I get asked this question a lot. Usually by founders who've just raised a Series A and feel like they're supposed to have a CTO on the cap table.
Short answer: if you're asking the question, you probably don't need a full-time one yet.
What a CTO actually does
Let's start here because most people get it wrong. A CTO at a 20-person startup isn't doing the same job as a CTO at a 2,000-person company. Not even close.
At a 20-person startup, the CTO is usually the most senior engineer who also happens to talk to the board. They're setting architecture. They're hiring. They're debugging production at 11pm. They're in every product meeting. They're writing code 40% of the time and managing people the other 60%.
At a bigger company, the CTO is a strategic role. They're not writing code. They're setting direction, managing VPs, talking to customers, and sitting in a lot of meetings about roadmaps.
The problem is that founders hire for the second job when they need the first one. They want someone "strategic" when what they actually need is someone who can ship.
When a fractional CTO makes sense
A fractional CTO works when you need senior technical leadership but not 5 days a week of it.
That sounds vague, so let me be specific. Here are three real situations where I've seen it work well:
The post-raise build-out. You've raised money. You need to hire 4-6 engineers in the next 3 months. You need someone to define the architecture, set up the hiring process, and make sure you don't hire the wrong people. That's 2-3 days a week for 3-4 months. A fractional CTO does that.
The AI transition. Your team knows they need to integrate AI but nobody has the experience. You need someone who's done it before to assess where AI fits, build the first prototypes, and upskill the team. This is literally what I do through embedded AI leadership. It's a 6-month engagement, not a permanent hire.
The technical debt reckoning. You've been moving fast for two years and the codebase is a mess. You need someone to come in, assess the damage, prioritise what to fix, and set up processes so it doesn't happen again. That's a project with an end date.
In all three cases, what you need is expertise and judgement for a defined period. Not a permanent seat.
When you need a full-time CTO
Full-time makes sense when technology is the product. When the technical decisions are so frequent and so tied to business strategy that you need someone thinking about it every single day.
If you're a SaaS company with a complex product, 15+ engineers, and the technology itself is your competitive advantage, you need a full-time CTO. No question.
Also if you're going through due diligence for a major round. Investors want to see a named CTO. It's theatre, partly, but it matters.
And honestly, if your engineering team is bigger than about 12 people and growing, the management load alone justifies full-time. Someone needs to be thinking about team structure, career progression, hiring pipeline, and technical direction. That's a full-time job even without writing any code.
The money conversation
Let's talk numbers because nobody else will.
A decent CTO in the UK, at a Series A startup, is going to cost you £150k-£200k base. Plus equity. Plus the time it takes to find them, which is typically 3-6 months of searching. That's before they've written a line of code or made a single decision.
A fractional CTO is typically £1,500-£3,000 per day, 2-3 days a week. Call it £15k-£35k a month. Sounds expensive until you compare it to £180k salary plus 20% employer costs plus equity dilution plus recruiter fees.
For the first 6-12 months after a raise, fractional is almost always the better financial decision. You get the expertise without the commitment, and you buy yourself time to figure out what the full-time role actually needs to look like.
I've seen two startups in the last year hire a full-time CTO too early. One of them parted ways after 8 months because the role had changed so much since they defined it. That cost them about £100k in salary, £30k in recruiter fees, and 8 months of momentum. The other is still trying to figure out how to give their CTO enough to do now that the initial build is done.
The hybrid path
What I actually recommend to most founders is this: start fractional. Use the first 3-6 months to define what the full-time role really needs to be. Then hire for that specific job, not a generic "CTO" job description.
The fractional person can even help you hire their replacement. A good one will. Because a good fractional CTO knows they're temporary by design, and the best outcome is a clean handoff to someone who's going to be there for the long haul.
This isn't about fractional being better than full-time. It's about sequencing. Get the expertise when you need it. Hire the permanent role when you can define it properly.
If you're in this position right now and you're not sure which way to go, have a look at what embedded AI leadership looks like. It might save you a very expensive wrong hire.