What does employee ownership actually feel like?
Part 10 concludes the Boot Camp series by exploring ownership culture, engagement, and long-term wealth building.
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Video Transcript
Introduction
Hi everyone.
Welcome to the official ESOP Radio.
Episode ten of the ESOP Bootcamp.
Today we’re discussing what employees actually experience in an Esop.
We’ll cover three things.
Ownership culture
Number one ownership culture.
Number two, what Esop statements really mean to workers.
And number three, why ownership alone does not
equal engagement.
Let’s dive in with ownership culture.
Take it away then. Thanks, Trevor.
Speaking about ownership culture, an analogy comes to mind right away.
Rental car vs. owned car analogy
And that’s. No one washes a rental car.
You just drive it, you return it, pay your fee.
But if once you own a car, you might take it to a detailer.
Wash it yourself. Things like that.
There’s that sense of pride in ownership that doesn’t happen at a normal job.
So creating that ownership mentality with the rank and file employees is important.
And providing a skin in the game
makes them better stewards for the organization as a whole.
When they’re out in public, they could talk about, oh, I work for XYZ company.
Yeah, they’re an Esop.
I’m an owner, and that sense of pride starts to swell up.
Accountability and stewardship
And not to mention on the
on the flip side of that, there’s the accountability component.
They are a lot more accountable at their job because they care.
They have intent with their decision making, it
making on a day to day basis and it improves performance.
All of that combined brings great results for the company,
and it’s really hard to define in in English.
I’ll just lay the words out there.
But when you see it, it’s obvious everybody is working
like a well-oiled machine.
Legendary long term Esop companies that you hear about big, successful Esop
companies, they embrace that strong ownership culture
and utilize that to help move the ship forward.
And so when it comes to that sort of ownership culture, it’s
all of those things combined that create that ownership culture.
Trevor, you want to speak about number two.
Understanding ESOP statements
Esop statements are really the only tangible document that employees get.
What does that mean?
A lot of things, it’s the accumulated value of their retirement wealth.
And the Esop shows their vesting.
So it shows what the projected retirement benefit is and so on.
Let’s talk about the intangible aspects of what an Esop is and how
this is all codified in an Esop statement, which takes time for employees
and several years for them to start seeing the value accumulate.
So it’s very much a long term play here.
Long-term compounding explained
Think a marathon, not a sprint.
As a company leader, you need to communicate with employees.
They get statements once a year showing what they’re allocated, shares
and any cash and the other investment account as well.
So that’s just once a year.
But employee ownership and an employee ownership mentality is ongoing.
So as a leader you need to codify long term thinking.
Also, the power of compounding the 710 rule.
Meaning if you have an investment that grows at 7% a year, you know,
pretty conservative, it’s going to double in value for ten years.
That’s powerful.
We see that across Esop clients and nearly every industry.
Also, we see many employees with sizable Esop account balances across
all major industries. So you have
many employee owners out there
with hundreds of thousands of their Esop account, even millions.
And again, it’s not created overnight.
It’s very much a long term place.
And employees need to understand that and be excited about the company,
its future and work smart to help contribute to that.
In the East, if you’re building real retirement wealth for all your employees.
And that’s powerful because when people retire,
unless they have a nest egg elsewhere, they often have A41K, maybe an I.R.A.
Social Security Esop is icing on the cake, and that could be
a very much material part of one’s retirement wealth as well.
Why ownership doesn’t equal engagement
Let’s change gears and talk about
why ownership alone does not equal employee engagement.
Yeah.
So building that real retirement wealth is important and is something
that is realized quite frequently and quite easily with an Esop.
But, you know, ownership alone does not equal engagement.
Employee engagement has to be built in, has to be baked into your company culture.
Everybody has to sort of fight on the same front line, facing the same direction.
And that tone at the top.
Leadership and tone at the top
What management has to believe it.
They have to buy in first and then everybody below them
can buy in to that message.
And it’s how you define that and measure the results is what matters.
And it’s how that management team
sets forth and says, okay, this is how we define success.
And then getting those employees engaged to believe in that.
And esops are very much that canoo strategy or canoe analogy,
where every single individual has a job to do and working towards the same goal.
So once we’re rowing in the same direction and you’ll hear that phrase many times
The canoe analogy
through, you know, these, webinars and podcasts that we have that
once we’re rolling in the same direction, everything seems so much easier.
And getting that strong coordination equals winning.
And, Trevor, I mean, we see a day in and day out that
once we have that culture in place, everything does seem a lot easier.
Strong coordination equals winning.
And so if I’m in a canoe race, I want to be on the boat that has people
working together that have practiced, have trained and want to win.
So a great analogy there have been and this is the final episode of the Esop
Series conclusion
Boot Camp. Thanks to everyone for joining us.
We hope you learned something throughout these ten episodes.
Since 1974, Nky has been a full service Esop advisor.
We’ve done thousands of Esops as an Esop ourselves.
Were Esop native.
Connect with us on LinkedIn Trevor Gilmore, Ben Spadt
Also check out Esop radio and the Menke Company page.
We post a lot about client case studies, Esop information and news, and so on.
Also, reach out if you want to chat
about Esop FIT to understand if an Esop is the right option for you.
Have an awesome day and join us for a future Esop radio episode!
Thanks everyone!
Ownership Culture
Ownership changes mindset:
Pride
Accountability
Stewardship
Understanding ESOP Statements
Annual statements reflect:
Accumulated shares
Vesting
Long-term compounding
Ownership Does Not Equal Engagement
Leadership must:
Communicate consistently
Align incentives
Set tone at the top
Conclusion of the Boot Camp Series
This episode completes the 10-part ESOP Boot Camp educational series.
Explore the full series at:
menke.com/esop-radio
About ESOP Radio
ESOP Radio is the official ESOP podcast from Menke — where real stories of growth, succession, and long-term wealth building are told.
Hosted by Trevor Gilmore and Ben Spadt, the show features conversations and educational episodes designed to help business owners better understand employee ownership.
Disclaimer
This podcast is provided for educational purposes only and does not constitute legal, tax, investment, or fiduciary advice.
Phil DeDominicis is an ESOP strategist and M&A advisor who has guided 300+ companies through ESOP formations, financing, and transactions over 20+ years at Menke & Associates. He specializes in selling ESOP‑owned businesses to financial or strategic buyers and in helping ESOP companies acquire other businesses.
