Two months ago, NPQ profiled an initiative supported by US Department of Agriculture (USDA) grants to encourage retiring business owners to sell their businesses to their employees in Oregon, Washington. Now a similar initiative, named the Ownership Transition Initiative, has been launched in Maine, also with USDA support.
As MaineBiz reports, “The Cooperative Development Institute has received two grants totaling more than $400,000 in public and private funds to support business ownership transitions in rural Maine.” Specifically, this includes a $200,000 grant from the John T. Gorman Foundation and a $215,000 Rural Community Development Initiative grant from USDA. The drive to implement the initiative comes from the fact that nationally, baby boomers own 2.34 million businesses, which employ 24.7 million people and have combined annual sales of $5.14 trillion. And Maine, the state with the nation’s oldest population, is affected more than most. Nationally, it is estimated that four in five businesses lack a succession plan for when their owner retires or, if misfortune falls, dies unexpectedly.
In short, the need for business succession support in Maine is high. Selling family businesses to employees is a way to enable older business owners to retire with a nest egg, while preserving jobs—and creating business ownership opportunities—for Maine’s workforce.