WWW.BACKCONSTRUCTION.COM BACK CONSTRUCTION AN ESOP LEGACY BUILT ON EXEMPLARY STRUCTURE & DEVELOPMENT
BACK CONSTRUCTION AT A GLANCE BACK CONSTRUCTION WHAT: A leading design-build remodeling company known for its exemplary customer service, craftsmanship, and innovative culture. WHERE: Lexington, Kentucky, USA WEBSITE: www.backconstruction.com AN ESOP LEGACY BUI EXEMPLARY STRUCT & DEVELOPMENT STRONG STAKEHOLDER ENGAGEMENT AT THE CENTER OF AN IMPACTFUL CULTURE 1 BUSINESS VIEW MAGAZINE VOLUME 11, ISSUE 08
ILT ON TURE Within the Bluegrass Commonwealth of Kentucky, there is a company actively demonstrating the immense potential the ESOP structure presents to the entrepreneurial community. Headquartered in Lexington, Kentucky, BACK Construction has shown that with a properly leveraged and rewarding structure, smaller businesses can operate at the scale of an enterprise. 2 BUSINESS VIEW MAGAZINE VOLUME 11, ISSUE 08
The company stands on a legacy of excellence and has solidified its market presence by leveraging the strong customer relationships and trust it has built over time. It’s known for maintaining high standards of customer service and craftsmanship, which have become synonymous with its brand. Internally, BACK Construction fosters a culture of innovation and continual improvement. This means investing in the latest construction technologies, adopting sustainable building practices, and continuously refining their design-build process. The emphasis here is on workforce development, recruiting and retaining skilled tradespeople, offering competitive benefits, and providing continuous professional development opportunities. The success of BACK Construction is reflected in its ability to consistently deliver exceptional results, foster a loyal and skilled workforce, and adapt to the evolving needs of its clients and industry. A thriving, innovative, and community-focused company, BACK Construction’s growth will manifest in increased market share, satisfied clients, and a robust, engaged team that embodies the spirit of ownership and excellence. A STORIED BEGINNING Founded in 1981, BACK Construction began as a collaboration of four partners: Billy Knight, Alvin Edge, Chuck Ross, and Kyle Whalen. Their shared vision and dedication quickly transformed the company from subcontracting to home building. As time passed, Knight and Edge departed, leaving Ross and Whalen to steer the ship, and in 1994, current President Rob Hundley joined the team, becoming a partner alongside Ross and Whalen in 1998. “Then over the next two years, we started doing more and more remodels, which led us to make the conscious decision to focus on remodeling,” Hundley explains. Driven by passion and the evident community need for professional remodelers, the company shifted its focus. In 2003, Ross left to pursue a different path, leaving Whalen and Hundley to run the company. The two leaders then led the company through a transition to an Employee Stock Ownership Plan (ESOP) on December 31, 2021, arguably the most influential decision in the company’s history. The decision to become an ESOP was rooted in Whalen and Hundley’s commitment to the company’s employees. 3 BUSINESS VIEW MAGAZINE VOLUME 11, ISSUE 08 BACK CONSTRUCTION
The company has always aimed to offer benefits comparable to larger corporations, such as paid vacations, holidays, health insurance, dental, and matching 401(k) plans. Now that it is an ESOP, it offers all of that on top of continually growing an ESOP that employees don’t have to contribute money into. “So, selling to an ESOP just made a whole lot of sense,” Hundley says, highlighting that the ESOP transition empowered the entire team, making each member a beneficial owner of the company. This shift aligned perfectly with the already forwardthinking and inclusive culture and fostered a sense of ownership and responsibility among all employees. “Becoming an ESOP made our leadership team much more impactful because they feel it more, they own it more. They’re more engaged. They’re just like the rest of the company, but now there are not just two people sitting in the ownership chairs. There’s technically 68 team members sitting in that chair,” Hundley says. COMMUNICATING ESOP VALUE TO PROMOTE ESOP CULTURE The ESOP transition undoubtedly enhanced BACK Constructions’ leadership structure. While Whalen became CFO and Board Chair, Hundley stepped into the role of President and CEO. With the remaining employees now acting as stakeholders, company members are more engaged and taking greater ownership of their roles and responsibilities. Moreover, leadership development has become more crucial than ever. By nurturing future leaders within the organization, BACK Construction ensures that their core values and commitment to quality are perpetuated. This involves providing robust training programs, and mentorship opportunities, and creating an environment where employees feel valued and empowered. Fortunately, this heightened sense of responsibility has improved the company’s overall performance, from job site safety to customer service. However, having everyone simultaneously play the role of owner and employee means that clear, consistent, and proper communication must be paramount. Internally, BACK Construction promotes its ESOP’s value through regular meetings and transparent communication. It hosts annual ESOP meetings, where items like 4 BUSINESS VIEW MAGAZINE VOLUME 11, ISSUE 08
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financial statements and stock appreciation are discussed, and considering that BACK Construction is 100% employee-owned, these meetings have been particularly impactful. This transparency and involvement have increased employee engagement and pride in the company’s success. “We’re in [ESOP] year 3… and it’s great because people are seeing the stock appreciate in real time relative to where we started two years ago,” Hundley explains. However, it’s not just the numbers that positively affect the company environment; BACK Construction also favors supporting a lively and family-oriented atmosphere among employees. The company often hosts events and get-togethers for the employees and their families, the most notable being the annual Christmas party and the 6 BUSINESS VIEW MAGAZINE VOLUME 11, ISSUE 08
monthly team building breakfasts. Externally, the company makes sure to consistently highlight the advantages of its ESOP status in marketing materials, showcasing its talented workforce and emphasizing our 100% employeeowned status. It markets heavily on social media, making sure to occupy large portions of the local webspace, an approach that not only boosts team morale but also allows it to focus its efforts on being the dominant constructive force within its region. RECOGNIZING PRESENT AND FUTURE IMPACT BACK Construction’s commitment to quality and customer satisfaction has garnered numerous accolades. It was named the Best in Lexington for Home Remodeling by Smiley Pete Publications in 2024 and has consistently received the Readers’ Choice Award from its local newspaper from 2011 to 2023. Additionally, the company has been recognized on a national level by Houzz and has been ranked in the Qualified Remodeler Top 500 since 1999, most recently ranking at 153, highlighting its stellar service and design and won the award of the 2018 Small Business of the Year - Commerce Lexington Inc.’s Salute to Small Business” 7 BUSINESS VIEW MAGAZINE VOLUME 11, ISSUE 08 BACK CONSTRUCTION
Awards such as these reflect the company’s dedication to maintaining high standards and continually improving services. It’s important to note that BACK Construction’s operational success also relies heavily on strong relationships with key vendors and subcontractors. “With the sheer amount of volume… we have to have partners that match our criteria on multiple levels. What we look for is great customer service,” Hundley says, explaining that the vendors they work with do an excellent job upholding the company’s standards, timelines, and project budgets. Companies like Mueller Roofing and Ferguson exemplify the high standards the company expects, providing exceptional customer service and quality products. These partnerships are crucial, given the custom nature of our projects, so the company continuously seeks vendors who align with its commitment to excellence and customer satisfaction. Luckily, the partners they have now understand what the company is trying to accomplish and have been on board for years. Overall, the ESOP structure has significantly influenced BACK Construction’s company culture, driving higher engagement and accountability. SMALL ENOUGH TO LISTEN, BIG ENOUGH TO DELIVER MUELLER DISTRIBUTORS TRUSTED SINCE 1875 Roofing (Residential & Commercial), Siding, Windows, Railings, Columns, Doors & More NEARLY 150 YEARS of industry knowledge. 877.711.6789 | www.Mueller1875.com Building products for all your job site needs. LOCKLAND | QUEENSGATE | COLERAIN COVINGTON | DAYTON | FAIRBORN COLUMBUS | LEXINGTON | LOUISVILLE 8 BUSINESS VIEW MAGAZINE VOLUME 11, ISSUE 08
Employees now take greater pride in their work and the company’s success. This shared ownership mentality fosters a collaborative environment where team members are proactive in maintaining safety, quality, and customer satisfaction. The vesting schedule, which increases by 20% annually, rewards longevity and commitment, further reinforcing a culture of shared success. “We show that we value them and the longevity of the team members as they stay here, mature, and grow with BACK construction. The vast majority get it, appreciate it, understand it, live it, and then even preach it,” Hundley says. THE FUTURE OF BACK CONSTRUCTION IS BRIGHT. With a growing demand for remodeling services, it plans to expand all five of its divisions and focus on sustained growth and continual improvement. The core value of continual improvement guides its efforts to further enhance its services for the benefit of our team and customers. The company is also exploring additional services that could complement its current offerings, ensuring that it remains at the forefront of the industry. Equally important is the need to expand their service offerings strategically, exploring new areas such as smart home technology integration or eco-friendly remodeling solutions. As it moves forward, BACK Construction remains dedicated to excellence, innovation, and community. 9 BUSINESS VIEW MAGAZINE VOLUME 11, ISSUE 08 BACK CONSTRUCTION
The transition to an ESOP ownership has strengthened the team, improved performance, and set the stage for a bright future. With a commitment to steady progress and a focus on meeting the evolving needs of its clients, this company is poised to continue building on its legacy of success. The future is promising, and together, as employeeowners, BACK Construction is ready to embrace and conquer the opportunities ahead. PREFERRED VENDOR/PARTNER n Ferguson Enterprises Inc. www.ferguson.com Whether you’re renovating an outdated bathroom or building your dream kitchen, Ferguson Bath, Kitchen & Lighting Gallery offers the widest selection of products from today’s most recognized brands. Our state-of-the-art showrooms and expert consultants ensure the kitchen, bath and lighting products you select are a perfect fit for your project. n 84 Lumber Company Lexington Ky www.84lumber.com n Mueller Roofing Distributors www.mueller1875.com n Pella Windows & Doors www.pella.com 10 BUSINESS VIEW MAGAZINE VOLUME 11, ISSUE 08
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