Another five Colorado businesses have converted to employee ownership with assistance from a state program.

The businesses received $3,000 employer ownership grants from the Employee Ownership Office of the Colorado Office of Economic Development and International Trade (OEDIT).

“When a company transitions to employee ownership, the business benefits from a more engaged workforce, a guaranteed succession plan and a way to attract and retain top talent. Employee-owners generally experience higher wages, access to better benefits and improved job security,” said Nikki Maloney, director of business support at OEDIT. “Among Colorado’s small businesses, we are seeing a growing recognition of these benefits along with increased interest in Employee Ownership Office resources that can help them convert. This trend will have lasting benefits for business owners and workers alike.”

The businesses included Top Notch Logworks, a log home and products provider based in Gypsum.

Colorado Gov. Jared Polis hailed the effort. “I congratulate these businesses on their transition to employee ownership and am proud to continue our administration’s work to save businesses money and support employee ownership so that everyone can benefit when a business thrives.”

The Colorado Employee Ownership Office was established in 2020 to provide programs, funding and incentives for business owners to understand, explore and pursue employee-owned business structures. Since the employee ownership grant program began in early 2021,
18 businesses have converted to employee-owned structures. 

The grants offset such professional services costs as accounting, business valuation and legal counsel.

 The Employee Ownership Office also offers employee ownership tax credits that cover up to 50 percent of professional service fees necessary to become employee-owned — up to $25,000 for worker-owned cooperatives and employee ownership trusts and up to $100,000 for employee stock ownership plans.

In addition to employee stock ownership plans and cooperatives, any structure that gives at least 20 percent of ownership to employees is considered an employee-owned business in Colorado and is eligible for grants.

Jennifer Briggs, chairwoman of the Colorado Employee Ownership Commission, said a recent survey conducted by the Employee Ownership Office and Exit Planning Institute found that 72 percent of survey respondents wanted to sell their business within the next 10 years. Yet, 68 percent said they were unfamiliar with their exit options. 

“We see employee ownership models as a way for retiring business owners to realize the economic benefits of their hard work while preserving their businesses for future generations,” Briggs said.

The Employee Ownership Office also will partner with the statewide network of Small Business Development Centers to develop low-cost and no-cost resources that help business owners understand employee ownership options and guide them through the transition process. These programs are expected to launch over the next several months.

Applications will be accepted through Nov. 4 for the next round of employee ownership grants for conversions completed by Jan. 6, 2023. For more information about grants and other resources, log on to https://oedit.colorado.gov/employee-ownership-grant.