Business View Magazine - Nov 2023

138 BUSINESS VIEW MAGAZINE VOLUME 10, ISSUE 11 McGinley emphasizes that “every business owner needs to think about what they want their exit to look like. There is no time like the present to start thinking about how you are going to exit your business and who you want to own it next. You don’t want to be in a situation where you have to transition ownership of the business in unfavorable circumstances.” Financing an ESOP can, at times, become another challenge to overcome. Transactions can be complex and typically entail higher costs for the company. However, avenues like the federally funded State Small Business Credit Initiative (SSBCI) are opening doors for ESOPs to expand through acquisitions or new formations. Steve Storkan, Executive Director at the Employee Ownership Expansion Network (EOX), is eager to leverage SSBCI loans to foster more employee- owned businesses. He underscores the game- changing potential of SSBCI, stating, “An existing ESOP company can use SSBCI dollars to leverage for a loan to buy another company and make them part of their ESOP.” For Storkan, this is ideal because helping companies employ such savvy financial strategies aligns seamlessly with EOX’s mission to advance employee ownership. Another challenge pertains to minority or women-owned businesses, as transitioning to 100% employee ownership can entail relinquishing these certifications. However, conversations are underway with the Department of Labor and ESOP community members to explore ways to navigate this issue, allowing companies to proudly bear both employee and minority/women-owned labels. Additionally, discussions are progressing to offer preferential treatment for federal contractors affiliated with employee-owned institutions. So, for every challenge, organizations like the NCEO, The ESOP Association, and EOX are diligently providing resources to mitigate risks associated with employee ownership.