The Case for Worker-Cooperative Conversions

We are happy to present the recording from our latest online session Selling Your Small Business – Practical Strategies for an Employee Buyout

If you are interested in learning more about the conversion process please feel free to fill out the survey below.

During the session we discussed the in’s and out’s of selling a small business to it’s employees and covered many topics including:

Why are so many small business owners selling their businesses to their workers? 

Most small businesses never find an outside buyer. Without a worker-buyout, your customers lose their brand of choice and your community loses critical economic activity. The longest-serving and most loyal of your workers will be the least likely to find a comparable livelihood elsewhere. When a larger competitor does buy a business, they usually lay off most or all of the workers and dissolve the enterprise. And your legacy disappears!

Why are worker-owned businesses better? 

Worker-owned businesses have higher productivity, lower worker turnover, and their profits stay in the community. Workers adopt more global perspectives on their workplace and the welfare of their co-workers and their customers, and engage broader concerns and policy issues about the future of their market, their industrial sector, the larger economy, and the environment. Worker-ownership fosters more engaged citizenship. And your legacy lives on!

Why are governments incentivizing worker buy-outs? What are those incentives? 

Aging baby boomers own a large percentage of small businesses, and they’re now looking to retire. Without worker buy-outs, most of these businesses, their jobs, and their other economic activity, will be lost. Worker buy-outs can also deliver significant tax breaks to the seller, and the Small Business Administration is expanding their lending options to support worker buy-outs. 

Why should I attend the workshop on selling my business and exploring employee ownership? 

You will get answers to all of your questions about selling to your workers, and we will lead you through the steps involved in doing it. These include overall exploratory process and strategy, ownership and management succession planning, financing options, legal and structural angles, and much more! The Baltimore Roundtable for Economic Democracy is a non-extractive lender that finances worker-buyouts; its members include experienced worker-owners skilled in converting businesses to worker-ownership and supporting workers and owners in making the transition. 

Resources for Worker Co-ops in Response to COVID-19

Resources for Worker Co-ops in Response to COVID-19

As the COVID-19 global pandemic unfolds we wanted to . provide a small set of resources applicable to worker-coops across Baltimore City. This list has been adapted from the Good Business Works original posting, and will continue to be updated as things unfold.

Share your Experience!

Complete the Baltimore Development Corporation Impact Survey

Resources for your Business:

Baltimore Ecomap: Resources on Loans & Financial Assistance, Local Support Organizations, and other statewide small business resources

Startup Soiree COVID-19 Small Business Discussion ForumSmall Business Administration Guidance

Policy Updates and Business FAQs from the Maryland Department of Commerce, a few key points some business tax filing deadlines are being extended to June 1st, contact taxpayerrelief@maryland.gov for more information any permits, licenses, or registrations that would expire during the state of emergency will be extended for 30 days after the end of the state of emergency.

IRS Coronavirus Tax Relief

Access to Capital, Loans & Emergency Assistance

KIVA Baltimore is offering 0% interest loans up to $15,000 with a 6 mos grace period on repayment

Honeycomb Credit is offering emergency relief loans for small businesses with a 6 mos interest only repayment

Baltimore Business Lending is still accepting low-barrier loan applications remotely up to $50,000

The Small Business Administration is providing low-interest Disaster Assistance loans to qualifying businesses

Economic Industry Disaster Loan support for small businesses under the US Small Business Administration

Restaurant Workers Community Foundation COVID 19 Crisis Relief Fund: 0% interest loans to businesses to maintain payroll, or reopen after the crisis.

Baltimore Community Foundation COVID 19 Evolving Community Needs Fund: funds will go directly to address the negative impacts of the COVID 19 pandemic on our region’s communities, workforce, and vulnerable populations.

Inner City Capital Connections has virtual business advising, webinars, and events

Pages to Follow for Updates

Resources for Worker-Owners:

Employment Related Families First Coronavirus Response Act will provide federally sponsored paid sick leave, expanded paid family and medical leave, expanded unemployment insurance, food assistance, and help for small businesses, read the full text here

Paper from Red Emmas about Unemployment Insurance

Red Emmas Covid-19 Response Protocol

Unemployment Benefits : US Department of Labor extends unemployment benefits to workers impacted by COVID-19

Financial Assistance

Seed Commons Worker Response Fund: direct response funds for worker owners at impacted cooperatives

Baltimore Virtual Tip Jar: organized locally by service workers & community members, add your name & Venmo to receive community-sourced “tips”

One Fair Wage Emergency Coronavirus Tipped and Service Worker Support Fund: cash assistance to restaurant workers, car service drivers, delivery workers, and personal service workers

Restaurant Workers Community Foundation COVID 19 Crisis Relief Fund: a relief fund for restaurant workers facing economic or health hardships**USBG Bartender Emergency Assistance Program**

Health Related Health Insurance Enrollment: The Maryland Health Connection is offering a special enrollment period for the ACA between March 16- April 15.

Visit MarylandHealthConnection.gov or download the free “Enroll MHC” mobile app. Request or select “Coronavirus Emergency Special Enrollment Period.” Free help is available by calling 1-855-642-8572 from 8 a.m. to 6 p.m. on weekdays.

Baltimore Health Clinics that accept uninsured patients: Currently testing for COVID-19 is free nationwide for all individuals regardless of insurance coverage Maryland Insurance Administration FAQ

Other Emergency Assistance: All evictions are halted while city schools are closed

Internet Service: A free “Internet Essentials” package will be free to all new Comcast customers for the next 60 days and Comcast will not disconnect internet or charge a late fee for any customer who contacts them and says they are unable to pay

No Power Shutoffs: BG&E is suspending all service disconnection and waiving late fees until May 1st

Pages to Follow for Updates

Baltimore Health Department

Baltimore Sun

Your Local Councilperson on Social Media, find them here

Succession Planning Strategies

Succession Planning Strategies

You worked hard to build your business

But now you are ready for your next big move. Selling to your employees can bring added security with a friendly buyer letting you take some chips off the table while still being at the helm.

Trusting that you are growing your business in the right direction often keeps entrepreneurs up at night. By selling a piece of your business to your employees you can be sure your team is in it for the long haul. Selling to your employees keeps good jobs in the community and helps to take care of the people who have worked hard to build your business. Trusting that you are growing your business in the right direction often keeps entrepreneurs up at night. By selling a piece of your business to your employees you can be sure your team is in it for the long haul.

Planning a successful transition

We are excited to announce a new workshop series designed to arm you with information and strategies for selling your business! In the workshop we will explore a range of options for business owners of different size and stage of business growth!

Signup to learn more

In conjunction with the City of Baltimore’s Community Catalyst program, Baltimore Roundtable for Economic Democracy is offering a free conversion information session to business owners interested in moving to the next level with an innovative employee engagement model. We will work with you to assess if a sale to your employees is right for your business.

Sign Up