Diversifying LA’s manufacturing ownership by empowering workers to buy their company

submission by concernedcapital
Diversifying LA’s manufacturing ownership by empowering workers to buy their company

About Your Application

Organization(s) name(s):

Concerned Capital

Organization(s) website(s):

www.concernedcapital.org

Organization(s) twitter handle(s):

www.twitter/concerncapital

Organization(s) facebook handle(s):

https://www.facebook.com/concernedcapital

Please share the direct link for voters to sign up for your newsletter(s):

http://www.concernedcapital.org/index.php/concerned-capital/contact

Describe Your Organization(s)

Non-profit organization

For-profit organization

Government

Other (please specify below):

:

Concerned Capital is a social benefit corporation, a for profit entity that has voluntarily and formally committed to creating a social and environmental benefit.

In one sentence, please describe what your organization does.

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Concerned Capital creates business ownership opportunities for long-term blue collar workers in privately held Southern California companies in order to build wealth in minority communities and preserve jobs.

In one to three sentences, please describe your proposal.

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The project will help key employees and related parties buy their company and in the process save jobs, promote investment, and help businesses get back into growth mode.

Please write a sample tweet to describe your submission.

:

We address income inequality and create wealth in the workplace; we help blue collar employees buy companies

Where will you be working? Please be specific (e.g. Third Street Middle School; Boyle Heights; LA County).

Central LA

East LA

San Gabriel Valley

San Fernando Valey

South LA

Westside

South Bay

Antelope Valley

County of Los Angeles (countywide)

City of Los Angeles (citywide)

LAUSD

Other (please specify below):

How do you plan to use these resources to make change? (check all that apply)

Conduct research

Engage residents and stakeholders

Implement a pilot or new project

Expand a pilot or program

Mobilize for systems change

Advocate with policymakers and leaders

Implement and track policy

Other (please specify below):

:

Engage economic development providers nationwide in this practice

How will your proposal improve the following “Create” metrics? (check all that apply)

Employment in the creative industries

Arts establishments per capita

Concentration of manufacturing activity in LA

Federal research grant funding

Patents per capita

Jobs per capita

Minority- and women-owned firms

Gini coefficient

Number of high growth startups

Venture capital investment

Measures of cultural and global economic influence (“soft power”) (Dream Metric)

Recruiting and retention rates for local higher education institutions (Dream Metric)

Percentage of graduates from local higher education institutions that remain in LA County 5 years after graduating (Dream Metric)

Unemployment rates (and opportunities) for the formerly incarcerated (Dream Metric)

Describe in greater detail how you will make LA the best place to create.

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LA 2050 seeks to “Create in LA means of fostering entrepreneurship, cultural diversity, and inclusivity.” Our proposal does this in the following ways:

We will identify 20 small companies with long-term employees (3 years or more) who seek to own the company they work for. The overwhelming majority of minority workers in LA’s private sector work for small businesses, (companies with 500 or fewer employees). Yet, less than 33% of these companies are owned by people of color; our proposal seeks to address this issue by encouraging entrepreneurship in the workplace of these smaller companies
Proceeds from our 2050 grant would be used to create a transition plan for employee groups that includes a business valuation for negotiating the business sale, a training plan that identifies employee skills needed and drafting of a ‘letter of intent’ to preclude the business from being sold during a period of due diligence.

We will enroll interested employees in entrepreneurial training designed to prepare them for eventual company ownership. By including blue collar workers in the ‘class’ of potential business owners and buyers, our proposal seeks to address income inequality and expand the economic horizons of employees it touches

By extending ownership opportunities to employees who would otherwise not have the chance to own their own company, our initiative seeks to make LA a more inclusive environment that encourages entrepreneurship, risk taking and creativity. The overwhelming majority of blue collar, manufacturing jobs are in the areas of LA with the highest concentration of low-income residents and people of color yet the ownership of these companies is still predominantly white and live outside of the communities where the companies are located. . “Seventy five percent of all small business is owned by folks over 55 years of age and every 7 seconds a Boomer is turning 65 and will do so for the next 15 years.” Transitioning these companies to existing management/employees groups will revitalize the business, realign their outlook with more contemporary racial and ethnic realities and extend the company’s useful life.

Recycling an existing manufacturing company with its years of goodwill, customer base and trade credit in-tack is easier than starting a new one. Bank financing is more readily available due to a track record of earnings or past history that demonstrates repayment ability. Long-term employees understand their business.

Please explain how you will evaluate your work.

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We evaluate our work in the method that traditional economic development practitioners do; by the numbers. We will use the following matrix:

·Jobs saved and/or created
· Number of entrepreneurial candidates readied to take over a company
·Number of companies identified as potential transfer of ownership candidates
·Total dollar amount of investment
·Total number of loans secured and dollar amount
·Total number of businesses where ownership transferred to employees.

We will also have a qualitative evaluation of our work with focus group studies using our partners as members. These qualitative focus groups will examine such questions as to our effectiveness in following areas: leads generated, quality of referral we make to them for trainees and impact in their service area of our work transitioning companies.

How can the LA2050 community and other stakeholders help your proposal succeed? (check all that apply)

Money (financial capital)

Volunteers/staff (human capital)

Publicity/awareness (social capital)

Infrastructure (building/space/vehicles, etc.)

Education/training

Technical infrastructure (computers, etc.)

Community outreach

Network/relationship support

Quality improvement research

Other (please specify below):

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Outreach to donors who own small manufacturing companies, outreach to social impact investors

Discussion
6 Pink talk bubble tail c96b4a07ef1417e25d0bcf5c4cba4766b8bbf0382f07677990a9d5577885d4d7

This is a very innovative idea that will strengthen our local economies!! Keep it up and I hope this wins!!!

by aydamay
5 months ago

What a great idea! Nothing improves your perspective on how great a place it like a decent, stable job. I hope it wins the prize.

by Tomas_Trojan
6 months ago

As much as this provides an opportunity for an employee to become a business owner, it also provides an opportunity for business owners, who may not see their path to retirement, to retire.

by slfrandsen1
6 months ago

What an innovative strategy to empower worker and keep manufacturing jobs in LA. Best of luck!

by ooodrae
6 months ago

Keeping jobs in existing companies by valuing ownership in transition and succession planning strategies is a win- win for all parties to the transaction for the selling all or part of the business until the owner is ready to liquefy his company when he is ready.. Up for sale and ready for sale can be planned to benefit all parties.
Gil Ostrick CPA,CVA Partner
gil@weissac.com or 424-208-6390

by gilostrick
6 months ago

Read the complete article 'Familiar Advantage" on recycling small companies on our blog at :
http://www.concernedcapital.info/2014/10/dont-start-up-company-recycle-one.html?view=flipcard

by buyoutyourboss
6 months ago

Pink ribbon award box icon 45b87e779c93f5099a48378c2aadc0fcd51184974daecf76e3f5c50034ea21fb
Award topvotedidea 5a5ae14e3d56a10363ea2a398cece46cf4df891213cbe68677c19d8903a1932a
$100,000
Circle 1 inactive e7784182a1bd5eace578987db27fc19ec6337f418c48c6c8732605b9043d50d0 Step1 title submission inactive cde083e53089b973e7c9dc80a44a038c1ce4cf3b2650aeb5549157d1ed58a2d9

Submission Began
Tuesday, September 08, 2015

Submission Ended
Tuesday, October 06, 2015
at 07:00 PM UTC

Circle 2 inactive 74a43088831beb43fdbd7591ef5d50a5a7a26ff92c9e8ed489782459fa31a8d9 Step2 title voting inactive 96be722f53c417edddb5742ba9a6dc2fd403f7e4f6c19dbe883d50d20d93689d

Voting Began
Tuesday, October 20, 2015

Voting Ended
Tuesday, November 03, 2015
at 08:00 PM UTC

Circle 3 83da7a9432aeea960e1a9e9ee93e7ea1221af6c8f42b27964f2e9999d94b2b8d Step3 title 3d9e2a65d6ea1ad301f8fc607f5f828bd96362932c71d81c0da5b1fd964422b0

Winner Announced
Tuesday, December 08, 2015