There’s been some great media coverage this week of a story incorporating two of my favourite things: Greek yoghurt and employee share ownership. This is thanks to a decision by Hamdi Ulukaya, CEO and founder of Chobani, a New York based yoghurt producer, to award equity to his entire 2,000 strong work-force.
The employee equity could ultimately represent some 10% of the value of Chobani and make millionaires of some of the company’s employees if the rapidly growing business is sold or floats.
Ulukaya, whose experience of the dairy business prior to founding Chobani was watching his mother make yoghurt at home in Turkey, has said of his decision “We built something, now we’re sharing it”.
The idea of awarding equity that crystalises value for employees on a company exit is not a new one. For many years, UK businesses have been adopting this strategy and enabling employees to share in business’ success. This has always resonated with me, not just because I like the idea of people that have helped to build a business being rewarded for this in a meaningful way but also because it makes such sound commercial sense. If you want to grow a business to attract buyers, ensuring your team are aligned with you in this goal is imperative and something that should be an inherent outcome of an award of exit related equity.
And there’s more. Back to my dairy story. A long term employee of Chobani has been quoted as saying of the company “there’s a very emotional bond and an emotional connection that you don’t typically associate with a manufacturing facility”. That’s what having a real financial stake in the employing company in the form of equity can do for an individual. And an employee who feels that connection is the sort of employee who will move mountains to meet a target or exceed customer expectations.
The moral of the dairy story? Employee share ownership could be seriously good for your business.
And they all lived happily ever after.
Emma, 4 May 2016