Employee ownership is a model that works from Main Street to Wall Street. While it remains one of the “best kept secrets” for business M&A, local business retention, strong local economies and equitable economic development, there are many employee ownership champions around the country working to elevate EO.
During this year’s Employee Ownership Equity Summit, Project Equity will debut our inaugural Employee Ownership Inspiration Award. This new accolade is designed to honor a business owner who has successfully transitioned their business to an employee-owned model prior to 2020 and has advanced the concept of employee ownership in broader contexts.
The award is not only a celebration of achievement for the individual business owner – it is also a marker of employee ownership’s growing importance and an indicator of the progress to come. A nominating committee made up of leaders throughout the employee ownership field and members of Project Equity’s Founders Circle – an esteemed group of business leaders who have transitioned their businesses to and are advocates for employee ownership – undertook a thorough and thoughtful selection process to choose the nominees and determine the winner.
Each of these incredible advocates has done and continues to do tremendous work to advance employee ownership. We’re encouraged by their stories and cannot wait to see what the future of employee ownership holds.
The winner will be announced at an awards luncheon Tuesday, May 7, in Los Angeles.
Learn about the nominees below.
Blaise Kielar, Electric Violin Shop
Type of employee ownership: Worker cooperative
Transitioned: May 2016
Percent sold to employees: 100%
Number of employee owners: 5-6
Low-to-moderate income: Unsure
Selling owner’s current role: Fully exited
Electric Violin Shop, based in Durham, NC, is a small niche retailer at the forefront of a unique and growing industry. They are a small, worker-owned company with less than $1MM in sales and about five worker owners. Since 2002, they have been a primary source for amplified bowed string instruments, gear, and knowledge for the electric violin industry.
Blaise wanted a way to exit the business and reward employees who had been running it day to day as he began to phase out.
“It took a special kind of mind to imagine and give birth to the world’s first electric violin shop. When Blaise was ready to retire, I think we were all afraid the shop might be bought by someone who didn’t have the vision to see the importance of this unique venture he’d created. We needn’t have worried – of course (with a little help from his friends), Blaise found a way to pass the business on to his employees, allowing us to carry it forward, and continue to be able to serve our growing, eccentric niche in the music industry.” – Chris Guin, one of the original employee owners of Electric Violin Shop whose title is Customer Service Representative, Product Photographer, Tech Officer, Fiddle Fashionista.
Blaise is a true champion of employee ownership. He always takes time to speak with others considering a worker cooperative as a potential exit, giving them a thoughtful account of his experience.
Larry Roadman, Margaretville Telephone Company
Type of employee ownership: ESOP
Transitioned: 2018
Percent sold to employees: 100%
Number of employee owners: 46
Low-to-moderate income: Yes
Selling owner’s current role: Holds a board seat
Established in 1916, the Margaretville Telephone Company (MTC) was a family-owned company that had grown to provide a range of voice, video, data, and commercial services throughout the Central Catskills Region in New York. The company facilitated business partnerships that allowed the deployment of 2,000 miles of fiber optic facilities to bring broadband to rural and underserved populations. To this day, the business reinvests in its home communities and employees, believing that excellent customer service stems from a valued and dedicated workforce.
MTC leadership sought a business transition plan that would reward the commitment of its employees through company ownership, further the values of their community-focused culture, and sustain long-term business growth as an independent company. Moving to a full 100% ESOP ownership plan emerged as the right fit. As part of a regulated industry, any transaction affecting 10% or more of ownership would require going through the process of state regulatory approval.
“My sister Karen [Harris] and I value the dedication of our employees, and our family takes great pride in our history of serving our home communities. Moving to 100% ESOP ownership was a great way to reward our employees while securing the company’s independence,” said Larry Roadman, Chair of the MTC Board of Directors.
Larry’s family even accepted a price that was 20% lower than the Trustee’s offer, pushing more of the value from themselves to the employees. The family also created a new requirement that the company contribute $100,000 annually to community needs in their market.
Since their transition, the company has talked with similar neighboring companies and has been sharing their experience.
Blake Jones, Namaste Solar
Type of employee ownership: Worker cooperative
Transitioned: 2011
Percent sold to employees: 100%
Number of employee owners: ~115
Low-to-moderate income: Unsure
Selling owner’s current role: Ongoing role in operations
Namaste Solar is based in Colorado and provides solar design and installation services.
Blake and his two co-founders started their company in 2005 with a self-designed type of employee ownership, but when they learned about worker cooperatives, they knew it would serve their purposes much better.
“We undertook the transition to this new capital structure for many reasons, mainly to better align our capital structure with our governance structure. Prior to the transition, our company operated on a one person, one vote basis for most operational decisions, but when it came to shareholder votes, we voted on a one share, one vote basis. The cooperative model more closely matches our democratic ideals and more equitably distributes the risk/reward equation of our employee-owners. In addition, this enables us to accept external investors without sacrificing internal control.” – Namaste Solar, 2014
Blake is a serial cooperative entrepreneur and has helped to build a cutting-edge ecosystem using different versions of the cooperative model to support employee-owned companies, small businesses, and leading companies in the green energy movement. Blake also conceived, founded, and serves on the Board of the Clean Energy Credit Union, which provides affordable financing for home solar systems to its members.