Community Capital Working Group


Invest Strategically to Close the Wealth Gap
Converting Businesses into Employee-Owned Enterprises


Study after study documents the powerful benefits achieved by employee-owned enterprises for workers in terms of additional income and retirement savings as well as improved workplace conditions. Additionally, employee ownership can address issues leading to racial and gender wealth gaps. Employee owners of color have a 30% higher wage income than do non-employee owners of color.

Communities are also direct beneficiaries of employee owner conversions because these initiatives help preserve successful, local businesses, especially so, in the current pandemic environment when many sound small and medium sized businesses are threatened with bankruptcy.


Business conversions into employee-owned enterprises offer exciting triple bottom line opportunities to investors, workers, and local communities. It is no surprise that more than 20 municipal and state governments in the U.S. have designed programs to facilitate such transactions. These efforts save jobs, keep wealth building in the local community, and diminish racial and social equity barriers. Because this investment model is based on converting already successful companies, it has the potential to substantially lower risk than investing in startup ventures.

Of course, this economic development strategy, like all others, has its complexities. For example, there are a number of legal forms an employee-owned enterprise can take. Perhaps the two best known are Coops and the ESOPs, each of which enjoy unique characteristics. However, the purpose of our site is not to examine such nuances but to provide you with the educational resources necessary for your exploration of this rapidly growing niche of the socially responsible economy.  Nonetheless, rest assured that genuine worker participation in entity management is a fundamental criterion we evaluate.

To understand the essentials of ownership conversion, we encourage you to read the papers listed below and to check out some of the seminars also enumerated below. You will learn why a market for transfer of ownership exists as well as the general mechanics of the transactions and the many benefits transmitted.

While there is always the possibility to invest in an individual conversion, we believe that for most investors investing in a diversified portfolio of holdings is the most efficient strategy to employ. To this end we have reached out via questionnaire to all the funds we could find that meet our standards of conversion (democratic management) and reserve a considerable portion of their assets for the conversion objective. The questionnaire was designed with the individual investor in mind and attempts to provide answers to the most basic and common investor concerns. We have reproduced a number of the responses in the chart below to help investors compare “apples with apples”, and thereby simplify the path to follow in researching appropriate investments. 


Interested investors should first read a fund’s full response to our questions, and then contact the fund to ascertain understanding of its representations. The full survey can be found by clicking the name of the fund in the survey results section below. The responses in the chart above may not fully reflect investment experience/track record and social priorities of the fund.


Help us strengthen our work: Take the Survey for Worker Conversion Funds

Funds – We realize this is a preliminary survey and invite other funds that support this work to submit their information here.
Investors – Please let us know if you invest in any of these funds so we can measure our success. 

For more information contact Eric Leenson,


Opportunity Knocking: Impact Capital as the Transformational  Agent to Take Employee Ownership to Scale – January 2021 – Prepared by the Democracy Alliance | Authored by Jessica Rose, Marjorie Kelly, Sarah Stranahan, Michelle Camou & Karen Kahn

Race and Gender Wealth Equity and the Role of Employee Share Ownership – April 1, 2021  – Prepared by the Aspen Institute, Rutgers and the Democracy at Work Institute | Authored by  Jenny Weissbourd, Maureen Conway, Joyce Klein, Yoorie Chang, Joseph Blasi, Douglas Kruse, Melissa Hoover, Todd Leverette, Julian McKinley & Zen Trenholm

Conversions to Employee Ownership in a Succession Context – November 7, 2019 – Prepared by Transform Finance | Authored by Andrea Armeni and Camille Kerr