The University of Northern Iowa’s efforts to help rural Midwestern small businesses recently got a boost thanks to grant funding through the Ewing Marion Kauffman Foundation’s 2020 Heartland Challenge. The grant is intended to support small business’ transition programming by providing education about employee stock ownership plans.
UNI’s Center for Business Growth and Innovation (CBGI) plans to use the grant to help launch the Center for Business Ownership Transition, which will be an expanded element of CBGI’s proven succession planning work for small businesses where, since 2016, over 90 Iowa companies have successfully transitioned ownership of their business. The center will serve businesses in Iowa.
“Rural decline is one of the greatest issues facing Iowa’s economy, affecting more than one-third of the state’s population," said Paul Kinghorn, Director of the Center for Business Growth and Innovation. "The Center for Business Ownership Transition will provide a viable plan for rural businesses to remain the lifeblood of their local economies. By creating an inclusive educational and consultative program, we will be able to address all business succession issues that arise in rural Iowa."
CBGI’s Center for Business Ownership Transition will work with current business owners, their next generation of family, key employees and third-party buyers in developing detailed succession road maps for their firms across rural Iowa. CBGI aims to help current ownership determine which option works best for their company, including a business cooperative, an employee stock ownership plan (ESOP), selling to key employees, transitioning to their relative or finding a strategic buyer.
"Our center will provide education and support services for many different options for succession, including business cooperatives, employee stock ownership plans, selling to a new buyer, and transitioning the business to the next member of the family,” Kinghorn said. “This approach will create wins in rural communities and provide opportunities for companies to continue to operate and serve the rural areas of Iowa."