Mutating Within

[Rick Dubrow]

I’m 64 years old now. Beyond 60, the youth of old age.  Approaching retirement; defining retirement; exploring succession planning.

What will A-1 Builders and Adaptations Design Studio look like during, and after, Cindi and I extract ourselves from the helm.  Will this extraction be slow or sudden? Will we reduce our hours along a descending, straight line, or along a series of steps leading from fulltime to zero? Great questions, ones we’re discussing daily.  But this blog post is less about extraction; more about succession planning and structure.

Should we simply sell the company to a stranger?

Years ago, when I started to think about my inevitable retirement, I imagined heading to LA, Las Vegas, or the like, seeking out a builder who was tired of their deteriorating quality of life; seeking to relocate their business to a place more sane. What a logical buyer?

This classic succession plan – selling one’s company to a stranger -- usually leads to a significant shake-up within.  Will existing staff bond with the new owners?  Will the new owners even care about who’s here?  Will they wipe the slate clean and start anew? How dare we allow this to happen to our outstanding and committed staff?

Will a new business owner even care about embracing our mantra, which is to implement healthy, environmentally sensitive and resource efficient building and business practices? Talk about an unpredictable, unacceptable legacy.

Instead, Cindi and I searched for a pathway that supports both our staff and our mantra. These two deliverables became the most important critical success factors in our search for the right succession plan.

Our search led us to the worker-owned cooperative (WOC) model.  Simply put, we would sell the company to eligible employees: those who have worked here for at least 5 years. The existing VIP’s would carry on; the culture and ethics we’ve massaged into being would live on.  Cindi and could then step away with pride, safety and security. Both our staff and our mantra would thrive.

That’s our hope and that’s what we’re working hard to manifest.  And know this… since we’re a design/build firm, what’s to stop us.  It’s what we do each and every day.  Design something and then build it.  No matter… instead of homes using sticks ‘n stones we’ll design and build an outstanding organization incorporating the best human building blocks we know.  Proven humans carrying forth a proven mantra… building a better Whatcom County.

The International Cooperative Alliance defines a cooperative, in general, as “an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.” It is, essentially, an enterprise formed by a group of people who join forces and work together to solve a problem or reach a goal that they all share. In a cooperative, only members are permitted to own common shares of equity. All cooperatives are owned and governed democratically, applying the principle of “one member, one vote.”

What’s so appealing to us about the worker-owned cooperative model in particular? You’re probably familiar with member, or consumer, cooperatives like our Community Food Coop and R.E.I., right? Employee, or worker-owned, cooperatives, are a different breed:  the company’s employees rather than its customers are the patrons.  As such, employee coops are not often encountered in the business community.  This may be because coops are not widely understood, and, even if they were, a healthy, happy employee cooperative requires a certain set of circumstances and attitudes to thrive.

The Northcountry Cooperative Foundation says that “…the worker cooperative structure has many advantages, especially for a relatively small business. It is simple to create, relatively inexpensive to establish, and offers significant tax benefits. It is easy to understand. Worker cooperatives also build local assets and increase economic stability for worker-owners and their communities. Participatory decision making, featured in most worker coops, can enhance productivity, improve product and service quality, and promote the development of workers’ skills.”

Although Cindi and I are working hard to mutate our Sub-S corporation into a worker-owned cooperative, we’re far from arriving there.  Yes, we’re doing our homework: we’ve got an active Steering Committee meeting weekly; we’ve hired Tom Dorr to be our financial and strategic advisor; we’ve retained Emily Rose Mowrey as our attorney. We’ve got the team and a destination.

Onward into the storm…

http://a1builders.ws/2015/04/mutating-within/

[Holly O'Neil]

I am so excited for you, Rick!  I think this is an excellent direction to go, and have great confidence that you all can pull it off!

[Angela MacLeod]

I like hearing about this mutation.

Having worked at the Community Food Co-op for many years I experienced a different work model than most of our culture engages in. It has always been my hope that other businesses would shift to worker owned or worker managed co-operative models.