K-$500K+ saved)
Move faster: Better decisions, clearer direction (20-30% velocity improvement)
Better fundraising: Technical credibility with investors (can impact valuation by 10-20%)
Cost savings vs. full-time: Save $150K-$300K/year vs. hiring full-time CTO

The question isn't "can you afford fractional CTO?" but "can you afford NOT to have strategic technical leadership?"

2. How much does a fractional CTO cost per hour?

Effective hourly rates range widely:

Starter packages: $270-$400/hour (20-30 hours/month)
Standard packages: $240-$320/hour (40-50 hours/month)
Premium packages: $225-$315/hour (60-80 hours/month)
Pure hourly billing: $300-$600/hour (no retainer)

Retainer packages offer 25-40% better value than pure hourly billing.

3. What's cheaper: fractional CTO or full-time CTO?

Fractional is 50-70% cheaper in Year 1, and you get more experienced leadership:

Full-Time CTO (First Year):

Salary: $280K
Benefits/taxes: $70K (25%)
Recruiting fee: $70K (25% of salary)
Equity: 1.5% (worth $1.5M at $100M exit)
Total Year 1: $420K+ cash + significant equity

Fractional CTO (Standard Package):

Monthly retainer: $14K
Annual cost: $168K
No recruiting fees, no benefits
Minimal or no equity
Total Year 1: $168K

Savings: $252K+ in year one

Plus: Fractional CTO typically has 15-20 years experience vs. 8-12 years for affordable full-time CTO.

4. Do I pay for fractional CTO during holidays or vacations?

Depends on contract structure:

Retainer Model (Most Common):

Yes, you pay monthly retainer regardless
Fractional CTO typically takes 2-4 weeks vacation/year
They'll make up hours or provide coverage

Hourly Model:

No, you only pay for hours worked
No work during holidays = no charge

Our Approach: Retainer includes reasonable vacation (2-3 weeks/year). Hours are flexible month-to-month within ~20% range.

5. Can I negotiate fractional CTO pricing?

Yes, within reason:

What's Negotiable:

Commitment length (12-month commit → 10-20% discount)
Scope adjustments (fewer hours = lower price)
Payment terms (annual prepay → 5-10% discount)
Package customization

What's Usually Not Negotiable:

Hourly or daily rate (experienced CTOs know their value)
Large discounts (>20%) for standard services
Equity in lieu of cash (unless pre-seed)

Best Negotiation Strategy: Focus on commitment length and value alignment, not just price reduction.

6. What if I need more or fewer hours than the package?

Most fractional CTO contracts are flexible:

Fewer Hours Needed:

Some months you'll use 70-80% of hours (that's normal)
Many contracts allow 10-20% hour bank or rollover
If consistently under, renegotiate to smaller package

More Hours Needed:

Bill overage at hourly rate (usually 20-30% premium over effective rate)
If consistently over, upgrade to larger package
Some contracts include 10-20% flex in either direction

Example: Standard package = 45 hours/month at $14K ($311/hour effective)

Month 1: Used 38 hours (OK, within flex range)
Month 2: Used 52 hours (7 hours overage × $400/hour = $2,800 extra)
Month 3: Used 44 hours (on target)

7. Do fractional CTOs charge for Slack messages and emails?

Best Practice (and Ours): No. Async communication (Slack, email) is part of engagement, not separately billed.

What IS Included:

Slack messages and threads
Email correspondence
Quick questions and answers
Brief reviews and feedback

What MIGHT Be Billed:

Extensive written work (e.g., 5-page architecture document taking 3 hours)
Lengthy async discussions that exceed package hours

Red Flag: If fractional CTO bills per Slack message or email, find someone else. That's nickel-and-diming.

8. How long should I commit to fractional CTO engagement?

Minimum Recommended: 3 months

Fractional CTO needs time to understand your business and tech
Takes 4-6 weeks to ramp up and deliver value
3 months allows for strategy development and initial execution

Optimal Commitment: 6-12 months

Allows for strategic initiatives to complete
Gets best pricing (10-20% discount)
Fractional CTO more invested in long-term success

When Shorter Engagements Make Sense:

One-time project (architecture review, due diligence)
Trial period to test fit
Very specific, bounded need

When Longer Engagements Make Sense:

Ongoing strategic partnership
Scaling from 10 to 50+ engineers
Complex technical transformations

Average: Most engagements last 9-18 months, with many extending indefinitely.

9. What's included in fractional CTO pricing vs. what costs extra?

Included in Retainer:

All strategic and architecture work (within hours)
Meetings, calls, video sessions
Deliverables (roadmaps, reports, presentations)
Slack and email communication
Hiring support (interviews, offers)
Team leadership and mentorship
Emergency availability (reasonable)

Usually NOT Included (Costs Extra):

Travel expenses (flights, hotels, meals)
Specialized external consultants
Tools and software (though company should provide)
Out-of-scope work beyond package hours

Gray Area (Discuss Upfront):

Extensive travel (multi-day on-site visits)
Work significantly exceeding package hours
Highly specialized work requiring outside expertise

Best Practice: Get detailed scope document outlining what's included and what's not.

10. Do fractional CTOs take equity? Should I offer it?

Common Approaches:

Cash-Only (70% of engagements):

Standard monthly retainer, no equity
Clean, simple relationship
Fractional CTO works with multiple companies

Reduced Cash + Equity (25% of engagements):

30-50% cash discount + equity (0.25-1%)
Usually pre-seed or seed stage with limited cash
Mutual belief in significant upside

Equity-Only (5% of engagements, rare):

Almost never done
Only if company pre-revenue, near-zero runway, about to raise

Should You Offer Equity?

Offer equity if:

Pre-seed with <6 months runway
Fractional CTO provides exceptional strategic value
You need to preserve cash

Don't offer equity if:

You have 12+ months runway
You can afford market-rate cash
Fractional CTO is providing standard services

Equity Ranges:

Pre-seed: 0.75-1.5% for 50% cash reduction
Seed: 0.5-1% for 30-40% cash reduction
Series A+: 0.1-0.5% (rare)

Vesting: 1-2 years (faster than full-time 4-year), often with 3-6 month cliff

11. How do I budget for fractional CTO in my financial plan?

Budgeting Approach:

Line Item: Professional Services - Fractional CTO (or Executive Consulting)

Amount: $8K-$25K/month depending on stage

Budget as:

Fixed monthly cost (not variable)
Part of "Leadership" or "G&A" budget (not engineering)
Should be separate from engineering headcount budget

Example Budget:

Revenue: $2M ARR
Engineering Budget: $2.5M (15 engineers × $165K avg)
G&A Budget: $800K
  - CEO: $200K
  - CFO (fractional): $120K
  - CTO (fractional): $168K
  - Operations: $150K
  - Legal/Accounting: $100K
  - Other G&A: $62K

Runway Calculation: Include fractional CTO as fixed monthly burn:

Monthly Burn: $350K
Fractional CTO: $14K (4% of burn)
Runway: $4.2M / $350K = 12 months

12. Can I get fractional CTO services for less than $8K/month?

Rarely, and with significant tradeoffs:

Options Under $8K/Month:

1. Junior Fractional CTO ($5K-$7K/month)

5-10 years experience (vs. 15-20 years)
Limited hours (15-20 hours/month)
Good for: Very early stage, limited needs

2. Offshore/International ($4K-$6K/month)

Based outside US (different time zones)
May have communication challenges
Quality varies widely

3. Hourly Consulting (Variable)

$300/hour × 15 hours = $4,500/month
But no ongoing relationship or retainer benefits

4. Advisor/Consultant (Not Fractional CTO)

$2K-$5K/month for quarterly advice
Much less involved than fractional CTO
Good for: Very specific, limited guidance

Our Recommendation: If your budget is truly under $8K/month:

Start with hourly consulting for specific projects
Wait until you can afford $8K-$10K/month for proper fractional CTO engagement
Consider advisor relationship ($2K-$3K/month) until ready

Cheap fractional CTO (<$5K/month) is usually false economy - you get what you pay for.

13. What's the difference between $12K and $20K/month fractional CTO?

$12K/Month Package (Standard):

40-50 hours/month (2-2.5 days/week)
Weekly strategic sessions
Monthly team touchpoints
Hiring support
Architecture reviews
Response time: 4-8 hours

Best For: Series A, 10-25 engineers, standard SaaS

$20K/Month Package (Premium):

65-80 hours/month (3.5-4 days/week)
Daily engagement
Weekly 1-on-1s with all leads
Compliance oversight
Board presentation support
Response time: 2-4 hours, 24/7 emergency

Best For: Series B, 25-50+ engineers, FinTech/HealthTech, complex needs

Is the $8K/month premium worth it?

Yes if you need:

Daily fractional CTO engagement
Compliance/regulatory support
Rapid scaling (doubling team in 6-12 months)
Board-level reporting

No if:

Standard engagement is sufficient
Team under 25 engineers
General SaaS (not regulated industry)

Cost/Value Analysis:

$8K extra/month = $96K/year
If compliance alone saves $150K in consultants, pays for itself
If extra engagement accelerates growth 10-15%, massive ROI

14. Do I still need fractional CTO if I have a VP Engineering?

Often yes - they serve different functions:

VP Engineering: Execution, team management, delivery Fractional CTO: Strategy, architecture, external relationships

Great Combination:

VP Engineering (full-time): $220K-$300K
Fractional CTO (2 days/week): $12K-$15K/month ($144K-$180K/year)
Total: $364K-$480K/year

vs. Full-Time CTO + VP Engineering:

CTO: $300K-$400K
VP Eng: $220K-$300K
Total: $520K-$700K/year

Savings: $140K-$220K/year with fractional model

When This Works:

15-40 engineers
VP Eng handles day-to-day, fractional CTO handles strategy
Series A-B stage
Budget-conscious but need both strategic and execution leadership

Learn more about fractional CTO + VP Engineering collaboration

15. How do I know if I'm getting good value from my fractional CTO?

Metrics to Track:

Hard Metrics:

Engineering velocity (story points, deployment frequency)
Code quality (bug rates, tech debt trending down)
Hiring success (time-to-hire, retention rate)
Infrastructure costs (optimization savings)

Soft Metrics:

Team satisfaction with technical direction (surveys)
Stakeholder confidence (CEO, board, investors)
Strategic clarity (everyone knows technology roadmap)
Decision speed (faster architecture decisions)

Value Indicators:

You're Getting Good Value If:

Fractional CTO delivers on commitments (reports, meetings, deliverables)
Team respects and listens to fractional CTO
You're making better, faster technical decisions
Technical risks are identified and mitigated proactively
Hiring quality improved
Investors/board express confidence in technology

Red Flags (Not Getting Value):

Fractional CTO frequently unavailable or cancels meetings
Deliverables late or incomplete
Team doesn't respect or follow fractional CTO guidance
No measurable improvement in 3-6 months
Fractional CTO not proactive (only reactive)

What to Do If Value Unclear:

Monthly value reviews (what did we accomplish this month?)
Quarterly ROI assessment
Open feedback loop (both directions)
Adjust scope or consider changing fractional CTO if not working

16. What payment methods do fractional CTOs accept?

Standard Payment Methods:

ACH/wire transfer (most common)
Credit card (some accept, may charge 2-3% processing fee)
Check (rare, slow)
Automated monthly billing (preferred)

Payment Schedule:

Monthly invoicing (in advance or arrears)
Net 15 or Net 30 terms
Some offer annual prepay (with 5-10% discount)

Contracts:

Usually W9 (US) - fractional CTO is independent contractor
You'll need to issue 1099 at year end (if US-based, >$600 paid)

17. Can I pause fractional CTO engagement if I run low on cash?

Depends on contract terms:

Flexible Contracts:

30-60 days notice to pause or reduce hours
Can scale down (e.g., Premium to Starter)
Can pause with 30-day notice, resume later

Committed Contracts:

3-12 month minimum commitment
Early cancellation may incur fee (e.g., 50% of remaining commitment)
But can often renegotiate in good faith if cash crunch

Best Practice:

Discuss cash flow concerns openly with fractional CTO
Most will work with you (reduce hours, defer payment, etc.)
Better to communicate early than ghost/default

Alternatives to Pausing:

Scale down to lower package
Move to hourly for 2-3 months
Defer payment with repayment plan

Most fractional CTOs understand startup cash flow and will be flexible if you're transparent.

18. How do fractional CTO costs compare to hiring a full-time junior CTO?

Full-Time Junior CTO (5-8 years experience):

Salary: $180K-$250K
Benefits: $45K-$62K (25%)
Recruiting: $45K-$62K (one-time)
Equity: 1-2%
Year 1 Total: $270K-$374K + equity

Experienced Fractional CTO (15-20 years):

Monthly: $12K-$16K
Annual: $144K-$192K
No benefits, no recruiting fees
Minimal equity (0-0.5%)
Year 1 Total: $144K-$192K

Comparison:

Cash Savings: $126K-$182K in year one
Experience Gap: Fractional has 2x the experience
Risk: Junior CTO might not work out (40% executive hire failure rate)

When Junior Full-Time Makes Sense:

You need 5 days/week coverage
Budget for $270K+ all-in
Willing to accept less experience

When Fractional Makes Sense:

2-3 days/week sufficient
Want more experienced leadership
Prefer lower risk and cost

19. Do fractional CTO prices increase over time?

During Initial Contract:

Usually fixed pricing for commitment period (3-12 months)
Scope changes might trigger adjustments

Upon Renewal:

Most fractional CTOs increase 5-10% annually
Reflects market rate increases and value delivered
Negotiable based on scope and relationship

Scope Expansion:

If you grow from 15 to 40 engineers, may need premium vs. standard package
Price increase reflects more work, not just time

Market Rate Changes:

Fractional CTO rates have increased 15-20% over last 3 years
Expect 5-7% annual increases on average

How to Manage:

Lock in longer commitments (12 months) for rate stability
Discuss rate changes proactively
Evaluate value relative to cost annually

20. What's the best fractional CTO package for a seed-stage startup?

Typical Seed Stage Profile:

Raised $1M-$3M
5-15 engineers
12-18 months runway
Hiring 5-10 engineers in next 12 months

Recommended Package: Standard ($12K-$15K/month)

Why Standard (Not Starter):

You're scaling team (need active hiring support)
Establishing processes and culture (needs regular engagement)
Weekly strategic sessions valuable during rapid growth
Preparing for Series A (need ongoing tech diligence readiness)

Why Not Premium:

Team under 20 engineers (don't need daily CTO engagement yet)
Budget likely limited ($144K-$180K/year vs. $216K-$300K)
VP Engineering not hired yet (so CTO doesn't need to manage VPs)

Budget Justification:

Engineering budget: ~$1.5M-$2M (10-12 engineers × $150K avg)
Fractional CTO: $168K/year (8.4% of engineering budget)
vs. Full-time CTO: $350K+ (17.5% of engineering budget)

Expected ROI: 300-500% (see ROI examples above)

Duration: 12 months (covers scaling to Series A)

See our seed-stage packages

Next Steps: Get Custom Fractional CTO Pricing

Now you understand fractional CTO pricing: the models, the costs, what drives pricing, and how to calculate ROI.

Here's what to do next:

1. Determine Your Budget

Engineering team size × $150K avg = total engineering spend
Fractional CTO budget: 3-7% of engineering spend
Or: Series A → $144K-$216K/year range

2. Identify Your Needs

Strategic only → Starter ($8K-$11K/month)
Active engagement → Standard ($12K-$16K/month)
Comprehensive CTO → Premium ($18K-$25K/month)

3. Get Custom Quote Every company is different. We'll assess your specific needs and provide custom pricing.

What to expect in consultation:

30-minute discovery call (free)
Assessment of your stage, team, technical needs
Custom package recommendation
Transparent pricing (no hidden costs)
Sample deliverables and success metrics

Common packages we recommend:

Seed Stage Standard Package: $13,500/month

45 hours/month (2.5 days/week)
Weekly strategic sessions
Active hiring support
Architecture and tech decisions
Series A preparation

Series A Premium Package: $18,500/month

70 hours/month (3.5 days/week)
Daily engagement
Team leadership
Compliance support
Board presentation preparation

Ready to explore fractional CTO for your company?

Schedule free 30-minute consultation

View detailed pricing packages

Calculate your potential ROI with our calculator

Read case studies of fractional CTO ROI

About Fractional CTO Experts: We provide experienced fractional CTO services to startups from seed through Series C. Our CTOs average 18+ years of experience and have led engineering teams from 5 to 500+. We've worked with companies in SaaS, FinTech, HealthTech, and more, delivering measurable ROI through strategic technology leadership.

Transparent Pricing Guarantee: We provide upfront, transparent pricing with no hidden fees. Our contracts are flexible, fair, and designed for mutual success. If you're not satisfied in the first 90 days, we'll work with you to make it right or part ways professionally.