RETAIN BUSINESSESin Berkeley, CA
As business owners retire we help keep
these businesses thriving in our communities
Employee ownership as a strategy for business retention in Berkeley, CA
Berkeley seeks to curb the effects of the Silver Tsunami
The city of Berkeley, located in the San Francisco Bay Area just north of Oakland, is already the home of many employee-owned businesses, and is a critical city for the Bay Area’s small business economy.
Small, locally-owned businesses are essential to Berkeley’s local economy and community vitality. Among the challenges the city faces is keeping small businesses and the jobs they provide rooted in the community, as the Silver Tsunami – the retirement of baby boomer business owners – impacts Berkeley.
The silent risk of the Silver Tsunami
Baby boomers (those born between 1946-1964) own nearly half of all businesses with employees in the nine county San Francisco Bay Area (Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, Sonoma, Solano). Cities and regions need to understand the risk of these legacy businesses not being retained locally — either because they quietly close down, are sold to out of area buyers, or simply don’t have a succession plan as the owner marches into retirement.
Berkeley’s proactive approach
Berkeley, CA is taking a very proactive look at this issue and investing city funds into growing employee-owned companies. Project Equity performed an analysis for Berkeley to quantify the number of privately-held companies with employees that are 20 years or older — a good indication that they need succession planning — and the impact if these businesses are not retained.
- Represent over 1,600 of the city’s businesses
- Employ an estimated 12,600 individuals
- Generate over $1.7B in revenue
Local ownership over the long-term
Keeping privately-held companies locally owned over the long term is a critical component of any economic development strategy. One challenge is that increasingly, daughters and sons don’t want to take over their parents’ companies. Since, according to BizBuySell, the largest online marketplace for businesses, only an estimated 20 percent of businesses listed ever sell, we need more strategies for business succession. The good news is that there is an approach that can provide similar benefits to family succession: employee ownership.
Employee ownership may be unfamiliar to many, but it brings numerous benefits, the most important of these are keeping companies rooted in place, providing quality jobs and strengthening companies for the long-term. It also offers a ready solution to the retiring business owner: there’s a buyer right there under your nose — the very employees who helped you build the company.
Berkeley has partnered with Project Equity to shine a light on the need for smart succession planning and to develop an effective strategy to engage with their legacy businesses.
Local ownership is important to our region’s future. Let’s make sure the Silver Tsunami doesn’t put us at risk.
More about Project Equity
Project Equity partners with cities and regions to help understand the impact of baby boomer retirements on business retention and potential job loss. We educate and engage businesses and de-mystify the employee ownership succession path. When it is the right fit, we help companies develop employee succession plans, and provide support along the way to foster a smooth transition.
Learn about our partnership with the City of Berkeley
Check out our recent media coverage
for businesses interested in employee ownership