FIVE EMPLOYEE OWNERSHIP MYTHS DISPELLED

Adopting an employee ownership model can bring a number of benefits to a business. It can be an effective succession solution for an established business, an innovative ownership structure for a start-up, a way of empowering and engaging a company’s workforce, and/or a method of rooting a business in the local area.

Therefore, it is no surprise that employee ownership is becoming increasingly popular, with the number of employee owned businesses headquartered in Scotland trebling over the past five years. EO is still often overlooked however as an ownership structure, and a number of misconceptions regarding the model are potentially contributing to this.

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Here, Co-operative Development Scotland (CDS) director Sarah Deas dispels some of these myths.

Myth 1: The process of becoming employee owned is a complex transaction

“While additional elements such as setting up a trust are required, an employee ownership transaction tends to be more cooperative than a standard business sale as everyone is effectively on the same side. All parties want what is best for the business and its workforce, therefore less time and resources are spent resolving potential conflicts and the transaction is typically completed more efficiently.

“Furthermore, CDS offers a wealth of advice through its expert advisors, who can guide business owners through any perceived complexities throughout the EO process.”

Myth 2: Employees cannot afford to make the investment

“Typically, when a business becomes employee owned, most of the shares are bought on behalf of the employees by a trust. This is usually financed by contributions from the company itself, or a loan that is then paid back by the company. Employees don’t carry any personal liability for the debt assumed by the company in an employee buyout. Furthermore, when the trust pays out bonuses the first £3600 is free from income tax, so is very tax efficient for employees.

“In some cases, employees also have the opportunity to invest their own money in company shares. However, this is a relatively small amount of the share capital.”

Myth 3: Employee ownership is only an option for retiring family business owners or entrepreneurs with no heir

“While this can be a common reason behind employee ownership, some owners may opt for the model despite having a suitable successor in order to repay the loyalty of staff and root the business in the local area. They may trigger an employee buyout a long time before they intend to withdraw from the company, remaining involved in the day to day running of the business for years before retiring.

“An increasing number of companies are choosing employee owned from the outset or as a means to attract, retain and reward staff”.

Myth 4: The vendor will have to sell their business at a lower price

“As they don’t have to negotiate with another business, the seller holds a great deal of control over the process. There is no reason that a carefully considered employee buy-out can’t deliver a fair price in line with the company’s market value.

“With increasing number of businesses choosing employee ownership, specialist finance is now becoming available. Mainstream providers, like the banks, are also becoming more aware and supportive of the model.”

Myth 5: Employees will be more interested in keeping company profits for themselves than investing in the long-term health of the business

“Employees are well informed and understand the importance of investing in the businesses for the long-term. Decisions on bonus and share distributions are carefully considered in this context.

“Evidence shows that priority is given to investment in businesses’ long term success, with bonus and dividend payments being paid at a realistic level.”

FIVE KEY BENEFITS OF EMPLOYEE OWNERSHIP

Latest figures show that there are 86 employee owned (EO) companies operating in Scotland, with approximately 6,800 employee-owners generating a combined turnover of around £925million. With 12% of SME employers anticipating transfer of ownership in the next five years, it is expected that the take up of employee ownership in Scotland will continue to accelerate.

But what are the reasons behind the rising popularity in an EO structure and would it be suitable for your business? Sarah Deas, director at Co-operative Development Scotland, outlines five key benefits of employee ownership below.

11/12/15 - 15112301 - SCOTTISH ENTERPRISEGLASGOWSarah Deas

Employee ownership is a succession solution

“If you’re a business owner considering the future of your business, employer ownership can provide a solution to managing your exit whilst achieving a competitive price and safeguarding the future of your business. It secures the long-term future of your company, retaining jobs, skills and investment, and is a succession option that should be explored by businesses of all sizes and sectors.”

Employee ownership can drive the performance of your business

“Having a personal stake in the business can significantly boost motivation among employees. Statistics consistently demonstrate that employee-owned businesses outperform their non EO counterparts in terms of higher levels of profitability, improved business resilience during times of recession, increased productivity, enhanced employee wellbeing, and greater desire to innovate.”

The rewards of strong performance are shared with the employees

“Employee ownership is an opportunity to repay and strengthen the hard work and loyalty of staff with financial bonuses such as annual tax-free dividend payments. This incentive can further drive staff productivity and overall profitability as a result.”

Employee ownership roots the business in Scotland

“A businesses that is owned by its employees is more likely to remain rooted in its local community, providing jobs, retaining skills and generating wealth in the local area for generations to come. Businesses which chiefly serve their local communities can also benefit when the owners themselves have a strongly developed knowledge of the area.

Employees are given a greater voice in the operation of the business

“Knowing the company better than anyone else, employees are well placed to give their input on key decisions such as ways to increase performance. As owners, staff feel more involved and engaged with the future of the business, driving job satisfaction and strengthening their commitment to the company.“

If you would like to learn more about how employee ownership could benefit your business, please get in touch.

COLLABORATION PRIZE WINNER SPOTLIGHT – MADE IN SCOTLAND

Following on from our blog announcing this year’s Collaboration Prize winners, we’ll be taking a closer look at each of our winning collaborations over the coming weeks and learning more about their plans for the future. First up is Made in Scotland…

Made In Scotland Collaborative Export Solutions team members

Made In Scotland – Collaborative Export Solutions

Made in Scotland – Collaborative Export Solutions is a collaboration of eleven companies involved in the luxury food and drink sector from across the Highlands and Islands.  By demonstrating particularly strong international ambitions to be delivered via the collaboration, it was awarded a special accolade at the HSBC Scottish Export Awards.

Made in Scotland offers a range of products including salmon, cheese, cakes and charcuterie as well as craft gin, craft beer and whisky. The collaboration will enable member businesses to offer the basket of Scottish produce to lucrative overseas markets by pooling together their resources and experience, both intellectually and financially.

We caught up with Willie Cameron from Made in Scotland who said:  “The idea was to create a route to market for high quality SME producers and to give them the resources like the big boys have that they could not afford as individual business operators.

“The great opportunity is that Scotland as a country is high on the world agenda and that is what we are cashing in on, i.e. both general interest and expats.

“One thing that has been extremely successful in particular is the cross-selling between some of the businesses within the collaboration.  In one instance a partnership has even been created through the purchase of a defunct brewery by two members.  Another venture is the introduction of one of the member’s ice cream products to seventeen outlets of another member.  None of this would have happened if it was not for the collaboration. It also helps to strengthen the bond between the companies.  Collaboration on sales and marketing has also lead to operational collaboration between member companies resulting in cost saving, new product development and in one case an acquisition.

Made In Scotland Collaborative Export Solutions team members

“The Made in Scotland operational and funding model is ground-breaking, not only in Scotland but internationally.  It will drive international opportunities for Scottish-based SME food companies and thus help underpin the Scottish Government’s aspirations to double exports to £17.1bn by 2107.

“It was fantastic news to hear we had won the Collaboration Prize. The money and support will enable us to access expert advice on marketing food and drink on a global scale, as well as allowing us to develop our brand and create a website with e-commerce functionality. This will help us to really get our name and offering out there on a magnitude that would be far more difficult for us to achieve as individual companies.

“Not only does working together enable us to reach an international customer base as a whole, it also encourages us to support each other by highlighting new opportunities that we think will benefit individual members.  By continuing to collaborate, we aim to further boost Scotland’s global reputation as a producer of some of the finest food and drink in the world, hopefully attracting more of the country’s like-minded, quality producers to join us along the way.”

The member businesses in Made in Scotland are:

  • Cobbs, Inverness
  • Cairngorm Brewery, Aviemore, Highlands
  • Shetland Distillery, Shetland
  • R & B Distillers (opening distillery in Isle of Raasay, Highlands, and plans to open one in the Borders)
  • Scottish Salmon Company (offices in Cairndow in Argyll and Bute, Isle of Lewis in Stornoway and Edinburgh)
  • Bute Island Foods Ltd, Argyll and Bute
  • Summer Harvest Oils, Crieff, Perth and Kinross
  • Taste of Arran, North Ayrshire
  • Braehead Foods, Kilmarnock, East Ayrshire
  • Aldomak, Giffnock, East Renfrewshire
  • Bondeau, Glasgow

COLLABORATION PRIZE WINNER SPOTLIGHT – THE START-UP DRINKS LAB

We’re learning more about this year’s Collaboration Prize winners by hearing about their plans for the future in a new series of blogs.  In this blog we take a closer look at The Start-up Drinks Lab…

The two companies that form The Start-up Drinks Lab – Tongue in Peat and FOAL Drinks – are aiming to work together to solve challenges faced by drinks entrepreneurs in Scotland that result in them having to compromise on quality, cost or location.

Startup Drinks Coop Scotland, L-R Hannah Fisher, Paul Strachan

Hannah Fisher from Tongue in Peat and Craig Strachan from FOAL Drinks

When we caught up with Hannah Fisher and Craig Strachan from The Start-up Drinks Lab, Hannah (founder of Tongue in Peat) said:  “Our main focus is to establish facilities to alleviate the manufacturing challenge created by the limited number of small scale manufacturing options for start-up drink businesses in Scotland.  We plan to do this by offering a full suite of services including product development, manufacturing, packaging and business support as well as providing a small scale bottling facility with pasteurisation, carbonation, capping and canning not currently readily available in Scotland.”

The consortium’s long-term plan includes both market and service expansion. Geographically, it will focus initially on Scotland then expand into the rest of the UK, eventually aiming to grow into Europe and even North America.

“As well as benefitting from the support, manufacturing advice and guidance of Scottish Enterprise, we will use the prize money to pay the first few months’ rental, meaning we can move in and fit out the factory.  Furthermore, we will be able to purchase our first pieces of equipment and engage experts to help fit the facility out to a full operational specification,” added Craig (founder of FOAL Drinks).

Hannah said:  “I met Craig at an Entrepreneurial Spark event where we quickly discovered our businesses faced similar challenges.  We then heard about the CDS Collaboration Prize and decided to enter.

Startup Drinks Coop Scotland, L-R Hannah Fisher, Paul Strachan

“We have often talked about setting up small scale manufacturing facilities to benefit our own businesses but when going through the research process to validate our idea for the competition, we realised we were not alone in this pain point and that many great Scottish brands were forced to go down south to produce, losing that all important ‘made in Scotland’. We felt and continue to feel more passionate everyday about making sure we help Scotland and its produce by giving its producers an accessible platform.”

Craig continued: “Collaboration has been of massive assistance for my own company, FOAL Drinks, and for me personally. The anticipated cost savings by opening the lab will be of fantastic benefit, allowing us to be more competitive and provide our awesome customers with an even better offering.  Furthermore, our regular meetings and focus groups have been given a different perspective and have given us some excellent introductions, especially in the food and drink arena. This will be invaluable going forward and is especially important for start-up businesses.”

The member businesses in The Start-up Drinks Lab are:

  • FOAL Drinks, Glasgow
  • Tongue in Peat, Glasgow

COLLABORATE TO TENDER – WORKING TOGETHER TO ACCESS LARGER CONTRACTS

Collaborating with other businesses can bring a number of benefits such as improved market presence, shared resources and knowledge, and the reduction of costs and risk when exploring new markets. Increasingly businesses are also coming together as a means of accessing larger contracts.

To learn more, we spoke to CDS advisors Gill Joy and Gavin Tosh, who have collaborated together themselves to provide unique specialist support to CDS clients on collaborative tendering.

GillandGavin

Q1. Tell us a little more about yourself?

Gill: I have 30 years’ experience in business management and consultancy, focussing on collaborative projects and programmes. I set up Intend Business Development in 2006, which helps SMEs and social enterprises compete with larger national players on public sector tenders.

In 2011, Gavin and I decided to collaborate to design a new training programme for consortium bidding, working closely with the CDS team. We continue to tender jointly for various contracts where our complementary skills can add value for clients, and we have worked as CDS specialist advisors for consortium co-operatives since 2013.

Gavin: I am a practicing solicitor and started my own niche legal business in 2009 specialising in business law. Before I was a solicitor I was a contracts manager in large engineering-based companies, and was frequently involved in tendering for contracts, including collaboratively.

Q2. Why is tendering an important area for businesses, including SMEs?

Gill: £10billion worth of business is put out to tender each year in Scotland alone, with a huge number of private and third sector contracts also subject to a tendering process. These contracts will be for goods and services that smaller businesses are well placed to provide, yet so many SMEs aren’t going after them, essentially closing their doors to this enormous source of business.

Q3. What are the barriers for SMEs?

Gill: Particular barriers for SMEs include their small size, lack of specialist expertise, and limited resources to identify opportunities and prepare tender responses. Larger organisations can have in-house resources dedicated to the tendering process, but this is usually out of the question for SMEs. Small companies are encouraged by buyers to form consortia in order to bid for contracts, however, sometimes collaboration can be viewed as a barrier in itself. Most SMEs don’t really know where to start, from finding the right partners to getting a sound agreement and working together to create a winning bid.

Q4. How can collaboration help?

Gavin: By collaborating with other businesses, increased capacity and a wider range of available resources and skills make it possible to bid for larger contracts. Coming together under a single brand in a consortium co-operative can really consolidate the members’ joint offering and put them on an equal footing with larger companies pitching for the contract. With each member business focusing on its own strengths, the customer gets a team of true specialists in their respective fields instead of a larger organisation which may not be strong in all areas.

Gill: Collaboration also means more eyes out there to spot opportunities in the first place, and the costs and time involved in the tendering process are shared, making it less of a burden on smaller businesses. An added benefit of working closely with other businesses is the significant amount of organisational learning that each partner can derive from the experience.

Q5. What are the options?

Gavin: There are different ways to collaborate when tendering. The most common approach is to have a main contractor with a number of subcontractors, however, this is rarely a collaboration of equals. Subcontractors may have little say in important decisions and can be subject to the whims of the main contractor in terms of what work they get and when they are paid.

Tools and techniques to improve the position of subcontractors in this position are available, however for a truly co-operative collaboration where all parties have an equal say, there is also the consortium co-operative model.

In a consortium co-operative, members work together for a common goal whilst retaining their own brands, identities and control. Members can be limited companies, partnerships or individuals and the membership can be of any size from two businesses upwards. Each member business has an equal say on consortium activity, no matter its size, and both exiting and bringing in new partners is simple. As a recognised legal entity with limited liability, the model provides a durable yet flexible framework for collaboration.

Q6. What support is available?

Gavin: CDS’s principal form of support is called Consortium Expert Support – it is free of charge to eligible businesses and provides assistance to form a consortium co-operative. You can get in touch with CDS for more information about consortium support.

Q7. Are there any examples of successful consortium tendering?

Gill: A CDS client which has experienced success in tendering is The Wee Agency, a collaboration between a group of PR, IT and design firms to offer an integrated digital marketing service. The members were already collaborating on an informal basis, but bringing their skills together under a single brand has enabled them to successfully pitch for more ambitious contracts.

Gavin: Another consortium which has seen great results from tendering is the Community Resources Network Scotland (CRNS) Reuse Consortium, a nationwide collaboration between social enterprises managing waste resources at a local level through recycling, reuse and reduction. It won a contract from Fife Council to supply second-hand household essentials such as white goods and furniture to be given to locals on low incomes who need them, and hopes to support other local authorities in this manner in future.

COLLABORATION PRIZE WINNER SPOTLIGHT – TERRIER RISK PARTNERS

We’re taking a closer look at each of our winning collaborations over the coming weeks and learning more about their plans for the future.  In this blog we learn all about Terrier Risk Partners…

Terrier Risk Partners, L-R Tom Inglis, Alison Stone, Chris Knight

Terrier Risk Partners – Tom Inglis of Wildcat Applications and Alison Stone of 3 Minutes to Midnight

Terrier Risk Partners comprises two experienced businesses coming together to provide cyber security solutions to SME’s in order to tender for larger contracts.

Together the businesses wanted to capitalise on initiatives offered by the Scottish Government, such as the Digital Scotland Superfast Broadband, by offering expertise in the fields risk assessment, business continuity , protection and recovery

The consortium is a combined offering for firms who have identified a need to improve their ability to protect against and recover from IT related disasters.  It aims to provide a 360 degree review of each organisation’s risk exposure and then recommend solutions that are appropriate to the size, needs and budgets of their clients.

Tom Inglis from Terrier Risk Partners spoke to us:  “We strongly believes that the services we are offering are valuable to businesses and supply a solution to problems identified by the Scottish Government, industry bodies and academic research.

“Following our win, we intend to fund the creation of a brand, website and various other marketing materials.

“The business support we will receive from winning is extremely important as it will help us to grow the business. We’re hoping to work with Scottish Enterprise to explore partnership opportunities and utilise PR opportunities to help us raise our profile as well as marketing support to assist in developing the offering and positioning us in the marketplace.”

The member businesses in Terrier Risk Partners are:

  • Wildcat Applications, Edinburgh
  • 3 Minutes to Midnight, Musselburgh, East Lothian

COLLABORATION PRIZE WINNER SPOTLIGHT – Offsite Hub

We’re taking a closer look at each of our winning collaborations and learning more about their plans for the prize money.  In this blog we learn all about Offsite Hub…

Offsite Hub (Scotland)

Offsite Hub is a new consortium of firms involved in offsite construction providing leading edge technology in the industry.  It was formed following the UK Government’s release of its 2025 Construction Strategy identifying offsite construction as a vehicle for delivering improvement targets for the construction sector.

Comprising nine companies, Offsite Hub’s goal is to promote improved market awareness, address emerging skills challenges and to foster a collective approach to ongoing research and development in the use of timber construction technology.

We spoke to Calum Murray, chairman of Offsite Hub, on the win:  “Together with a number of public sector partners (such as Napier University and SDI), we are aiming to realise the full potential of Scottish Offsite Modern Methods of Construction by improving the working environment in the construction industry, reducing waste from that sector, and significantly improving the performance of buildings in terms of construction, comfort and long-term running costs.

“Support in translating ideas into practical action will be hugely useful for us and we plan to utilise this support from Scottish Enterprise.  For instance, in approaching UK wide institutions with the right message as a group, the assistance will be essential.    We are exploring other possible uses for the funding and support, including a ‘learning journey’ being proposed for Sweden next year and representation at a conference on offsite construction in Salford next year.”

The member businesses in Offsite Hub are:

  • CCG Off-Site Manufacturing, Cambuslang, South Lanarkshire
  • Alexanders’ Timber Design, Troon
  • Carbon Dynamic CLDB Ltd, Invergordon
  • MAKAR Ltd, Inverness
  • Oregon Timber Frame Ltd, Selkirk
  • Robertson Group, Stirling
  • Scotframe Timber Engineering Ltd, Inverurie
  • Stewart Milne Group, Aberdeen

COLLABORATION PRIZE WINNER SPOTLIGHT – Healthworks

We’ll be taking a closer look at each of our Collaboration Prize winners and learning more about their plans for the future. Next up is Healthworks…

Healthworks Consortium, L-R Niall Gosman, Marney Ackroyd, Karen Davidson, Kevin Dewar

Healthworks members Niall Gosman, Marney Ackroyd, Karen Davidson, Kevin Dewar

Healthworks is a new consortium formed of health and wellbeing professionals based in East Lothian.  It works in partnership with businesses to optimise their employees’ physical, psychological and personal wellbeing,

Comprising four member businesses, Healthworks offers a range of expertise in areas including physiotherapy, nutrition, psychological therapies and counselling, fitness training, behavioural risk management training and employee health assessments.  Working with businesses to identify the health and behavioural risks and barriers that prevent them from getting the best from their employees, Healthworks develops innovative, integrated health and wellbeing services and solutions that clients can ‘own’.  Each service is designed to address the unique needs and culture of the individual business and delivered in the way that best meets their needs.

Karen Davison from Healthworks spoke to us about winning the Prize:  “We are thrilled to have been selected as one of the winners and are looking forward to working together to develop programmes which will have a wide-reaching benefit for both employees and their employers. The generous prize will help us brand, package and promote our offering to get it in front of the right people, as well as enable us to develop new resources and tools to boost the services we can deliver, both face to face and online.

“Working together in this manner is beneficial for many reasons – not only does it allow us to access more opportunities and secure larger scale contracts, it also gives us all an excellent degree of professional satisfaction. Delivering a truly comprehensive service that reflects the many intricate aspects of an individual’s health and wellbeing requires a tailored approach incorporating expert knowledge and experience across a range of disciplines. We believe collaboration is the most effective way of providing this, and are hopeful that we can continue to develop our offering as we are joined by members in further areas of expertise.”

Healthworks Consortium, L-R Kevin Dewar, Karen Davidson, Niall Gosman, Marney Ackroyd

The member businesses in Healthworks are:

  • Dovetail Partnerships (North) Ltd, East Lothian
  • First for Fitness, East Lothian
  • Midlothian Physiotherapy LLP, Midlothian
  • Marney Ackroyd, Edinburgh

COLLABORATION PRIZE WINNER SPOTLIGHT – LOOK TEAM

We’re taking a closer look at each of our winning collaborations over the coming weeks and learning more about their plans for the future.  In this blog we learn all about Look Team…

Look Team is a graphic design and event branding production collaboration consisting of two already well established and successful Glasgow-based companies: EVM and Tangent Graphic.  It is focused on developing, managing and delivering wayfinding solutions for major sporting and cultural events in order to create memorable experiences for participants, stakeholders, spectators and broadcasters.

Look provided the branding and wayfinding solutions for three major events in Glasgow: the Commonwealth Games 2014, the World Gymnastics Championships 2015 and the UCI Track Cycling World Cup 2016.

The two businesses have successfully formed a consortium co-operative to facilitate pitching a total project planning and management service for other large sporting events. They plan to expand into other geographic markets across the UK and internationally.

Look (Branding & Application) L-R Andrew Stevenson, Paul Fennon

Andrew Stevenson and Paul Fennon of Look Team

We spoke to Paul Fennon from Look Team about the consortium:  “We wish to enter international markets based on our unique set of skills and capabilities including bid development, project management, risk mitigation and logistics planning, creative and branding development, art working, manufacturing, installation and de-rigging.

“Our offer is different to those offered by our competitors in that we provide an end-to-end service including the branding and creative approach tailored for specific events. This enables us to create a unique sense of ‘time and place’ for each event which allows us to effectively create more memorable experiences for everyone involved.  We believe this unique approach is one of the main reasons we were successful in our bid for the World Gymnastics Championships and the UCI Track Cycling World Cup.

“The cash and support from winning the Collaboration Prize will help us achieve a number of goals, beginning with in-depth research of the global sporting events market and investigating the best way to scale our operation internationally. The commission of a bespoke Inventory Management System for managing and tracking event Kit of Parts (KOP) will help us to streamline our services and increase efficiency, giving us a competitive edge when tendering for contracts. We also plan to get in front of the right people by identifying and attending major international trade shows, allowing us to forge potentially lucrative relationships and explore significant business development opportunities.

“Our intention is to manage tasks by appointing individuals and teams on a ‘needs must’ basis. At the moment EVM and Tangent have clearly defined skill sets; Tangent for branding and creative development and EVM for project management, manufacture, production and installation. As such, managing the current workload within the co-operative is very much business-as-usual, punctuated by regular weekly project meetings. A monthly meeting of the co-operative’s partners enables us to discuss planning for growth and more strategic matters.

“Forming the consortium enables us to deliver a unique service which is usually provided by two distinct companies. Working so closely together means we can combine our expertise and push creative and technical boundaries in ways that others in our field don’t. Having achieved a significant degree of success on a national level, our ambition now is to mirror that success internationally and we look forward to the doors that collaboration will open.”

EMPLOYEE OWNERSHIP TAKES BRIGHT ASCENSION TO INFINITY AND BEYOND

Dundee and Edinburgh based experts in space technology, Bright Ascension, which specialises in software products and services for satellites, has recently announced its plans to become Scotland’s latest employee owned business. 

The company, which was instrumental in the workings of the first ever Scottish satellite to rocket its way to space in 2014, was founded five and a half years ago by Dr Peter Mendham.  Dr Mendham recognised the potential for creating a business specialising in software for satellite development, mission control and operations.  Bright Ascension now has a workforce of nine staff and had a turnover of £314,000 last year, including profits of £27,000.

Dr Mark McCrum, who joined Bright Ascension a year after it started and is now technical director, discusses the decision to move to employee ownership and his experience of the transition…

Bright Ascension company, Edinburgh, 14/03/2017: Bright Ascension founder director Peter Mendham (correct, bottom), with technical director / software engineer Mark McCram and a satellite launch control board. Photography for Cooperative Development Scotland / Scottish Enterprise from:  Colin Hattersley Photography - colinhattersley@btinternet.com - www.colinhattersley.com - 07974 957 388

Dr Mark McCrum, technical director at Bright Ascension

In order to help meet plans for growth and to continue developing and creating innovative products, we started investigating the possibility of employee ownership in 2013 through an initial consultation with Co-operative Development Scotland.

We met with a CDS advisor who explained employee ownership and that this might open up investment opportunities for the business. CDS introduced us to Capital for Colleagues, an investment vehicle focused on employee ownership and an appropriate package was developed.

As well as the need for investment we were interested in employee ownership because it seems like the fairest way to structure the ownership of a company. In order to build a world class company we need to attract, retain, motivate and harness the best talent in the field and adopting an employee ownership model allows us to do that.

Our staff have been receptive and enthusiastic to the changes so we are currently in the process of setting up an Employee Benefit Trust with an initial 20% holding of the company. The shares are being gifted by the current owners which is happening in conjunction with an investment by Capital for Colleagues.

Bright Ascension company, Edinburgh, 14/03/2017: Bright Ascension founder director Peter Mendham (correct, centre left) and technical director / software engineer Mark McCrum (centre right), with software engineers Alex Mason (left) and Ed Willson (correct). Photography for Cooperative Development Scotland / Scottish Enterprise from:  Colin Hattersley Photography - colinhattersley@btinternet.com - www.colinhattersley.com - 07974 957 388

The Bright Ascension team

Before moving to employee ownership, our main priorities were to upscale the business by attracting investment and then fully engage our employees to drive performance within it. Employee ownership has allowed us to achieve both of these goals and all nine of our staff members now have a meaningful stake in their company and its future success.

CDS provided invaluable guidance and support to Bright Ascension throughout the employee ownership transition. If you would like to find out more about how your business could benefit from employee ownership in the same way that Bright Ascencion has, please get in touch with one of our expert advisers who will be happy to help.