Part 1: Why California Is Poised for an ESOP Boom
Employee Ownership on the Rise: What's Driving the Interest?
In recent years, employee stock ownership plans (ESOPs) have gained traction across the U.S. as an innovative solution for business succession planning — but in California, adoption has lagged behind other states. That may be about to change.
With new pro-ESOP legislation, access to financing, and rising interest in employee ownership, California businesses have a unique opportunity to embrace ESOPs as a way to empower employees and strengthen communities.
Why Now?
Several key factors are contributing to the rising interest in ESOPs:
- The Silver Tsunami of business owner retirements
- Growing pressure to retain local businesses and jobs
- California's 2023 budget allocation of $50 million to support ESOP transitions through loan guarantees
- Federal legislation like the WORK Act pushing employee ownership incentives nationwide
At Schechter Benefits Law Group, we're seeing a noticeable increase in business owners exploring ESOPs — especially among small to mid-sized businesses looking to preserve their company's legacy while rewarding employees.
Coming Next:
In Part 2 of our series, we'll break down how businesses can customize their ESOP through plan design — and why getting it right from the start is crucial to long-term success.
If you're considering an ESOP for your company, let's start the conversation.
Contact us today at sblgllp.com to explore how an ESOP could work for your business.
