Tucson, Az. and Project Equity announced a business succession and recovery initiative aimed at preserving Tucson’s small business vitality.
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The program is a partnership of Project Equity, a nonprofit that helps business owners preserve their legacy through employee ownership, and the City of Tucson Office of Economic Initiatives.
Funded by the federal American Rescue Plan Act of 2021 (“ARPAâ€), the initiative will provide training and support to demonstrate the efficacy of employee buyouts as a strategy to strengthen small businesses through increasing employee engagement, hiring and retention, and to preserve jobs, provide small business owners liquidity and reinvigorate the local economy.
According to a study by Project Equity, about half of the privately-held businesses in Tucson are owned by baby boomers nearing retirement.
There are over 2,000 local businesses over 20 years old that account for nearly $16 billion in revenue and 60,000 local jobs.
This represents an impending, massive ownership change of locally held businesses.
This silver tsunami coupled with the lingering impacts of COVID-19, means these businesses urgently need solutions. This is a critical time for business owners to consider pathways to retirement, particularly how employee ownership can address current business needs.
Without an exit plan, many local businesses in Tucson are at risk.
Additionally, the pandemic has made recruitment and retention of employees more challenging for business owners, thus slowing the recovery of their operations.
Project Equity and the City of Tucson are raising awareness of employee ownership as a strategy to strengthen Tucson’s economic resilience, protect local jobs and revenue, and help business owners recruit and retain employees.
Through this collaboration, Project Equity will provide hands-on support to companies that want to explore and execute employee ownership; and through its Employee Ownership Catalyst Fund also offer working capital and transaction financing. ■