Why To Sell Your Company To Your Employees
In 1987 I sold my business, South Mountain Company, to my employees (and myself). My sole proprietorship became an employee-owned cooperative corporation. It was a hinge point in the history of the company. Ownership has become available to all employees, enabling people to own and guide their workplace. The responsibility, the power, and the profits all belong to the group of owners.
Shared ownership and control is our method at South Mountain. “Every employee, an owner” is our intention. More than half of our thirty employees are full owners. Each time another comes in, and each time a new management invention encourages more voices to be heard, we move steadily toward the goals of democracy, fairness, and transparency. This is not about a sense of ownership or a sense of control. Corey Rosen of the National Center for Employee Ownership once said that giving employees a “sense” of ownership is like giving them a “sense” of dinner. This is the whole meal.
I first contemplated the conversion to find a way to retain long-time valued employees, who wanted to stay in the company but felt they needed more stake than working for an hourly wage. At the time it was both frightening and exciting. I had the power, and the greatest financial and emotional investment; therefore, I had the most to lose. Under my ownership the company had become a viable, profitable entity with a strong reputation. Sometimes, during the early discussions, it felt like control was slipping away, like I was tugging on the reins of a runaway horse. But it occurred to me that perhaps I had the most to gain. Aside from the lure of clearing this new path and seeing where it led, the possibility of shared responsibility and ownership promised new freedoms for me and new achievements for the company. But the full implications of what I was doing were not yet clear to me.
Adapted from The Company We Keep: Reinventing Small Business for People, Community, and Place.
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