As more US business owners retire many are selling up to their staff
Summary
Many US business owners who are retiring are selling their companies to their employees instead of outside buyers. This trend helps keep jobs local and can motivate staff because they share ownership and profits. Employee ownership is growing, supported by rising investment funds and various legal structures.Key Facts
- Softstar Shoes in Oregon sold its business to its 30 employees in January.
- Owner Tricia Salcido is staying on as chief financial officer while planning for retirement.
- Selling companies to employees is becoming more common in the US, with about 600 firms sold this way each year.
- Investment funds to support employee buyouts grew from $500 million in 2024 to $865 million in 2025.
- Employee-owned companies tend to have higher productivity, pay better wages, and reduce layoffs.
- Many retiring "baby boomer" business owners face decisions on selling as about six million small and medium firms will change hands by 2035.
- Harvard Business School experts say employee ownership can help companies survive and appeal to owners who care about their workers.
- Various legal tools help employees buy companies, such as Employee Ownership Trusts, where a trust owns the company on behalf of workers and pays the owner over time.
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