Private equity is devouring the economy as boomer entrepreneurs exit—but a new approach to employee ownership can change that
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Private equity roll-up mergers are growing rapidly as baby boomer entrepreneurs seek to retire; Private equity companies are acquiring private companies in fragmented industries with insufficient succession planning; Private equity companies lack expertise in specific industries and running a company; A civil engineering company in Wisconsin made over 20 acquisitions without private equity involvement by implementing an Employee Stock Ownership Program (ESOP) and fostering common stock ownership among employees; The valuation of the civil engineering company surged more than sixfold in the last five years; The alternative approach to private equity roll-ups is becoming known as 'rewarding roll-ups'; Broad awareness and adoption of this approach are limited but growing quickly

#PrivateEquity #EmployeeOwnership #BusinessSuccessionPlanning #Esop #RewardingRollups

https://fortune.com/2024/07/24/private-equity-devouring-economy-boomer-entrepreneurs-exit-employee-ownership-labor-finance-leadership/