The advantages of an Employee Ownership Trust
UKClimbing Limited, the company behind UKClimbing, UKHillwalking, Rockfax print and Rockfax Digital, has become an Employee Ownership Trust.
This significant move means that long term ownership and management of the company has been placed in the hands of its employees under the governorship of a Board of Trustees. This offers stability to the business and a much more certain independent future based on a highly motivated staff who have all contributed to the growth and development of the company, and who all share its ethos, and a passion for what we do.
Alan James, Managing Director of UKClimbing Ltd throughout its long progress from humble beginnings to today’s thriving business, explains why he decided to move his company into an Employee Ownership Trust.
It became clear that a traditional approach to small business – namely fattening it up and finding a bigger company to sell it to for a tasty payday – was not right for us. The two main activities are more than just a small business producing things; UKClimbing and Rockfax have both become significant players in the long heritage of climbing in Britain, and UKHillwalking continues to grow in its own field.
Often said to me when discussing the legacy of UKClimbing and Rockfax: “great, but what happens when you sell the business?” This statement has sat at the back of my mind for the last ten years or so when I looked at my options for how to move the business on. It was obviously going to be attractive to someone, but who? Big media companies would have the cash, and might love to get access to a user database over 100,000, but would they want to deal with documenting obscure bouldering areas on distant moors, or writing about the quirky nature of trad climbing? The business-becomes-the-product approach would shave off many of the things that make UKC/UKH and Rockfax great, or at least the ones that didn’t make a positive contribution to the balance sheet. An outdoor company would probably also be interested and may well get the significance of the quirky climbing things, but there is a danger they would want to, quite understandably, leverage it into more of an online shop.
With this in mind, an important phone call late in 2021 from Steve Frazer introduced me to the concept of Employee Ownership Trusts. Steve and I had crossed paths a few years earlier during a previous approach from a third-party investor that didn’t end up going anywhere. Steve is a shrewd guy and he kept me in mind and sent a speculative email suggesting that I might want to think of an Employee Ownership Trust. The more I read about them, and the more the staff got to know about them, the more we agreed with Steve’s assessment that an EoT was the right direction for UKClimbing Limited. An EoT recognises the importance of the staff, which in our case is by far our biggest asset. They are attractive companies to work for since there are certain tax benefits as well as an enduring sense of involvement in day-to-day activities. Employees don’t suffer the morale blow of feeling like a drain on the ‘more important people’, namely the shareholders, since they are in effect the shareholders (albeit in a slightly different way). They are also protected from hostile takeovers to an extent and have a foundation that means that team longevity doesn’t rely on a single individual, or a small set of individuals, to keep going.
The creation of UKClimbing Trustee Limited, as the owner behind UKClimbing Limited, means that the future of the company is on solid ground. We have a great staff and we will hopefully be able to recruit more new employees who share our enthusiasm and desire to communicate and promote climbing and the outdoors to the world and stick to the ethos that we have established over the last two to three decades as the business has developed.
Part of the procedure of becoming an EoT means we need to create three company boards, two of which require independent non-executive directors. It was a great pleasure to welcome the afore-mentioned Steve Frazer to the Board of Trustees for UKClimbing Trustee Limited. Having been intimately involved with the process throughout, Steve is well placed to help us through the early days of the process.
“I think the UKC team is fantastic,” he says, “it is full of bright people, bursting with energy and with a passion for what they do. The EOT is entirely in keeping with the Company’s culture and I am really looking forward to working with them.”
On the Company Board, we are delighted to welcome Jeremy Wilson as an independent non-executive director. Jeremy is a keen climber and the founder and owner of The Lakeland Climbing Centre Ltd, which owns various walls around the country including Kendal, Harrow and VauxWall amongst others. He is also a partner in The Depot.
“I am delighted to have been asked to join the Board of UKC,” Jeremy says, “especially at the outset of its new employee-owned structure. Alan has built a fantastic business over many years and it is great to see him share the benefits of this with his staff colleagues.”
The process of becoming an EoT allows a slow transition so, in many ways, nothing on the surface has really changed. I am still going to be the company director and the staff all have the same roles. Underneath that though the company is now owned and controlled by its employees and I am just another member of staff. The slow process of moving the business on to the next generation can take place. People who actually get Instagram and Tiktok can decide how we use these inevitable channels and I can slowly withdraw from the day-to-day business and go back to precisely what I started with – drawing, photographing and writing about routes on crags as a Rockfax author.