We're preparing for #GivingTuesday by revisiting an episode on giving back to the EO community. Bret Keisling was joined by Steve Storkan (EOX) and Jennifer Krieger (Weaver), who discussed how the Texas Center for Employee Ownership (TXCEO) was established; opportunities for employee owners, EO businesses and service providers; and why a successful center helps all of EO.
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The body of this episode originally aired on March 16th, 2021 as Episode 143: TXCEO - Building a State Center.
Episode 175 Transcript
Bret Keisling: As you may know, the first Tuesday after Thanksgiving is designated as #GivingTuesday, a time to support organizations and causes that are important to you. This year, Giving Tuesday falls on November 30th. Organizations dealing with every single aspect of society participate, including a number of employee ownership orgs.
On Friday, November 26th, Cher Mollé, the newly hired director of development for the Employee Ownership Expansion Network will be on our ESOP Mini-cast to talk about Giving Tuesday and EOX specifically and we'll also discuss the importance of giving to EO organizations generally.
We have a lot of great episodes in our archives at www.EsOpPodcast.com and today I thought we'd bring back an episode from March 2021, that features EOX executive director, Steve Storkan and our good friend, Jennifer Krieger of Weaver, who is one of the founding members and co-chairs of the board of directors of the Texas Center for Employee Ownership. This will give you a great look at EOX and hopefully put you in the mood for Giving Tuesday.
From all of us at The EsOp Podcast and Mini-cast and the EO Podcast Network, we hope you have a very happy Thanksgiving, and you'll join us Friday for the Mini-cast. Enjoy this episode.
Bitsy McCann: Welcome to The EO Podcast, where we amplify and celebrate all forms of employee ownership.
Bret Keisling: Hello, my friends. Thank you for listening. My name is Bret Keisling and as it says on my business cards, I'm a passionate advocate for employee ownership. Today. You're going to hear about how the Texas Center for Employee Ownership became established. I thought it'd be interesting to have the two founding co-chairs of the center, Steve Storkan and Jennifer Krieger, share the story of its creation.
Bret Keisling: Steve describes the various things needed to establish a state center and Jenn Krieger discusses how she implemented those steps on the ground. They also touch upon why it's important for employee owners, employee-owned companies, and service providers to support a state center and what they get in return.
Bret Keisling: I am a little sheepish about one thing as you'll hear Jennifer Krieger has been a repeated podcast guest. She's become a friend in real life and I've socialized with Jenn and her husband at more than one conference meal, which is why I'm really embarrassed. That you're about to hear me mispronounce her name. She is Jennifer Krieger, and I'm a little embarrassed. Notwithstanding that. I hope you enjoy this conversation.
Bret Keisling: There's only one thing that makes me happier than being joined on the podcast by another passionate advocate -- and that's when I'm joined by two of them! I'm very happy to bring back two people who have been friends of the podcast and previous guests, Steve Storkan of the Employee Ownership Expansion Network, EOX, and Jennifer [Krieger] of Weaver, a great valuation advisor. Steve, how are you today?
Steve Storkan: Doing well. Doing well. Thanks for having me on again.
Bret Keisling: I'm so happy. You are definitely a friend of the podcast. And if you're a friend of the podcast, Jenn, you've got to be our best friend! I've lost count, truly you've been on I think, 10 or 11 episodes and thank you for everything you're doing. Thanks for coming back on.
Jenn Krieger: It's my pleasure, Bret.
Bret Keisling: Right, before we begin for our listeners, we're going to refer back to some previous episodes. Steve has been on two of them. Jenn's been on, as I said, too many to count. You can find them all at www.ESOPpodcast.com and there's greater detail on some of the things that we're going to talk about.
Bret Keisling: But Steve, what I'd like to start with is two points that you discussed at length previously. So just briefly, how do you determine what state is a good candidate for a new state center and secondarily, the first step that you've talked about is finding an ambassador in that state. So I'd like you to just share, how do you identify a state and how do you find an ambassador?
Steve Storkan: Sure. So, I've been pretty lucky so far in the first two years of EOX that rather than looking for states and qualifying states, and we do have a process for that, but I've been lucky enough to have ambassadors, what I call ambassadors, ESOP ambassadors, or employee ownership ambassadors, come to be introduced to them or them come to me and then we determine whether or not the state that they're in is a good fit for a state center.
Steve Storkan: We'll talk a little bit about what an ambassador is, but for really, for a state to be, you know, a good place for EOX to start by opening a state center, it really comes down to the support that's in that state. And right now, it's the support of usually the ESOP community. Not every state is like that, but the majority of the states that we are working in right now we've really seen a lot of support from service providers in the ESOP arena, some service providers in the, in the worker cooperative arena, but really looking for people who are all ambassadors. Maybe they're not the one ambassador that's going to drive the work that's being done, but many different ambassadors that want to come together that have a passion for employee ownership and that are centrally located in that state or, you know, all located in that state.
Steve Storkan: We really take the Pennsylvania model or the Pennsylvania Center's model as kind of the model that we use across the country. You know, as you know, Bret, Pennsylvania is a hotbed for employee ownership, service providers, or ESOP service providers, there's a great group of them in Pennsylvania. And it was very helpful for Kevin [McPhillips] and the PACEO to get up and running by having that support.
Steve Storkan: So, we really start to look for states that have that support built in from the service provider community.
Bret Keisling: Steve, I just want to point out, as we shared before, I was one of the founding members of PACEO through Capital Trustees. So, absolutely, the community coming together is very important. And the one thing that I do want to say as well is very specifically, a lot of times it's the ESOP community who might be helping get the state centers up and going, but EOX is non-partisan employee ownership, as we say, co-ops collectives, ESOPs, you want to grow employee ownership, right?
Steve Storkan: Correct. All our state centers are working on promoting all forms of employee ownership. It just happens to be that, you know, me coming from the ESOP world and the connections that I have, and then just the amount of activity and work that's being done. The majority of the work being done by service providers right now is in the ESOP community or in ESOP area. The worker cooperatives there's, last checked, I think 465 worker cooperatives versus 7,000 ESOP. So it's just natural that that's where we're starting, but you're exactly right. Once we get up and running it's all forms of employee ownership. And we hope that our boards and people that are involved in our state centers run across the board in all forms.
Bret Keisling: Jenn, you've been a passionate advocate for the last couple of years, but I know a year ago you started really putting out a lot of feelers. You had reached out to me a number of other people. The second podcast, I think that you were on, you actually talked about Texas as being underrepresented per capita in ESOPs and employee ownership compared to the rest of the country. Did that need in Texas motivate you on becoming an ambassador?
Jenn Krieger: Most definitely Bret. So, I think, and that podcast we talked about on a, yeah, exactly, the per capita basis for ESOPs as they're representative of the population is much lower than in other states. And so, I thought that there was a great need for bringing more attention to employee stock ownership plans as a way of, of exiting the business. And Steve came along and I don't even recall at this point exactly how we got connected, but in our, in our, both of our individual missions to grow employee ownership through these different avenues, the cooperatives or the ESOPs, we came to find each other and the EOX is really represented a great opportunity to help provide some resources to Texas, specifically for the Texas center, to grow and continue the mission of increasing the number of employee owners in Texas.
Bret Keisling: Before we go on, I just want to point out, as we were preparing for this phone call, I said, how did you two connect with each other? And it was kind of funny because you couldn't quite figure it out and what we realized - and again, this is for the listeners - a lot of us who are doing work in employee ownership are doing a lot of things very broadly. And sometimes you just come into someone's orbit. And so for those who are saying, how do I get involved? Just get involved. And suddenly, if you're a Jenn Krieger, you'll run into a Steve Storkan. If you're me, you'll run into both of them, that sort of thing. So, it's actually kind of cool that you can't really pin down how you guys met.
Bret Keisling: So, Steve, you need an ambassador in the states. Jenn, you wanted to be the ambassador. Steve, very broadly, what would you expect for an ambassador? And then we'll have Jenn share what that meant, you know, in application.
Steve Storkan: For an employee ownership, ambassador, and to help EOX, get a state center or possibly get a state center up and running, you know the first thing that we need is the passion for employee ownership. And that's clear in the very first conversation that you have. I haven't found anybody that's reached out to me that wanted to help that didn't have the passion. But really, that's what it takes is passion to see employee ownership grow in the state in which they live or the state in which they work. And that's really where it starts. And from that passion we really just need to have a conversation about time involved and the duties involved and whether or not that's something that that person can add to their plate. So when Jenn and I first got talking and we actually met at the Vegas conference and started talking about what it takes for state center, those are the things that we talked about. The passion was there, but is there the time available on Jenn's schedule to help with the boots on the ground approach? Do we need to have more than one ambassador? Really, really what, you know, making sure they know what's involved and that they have the time to do that.
Steve Storkan: And it does come down to boots on the ground. EOX can open state centers probably without ambassadors, but we don't have the connections in those states. And so, beyond time the other question is, you know, what kind of connections do you have in the state? And Jenn, honestly, didn't have all the connections that maybe another ambassador might've had in other states, but she was definitely in the process of networking, knew who to call, and was willing to make those connections which made for a great start in Texas.
Bret Keisling: Jenn, first of all, let me point out -- and again, it's for those who are listening, not just professional service providers, but if you're an employee ownership -- a year ago, when you reached out to Steve, or you and Steve met, you didn't have the connections as Steve just said. You do now. So, in other words, I'm just pointing out as someone who wants to grow their practice, this presumably has been very beneficial.
Bret Keisling: So, Jenn, I know you shared on podcasts, you're spending a lot of time growing employee ownership, but also building your practice, which is how you earn a living. Can you talk a little bit about the time involved as Steve described, but also what made you to think it was a valuable use of your time when you could be spending it in so many different ways?
Jenn Krieger: Sure. Well, I guess the beauty for starting a state center in Texas is really two-fold. And you hit on it, there's a practical element, of course, always, to starting one of these state centers in which I get the ability to network with other professionals on the board. So I am now tied into other professionals that would be there to help put together a deal or attorneys or fellow valuation folks. You know, there's always people on both sides of the fence for every role and transaction. And so that also helps to expand the network as you had mentioned Steve and I met fairly early on in my ESOP marketing and business development for Weaver. And so that led to, you know, really getting together a small list of the professionals that I already knew, and then getting together a list of Weaver clients that may be interested in coming on board and helping out and helping to create a little bit of a foothold for expansion into potentially those folk's network as well. So really it came out through a real collaborative effort to be able to put together this state center.
Jenn Krieger: And I'll also add that there seems to be a a need for more ESOP professionals within the state itself. And it's kind of exciting to see other professionals in different states being interested in Texas. And we've even seen some movement of professionals coming to Texas, which is really exciting because that continues to help grow the ESOP cause here in Texas.
Bret Keisling: I have a trick question for you, Steve. If these professionals are coming to Texas and looking to help grow the Texas employee ownership market, are they just going to share fee and service wise, are they just going to share in the pie that's already there or are they going to grow the pie bigger, which will be better for everybody?
Steve Storkan: I think the intent is that we're going to grow the pie bigger for everybody both through the state center and through if, you know, if there are service providers coming to the state of Texas. I think the intent -- not, I think -- I know the intent is that we grow the pie. That we're not all coming from the same small you know, small list of prospective business owners who might be interested in employee ownership. You know, state centers really are there to do education and outreach so that more business owners know about it. And it can only help for that pie to grow or, it can only, the pie will only grow bigger if we're successful.
Bret Keisling: And Steve you're exactly right. Jenn, the flip side, and again, we're talking practice development now and we'll go back to state center development in a moment. Other professionals are coming into Texas, but I assume you, based in Houston now have relationships with those professionals from other states that you wouldn't have otherwise, am I right about that?
Jenn Krieger: Oh, for sure. But I think there's a natural collaboration across states, given that the ESOP world is it a niche community within itself. And so ESOP professionals are spread out across the United States, which makes it such that you really do need to reach across borders and not necessarily look within your own state boundaries. Here I think that we're just growing the presence within Texas, that Texas is becoming a state where ESOPs are looking more attractive and therefore more ESOP professionals are coming to do more education around ESOPs and do more networking with other ESOP professionals here as well.
Bret Keisling: So, Steve you meet with a new ambassador and you go through the time commitments that's required. And some of the challenges, and Jenn obviously said, okay, she's in. At that point, is it recruiting other people, board members money? What do you have, in this case Jenn, go out and do once you two have agreed to work together?
Steve Storkan: The biggest thing that needs to be done is exactly what we've talked about before, is the network. So, working with Jenn to get out, to get a list together of service providers and employee-owned companies that she knew that might be interested. And she and I just worked together to grow that list. You know, I work with other professionals across the country, start to ask them if they know of anybody working in Texas. We have gotten lists obviously of employee-owned companies from the [National Center for Employee Ownership] NCEO. You know, they publish their list of the [Department of Labor] DoL filings each year so we have a list of companies. So really it's about creating the network so that we can have our first kickoff event, which is -- hopefully, in the past, it was always an in-person seminar, in-person meeting -- this last year it's been all webinars. But get everybody in a room on a Zoom call and just talk about the purpose of a state center, what it takes to have a successful state center, to see who really is interested in helping move this agenda forward rather than just it being a project for the ambassador, Jenn, and I.
Bret Keisling: Jenn, how difficult was it to bring people together and did all of them stay in once they knew what it was about?
Jenn Krieger: That's a good question, Bret. I don't think that the list was terribly difficult from my perspective. It was just going through the Outlook, so to say, going through the contact list that I have as well as going through Weaver's contact lists for ESOP companies that are current clients and compiling all of that to build an interest base. And then initially having a call that I think we had probably about maybe 20 people RSVP originally for the ESOP call. When we first had it, we've narrowed down, of course there were some folks that didn't have that ability to either give of their time or give of their pocket book, so to say. And so ultimately it kind of narrowed down to the list that we have here, which is about half a dozen ESOP professionals who are committed to growing employee ownership in Texas.
Jenn Krieger: And I think over time that will continue to blossom and we'll continue to have more interest from ESOP companies as well. We're still very much on the lookout for others who would be interested in joining our cause. And already, since we had that initial meeting, we've had others come forward who wanted to offer their expertise or their time to help us get this off the ground.
Bret Keisling: Steve, from the initial phone call that was 20 people or so to the point where you put the board together and we're ready to incorporate, can you talk a little bit about what goes on during that time period?
Steve Storkan: Sure. You know, in states like Minnesota and North Carolina, where we started before COVID hit, once that initial in-person meeting, I'll take Minnesota for example, once that in-person meeting in Minnesota happened, you know, within the next two to three weeks, I was already reaching back out to those people that were at the meeting, asking if they had if they thought they were going to be able to financially support the organization or support it with their time and really started working through that and talking with each one of them individually, having one of my other ambassadors in Minnesota, talk with them. So, it was a group effort just to really get a final count on, do we think we can make this. You know, the financial support is such a big thing to get us off the ground and we really need to make sure that people are going to be all in with at least a contribution for one year, we look for two- or three-year pledges.
Steve Storkan: But that whole process took about a month of really trying to get a good feeling about, should we move forward. And then within about four to six weeks, we were ready to start gathering names for committees, trying to get board members. So it's not a long process when we don't have COVID. COVID made it a little bit longer. I think from Texas's standpoint, I think it took us probably a couple more months than that, you know, Jenn and I met in November [2019] and started working through after that talk, started working through and in early 2020 started working through that list. And the Texas center, you know, officially launched in October [2020].
Steve Storkan: So, it was a much longer process due to COVID, but usually it's about a two to three month, two to three month process, before we really kind of feel whether or not the center's going to be -- come to reality.
Bret Keisling: Jenn, during this process, there was networking, there was seeing who's interested, making sure they're still interested. Was there any lesson or that sort of thing, anything that stands out to you during that process that you'd like to share?
Jenn Krieger: That's a really good question. I think what I've taking away from this process is just that I have a lot more optimism, I think, in the ESOP space because we are all very geographically diverse. There's not a lot of folks in my own backyard who concentrate on ESOPs and so getting to know, better, my colleagues within the state of Texas has been very encouraging, I think just to myself personally. And this hits back on the business development side of it too, I guess, in connecting with those folks and getting to know more folks that would be able to go to market with me and help champion the cause of ESOPs while going about and educating those people who are our key trusted advisors for these companies that advise them on their exit planning strategies and so that we ultimately grow more employee ownership, which is really what I'm whole-heartedly passionate about! Is really being able to give that piece of equity and the beneficial ownership to that individual employee.
Steve Storkan: Bret, let me add something to that. Jenn brings up a really good point that I think is a lesson that I've learned. You know, I was a service provider for 25 years and I had the luxury of being in a location in the state of Minnesota, where we had an ESOP Association chapter. And it was the Minnesota/Dakotas chapter, but we were a very close-knit group of service providers who knew each other very well. The chapter organization was very active. It was just a -- it was a built-in network already of sharing of ideas and working with clients together.
Steve Storkan: What I've learned about other states, and this is not a knock against The ESOP Association in any way, but I've learned about other states is that what the regional chapters it's not always -- and Texas is a good example -- it's not always like a Minnesota chapter where there's already a built-in network where you're working with people within your state, and you're just automatically growing employee ownership. The State Center has done, I think, for Texas and will even further as we get going along. I think there's other states like that, that we've seen people like Jenn getting to know other service providers in the state that they didn't know, even if, even though Jenn was newer to the group, I think there's some other service providers who are now also learning about service providers in their backyard or in their state. And that can only help grow employee ownership in that state. As we try to put our heads together to say, okay, what should we do in Houston? You know, where else should we go in Texas? Who should we call? What connections does this person have? You know, things that weren't being done before. So that's an exciting part of my job and a thing I never expected I'd run into.
Bret Keisling: One thing I've noticed that's different between Texas and perhaps Minnesota and the Pennsylvania CEO is the involvement in with the professional advisors. And if you're a professional advisor, honest to goodness, you'll grow your practice and you'll grow what I call the sandbox employee ownership, which will make the pie bigger. But in Pennsylvania, Steve, if I'm not mistaken, one of the main proponents of PACEO that brought it about, and a previous podcast guest, is Ken Baker of NewAge Industries who got the passion as a 100% shareholder of a company that converted to employee ownership.
Bret Keisling: So, mindful that it's to the company's benefit as well to have a robust employee ownership community, because that will lead to favorable legislation, et cetera, how can you hope, or do you hope to bring in more employee-owned businesses to Texas and to the other state centers? Like the professional advisors are kicking them off, and I understand that completely, how do we get the companies involved and what's their role?
Steve Storkan: That's a great question. And it's something that we are trying to answer as we continue to open state centers. We were really spoiled with the creation of the Pennsylvania Center, Ken Baker, and a couple of other companies came together and they really opened the state center. And I apologize that I don't know the other gentleman's name that was with Ken Baker, but Ken and another selling shareholder decided that the Pennsylvania Center should be, should exist, and they made it happen. They pulled everybody together. They provided financial support. And we honestly thought that we would have other employee-owned companies, selling shareholders. We really thought that we would have that kind of success across the country. And we really haven't seen that part of the state center come to fruition in any of the other states. There's been a little bit in a couple states and it's getting better. But it's one of the parts that we really thought would happen that has not yet happened. And we're trying to figure out the best way to communicate.
Steve Storkan: Because you're right, you know, this is not a service provider-built organization. We want the service providers to be on an advisory committee eventually to help guide the mission. But our ultimate goal is to have community leaders in the state of Texas, as well as a former CEOs, CFOs, HR directors, or even maybe current ones in employee-owned companies. Those are the people we want running the state centers. The state centers are there to educate about employee ownership and who best to educate it, educate people, but those that don't have any skin in the game. I think sometimes business owners who are looking at employee ownership, maybe a little skeptical when a service provider is sitting across from the table from them giving this story, because I think they really do believe that service providers are all looking for that next best client which is not the case with many of the service providers that I know like Jenn and many others involved. You know, we are looking for clients when we're service providers but we're ultimately have the passion for employee ownership.
Steve Storkan: So, it's a long way of saying we really need employee-owned companies, former executives, selling shareholders. That's the core to making the mission grow within a state center and then the support of the service providers eventually.
Bret Keisling: And Steve just returning to Ken Baker for a moment in Pennsylvania. So that employee owners who are listening or management employee-owned companies, Pennsylvania CEO is interacting with our state legislature as all of your centers will do as they get up to speed. If it's just the service providers, don't get me wrong, but a lot of the legislative help is going to come from that perspective. Whereas with Ken Baker and his colleagues and the employee owners in Pennsylvania, when they're talking to the legislature, it's things like there's no federal tax for 100% S Corp companies. Wouldn't that be great in Pennsylvania, if Pennsylvania didn't pay state -- or Pennsylvania EO companies didn't pay state income tax if they're 100% S Corp ESOP.
Bret Keisling: So, again, just for those companies, if you're looking for a reason to get involved, that's just one, but there are so many different policy and legislative things that would make a huge difference to employee ownership. If the state centers are in a position to articulate that. Would you agree?
Steve Storkan: I would agree. It's both on the legislative side and it's on the storytelling side. We can put, when we can put two business owners in connection with each other to talk about experience, their experience with employee ownership; so, one who's gone through it and one who's thinking about going through it. The peer-to-peer connection from a selling shareholder standpoint or the peer-to-peer connection of an executive within a company, that story resonates so much stronger than having a service provider provide that story secondhand.
Steve Storkan: It's the same in the legislative push. If you're going to have any sort of changes at the state level, you know, state legislative people are going to want to hear from business owners, selling shareholders, executives, employees, inside of employee-owned companies. You know, a rising tide lifts all ships or lifts all boats is something we use all the time. It's a message that we try to get out to those employee-owned companies.
Steve Storkan: We also understand that we are an organization, we're the newest kid on the block, and people really do have to kind of take a wait and see approach sometimes. You know, what's this organization doing? How does this really work? You know, is this just some guy out of his basement trying to collect dues or funds, you know, what is this, what is this new animal about? And so, I think we've gotten to that point. I hope we've gotten to that point, that show people that EOX and the state center network is a movement that will continue and has done great things so far. So we're really hopeful that we can start to get those employee-owned companies involved.
Bret Keisling: I'm laughing because that's actually classic startup business problem. How do we prove our reputation, you know, to the end-users?
Bret Keisling: Jenn, I know you're working to increase the number of the employee-owned businesses involved in Texas. Any thoughts to add to what Steve said?
Jenn Krieger: Not at this point, just wholeheartedly agree. And I'm very, very interested in finding other ESOP companies that would like to join our cause, to be able to provide those stories and highlight all the reasons that we're passionate about ESOPs.
Bret Keisling: Wonderful. Let's pause for just a moment, Jenn, you and Steve are co-chairs of the Texas board of directors. Could you share the other board members with us, please?
Jenn Krieger: I'd be happy to. And I'm sure Steve can dive into this too, but our board is really an organizational board. So, all throughout 2020, it's been a highly unusual year, I think, for all of us. And so, there was quite a bit of start and stop and lagging time periods for, for getting this particular board off the ground here in Texas, but the organizational board, as it stands today is, you know, as you mentioned, Steve, and I as co-chairs, and then we have Mark Russell, who's our treasurer, he's the head of finance at SES ESOP Strategies. You've got Stephie Althouse, who is our secretary, and she is the CEO at ESOP.io. And Laurie-Leigh White serves as a board member. She's a partner here in Houston at BVA Group. And we have Anthony Eppert a board member and partner at Hunton Andrews Kurth in Austin.
Bret Keisling: I appreciate everybody who's on the board that's serving, especially since they're part of the startup.
Steve Storkan: So Steve, you had mentioned earlier about some of the other chapters that are now in a position where they're setting up committees and that sort of thing. At this point, what committees would you hope would develop at Texas or, you know, other chapters?
Steve Storkan: The ultimate goal, as I mentioned earlier, is that the board of a state center not have service providers on the board that that's, that the board of a state center consists of representatives from employee-owned companies, whether that be ESOPs, worker cooperatives, trusts, community leaders, people who are involved in economic development. You know, North Carolina has 11 board members and one of them is a CEO of an employee-owned company, there are no service providers, and the rest of them are all either non-profit leaders, community leaders, worker cooperatives. So that's the ultimate goal, which gets us to the next committee, or really the committee that we're looking for, is the service provider advisory committee. And they're really an advisor, advisory committee, to the board and helping the board and the executive director and the state center carry out its mission. And their number one thing that they do for a state center is open up their network, their personal and professional networks to help get the word out about employee ownership.
Steve Storkan: So, if a service provider is wants to be involved and financially supports the state center or supports the state center with time and effort on the committee, you know, we want them to -- let's say they're an alumni of, you know, a business school or alumni of a college and that college has a business school or university. You know, maybe they need a speaker at that university and so they can connect us with that university -- or any connections they have. That's really what the service provider advisory committee is doing.
Steve Storkan: Now, when we get down the road a little bit further, some committees inside of there, or if people have an interest in legislative issues, now the state center's not going to drive legislation at a state level, but they're certainly going to be there to help support it. So, within that service provider advisory committee, we have a legislative committee. Fundraising is always a need. And so we have those people involved and then sometimes on the communication or PR side.
Steve Storkan: But really right now, what we're trying to do in those state centers is get from the organizational board, which is where we're at in Texas, have all of those great people lead that service provider advisory committee and be part of that. We need other, other people to step in their role. I'm hoping to make sure that Jenn's not having to chair a state center for a really long time.
Bret Keisling: Jenn, are you happy that he's already looking at your retirement from the role? [Laughter.]
Jenn Krieger: [Laughter.] You can't get rid of me fast enough!
Steve Storkan: [Laughter.]
Bret Keisling: Well, folks, I'm going to make a personal mission and in six months, we'll all see if I had any success at it. Like you both, I come from the ESOP space. I do my best in the greater employee ownership space, but it's a little bit challenging. But I'm going to make it my mission to track down someone from a co-op or collective and get them turned on to the Texas CEO and see if I can find someone outside of the ESOP space, just to make sure that they're represented. Because I know that the ESOPs will come easily, but this is so important.
Bret Keisling: So, Jenn, what do you see coming up for Texas? Any of those committees that you're planning at the moment, or is it just as Steve said, waiting to be able to replace the organizational board. And what activities do you see coming up in the foreseeable future? Or how do you start towards the activities you want to have?
Jenn Krieger: Right. So, we've actually already had some good conversations within the organizational board, which is of course made up of all the service providers I mentioned. We were discussing talking to different economic development committees and groups across Texas to offer up educational resources or webinars so that we could educate their folks about ESOPs as well as worker cooperatives and what those have to offer. And hopefully over time, we'll be able to just create inroads through networking and then be able to spread that word further into the state of Texas. Hopefully, my retirement is on the cusp here soon. We'd love to have, like we've said, I think we parked on it multiple times during this interview. We'd love to have ESOP owned companies step forward and really take the charge of championing the cause with us and being able to share those impactful stories of how this has changed people's lives through employee ownership. And that's really what we want to occur. So we're happy to get this off the ground and advise, and hopefully I'll continue to stay involved on the advisory committee from an ESOP professional perspective. But, you know, we really once again want to get other folks involved in this cause to help champion it.
Bret Keisling: And Steve, remind me, I know that your role is there's a three-year commitment with EOX's direct involvement. Will that be as co-chair or as a member of the board? When the board is organized, as it should be, what's your role?
Steve Storkan: You're correct. We commit financially to support a state center for three-year period. We also commit to help with every other aspect of a state center that we can, which includes sitting on the board of directors and helping drive that mission. So I will stay on the board not as chair, but as a board member just giving my help and advice to that state center. But right now, I'm chairing a couple of the other state's center boards and helping out with those organizational boards just like we are in Texas.
Bret Keisling: So, I don't think I'm summing this up wrong by saying that your efforts will be the most successful, the quicker both of you are out of your roles!
Steve Storkan: [Laughter.] That is true. That is true. You know, ultimately where we're going with this, and I haven't mentioned it yet, but ultimately the goal of this is to have both a board and a service provider committee, advisory committee, but we haven't talked about fundraising, but ultimately both of those entities are in the mode of fundraising in the startup mode because a state center does not really truly have its mission of education and outreach in full force until we're able to raise enough money to hire an executive director. So, until the state center is not run by volunteers, but we have at least one employee, whether that'd be part-time or full-time, we really are doing good work, but it's amazing what happens when a full-time executive director or even a part-time executive director gets hired. The work that's being done like in Minnesota, North Carolina. That's ultimately what we're both trying to do is to get that fundraising to the point that we can pay a staff member to carry out the mission. And then only be, be supported by all of the other players who right now are running this, running the center.
Bret Keisling: Steve, you spoke at length when you were on in the fall of 2020. Can you just share what approximately is a budget a state center would need -- and comfortable that it's not we raised money now, but how do we pay them next year. What is the dollar amount that you would look for a state center to have annually to be able to have a staffer and get things up and running?
Steve Storkan: That's a great question. Right now, what we're looking at for a budget is for a part-time, you know, between a part-time half-time and three-quarter time staff member, executive director, we're looking at a budget of about $75,000 per year. And what we're really hoping for is that to get to that $75,000 in year. One, that it's just not a one-year commitment by people that are financially supporting. We'd really like to have a two to three-year commitment -- three, three would be ideal. So we can hire you know, that top notch person even as a half-time person. Somebody who really wants to make a difference, you know, sees what employee ownership can do in people's lives, but they have to have some commitment from us that they're going to be able to have a job for more than a year. So, really, it's a commitment of $75,000 over a three-year period that really can get us going. We're starting in other state centers with a little bit less hoping that by having an executive director, we can do some fundraising and we can make that happen. So that's what we're looking at right now.
Bret Keisling: I will point out as I did on your previous podcast, that as one of the co-founders of PACEO, my firm made a three-year commitment, $10,000 a year. And again, we were just two partners. So for us, it was money out of each of our pocket, but it was so important and I won't go into it at length. It was a very worthwhile business endeavor.
Bret Keisling: Let me actually say this. Steve, I ran into my partner, Rich Heeter, my former partner, not long after you and I did the podcast and we were chatting a little bit about Capital Trustee's investment and he agreed with a point I'd made on the podcast. Sometimes people look at the financial investment and they try and do a return-on-investment analysis. If I do this, will I get a client or what have you. And I was happy that Rich agreed with me that for Capital Trustees, PACEO was unimportant part of all of our efforts in employee ownership. And as we grew, frankly, a very successful boutique trustee firm, I don't know that I could equate anything to, I got specifically a client from PACEO, but we wouldn't have changed it. It, for us was just part of the total investment that paid off exponentially. So, I just want to make that point that been there, done that, and you'll get returns. So, I hope people will support your financially.
Steve Storkan: Yeah, it's a conversation I have almost on a daily basis with somebody is that there will be return on investment. It's just that I can't point to that number exactly and I probably won't be able to, ever. It's both a return on your investment, but probably more importantly, and I try to get this point across and people like Jenn and the rest of the people that are involved in Texas and every other state center, there are a lot of service providers who get the fact that this is a giving back to a community that's provided a lot to you and your firm over the course of time over your career, whether it's a new career or a long-standing career. It really is just like you said, at the beginning, we're trying to grow the pie. We're trying to change people's lives and sometimes that comes without a return on investment. I think it's easier to give to an organization, especially right now, when, you know, you give to the food bank, you know that they're going to go buy food. You have no idea who it's going to go to, but you can feel good about the fact that you gave to a food bank and it did some good things. We're not doing those kinds of great things right now immediate, in the immediate future, but to give to a state center who is going to go out and spread the word about the power of employee ownership, for those of us that have been in the business for a while, we all have at least one or two stories of individual people we've met whose lives have been changed.
Steve Storkan: And I'm trying to get that message across that that's what the state centers are trying to do. We're trying to change lives in a different way. And sometimes it's not about the return on investment. So, I really do appreciate all the service providers like Weaver and others that have jumped on board and have gotten that back. Because I don't know of any service provider or employee on company - there's plenty of them that have given as well so don't let me forget them - none of them who have given in this early start of our startup, none of them have really looked at return on investment. They've asked about it, but it's been an immediate I'm in, how can I help? And without thinking about return on investment.
Bret Keisling: Jenn, does this fit into your experience and how you've gotten involved in and commitments of whatever type you've made?
Jenn Krieger: Oh, most definitely. Most definitely. This is definitely something where you can have those discussions about return of investment, but really at the heart of the matter it's about growing employee ownership. And that's what we're all about.
Bret Keisling: I can't think of a better way to end this episode than what you just said, Jenn. So short of Steve, anything you wish I had given you a chance to bring up that you didn't get to?
Steve Storkan: No, I was thinking the exact same thing. When Jenn, when I heard what Jenn just said, we're trying to grow, employee ownership. That's the end game. We're all in it together. So let's, let's start 2021 and let's do it all together. Let's change some people's lives and let's grow employee ownership!
Bret Keisling: I really want to thank Jennifer Krieger and Steve Storkan for all the work they're doing and for the repeated, willingness to come on the podcast and share their work and expertise, I appreciate them. And everyone involved in the Texas Center for Employee Ownership.
Bret Keisling: All of us in this country are going through a lot together right now. And that's how we'll get through it, together, which is in the best spirit of employee ownership. Thank you so much for listening. This is Bret Keisling; be well.
Bitsy McCann: We'd love to hear from you! To contact us, find us on Facebook at KEISOP, LLC and on Twitter @ESOPPodcast. To reach Bret, with one "T", email Bret@KEISOP.com, on LinkedIn at Bret Keisling, and most actively on Twitter at @EO_Bret. Again, that's one "T". This podcast has been produced by The KEISOP Group, technical assistance provided by Third Circle, Inc. and BitsyPlus Design. Original music composed by Max Keisling, archival podcast material edited and produced by Brian Keisling, and I'm Bitsy McCann.
Standard Disclaimer: The views expressed herein are my own and don't represent those of my own firms or the organizations to which I belong. Nothing in the podcast should be construed as guidance or advice of any kind in any field and the fact that I mentioned an organizational website or an advocate or a company on a podcast does not reflect an endorsement, but if you've heard your name or your group's name mentioned on this podcast, I'd love to have you come on and talk about it yourself.
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