“We exist to positively impact those around us,” is on display in giant letters inside the Frisco-based office of Text-Em-All, a software company specializing in delivering text messages and phone calls. This is how the company defines its goals of staying privately owned, continuing to be profitable, persevering for 100 years, and having a lasting impact.
In an effort to give back to employees and achieve these goals, co-founders Brad Herrmann and Hai Nguyen are implementing an employee ownership model, allowing Text-Em-All’s employees to become owners in the company.
“[The owners] took a huge risk to get to this point, but there’s so much that goes into running the company now,” said Jared Olfers, Head of Customer and Partner Relationships at Text-Em-All. “They realize they wouldn’t be here today without those contributions. This is a way to say thanks to those who have been by their side.”
Over the last two years, Text-Em-All—which is currently hiring for several software engineering positions—has experienced incredible growth, doubling its revenue and employee count, but that hasn’t come without its challenges.
“That’s made it challenging to find good people,” Olfers said. “At the end of the day, if more companies offered this kind of program or option, that can be a real differentiator in the job market.”
Text-Em-All’s employee ownership model is two-fold: Employees are granted ownership in 20% of the company for their future retirement but will have the option to invest their own money to purchase stock in the company to build wealth today.
“When we started down this journey, Brad didn’t really like the traditional employee stock ownership plan where it’s only a retirement vehicle,” Olfers said. “There’s a lot of hoops you have to jump through to put an ESOP into place and it’s just for retirement. ... The second part of it became, ‘How can we get people to own shares today and have an opportunity to build wealth they can use before retirement?’”
The employee ownership model is one step further than another initiative Text-Em-All has been doing for many years: Quarterly and annual profit sharing, which is often referred to as an “icing on the cake” bonus. It is substantial, but the employee ownership model is another way to celebrate the company’s success. All employees are eligible to participate, and once they hit their three-year anniversary, it becomes vested, or owned, by the employee.
“It’s like the anti-private equity route,” Olfers said. “They said let’s go with the model where we give it to people who are already here and will get the most benefit from it.”
Additionally, people act differently when they know there is something to gain out of their actions and feel like they have a say in the company’s decisions, Head of Marketing Ron Kinkade said.
“It’s an interesting mental change when you know what you’re doing on a daily basis—buying a keyboard or taking a client out for dinner—you act differently,” Kinkade said. “Most of our company already acts like that, but it changes the dynamic when it’s true.”
There has always a push to have Text-Em-All employees feel like owners, from transparent financials to discussing company decisions openly in meetings. The results speak for themselves—the company has been profitable since it was founded in 2005 and continues to grow at a healthy rate. The company is also Certified Evergreen by the Tugboat Institute, whose membership consists of other like-minded purpose-driven organizations attracting top talent, valuable partners and loyal customers.
Most importantly, employees are happy, which leads to a great product and happy customers, Kinkade said.
“How do you ensure the company stays that way?,” he said. “You make the employees even more invested in that success.”
President and founder Brad Herrmann said he believes employee owned businesses represent capitalism at its best.
“We want our employees to have the opportunity to share in the wealth they help build,” he said. “Our team already acts like owners, so this is really just enhancing and rewarding what’s been happening for years. Since we don’t plan on selling this company, employee ownership is a great way to keep ownership of the company in the hands of those that run it every day."
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