eT Portfolio Company: Direct investment in employee owned businesses
The eaga Trust came out of the success of an employee owned business established in 1999. The Trust was set up for the purpose of promoting employee well-being, engagement and ownership.
As a result of its history, the Trust believes in the benefits that employee engagement and fairness in the workplace (often manifested through employee ownership) can bring to a business. People who “have a stake” in their business are more engaged, higher performing and ultimately more successful.
In eaga Trust’s experience, businesses operating under these principles have motivated employees whose sense of co-ownership means they take direct responsibility for helping drive long-term growth and financial success.
What do we do
The eaga Trust supports the growth of employee ownership and engagement/fairness in the workplace through, amongst other things, direct, long-term investment.
It invests in businesses and management teams that believe in and are committed to these principles. It has established the eaga Trust Portfolio Company (eTPC) as its principal vehicle to make such investments. eTPC has considerable flexibility in the size of investment it can make but our typical investment in any one business will be up to £2m.
We are flexible as to the form of investment we make and we look to structure our investment to fit in with the needs of the investee business. Our typical investment will include equity and an income generating instrument.
What do we invest in
We invest in businesses and dedicated management teams where we see the potential for success which can be shared by employees, management and eTPC.
Our investees will include
- businesses that are already in employee ownership and are looking for capital to expand
- businesses that are owned by shareholders who are considering exit (partial or full) but who would like to effect a transfer of the ownership (or the benefits of ownership) of some of the business to employees
- experienced management teams who believe in employee engagement and who have a target business they wish to acquire and to move to employee ownership
Start-ups, turn-arounds, capital intensive businesses and businesses outside the UK will not be our focus, however, we remain open-minded and are pleased to consider each situation on its merits.
Our investment returns come from a mixture of capital appreciation and income generation. The balance between the two is dependent upon the needs of the business.
We invest for the long term but do not expect to invest forever. We will exit our investment when the time is right for the business and its employees and management. When exit does happen the employees and management and eTPC will share in the returns achieved.
How are we different
We are different from traditional providers of capital (including venture capital and private equity) in that
- we invest the Trust’s own money
- we understand and believe in the benefits of employee ownership and engagement
- although we understand there are many factors that contribute to a business’s success, in our experience employee ownership and engagement are key contributors to success. Unlike many fund providers we reward these attributes rather than penalise them
- we require a commercial return but are not seeking to drain every ounce of profit from our investment to the detriment of other stakeholders. We are collaborative not competitive
- we are not about making a quick return but about building long term business success
- we can make quick decisions and do not operate a tick box approach
- we believe that employees, management and eTPC should all share in the success of the business and in the returns that are achieved on a successful exit
We use our capital to generate sensible returns that can be used to support an ever wider pool of employee owned and engaged businesses
You should contact us if ...
... you have a commitment to employee engagement and ownership and would like to work with a like-minded and supportive capital provider to realise your plans.
We are pleased to speak with businesses which have been rejected by traditional fund providers wary of employee ownership.
If possible come to us early so we can plan the right way forward with you.
What else do we bring
We offer more than just money. In the businesses in which we invest, we can provide general business input as well as specific employee engagement know-how. We are prepared to be more than a passive investor and will support your business in whatever way best suits it.
How you can contact us
We are always interested in businesses and management teams that are committed to employee engagement. Irrespective of whether we can help from a direct investment perspective, we are happy to start a relationship and we look forward to hearing from you.
You can contact us by e-mail on firstname.lastname@example.org. Alternatively you can reach us by telephone on 07717 415330