Innovations and Evolutions in Employee Ownership

um thank you so much Margo and thanks Olivia for being here as well um I'm going to welcome our first uh panel of the day up onto the stage our first panel is around um Innovations and evolutions and employee ownership so we're going to kind of take stock of like where the field is and where it's going and what some of those implications are uh as Margot noted it is really I mean I'm pretty new to this space myself but it feels like a really exciting and Innovative time to be involved in employee ownership you know you're seeing new models emerge new models being adapted and in response we're you know seeing new financing mechanisms and new types of Support Services uh come on come online to help uh help meet the needs of those different forms been an explosion of growth and State Centers obviously um and I think therein kind of Lies the beauty of this concept of employee ownership right is that uh it doesn't just mean one thing um I was I was thinking a bit a little bit about it last night and I I kind of think of employee ownership as like this this kind of Swiss army knife right of um that can be used to solve a number of different problems so um my wife and kids and I go go camping quite a bit and um my wife doesn't let me play with the knife because she's worried I'm going to hurt myself but I see her get it out right and a Swiss army knife you know has a cork screw it has a can opener it has a saw it has scissors it has big knives it has small knives all used to be solved you know used to address different problems when you're out there in the wilderness right and um when I look at employee ownership I see kind of this Swiss army knife that can be used to uh address a number of problems as well right we have different forms that are really good at sharing profits and Building Wealth we have different forms and strategies for thinking about race and gender Equity uh different uh forms that are maybe better than others at at thinking about how we provide opportunities to people who've maybe been locked out of the labor market and discriminated against so like returning citizens right um a a new wave of forms that I think are really exciting that are coming online to think about how ownership can be combined with other social purposes uh we have forms that are good for Main Street and forms that are you know uh better maybe for uh Wall Street and uh as we're going to hear about in a little bit you know there's uh a number of different forms and strategies that could maybe potentially really transform how we think about the care uh uh economy so child care and home care and how we can improve uh the lives of those workers as well as maybe the care that they they deliver so I think there's a lot of beauty and strength in all this diversity uh that we have and I think uh that strength really holds the potential for us to think about scale um because I I don't think there's going to be any one model that gets us to to where we all hope to go in terms of growing employee ownership I don't think there's one model that's going to really reach into all the the communities that we know need ownership the most and all that comes with it um so it's a really EX exciting time and um we're just going to barely scratch the surface on this panel of all like the Innovative models and Innovative work going on in this space um we certainly could have probably had four or five uh panel more panels at least um to to uh cover all the Innovation um so let me introduce our great panel and let them dive into it and let me find my notes so I don't get anyone's name wrong so I'm going to start on the very far right uh of the face many of you know Cory Rosen he's the founder and Senior staff member of the national Center for employee ownership we do have more copies of his book out there it's a great book whether you know a little or a lot about employee ownership I hope you'll pick it up uh next to him we have Chris Cooper who's the director of our oldest state center of employee ownership out of uh Ohio great to see Chris and then we have um Aki Sorano verosa who's the executive director of the pilipino workers Center and an executive fellow with the Ruckers Institute next to Chris we have um or next to Aki we have Chris 80 who's the co-chief executive officer of owner's Edge and ESOP holding company and then a face many of you also know moderating today's conversation is Mary Joseph's founder and CH uh Chief Executive Officer of verit advisers so I'll turn it over to you Mary thank you really appreciate it and thank you to ruter and the Aspen Institute for assembling this incredible forum for conversation on expanding worker ownership you are right Matt this conversation that we're having with this incredible panel could take all morning but there's other exciting things to talk about so we will try and be as succinct as possible and are excited to seed and share some ideas that are really working I've been in the ESOP space for decades and the innovation in recent years is exhilarating one fueled by the conversation of as you said Margot this broader tent and ESOP does not equal exclusively employe ownership employee ownership uh that tent is getting bigger and bigger and it's it's exciting as we can meet an opportunity for worker ownership in businesses that previously didn't have access to it for whatever reason so thank you I uh we're going to learn a lot from our panel um and Corey I'm gonna start with you uh Corey you get three minutes Cory could talk for an hour no that um but if you could share some perspective on over your legacy with esops on why and what you're seeing today in terms of innovation thank you so what we've seen in esops over the last now almost 50 years this will be the 50th anniversary of the statutory creation of esops in 1974 and when esops were first imagined by Lewis Kelo the idea was they would be used as a mechanism to raise capital for for large companies you'd borrow money at a reduced interest rate you would buy new capital through the ESOP by issuing shares the employees would become owners the company would get bigger and everybody would be happy and and there were tax incentives to do just that and then that wasn't happening there were esops being formed but it wasn't being used that way so Congress said okay we'll actually pay you big companies to set up these e Ops because we think that you'll like that once you do and you'll expand it and so the first research project we ever did after I left Capitol Hill and started the center was whether that encouraged large companies to actually set up more esops to expand their ESOP beyond the one or two% that the government was giving them a tax credit for so literally paying them to do it and we found that that was not the case not even once in any of these companies and the That Was Then replaced by okay well maybe what's happening is that esops are being used to buy out owners of closely held companies and so this tax credit was substituted for some other tax goodies including a tax incentive to sellers to sell to esops and then that part of esops grew and grew and grew until where we are today and it's kind of equilibri the number number of terminated plans equals the number of new plans so a couple trends that are happening though that are encouraging by far the most important is what we're going to hear more from Chris and we heard yesterday from Daniel there is a huge wave of ESOP companies buying other companies so as ESOP companies mature and they're not paying taxes because government says if you're 100% employee own you have to pay taxes and these companies perform better than other companies which we know they do they're saying hey we can go out and buy another company or maybe lots of other companies and when they go to the targets the targets say that's cool I don't have to sell to private Equity I don't have to sell to some competitor and I know what happens when we do that to the people who help me build a company you're telling me I can get a fair price and my employ can become owners of you that that's a kind of sweet deal so we're seeing a many more companies being bought by ESOP companies than new esops being established in 2021 there were 423,000 more new employees added to private company esops and I'd say 70% of that number came from Acquisitions to me this is the future of ESOP this is this is what's going to really get us out of this equilibrium State and into something really important at the same time we are seeing as was mentioned alternatives to esops I don't think they have any chance of really replacing esops as a model because they're better adapted to specific circumstances and it's pretty hard to give up all these tax benefits for basically the greater flexibility you get with these other models but we're seeing private equity for instance a few giving Equity to everybody when they buy a company we're seeing employee ownership trusts growing somewhat in this country so that's encouraging and we're also seeing more conversation about this idea as this is one of the few things we can all agree on that actually works but I'll just End by saying it's really frustrating to me and I know to many of you that you've got an idea that in that means that employees have three times the retirement assets they're paid better they're one5 as likely to be laid off as in other companies and everybody everybody virtually in both parties agree it's a good idea and nobody's standing on the top of the roof yelling hey pay attention to this this is something that really could move us forward it's relegated to a very third tier issue so that's something I hope can change thank you Corey um given that uh Chris I'll come to you next uh the Ohio Center for employe ownership I have been familiar with for decades and you stand alone in advocacy programming and services for employee ownership I'd like to share the history and why you think what some critical uh aspects are that make you so successful um well I I'll share the history first um so we've been around for about uh 38 years now um so we've been continuously operating that's oh having a microphone would be good right using it right sorry about that folks um so we've been around for about 38 years now uh we're going to have our 38th annual conference here in April 18th we're going to have about 4 people joining us in akan Ohio um uh for that so uh our our basic focus is uh kind of three major areas I call it the three-legged stool uh we work with startup employee owned businesses or Andor business owners planning for succession and maybe transferring the business uh to their employees as part of that process a big chunk of what we do is we provide training and education for existing employee owned companies in Ohio thankfully you know employee owned companies uh the number of employee owned companies I I I think Ohio we punch a little bit above our weight in terms of population in terms of the number so we're very proud of that um and that's what our conference is going to be mostly about is training and education for folks exciting for us is that uh uh as we go through each conference it's more diverse in terms of its content so we're going to have you know it's very ESOP heavy because that's most of the employee own companies are esops in Ohio but we're we've expanded um our our Co-op content and we're doing some stuff with you know the employee ownership trust model and all that kind of thing so we we we try to keep a handle on that and the third part of what we do is kind of advocacy and research so we are part part of Kent State University in Ohio I just want to say the Kent State University right nice okay sorry sorry it's my one joke right um and so uh I have a colleague Mike palmary who's also a fellow here at ber uh at the at ruter um who kind of handles uh our research side of things um we also do some public policy kind of advocacy work as well so remind me what the second part of your question was I was why you've been so successful ah yeah well you know I was going to say that uh people say how have you been so successful and I always feel that I get up every day realizing it's still a struggle uh to keep the doors open and keep doing what we do so you know I think we figured some things out I I would hesitate to say we figured a lot of things out right I think um you know a kind of a pragmatic approach is probably what I would ascribe our success to most is that we're e ecumenical in terms of model um uh we work with anyone and everyone um we we meet uh whoever we meet with we meet them where they're at instead of trying to say that they need to be where we're at right and so I think part the other big piece is partnership so in Ohio uh we have a a great network of organizations that are doing this work um we have uh We've started among uh with other organizations an organization called another organization called own um which is Ohio's worker ownership network is what we're calling it and so that includes Co-op ciny Co-op Dayton Evergreen cooperatives uh the Ohio Cooperative Development Center at uh at Ohio State uh a group called Cleveland owns up in Cleveland as well so we've created that Network to kind of help us do work there's lots of work to do right none of us can do it all and so so um we've got a great network of service providers you know the professionals um that really uh while I'm sleeping they're out doing deals right and so they're building the infrastructure as well um so they're they're a huge important part and I think a lot of it is the magic of the companies um I I got asked a couple weeks ago why do you do what you do and and you know invariably what I always point to is when I get a chance to go to an employee owned company and work directly with the employee owners um and the business owners as they're thinking about what's going to happen to their business and their legacy those kind of things sort of like the soft gushy you know emotional kind of stuff um it never gets old you know and um I can feel myself getting a little emotional right now because it's it's it's an amazing thing so so I think that kind of pragmatic but I um uh uh also kind of dreamer a pragmatic dreamer kind of thing you know um and approach to what we do and how we do it um along with the Partnerships is really what what's driving our success thank you congratulations uh Corey thanks for flagging ESOP holding companies it is so clearly obvious that m&a or acquisition isn't the prerogative of just private Equity companies or large public company it's you is it is me okay so growth through acquisition is a tri and true across the capital markets as a way to drive share share value diversify and grow and uh what you guys have done at owner's Edge is I think so exciting in Wisconsin and uh starting with one at a time and building a a team and a strategy and Leadership around it so could you share more about that Journey sure I'm so excited and thank you for the opportunity to share our story this morning um so owner's Edge is a holding company we are 100% owned by an esap today we have five um portfol companies operating companies in our portfolio today and our current intent is to acquire up to five more companies our Legacy company is ccnn their cabling infrastructure company they became 100% um owned by the esup in the late '90s so we have a very mature esep at about 25 years and in the 2000s around 2010 our CEO came on board and looked at the sustainability of that company and they were financially healthy and doing very well and thought longtime sustainability esap forever what should we do and how can we really continue to think about that and with our executive team and our board of directors in 2015 we created the holding company and we moved that operating company down below the holding company so % ESOP owns the holding company five businesses are operating companies now owned by the holding company all participating in one esap so since 2015 we've actually acquired eight companies to get to the five businesses today so Acquisitions aren't just Diversified in our portfolio we also do strategic rollups within there but our intent of creating that holding company was to create diversification counter cyclical business is not all going with the economy at the same time making sure and in The Last 5 Years with everything that's gone on that has proven very successful for our businesses so in that 10year period our Share value to our participants has grown over 400% in that 10-year period um and so we're continually thinking longterm what does that look like as we continue to think about diversification and strategic growth within our portfolio so just again to share a little bit more about those companies ccnn cabling infrastructure bom is a mission critical Communication company they provide um two-way radios Panasonic tough books to Public Safety um and make sure that that and we're all based in the midwest area mostly within Wisconsin with one or two businesses in Minnesota our third company is cuum Technologies they're a robotics integrator um so they work with manufacturing facilities to design Robotics and um mostly palletizing and DEP pal End of Line Manufacturing specializing in the glass industry um our fourth company is impco we actually combined two of our companies to create impco and they sell and rent Audio Communications so now we're in a big event like this maybe there's thousands more people around us and we want to just have you all hear what we have to say instead of the microphones we're going to give you all a headset we're going to rent it to the facility and provide that to you so you can hear that a little bit better now our fifth company is the most Diversified in our portfolio it's a company called Ashen Spencer they create and compose music for the advertising agency so we've gone from unionized technicians to sales in the public safety area engineers at qm our impco team is a sales-driven team and now we've added composers and creative to our employee ownership and so we're always thinking about that diversification and the long-term sustainability of our esap and what that means to us from a diversification one of the things that excites me the most as I think about what we've been doing over the years is that growth and wealth creation that we're doing for the employee owners I've talked yesterday with several people and we think about and many other uh employee owned companies and our generation coming in is thinking a lot about well how much money am I making today we bring a new employee into our company and they aren't thinking retirement so we talk about wealth management and how we're helping them to grow their wealth and the first year you join the company and you're thinking I don't know I didn't get a contribution yet I got to wait 12 months to get into the plan it's year two and three when this really starts to become meaningful dollars for those employees and so it's really working with our communication plan our communication committee um to educate our employees on what that means to them what it could mean in 10 to 20 years from now and so that really excites me about how we can really um educate our employees on that wealth building and looking a little bit more into the future um even though it might not be their retirement in that final stage but really thinking about that wealth management thank you so much and congratulations thank you all right we're going to move over to California and uh hear from Aki Aki yes okay sorry akie um the Home Care sector or or sectors with with you know minimum wage workers uh and the opportunity for retirement savings is so desperate in that that particular Community or sector so uh you have come up with a very Innovative way of bringing more good jobs to this particular demographic and I'm really anxious to hear more about it and share it well I'm happy to be here to share it um I my background is more and our organization um Filipino workers Center I'm also I've was President for a long time of the National Domestic workers Alliance is coming from the worker organizing perspective and how we're transforming an industry for better jobs and dignity on the job um so we've had to do a lot of policy work a lot of organizing leadership development but I'm really excited about how worker ownership and the co-op has come in as a really important strategy for how we're transforming in these industries for a long time we've been um fighting and helping workers to get back wages this is an industry that is plagued by wage theft um to give you an idea we have workers commonly workers who are working for less than $3 an hour with no overtime working 24hour a day shifts um and many who are doing this job in California and across the country are also immigrants um in the IND industry uh part of the issue is that we have um a population that is aging here in um the country every 8 seconds someone turns 65 um as the Baby Boomers are hitting retirement so we have this huge need most people want to age at home um and in their own communities um but we have a Workforce problem because we have a lack of good jobs to to really bring people into the sector um and um so with our worker with our Cooperative that we're developing we have an a new model that is um well parts of it have been developed over the last decade of an LLC Cooperative where workers are earning as um as owners not as employees that creates an inclusiveness for everyone who is doing the jobs in this industry um no matter the immigration status um so we have built um and we incubated uh a home care Cooperative called courage um courage Home Care in Los Angeles that's been operating successfully since 2015 but now we've embarked on building a scaled model um the llc's can only get so big um and me to be manageable and for other legal reasons so now we're creating and using um secondary a secondary cooperative and actually even a tertiary Cooperative structures to create um in a way a kind of franchise but not a franchise um where the LLC cooperatives the local cooperatives will be member owners of a secondary Cooperative um and the secondary Cooperative provides the shared infrastructure of marketing of the shared brand of back office of technical assistance because it is bringing in um you know workers who may also have language and uh you know um Tech skills are experts in what they do in providing the care but also don't have the expertise to um necessarily sometimes build these businesses so building out a structure that can help we have a whole Academy as well that helps helps to grow their own um their own skills and build a structure that already has a lot of um best practices systems that they can be trained into so that each of the local co-ops can really get off and running and build a viable um business in their local market as a part of this larger scaled model so that we can really make an impact on a larger level in this industry um and one we conquer California we'll bring it you know other places into other parts of the industries and I think what's really exciting is that it's like it's a model that is helping to transform jobs I don't think cooperatives have been as much used in low-wage Industries right to really transform um not only we need we need unions we need organizing but this is a way to actually create um the jobs and what we want to see in the industry instead of just fighting the bad jobs thank you so much we can't wait to get you to Illinois Corey uh the nceo has grown extraordinarily over the decades that you've uh been Affiliated and in a few weeks you have a soldout conference of 2300 well we would have if we'd had space 20 1900 is all we had room for okay so uh what are you what are you excited about in terms of growth opportunities and thank you for your continued vision and and thinking through ways to continue to grow so you know for us as an organization of course we want more esops if you're not a member then you can help us grow by going to n.org and joining that would help us grow uh We've we're different I should say for those who aren't familiar with us we're different from typical nonprofits in that I never wanted us to be funded by Charities or foundations so we never sought that money uh we are we operate like a business and we actually been successful in that term so we've we've grown quite a bit but I I really would go back to what I said earlier the growth opportunities for this movement and H hence for us is really esops getting bigger and and I course more esops would be good but the big opportunity the supercharging opportunity is going to be through the sorts of things that Chris is doing because it's such an attractive opportunity for the companies who are being bought and I the it would be really helpful if there were more financial systems that were supporting those kinds of Acquisitions particularly Acquisitions of a larger scale where financing might be needed so the idea of an employee ownership bank or what was we were hearing yesterday about the employee Equity investment act I think if these kinds of Innovations in finance can succeed that we'll see this movement grow substantially over what it is the other thing that I think is a real opportunity for growth I want to emphasize what I said yesterday and I hope some of you will take to heart you heard about these State programs like in Ohio Ohio started cuz one guy decided that this was a good thing to do and he made it happen Colorado and Washington happened because one person went to a legislator and said this is a really good idea it's popular it's effective and it doesn't cost much how about introducing legislation on this now to to be clear it's not simply a matter of getting an idea and then it passes it's a lot of work but it starts with that and all of you have the opportunity to do that go find your legislator go find somebody on the appropriate committee and say Here's a really interesting idea take somebody from a local ESOP company with you to meet with that legislators preferably someone in their district and you can really make a difference uh it it all happens because one person gets started on it so I hope some of you will take that to heart go ahead actually I would love to carry off of that Corey we you and I have had several conversations recently about the acquisitiveness of esap so the concept of an esap acquiring another company or an EOP owned business acquiring has been around for a long time ESOP having but this idea a diversified holding company seems to be really taking much more um attention recently I mean we've been around for 9 years some of you may have heard of houin they're one of the largest Diversified esap holding companies in the in the country and they've been making Acquisitions for many years too we are focused on Middle Market so our whole strategy um really looks at continuing to grow employee ownership a lot of you who are doing research and understanding that and the CEO is thinking about number of eaps in the country and we're thinking number of employee ownerships so we want to continue to grow employee ownership that way and looking for those right fit companies that are going to fit into an existing employee ownership culture is really important obviously we need financially healthy as we're continuing to think about long-term sustainability in that process um culture is key the other thing that's a growing Trend in the industry is the idea of eaps acquiring eaps this is something I've been talking with our associations and our professionals about for quite some time now because it becomes very complicated going out and acquiring a company that exists today from a seller yes we've need some financing for it they might need a seller's note m&a gets involved we can do that but now bringing eaps together to prevent that esap that's been around for 5 10 15 years didn't do succession planning yet now they're like world CEO is getting ready to really move on this time the board doesn't have another leader in place let's not get PE involved to buy that esep that now needs to sell um and the first round all those employees get a p is get a payout but that's a short-term process we didn't think about the long-term sustainability of that employee ownership that esep so really the idea of bringing eaps more together and getting esubs to merge with each other is a really growing Trend that we've really are Focus scene in our associations to continue to grow that employee ownership and keep the number of employees in ownership growing within the um community so just something that I if you can tell I'm a little passionate about when it comes to that area and um really advocating for continuing to have that type of a culture so at owner's Edge we think about um we all have the same dream if you go out to our website you're going to see it's all about the American dream that each one of our employee owners will have at some point in their life but we're different companies within that dream and so we keep all of our individual cultures intact and want to continue to grow our businesses and bring more employee owners um together thank you uh Chris I think another growing conversation is how and you use the word sustainability I is how you stay private and it does take key initiatives in leadership and talent development capital ation and strategy with your conferences uh I know because I've been to them you have so many sessions on continued techn technical education and resources uh but I would love your perspective on how how you stay private stay employee owned or other uh well that's a that's a very good question uh I don't know if there's a Magic Bullet I think it's um working with companies to develop a plan um you know so many kind of uh I mean we all do it even as Leaders of our organizations we focus on the important stuff right that's happening now so it's it's a lot about planning you know um you know we've we've done uh some sessions at our conference and had some conversations around how you fund re a repurchase so that it's not a this looming disaster but rather something that's that's being planned for effectively um I you know I think some of it is beyond our control it's the economy stupid I guess to paraphrase right um that sometimes drives things it's industry wide things um uh but you know I and I think there's a culture aspect too right the the longest lasting uh ESOP companies we have in Ohio I think have done that because they' built an amazing culture that feeds on itself it it it's a self it's a what do they call it a self- feeding Loop or uh kind of thing right and so a lot of those good things keep on happening right and people uh they have the internal capacity to to react effectively to covid right or you know those all of those kind of things so um again I don't know if there's so many when I was looking at the the topics for today so many of these things have multifaceted answers I don't know if there's a single piece right but it's it's all of those things combined um and you know hopefully we were able to do that with the with the education and the training that we provided as well so thank you akie I know for my time in the ESOP space there we can spend so much time trying to describe what it is to an owner and Chris referenced so appropriately how difficult it is uh to communicate and and perpetuate that communication with um with employees uh cooperatives seems you know even more challenging or secondary cooperatives how are you going about that well we're creating visuals to help break down the structure with how many languages right with many languages in our um Advisory board our worker Advisory Board we have three different languages English or not actually English Spanish Tagalog and Nepali that we um do translation in um and so so it is very complex and in talking with workers and with organizations um it's like bringing together these different worlds of structure and business than with the daily lives and realities of home home care workers um so so it is very complex for myself I've had to learn a lot of it myself um so we we know that like in the sector we're going to have to have extra special training and um support um to be able to um support workers to come into these roles um and we're creating something that is a bit new you know a lot of people don't think of or don't know about the LLC Cooperative model for example um so it's doing education and and breaking down what does that what does it do and then what are the limitations and then how we're building the the secondary structures to support and grow and scale um the the the LLC model um and then what also is more more uh complicated is how it fits in with other things that we're doing like developing and leveraging Workforce Development dollars to do the training and do actually um uh education about Cooperative governance um and how to be a worker owner integrated with the skills development um and doing on the job training through a Cooperative so that you're not only um getting the experience of doing home care you're also getting the experience of being a Cooperative owner at the same time um so developing models that can leverage a lot of the assets that we've been building um so that um yeah so so it is a fairly complicated model and we have a lot of Big Dreams for it it doesn't um I think what's what may be a little bit different too is that this Cooperative model we don't see as the solution for transforming everything it has to be in relationship with the other things that we're doing in terms of lifting the floor of the the laws and protections for workers because our competition is operating on a business model that's based on wage theft right um and um actually building a political invoice and power to shift the environment in the industry itself and and actually I see what we're building in terms of our our skilled Cooperative model is also a powerful political voice um to be able to uh impact and speak on the industry in a different way than just worker organizations alone could also do because they're not only workers they are worker owners who are running the business of it as well and showing by example how things can be different can you share a story of how life or or work might be different for a worker owner compared to what you'd seen previously in your career so yes so um so in our membership as Filipino workers Center we've asked uh like our members who here is actually earning minimum wage getting all of their protections over time pay and where we've had no one in the room raise their hand that that's their reality um now because we have the Cooperative when we ask that question we have Cooperative Members Own worker owners who can raise their hands um so for example one of the member owners uh Fatima uh she's working in the Private Industry um through an agency Home Care Agency was working 5 days a week 24-hour shift straight through 5 days and um and when she came to the co-op um for a time she was working 3 days a week during during Co it had to be 24 hours we try and shift so that people aren't working 24 hours but during Co that was necessary and what she was earning working three days a week in the Cooperative um in one month would have taken her uh three months in the private home care agency working five days a week before um so and she has uh dental and vision she's actually able to take paid days off because the power Dynamic also in the private sector is like it's very hard to actually even though you have the right to hard to ask for your paid day off um because of the dynamic because maybe they just won't ask you back you know um if you're asking for your paid days um so it shifts actually the the the power dynamic because they are the worker owners that they can then take their pay days off they have holiday pay um and they actually have you know um they're they're running it they're seeing where their their money is going it's not just going to um an owner you know but it's actually they get to make the decisions together they also build care teams together which is very different they're kind of just like thrown out there usually um in the private Market but in Courage they're bu building care teams that actually then creates like you know a space where they have a community um that ALS that doesn't only improve their own quality of life it improves the quality of care as well that they're providing to the client very exciting thank thank you uh Chris you had mentioned uh gentleman has a question oh sorry his hand there we oh Mr keing I just wanted to throw in great panel are amazing talking about something that's bothered me a long time visited 592 ESOP companies in my career yes some were sick puppies some were fake some were no good fast majority were overwhelmed and so many of them so many of them I've talk loud anyway so many of them don't exist anymore now some of the Sick Puppies went away that's fine but many of them were good companies and the repurchase obligation would drain their ability to make the Capital Improvements in the organization the mechanical things expand etc etc and the ESOP terminated went away because they couldn't handle the financial demands all three of the Seas brought something forward especially Chris and Corey brought and and uh Greg they must have our nation if you're going to be dedicated to an amazing wonderful way to improve the income improve the lifestyle of most Americans who work that become employee own the repurchase obligation issue those companies have it grow and grow and grow and I think that this panel has put things on the table that can start addressing particularly Chris can start addressing this problem that I saw in the nearly 30 years that I visited ESOP companies yes some were sick puppies don't get wrong me wrong some were done flim flamy and I also go back to yes one person was named Russell long an amazing person who was able to listen to another one person luk ELO to create the mo model a broad-based employee ownership and so never underestimate new ideas Innovation Etc but you guys have hit on something that really rang a bell with me because being in 592 companies and so many of them don't exist the hundred that are listed that y'all did Corey and the list that's provided I visited 25 of those companies there are others that would be on that list if they were still employee owned so thank you very much thank you Michael for sharing that um Jen from hypertherm uh when uh you spoke yesterday one time when I visited hypertherm uh one of the executives said Mary if we don't grow uh we die because as your expenses go up just inflation and whatnot your margins are going to shrink so uh companies are paying attention to it so thank you and thank you guys for paying attention to that there's a question in the back there because everyone else will be in and black brown workers in particular really are needed this movement is needed for them in particular and so I really appreciate you you know the groundbreaking work you're doing there um I had a question because we um started to do this kind of work in farm labor as well and so similar sort of circumstances of Highly exploited marketpl um um you know wage theft all the same issues that I think your workers go through and so one of the questions one of the challenges was just that you're in a market of Bottom Feeders right and you're competing with those Bottom Feeders so our our workers the challenge was um you know they had to move around a lot to get work right they're they they've got two or three different employers and it's they follow the work so the loyalty to the company the EO model is interesting because if you get loyalty to the company then you can build up a A system that actually like addresses um a lot of the inequalities but then also provides quality services to the market to the farmers so one of the questions I have is just how did you stabilize your Market to be able to provide continuous employment for your workers so that they stay with you right or is that even something in in home care where they have multiple employers and they're chasing jobs all the time or is it that they work with one employer but you can see this is like a repetitive theme in low agage workers right and so to me EO is so powerful in that space But the exploitation precludes like real scale and so just wanted to hear your thoughts on that thank you thank you yeah definitely so it is something that we do still deal with right um and so uh part of it is making the the the mod model and the business right now work for the current conditions of the market which means that we're also only going to be able to serve a certain part of the market that can actually afford to pay our Co-op prices that provide the good jobs um but because there's this like growing need there's actually a good Market there for for us to be able to build a real Niche and we don't have as much the the geographic traveling problem but it is about about um uh needing to create enough um of scale of available jobs that they can continuously work in the Cooperative as well and so that's why it's really important for us to build this scaled model um where we can really have Investments and expertise brought into marketing to to build up enough clientele as well as then on the other side enough of the structures that can hold and have the available workers that are ready to provide the services because usually it's like they need the care yesterday right um so uh at the same time as we're doing like serving that part of the market we are also as as a movement and as PWC we are also trying to shift things in terms of policy we know that in an industry that's plagued by wage theft it's also about underinvestment because everyone has the need for Home Care at some point but do not everyone has the resources right so it's not but it's not a choice of whether you you you want it or not so it's we also doing policy work to create more public investment um in home care that's another reason why I'm in DC this week because we are also working with the current Administration um about uh Federal Investments as well as in California we're building out um a campaign to build a new public benefit of social insurance uh to um to address the issue of affordability um and at the same time because we are growing and developing it also with our Union Partners um we're designing it in a way that our Cooperative model will actually be um one of the preferential High Road agencies that then will be a part of the system uh other questions right here I sir you do hi I'm Michael Higgins hello yep it's good okay Michael Higgins I was at saic for many many years and then ran the foundation for Enterprise development for other years but that was a long time ago and when you know I come to these meetings uh and I hear these wonderful things going on but I'm most interested in growth it seems to me that Corey there still hasn't been a lot of growth overall in the number of EO companies uh and in the over you know the impact on the economy for example what is the total of Revenue of all of your companies combined and how many people are involved and Corey I'd like if you can a guess about the same thing just how many uh employee owners are there today and and and how what's its relative size to the economy so it depends on how you count it so if you look at every employee owner who owns stock in any kind of way yeah okay excluding the owning stock through 401k plans in their company it's about 25 million so that includes people who are in Employee Stock purchase plans who work for companies that give everybody restricted stock or stock options includes esops and then some of the smaller iterations on this so that's a pretty big number if you look at the number of people about 25 years ago would have been smaller uh but for the last 10 to 15 years it's been pretty stagnant and if you look at private company esops so arguably the most impactful form of employee ownership that number grew till about the early 2000s then it leveled off and now we've started to see what could be very meaningful growth to now about 2 and a half million people people but 2 and A5 million out of a private sector Workforce I think of it's about 110 million or something so you're right it's still a tiny percentage of the total economy and it's difficult for esops to compete with larger market forces particularly the growth of private equity which may become larger than public markets in the not too distant future and so that's a totally different model and that model is growing very quickly so there are real challenges to getting where we need to be we're a long long long way from where we need to be and yet every little bit helps so we are a middle Market company right so we started at 25 million with about 135 employees today we're about 125 million with 350 employees thank you do you have any idea what fraction State I don't off the top of my head no but I there's many eaps within our community there's a lot of um eaps that we uh work with on a regular basis within the state of Wisconsin several more questions Ellen I think you have the mic I the Talking Stick I do someone handed it to me um my question is also for Aki uh Ellen Frank Miller um so I have done research and work with um other home care agencies and one of the things we hear all the time is well we can't pay them more because that's what Medicare reimbursement rates are and that's what limits our ability for wages so I was wonder it sounds like when you say you have a niche market that can afford it can you talk just briefly about um kind of how you've addressed this limitation that either is a legitimate limitation or a really nice excuse that we hear from other firms um I mean that's a reality especially because for other Home Care um coop operatives who primarily work with their states um program Med Medicaid based program and that there isn't there actually needs to be higher reimbursements um through those programs so those are real and actually need to be yeah uh campaigns to Advocate around um you know we're in California that also does have like a concentration of like markets and demographics where we can actually make this work it may be less doable in rural like we're starting in the in the urban areas because that's where we have the biggest markets that we can actually compete for um and in California we actually our Medicaid um program is uh I inhome supports and services that doesn't have an agency model so it just goes directly to the provider um so as we expand that's why we need to also grow the program so that we can also include uh um how our our model um into it um so so it is a real thing I would say it's not just an excuse um we need more investment overall in home care um so that we can so that everyone can afford to pay workers what they should be paid um and that definitely happens co-ops and a lot of the co-ops now they have to uh for long-term sustainability ones who are working with their state programs are having to diversify so that they're also doing private pay as well as um the Medicaid reimbursements at the same time thank you I'm on the board of a company in West Virginia it's 2300 employees a home care company and they're they're they work with Medicare that's they're they have some private but it's almost all through Medicare Medicaid and they're reimbursed at $15 an hour and they can't so what can you do if you're in that situ it's very frustrating for them to because they want to pay people more uh but there's just limits on what you can do and then so they're competing with the jobs workers who then go to the gas stations instead of home care right they can make more money at Amazon uh so I think we have time thank so we have time for maybe one more question I do want to bring in our virtual audience I know there's a number of questions in the room but maybe you can grab the panelist afterwards uh quick question for Chris um so one of your companies is unionized and uh we had a question come in about how unionization works with esops and some of the challenges and opportunities that you see there sure that's a great question and actually it's the original company that started the esa back in the late 90s that is the unionized workforce and so they have always participated 100% in the um esap plan as well through that process granted they have a collective bargaining agreement and we negotiate with them every year and the esep has just been part of that um process for them what's really exciting about it is that that's such a legacy business and been around and mature from that perspective is that we have unionized workers who the value in their EOP plan today on an annualized basis increases more than the compensation that they're making and they really show that to they they actually attract more people coming into our business because they can talk about what it means to be a part of that esap community and actually understand that they can contribute to the value of the business and the gentlemen who have been or the technicians who have been around for 25 years talk to the new guys coming in and say we have a great video on our website of someone who retired about four years ago and he said when he first started they all told him you should come to this annual meeting where they'd reveal the shares and you get a statement and he was like why should I go and they said free beer and free food he said I'm in so he started going to the meetings and now he's retired and literally living out his American Dream based on what he was able to earn over the course of the period of time that he worked for the business thank you everyone uh the panel is around for more questions Corey Chris akie and Chris thank you this has been extraordinary