West Lebanon Feed & Supply sold using model that transfers ownership to workers

  • Jerilyn Zaroogian, left, merchandising and receiving manager, talks to Ira Richards, vice president of marketing and business development, as he checks a cash register at West Lebanon Feed & Supply in West Lebanon, N.H., on Friday, Feb. 10, 2023. Both Zaroogian and Richards said that Curt and Sharon Jacques have put their heart and soul into the business, but they are looking forward to the next chapter. “It is kind of exciting to be another employee-owned business in the Upper Valley,” Zaroogian said. “It’s a big boost for the team,” Richards said. (Valley News / Report For America - Alex Driehaus) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com. valley news / report for america photographs — Alex Driehaus

  • Clean Paws Grooming employee Kaitlyn Pomerleau, left, talks to her coworker Chris Swan, right, while Claire Reynolds bathes her dog Meru at West Lebanon Feed & Supply in West Lebanon, N.H., on Friday, Feb. 10, 2023. West Lebanon Feed & Supply has been acquired by Teamshares, Inc., with the goal of eventually transferring majority ownership to employees. “Change is always a little scary, but everyone is optimistic,” sales clerk Aren Caruso said. (Valley News / Report For America - Alex Driehaus) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com. Alex Driehaus

  • West Lebanon Feed & Supply owners Curt and Sharon Jacques have owned and operated the business for 29 years.

Valley News Staff Writer
Published: 2/10/2023 6:40:35 PM
Modified: 2/10/2023 6:39:55 PM

WEST LEBANON — A nearly century-old West Lebanon business has been sold in a unique arrangement designed to keep future ownership in the hands of its workers.

West Lebanon Feed & Supply, which began as a feed store in 1926 before expanding into pet and gardening supplies, has been acquired by Teamshares Inc., a four-year-old startup that specializes in acquiring small businesses from owners who want to retire and then gradually transferring majority ownership to the business’s employees.

Long a fiercely independent retail store and the antithesis of corporate box store chains, West Lebanon Feed & Supply has been owned and operated for 29 years by Curt and Sharon Jacques, who grew it from six to 30 employees and won loyal customers from around the Upper Valley who rely on it for everything from pet food to dog grooming to sourcing baby chicks in the spring.

“This was the right thing for us to do,” Curt Jacques said Friday about the sale of the business to Teamshares. “Our goal was to find a partner that we could embrace that would continue this legacy and make this something that our employees could be proud of.”

Unlike the more typical structure of employee-owned companies, Teamshares is not an Employee Stock Ownership Plan, or ESOP. The model instead sets up a plan that immediately grants a 10% stake to employees of the acquired company and then, over time, gradually dilutes its stake and increases the employee stake to 80%.

But the ownership transfer process can take up to 20 years, and employees have to be employed for several years before they are vested in the ownership plan, according to Teamshares.

Jacques, a leading voice in the Upper Valley business community for nearly three decades, said he and his wife began planning for retirement several years ago and had the store listed for sale with a business broker. Despite discussions with traditional buyers, Jacques said Teamhares offered a pioneering model that would benefit employees while at the same time providing him and his wife with an exit strategy and reward for their hard work.

“All the jobs are safe. Nobody’s going to lose their jobs,” Jacques said, adding that employees “are not only shareholders now but stakeholders, too.”

Jacques said he has a consulting contract for six months to help during the transition and that he expects a new president of the business to be selected by Teamshares and on board within a couple months.

Terms of the sale were not disclosed, but Jacques said it includes the store’s building and property below the former library on Railroad Avenue in West Lebanon.

Since Teamshares was launched in 2019 by a trio of former investment bankers, the company — whose staff all work remotely — has acquired a total of 74 small businesses with a total of 1,670 employees, including restaurants, mattress retailers, printing businesses and flooring, roofing and HVAC contractors across 30 different sectors, said Jaimen Sfetko, a Teamshares spokesperson.

The founders of Teamshares said they hit upon the idea for their business model when they realized that small business owners who want to retire after decades of work often either don’t have children who want to take over the business or can’t find buyers to acquire them.

But by granting employees a mechanism to acquire ownership in the business, it will help drive growth and sustainability. They contend the model, although not widely adopted, will help address the issue of wealth inequality that has been widening since the late 20th century.

(To be sure, the principals in Teamshares, who will retain a minority stake in the businesses, should do very well, too, if the businesses have the long-term prospects they expect.)

West Lebanon Feed & Supply is both the first pet food/feed retailer Teamshares has acquired and the first business in either New Hampshire or Vermont, Sfetko said, who added that Teamshares was attracted to West Lebanon Feed & Supply because of its long history in the community and “legacy” built by Jacques.

“It has continued to stand the test of time and is embedded in the community,” she said.

Still, like all mom-and-pop retailers, West Lebanon Feed & Supply has to contend with the inevitable encroachment of corporate chains such as PetSmart and Tractor Supply opening box stores in Lebanon in recent years, in addition to online retailers like Chewy delivering pet food to customers’ doors.

But the COVID-19 pandemic in some ways has been good for his business, Jacques said, with record sales of baby chicks and gardening supplies as people sought to raise chickens for eggs and to grow their own food amid shortages in supermarkets and inflation.

“Some of that has fallen off” as the pandemic has subsided, Jacques said, “but not much.”

Teamshares said it has raised $150 million in “committed capital” to acquire companies and has a goal of acquiring 100 businesses this year, according to the company’s website.

Sfetko said Teamshares expects to buy thousands of businesses from retiring owners in the coming years.

Teamshares also has a policy of not promoting from within the acquired company in hiring a new boss to replace the retiring owner, with the company explaining on its website that “new leadership can often accelerate growth, strengthen company culture and improve employee happiness after a previous long-term owner retires.”

Although Teamshares does not offer employees of the business it acquires health insurance or a 401(k) plan — those decisions are left to the local manager to decide — Sfetko said employees receive a share in profits and dividends, boosting their earnings.

Born and raised in northern Vermont, Jacques worked in the animal feed business as a manager with Blue Seal before he and Sharon bought West Lebanon Feed & Supply in 1995 from Al Stanley, who had acquired the store in 1984 from his brother, Clint Stanley.

Earlier, the store was known as Wayne Feeds, and when it opened in 1926 was called Sunshine Feeds.

In recent years Jacques has been leaving work in Lebanon at noon Thursday to drive to Maine, where he and Sharon have a home, and he works from a home office on Friday. He sets out at 6 a.m. Monday to “beat the traffic” to make it back to the store later that morning.

That soon will be coming to an end as the Jacques plan to retire full-time to their home in Maine, where they live only 20 minutes away from their daughter and two grandkids.

Jacques said his business philosophy has been simple, and it is based upon a reciprocal relationship between the business and its customers.

“Bottom line is people love to support people who support the community,” he said.

Contact John Lippman at jlippman@vnews.com.

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