Bret Keisling celebrates 100% ESOP Penmac, a staffing agency that started with an idea and a single client and grew to 32 offices with over 28,000 employee owners, making it the second largest EO company in the United States.
Mini-cast 127 Transcript
Bret Keisling: 00:08 Welcome to the ESOP Mini-cast. Thank you so much for listening. My name is Bret Keisling, and as it says on my business cards, I'm a passionate advocate for employee ownership. Today I'm going to celebrate Penmac Staffing, which is a 100% ESOP that provides employment and staffing solutions - in other words, a temp agency.
Bret Keisling: 00:30 It's based in Springfield, Missouri, and as of 2018, what was once a small single office now counts 32 branch offices in eight states. As of 2018, the company generated more than 25,000 W2 forms, and it has over 1,200 business clients and 170 internal employees, including 34 in the corporate office.
Bret Keisling: 00:54 According to in NCEO's 2020 list of top 100 employee owned companies, Penmac has over 28,000 employee owners. It took me a moment to make the numbers add up in my head and when they did, I got very excited. Unlike most businesses where the corporate and branch headcounts make up the employee body, here all of these thousands of temp workers are also employee owners of Penmac. That's a cool expansion of employee ownership that I hadn't considered before and I like it.
Bret Keisling: 01:30 That would all be exciting enough, but I'm a sucker for a great origin story and Penmac's story is amazing. It was started by Patti Penny in 1988 with a partner. Prior to that, Patti had a 20 year career in human relations at a major corporation and a regional hospital and, as is familiar to many of us in the business world, she dreamed of starting her own company. She had an opportunity to get a staffing contract with the business where her husband worked, and that was the foundation of Penmac. But as sometimes happened, that initial contract didn't work out as she hoped.
Bret Keisling: 02:09 In the face of this adversity, Patti doubled down. She reached out to all of her contacts in the community and she did something that's very, very difficult and something of a lost art. She began cold calling.
Bret Keisling: 02:24 In time she landed small clients in the Springfield area and before long she landed two big accounts; one with General Electric and another company called Reckitt Benckiser, which at the time was known as French's Mustard.
Bret Keisling: 02:39 Here's a sure sign Penmac is doing something right -- as its business has grown to incredible levels, both General Electric and Reckitt Benckiser are still Penmac clients today.
Bret Keisling: 02:52 In 2010, Penmac transitioned to an ESOP. In 2012. Patti stepped down as CEO, but still serves as chairwoman of the board and her daughter, Paula, who worked with Patti for a decade prior to the transition, has become CEO.
Bret Keisling: 03:11 This is a quintessential entrepreneur story. And the fact that the successful company converted to employee ownership certainly speaks to the power of EO.
Bret Keisling: 03:21 Now, I don't have any information on the 2010 transition to employee ownership, but allow me to speculate. Patti had other options where she could have sold the business either to a major national player or even a regional competitor. But I suspect that Patti and her family knew that if she sold out in such a way, her legacy and all of the work she and her colleagues and put in, would effectively be erased.
Bret Keisling: 03:48 As we've heard guests share on previous podcasts, legacy can mean a lot to the entrepreneur who started and grew the business and among all the powerful benefits to the employee owners, the legacy of the founder is very important.
Bret Keisling: 04:04 Congratulations to all the wonderful employee owners at Penmac Staffing and congratulations to Patti Penny, her daughter Paula, and all the great team members who've built such an amazing company.
Bret Keisling: 04:18 If you go to our website at www.ESOPpodcast.com, you'll find transcripts of all of our episodes. If you check out the transcript for today's episode, you'll find links to Penmac, NCEO's Top 100 list and some other links as well.
Bret Keisling: 04:35 One more thing about [the National Center for Employee Ownership] NCEO. You no doubt are aware that NCEO's virtual annual conference is April 20th to 21st, 2021 with a virtual pre-conference on April 16th. More than a thousand people have registered and I'm one of them. I hope you'll register too. And if you do enter the discount code, EOPODCAST25 to save $25 off the cost of registration, I'd love to see you virtually at NCEO's conference.
Bret Keisling: 05:04 Please join us next Tuesday on our primary EO/ESOP podcast, where we'll have all new content. And remember our country's 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: 05:27 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.
A note on the transcript: This transcript was produced by Temi, an automated transcription service. While it has been reviewed by The ESOP Podcast, we can not guarantee the accuracy of the transcription. Please refer to the original audio when citing sources.