Hello, Welcome to today's Employee Ownership Small Business Week minicast. I'm Benjamin Tsai, director of the Worker Ownership Initiative at Nexus Community Partners.
Employee Ownership or EO also stands for exit opportunity because it provides a unique and often underutilized avenue for selling a business. First off, there's a potential buyer already on site, the staff, so there's no need to go through a broker and pay extra fees, and employees are likely to be motivated buyers as they have an inherent interest in the continuity of the business as well as the skills to help it continue growing.
Salaries can also get a fair value for the business and there may be tax benefits to selling to employees. There's a common assumption that the employees can't afford to buy. However, there are specialized EO lenders that can help with financing where employees may not need to bring a down payment to close the deal. And last but not least, transitioning to employee ownership keeps the business locally owned. It honors the hard work employees have contributed as well as the legacy built by the current owner.
So EO is an exit opportunity that has a triple bottom line supporting business owners, employees and the local community. For more information about the benefits of EO and to contact an EO expert visit employeeownershipequals.org.