Hiring a fractional CMO without a clearly defined contract leads to misaligned expectations, scope creep, and disputes over deliverables. The arrangement starts promising, then deteriorates when neither party can point to a documented understanding of responsibilities, time allocation, or success metrics.
This guide provides a ready-to-use fractional CMO contract template and agreement structure you can customize for your specific engagement. Whether you are a startup founder hiring strategic marketing leadership for the first time, a small marketing team bringing in senior guidance, or an agency structuring fractional CMO services for clients, this framework covers what matters: scope of work, KPIs, time allocation, payment terms, termination provisions, IP ownership, and confidentiality.
Important: This guide is for informational purposes only and does not constitute legal advice. Always have a qualified lawyer review any contract before you use it.
Important: This guide is for informational purposes only and does not constitute legal advice. Always have a qualified lawyer review any contract before you use it. Its intended as an overview of the elements that go inside a CMO's contract.
Please consult a lawyer to draw up your contract.
The following sections are example clauses you can discuss with your legal counsel. Each can be copied into a fractional CMO contract, fractional CMO agreement, or fractional CMO proposal template and adapted for your specific situation. Each section addresses a specific element of the engagement that, when documented properly, protects both the company and the CMO while aligning incentives toward measurable outcomes.
Replace all bracketed placeholders with your own details before finalizing the document.
Purpose: Clearly outline the specific responsibilities, tasks, and projects the Fractional CMO will handle.
Why It Matters: This prevents scope creep and eliminates ambiguity about what falls within the engagement versus what requires additional discussion or compensation.
This Scope of Work (SOW) outlines the services and responsibilities of the Fractional Chief Marketing Officer for [Company Name]. The Fractional CMO will provide strategic and operational marketing leadership to support the company's business goals and objectives.
Core Responsibilities:
Out of Scope (unless separately agreed):
Purpose: Specify the number of hours or days per week or month the CMO is expected to dedicate to the engagement.
Why It Matters: Clear time expectations prevent over-reliance (expecting full-time attention at fractional rates) or under-utilization (paying for time that goes unused).
The Fractional CMO will dedicate approximately [X] hours per month to [Company Name]. This allocation includes:
Time allocation may be adjusted by mutual written agreement. Hours do not roll over month to month unless explicitly agreed.
| Engagement Level | Monthly Hours | Typical Use Case |
|---|---|---|
| Advisory | 10-15 hours | Strategic guidance, quarterly planning |
| Part-time | 20-30 hours | Active leadership, team management |
| Near full-time | 40-60 hours | Interim CMO during transition or scaling |
Purpose: Define clear, measurable goals and key performance indicators the Fractional CMO is expected to influence or achieve.
Why It Matters: Without documented KPIs, you cannot objectively evaluate whether the engagement delivers value. KPIs also align incentives and provide a basis for performance-based compensation if applicable.
The Fractional CMO will be evaluated against the following performance metrics:
Primary KPIs:
Secondary KPIs:
KPIs will be reviewed [monthly/quarterly] and may be adjusted based on market conditions or company strategy changes with mutual written agreement.
Purpose: Detail the payment structure, rates, payment schedules, and any performance-based incentives.
Why It Matters: Clear compensation terms prevent disputes and ensure the CMO understands how and when they will be paid. Performance incentives, if structured properly, can align the CMO's financial interests with company outcomes.
[Company Name] agrees to pay [Fractional CMO Name] a monthly retainer of $[X], due on the [1st/15th] of each month. Payment will be made via [wire transfer/ACH/check].
Payment Structure Options:
| Structure | Description | Best For |
|---|---|---|
| Fixed retainer | Same amount each month regardless of hours | Predictable budgeting |
| Hourly with cap | Hourly rate up to a monthly maximum | Variable workloads |
| Retainer plus performance bonus | Base retainer plus bonus tied to KPIs | Aligning incentives |
Performance Bonus (if applicable):
A quarterly bonus of $[X] will be paid if the following targets are met: [specific KPI targets]. Bonus calculations will be completed within [X] days of quarter end.
Purpose: Protect the company's confidential information, trade secrets, and proprietary data.
Why It Matters: Fractional CMOs gain access to sensitive business information including customer data, pricing strategies, competitive intelligence, and financial projections. An NDA ensures this information remains protected during and after the engagement.
The Fractional CMO agrees to maintain the confidentiality of all proprietary information disclosed during the engagement. "Confidential Information" includes but is not limited to: customer lists, pricing data, marketing strategies, financial information, product roadmaps, and trade secrets.
The Fractional CMO will not disclose Confidential Information to any third party without prior written consent from [Company Name]. This obligation survives termination of the agreement for a period of [2/3/5] years.
Exceptions: Information that is publicly available, independently developed, or required to be disclosed by law.
Purpose: Outline the conditions under which either party can end the agreement, including notice periods, transition obligations, and any penalties.
Why It Matters: A clear termination clause provides an exit strategy if the partnership is not working. It protects the company from being locked into a non-beneficial arrangement and protects the CMO from sudden loss of income without notice.
Either party may terminate this agreement with [30/60/90] days written notice. Upon termination:
Termination for Cause: Either party may terminate immediately for material breach, including: failure to perform duties, violation of confidentiality, or conduct harmful to the company's reputation.
Purpose: Specify ownership of any intellectual property, marketing materials, strategies, or creative work developed during the engagement.
Why It Matters: Without clear IP provisions, disputes can arise over who owns campaign strategies, brand positioning work, or content created during the engagement. Most companies require full ownership of all work product.
All work product created by the Fractional CMO during the engagement, including but not limited to marketing strategies, campaign materials, brand guidelines, and content, shall be the exclusive property of [Company Name].
The Fractional CMO assigns all rights, title, and interest in such work product to [Company Name] upon creation. The Fractional CMO retains no rights to use, reproduce, or distribute work product except as authorized in writing.
Pre-existing IP: Tools, frameworks, or methodologies the Fractional CMO brings to the engagement remain their property, but [Company Name] receives a perpetual, royalty-free license to use them in connection with company business.
Beyond the core sections above, consider including:
Conflict of Interest Clause: Prevents the CMO from working with direct competitors or engaging in activities that conflict with the company's interests during the engagement period.
Regular Reporting and Communication: Establishes expectations for weekly standups, monthly reports, and executive updates. Define what information will be shared and in what format.
Review and Feedback Mechanism: Set quarterly performance reviews to address issues early and adjust scope or KPIs as the business evolves.
Insurance Requirements: Some companies require fractional executives to carry professional liability insurance.
Non-Solicitation: Prevents either party from recruiting the other's employees for a specified period after the engagement ends.
Greylock Partners. (2023). Building your first marketing team. https://greylock.com/greymatter/building-your-first-marketing-team/
First Round Review. (2022). The strategic guide to fractional executives. https://review.firstround.com/
Harvard Business Review. (2024). When to hire a CMO. https://hbr.org/topic/marketing
Y Combinator. (2023). Marketing for startups. https://www.ycombinator.com/library/5z-marketing-for-startups
OpenView Partners. (2024). SaaS marketing benchmarks report. https://openviewpartners.com/
SHRM. (2024). Independent contractor agreements. https://www.shrm.org/
This guide provides a framework for structuring fractional CMO engagements. It is not legal advice. Have a qualified attorney review your final contract before signing.