How the late Bob's Red Mill founder avoided selling out to a food giant and instead transferred ownership to his 700 employees
How the late Bob's Red Mill founder avoided selling out to a food giant and instead transferred ownership to his 700 employees
Bob Moore, who died Saturday, said large corporations tried to buy out Bob's Red Mill, but he transferred complete ownership to his employees.
Bob Moore sounds like he was a good dude. If more business leaders thought like him we'd all be a lot better off.
But that's the point: that level of wealth and power is unhealthy. For literally everyone. We can't just hope more of these insanely privileged people resist corruption and greed to do the right thing and treat their employees fairly (more than fairly, in this case). He was a good dude all right, but a huge exception to the overwhelming norm of wealthy people exploiting their workers...
Socalism is quite a nice concept and one that has the potential to be implemented at a large scale.
This sounds like a mondragon corporation, a specific type of co-op primarily from the Basque region: https://en.wikipedia.org/wiki/Mondragon_Corporation?wprov=sfti1#
Bob was genuinely a good man and the Red Mill products are amazing.
Communism! How dare he! Giving power to the people who built his wealth from? Might as well give him a parade in Red square!
But seriously people shouldn't be able to transfer their corporations to their families. Once you die/retire it goes to the workers by law. If you didn't amass enough wealth in that time frame maybe you should have budgeted better. Why should current and future workers continue supporting wealthy peoples children.
Estate taxes are the way to deal with that. Otherwise you potentially get massive distortionary effects from people trying to dump all their ownership into liquid assets right before they die, assuming that's what you meant by wealth. It also gets odder when you no longer have a single owner. Jeff Bezos is fabulously wealthy and holds lots of stock in Amazon, but he does not own Amazon outright. You could say that when he dies, his stock goes to the workers. Okay, what about stock held by funds like Vanguard or pension funds? What does death even mean then? It's a whole mess, or you could go with the simpler estate tax.
I mean, private ownership of capital should just not be provided and enforced by government in the first place, that would be a lot simpler than some automatic death-bed transfer. End capitalism, before it ends us.
Communism
Socialism, actually.
People are careful with their words on this and often act like it's a gift. It's an ESOP so he sold it to his employees. That said, it's still a better model than selling to a public company and I'm sure he did take a loss on it compared to that.
From the perspective of the employee it basically is a gift (more a benefit).
Employees don't pay for stock in an ESOP; they're earned by being employed there (with different options for how they're divided, but restrictions so they aren't excessively dominated by the highest earners).
ESOP is a thing… the question is who gets to make decisions. Is the board run by employees? I used to work for an ESOP, but the scheme was little more than a way for the founders to cash out on their investment by saddling the company with the debt to buy itself… all while still retaining control of the board. Despite being employee-owned, employees had no decision making power.
An ESOP is generally going to be better than sale to venture capital. That said for folks considering this I'd recommend conversion to a worker coop, since then employees both own the business and make decisions for the business.
My wife's company got bought out by an ESOP company. When she explained it to me, the whole thing sounded like a scam. I'm not qualified to explain it but it sounds like the stock never vests until you retire so no one has any control outside of the incompetent execs who run the thing.
Yeah… and a lot of companies use this to replace your 401k or in lieu of contributing to one. So, a big chunk of your retirement savings is tied up in the company and usually can’t be diversified until you’re pretty close to retirement age.
Alternatively, if you leave the company, many will let you take money out and roll it into an IRA, but it’s usually capped at like $5k per year. It can take a long time to get your money out.
That’s not necessarily a feature of ESOP.
My first ESOP vested 100% on day 1, we also had a 401k with matching, with a discretionary amount added from the company depending on how well the company did that year (never saw less than 10% of my salary in the years I was there). If/when you leave the company, you’re payed out within 3 years.
For my second ESOP it was a 3 year vesting schedule, no 401k matching and no discretionary amount (though ESOP contribution was ~10% of salary, depending on company performance). If/when you leave the company, you’re payed out starting at year 6, over a period of a few years (can’t remember exactly).
I say all this to demonstrate that these things can be set up very differently while all still being an ESOP generally.
May his legacy inspire mankind to become something great.
Laughing in the back of my head I heard. "what is dead may never die"
Based
This is the best summary I could come up with:
Moore, who was 94 when he died, founded Bob's Red Mill with his wife, Charlee, in Oregon in 1978.
In the decades that followed, the couple grew their whole-grain food company into a global empire that did more than $100 million annually, selling over 200 products in more than 70 countries.
When asked why he chose an employee-owned model during an interview with Portland Monthly last year, Moore, who was Christian, cited the bible.
"The more everyone organizes and works hard, the greater the profitability of the company, and that translates into higher value of ownership," Moore told Portland Monthly.
In 2022, when some business leaders were complaining about a labor shortage, Moore said executive greed was to blame and that more companies could adopt the ESOP model, Fortune reported.
He said employees at Bob's Red Mill feel valued and informed, an approach other companies could learn from.
The original article contains 554 words, the summary contains 148 words. Saved 73%. I'm a bot and I'm open source!
Sounds like a good guy
Okay serious question, how the fuck is this Christian and the Westboro Baptist Church Christian??? I know but still I will never be able to get it.
Schröedinger’s Christian: simultaneously wonderful and just the worst.
Honestly, the retail shop and restaurant really went downhill shortly after that happened. My family used to eat there weekly. Breakfasts were excellent and nicely priced. Over the next couple years we just stopped.
Now I just miss that vegetarian sausage omelette with those cheesy grits.
I don’t know why those things seemed to coincide but the handover was in the local news a lot and shortly thereafter it just seemed to begin its decline.
That's too bad. I had moved away from Milwaukie by then so it wasn't really practical for me to make my way down there. I still eat a lot of their grains and other products, though.
Yeah. I still buy a lot of their products especially the Artisan Flours. Such great products.
He initiated the ESOP in 2010 so maybe it's worth trying again?
I tried many times including multiple times a few years ago (after they put up the big outside area). Still disappointing, sadly.
I’ve had the privilege of working for 2 employee owned companies in the past and both were a positive experience.
I'd love to try that.
Oh, I always wondered if he was a real guy when I look at that bag of flaxseed...