Back in July, the LAVA team got the exciting news that we were becoming an Employee Ownership Trust (EOT), with partners Simon Woodcock and Hamish Martin selling 100% of their shares to the new structure.
As you’d expect from M&A experts, there were plenty of questions and details to be explored, but it was quickly apparent that this felt like a really positive step not only for the future of LAVA, but for all of us who call it home.
Business owners looking to transition to an EOT have quite a few different options to consider, including what percentage of shares to transition, the length of service employees need to be included, and whether to apportion funds within the EOT based on salary, length of service, or hours worked. As the first EOT of its kind within the M&A advisory market, there were no previous examples to reference and Simon and Hamish were breaking new ground, but given that’s why they started LAVA in the first place, they weren’t deterred.
We knew this was a bold move for the M&A industry but we’ve handled many EOTs for our clients and were comfortable this was the right move for the company.
We would never ask our clients to do something we wouldn’t be prepared to consider ourselves, so when it came time to talk about our future an EOT was always going to be on the table. Now we’ve completed the transition and we’re fully embracing the new structure, I’m more confident than ever that it was the right thing to do.
Everyone we speak to in the market is really interested in the process and can see how well it works in this context, so it’s great to be setting an example and making an impact on the industry.
Hamish Martin Partner
Simon too, is really happy with the outcome and feeling buoyant about the future of the team:
The exit process can be a real distraction for business owners with so many considerations around valuation, potential buyers, management structure and so on, so crystallising the EOT brings huge clarity and removes a lot of distraction from our minds.
A lot of clients struggle with a possible exit looming in the medium term, and often find it challenging to balance investing in the company now, versus holding back and pumping up profit for a potential future sale. Whereas getting the EOT done means we can get back to investing where it’s right for the business.
Simon Woodcock Partner
In LAVA’s case, this investment has meant hiring three Associate Directors instead of one. This might be considered too bold a move if you’re having to consider what EBITDA might look like in six months time, but with an EOT in place it allows us to really ramp up growth while protecting the culture we’ve worked so hard to embed.
Let’s see what the rest of the team had to say about life as an EOT:
It’s very exciting for the team to be involved in what we can do and where we can take the company, so it’s brought everyone together even more and our collective thinking means we’re really sharing both the wins and the challenges.
Loic Bourdonnec Associate Director
I think it’s already been a really positive step for LAVA and the team. We can demonstrate that we’re not afraid to do things differently from the rest of the industry, and we can share our expertise with other companies who could reap the same benefits.
Rob Telkman Director
You don’t expect to have an opportunity to properly buy into the future of the company so early in your career, so it’s incredibly exciting to already be somewhere where I have skin in the game and it feels like everyone is working towards the same goals.
Ivo Brett Analyst
I’m excited! I like to stick my nose into every detail of the company anyway, so being directly invested in the business is even more motivation to engage with what’s going on and drive things forward.
Felix Neate Associate Director
It’s been a real differentiating factor when speaking to vendors, because it shows we share their values in terms of safeguarding the best interests of the employees – and from a personal standpoint it’s good to know we’re all aligned and pulling in the same direction so I’m excited to see what happens.
Ary Singh Head of Origination
It’s a pretty momentous step forward for the industry and a great testament to LAVA’s ethos that came across so strongly in my initial meetings with the team, so it made it an easy decision to join the business at a time when we can have such an impact on its success.
Joe Sharp Associate Director
I work on a lot of EOT transactions so I was pleased to hear we were going the same way, and being so close to our own transition also adds helpful context and first hand experience I can share with our clients.
Millie Counsell Assistant Manager
It’s a real positive in terms of giving clarity to the team about our future prospects and it helps foster and embed the culture which is super important in a close-knit company like LAVA.
Sunil Samani Associate Director
It’s brilliant to see how much it’s invigorated the team and how excited everyone is for the success of LAVA. We’ve built such a unique culture and I’m personally delighted we get to protect and grow it for the future.
Tom Rowe-Jones Director
As the only non-technical member of the team it’s amazing to feel so inherently a part of everything we do here, I love the community we’ve built so it’s great to have the reassurance that we can preserve that as we grow and evolve.
Freddi Rose Marketing & Communications Director
To find out whether an Employee Ownership Trust could be the right move for your business, get in touch with our expert team.
