Podcast

Episode Twenty-Seven… Let’s Chat: Exploring the History of EV with Chris and Emily

Episode Description

While you likely have a solid understanding of Empowered Ventures and its history, chances are you haven’t heard some of the exciting details that went into crafting the family of businesses we know and love.

In this episode, Chris Fredericks, CEO of Empowered Ventures, and Emily Bopp, Chief of Staff at Empowered Ventures, take a trip down memory lane to discuss how Empowered Ventures came to be.

Whether you’re a long-standing Employee Owner or a newcomer eager to dive into the world of ESOP, tune in to learn about the impactful experiences and transformations that have shaped the culture and spirit of Empowered Ventures.

In this episode, you’ll learn:

  • How far Empowered Ventures has come in just a few years. Take a moment to reflect on the progress we’ve made and the exciting potential that lies ahead. Remember, this is just the beginning.
  • When you truly understand the impact of being an employee-owner, it’s game-changing. Think about how you’ve seen employee ownership create life-changing outcomes for yourself and your colleagues.
  • The importance of the feedback loop. Your voice matters, and your feedback is invaluable in shaping the future of Empowered Ventures. Let’s keep the conversation going.

Jump into the conversation:

[02:11] How EV came to be
[04:04] Employee Ownership at TVF
[08:06] How ESOP is different
[12:40] Building Empowered Ventures
[23:32] What’s next for Empowered Ventures

How to Listen or Watch

Listen below or wherever you listen to podcasts.

Watch below or @Empowered_Ventures on YouTube.

Read the full transcript here or below the following media links.


 

Episode Transcript

Chris Fredericks: We’ve come so far in just six years with this idea, and we’ve got so many learnings and so many new things that are in place now that are really fun and working. But we also have so much more to learn, and we’re building our approaches and our systems and ultimately hearing from all our employee owners and the way they’ve sparked this question even I think it’s that feedback loop that I crave to continue to build this the right way and ultimately create something that we can all be super proud of as employee owners at Empowered ventures.

Chris Fredericks: Welcome to Empowered Owners, the podcast that takes you inside Empowered Ventures. I’m your host, Chris Fredericks. In each episode, I’ll have a discussion with one of our employees to discover and highlight their distinct personalities, perspectives, and skills while also keeping you in the loop with exclusive news, updates on company performance, and a glimpse into the future plans of Empowered Ventures. This is an opportunity for me to learn more about our amazing employee owners and an opportunity for you to hear regularly from me and others from within Empowered Ventures. On this episode of empowered owners, Emily shares a question from our employee owners at Paramount Plastics. How did Empowered Ventures come to be? We talk about EV’s origins, including TVF’s employee ownership story and the early efforts that led to Firststar and Paramount becoming EV’s first two diversifying acquisitions. Let’s get to the conversation. Hi, Emily. Welcome back to Empowered Owners.

Emily Bopp: Hello. Great to be here. And I’ve got a question for you. How were you listening to music when you were in junior high?

Chris Fredericks: Some tapes, but just tons of radio.

Emily Bopp: So do you remember Casey Kasem?

Chris Fredericks: Yes.

Emily Bopp: So I think we’re dating ourselves. So some of our listeners are like, who the heck are they talking about? I don’t know. Is Casey Kasam still a thing?

Chris Fredericks: That’s a great question. I have no idea. For some reason, I want to say yes, but I have no idea.

Emily Bopp: Yeah, so I’m going to go look it up. I didn’t before we got on this podcast, but the point is that Casey Kasem, you could call in with, like, requests and dedications. Do you remember that?

Chris Fredericks: I listened to that a lot more than I would like to admit, to be honest with you.

Emily Bopp: Today’s episode was a request. So therefore, I’m going to put my Casey Kason hat on. This one goes out to our employee owners at Paramount. So Paramount Plastics folks specifically asked us to tell the history of EV. Like, how did we come to be? So I’m excited to dive into that. And I was thinking about it back to when you and I met. It was maybe six weeks after we met at an event, and I brought my business partner to TVF, where you were president and CEO at the time. And we were talking about other business related things. But obviously this was what was on your mind, EV, because you slid a one pager across the table at us and said, and also, I’m thinking about this idea. So once upon a time, Chris had an idea. Can you start us out at the beginning? How did this all come to be?

Chris Fredericks: Yeah. Thank you. And it goes back definitely to the beginning of TVF’s ESOP story. So TVF became employee owned in 2010, and that’s when I also became president of TVF. And we can go back further than that, but maybe we can just start there. And coming employee owned was a great thing for TVF. So this is a 40 year old business and a lot of great people that have worked there for a long time. And we became employee owned, and it solved a lot of concerns and questions about the future, like, what’s going to happen to this company when the founder and owner decides to retire. So TVF became employee owned, and we basically had a really great run as an employee owned company the 2010s, learned how to be an employee owned company. The culture started changing and people became really excited about this employee ownership experience and the life changing outcomes it really started to have for people. So that’s like the foundation of Empowered Ventures is that experience that we at TVF had.

Emily Bopp: Can I stop you there? Because I think that’s really noteworthy, and I’m glad that you always go back to that. I tend to default to just starting with, oh, when did the idea of Empowered Ventures come? What you will say over and over again is that Empowered Ventures as an idea never would have happened had there not been this decade of experience with employee ownership at TVF.

Chris Fredericks: Absolutely. Yeah. Because that’s how I became a true believer in employee ownership when in 2010, it was more of a solution to Dick Hansel, the founder and owner of TVF, to his problem, which was, what does he want to do with his company that he’s built? And I helped him figure out that employee ownership was a good solution. But even at that point, I wasn’t sure. I wasn’t even aware of ESOPs prior to that point. It became an experience for all of us to learn and enjoy what it can be like to be an employee owned company. And it’s from that that I became so passionate, so excited about the potential of employee ownership for people in general, for employees throughout the country, throughout the world, that it can be life changing. So I really drew on that first experience of what it was like to announce it to the employees and then see how the change happened over time. And the embracing of this thing gave me the idea of how could we do more of that and it be good for TVF and for all of our current employee owners. So the idea came to mind that we could buy more companies and basically create more employee owners, which creates opportunity for them to be part of this great employee ownership experience and also can create financial returns for our existing employee owners. So we buy great companies, create better returns for the future, ultimately grow financially, and also grow our capability of having more impact on the world. So that’s really how the idea came about, which was maybe eight years later or so.

Emily Bopp: So what year would that have been when it first dawned on you that this could be a possibility?

Chris Fredericks: I would say it first dawned on me probably around 2016, but I just sat on it for a while and just thought about it. We did one acquisition at TVF, too. In that time period, the folks at Pacific Coast Fabrics joined TVF, and I enjoyed that experience of doing another acquisition and bringing more folks into the fold. So it confirmed that that’s something I enjoyed doing as well, from a work perspective. So then that really fed into just that idea of, okay, I think I’m serious about this idea. And I had a conversation with our board of directors. So TVF’s board of directors at the time, Bruce Kidd and John Cron and Lisa Reardon, and they were very supportive of this idea of continuing to grow through acquisition, but with the added idea that we specifically want to achieve diversification. So now we’re going to not just buy textile companies, but we want to build essentially a family of companies that do different things and are different places, but are all part of one big thing. And that was the idea. And when I met you, yeah, I was right in the middle of actually putting pen to paper and coming up with the real plan to go about doing this, which would have been 2018. 2019.

Emily Bopp: So 2018. And we’re in 2024, so this is six years ago. We’re still kind of a toddler of a company.

Chris Fredericks: Yeah, I agree. We have just gotten started here, and that’s exciting to me. We’ve come so far in just six years with this idea, and we’ve got so many learnings and so many new things that are in place now that are really fun and working, but we also have so much more to learn and we’re building our approaches and our systems and ultimately hearing from all our employee owners and the way they’ve sparked this question, even I think it’s that feedback loop that I crave to continue to build this the right way and ultimately create something that we can all be super proud of as employee owners at Empowered Ventures.

Emily Bopp: So what I don’t hear you saying is that once upon a time, there was a set of people who had a bunch of money and wanted to figure out how to make more money and make a bigger business.

Chris Fredericks: No. Yeah, we don’t have any investors. No one is an investor in Empowered Ventures. We’re all employee owners. And yes, we want to grow this pie of financial wealth that is there. These companies have value that are to the benefit of all our employees. But that’s a key part of this. But it’s not because we’re just trying to make more money for wealthy people. It’s because we want to create life changing outcomes for our employees.

Emily Bopp: And to hear you say that, you crave that feedback loop of, well, how are we doing that? Ultimately, we’re building this for our employee owners. So I think we’re maybe getting ahead of ourselves, but back to the building phase then. Okay. So if the spirit behind it is to benefit the original employee owners at TVF and then any other employee owner who comes along and how lovely. We don’t answer to any outside anybody. We would say stakeholders in business speak, but we don’t answer to anybody who has also some money in the bucket. And when you first started building, I’m curious, did you have other companies to pattern off of? We’ve known and been told that this is rare. There’s not a ton of diversifying, 100% employee owned holding companies out there. How did you initially come up with how to start building on this idea?

Chris Fredericks: Yeah, I wasn’t aware, but there were a few, and still are a few similar kind of diversified ESOP holding company businesses out there. When I had the idea, I’m not trying to take credit for an idea that already existed, but I didn’t know about these companies. It just came to mind because I do respect and appreciate the Warren Buffett Berkshire Hathaway business model, which, if anybody’s interested, it’s just a great and an amazing story of how this business, which is one of the largest in the world, but it’s really a diversified holding company model, very similar to the idea of what we’re building, just on a much larger scale, of course, because it’s all these huge publicly traded kind of companies. But Warren Buffett’s approach to finding great companies with great leaders and then letting them do their thing, that’s really the idea, is that he’s not buying companies because he wants to run more companies and step in and start telling people what to do. It’s the complete opposite, where he wants to work with people who love what they do and invest essentially in what they’re doing and then support them and root them on. And that idea of a family of companies that kind of do that for each other is what really came to mind for me and formed into this idea of Empowered Ventures.

Emily Bopp: That’s so awesome. Okay, so then let’s step it forward. So it’s 2019, and now you’ve got board approval. What did TVF folks say? They were like, what’s this crazy idea? What are we doing?

Chris Fredericks: Totally. I’m sure that is definitely the reaction for most. For me, it was reminiscent of 2010 when I announced the ESOP initially, it’s okay. I have no idea what this is. I’m not sure if I even fully want to believe and trust in it. But it worked out. And I did hear through the grapevine some folks basically had that message for each other. Sometimes Chris comes up with crazy ideas and look what happened in the past. It worked, so maybe let’s trust him. And I’m not saying that meant it was the perfect idea or whatever, but I do truly believe in this with my whole heart. I think it’s proving out already in the early years, but the long term potential of this for everyone, including our current play owners, I’m so convinced by. So, yeah, it’s totally fine to have a wait and see approach to these kind of things and also to want to understand it. I think that’s a good point. We don’t want to ask people to just have blind faith in us and say, Chris says it’s a good idea, so it’s a good idea. No. Ask questions. We are happy to talk more about it, to share our perspective on what’s going on in our companies. We are slowly building that out, though. Like, it takes time to develop the way we want to communicate what’s going on in a more systematic and consistent way. But at the same time, that’s not because we’re trying to keep anything a secret. It’s just everyone’s so busy in all of our companies and at our holding company that it just takes time to build our systems. But that’s not because we don’t want to be open and talk about how things are going. So I want people to feel like they get it and understand what we’re doing.

Emily Bopp: And I think anyone who has experienced that of you really appreciates it genuinely. Okay, so history of EV, it was your idea. Now it’s moving forward. You’ve got the thumbs up from the board and from TVF folks. What happened next?

Chris Fredericks: Yeah, I really started just looking around at other kind of business models where companies and groups grow through acquisition of small businesses. You can look at big public companies and they do acquisitions, but it’s a whole different ballgame. Buying small businesses of 25 to 100 people, that’s a huge challenge. There’s a lot of nuances involved, there’s a lot of risk if you buy a bad company unknowingly. I wanted to go about that very carefully, very thoughtfully. And so I just started researching how other people are doing this, not just employee owned companies, but private equity. There’s all kinds of kind of groups and people that are doing this, essentially buying companies, small companies and running them. And so I just started researching all the different approaches. One approach that I came across that resonated a lot is called ETA entrepreneurship through acquisition. So this is where maybe an executive of a company decides they want to own their own business and they go locally, they go talk to business owners and they try to find a business that they want to buy and run and that just personal touch and that kind of version of this versus maybe financial buyers who are coming in from New York City and trying to buy companies because they just have a financial mindset about it and not really a people mindset about it. This other smaller approach really resonated with me. And so I dug in and learned about this community. There’s like communities around ETA employee entrepreneurship through acquisition. And through that I ended up meeting Spencer, Spencer Springer, who joined first employee of Empowered Ventures. And basically Spencer has acquisitions experience and was interested and excited to help us do what we’re doing. And yeah, so Spencer and I embarked on a process to find our first company and we also worked with a branding agency to build a brand. So the name Empowered Ventures didn’t exist yet. I had some idea that this word, I wanted the company to be an e word because employee, I don’t know, I wanted there to be some sort of connection and I had a sense of what the name should feel like. But we did the whole hundreds of possible names. I was looking at the dictionary, the e section of the dictionary. I looked at 20 times, reading every word and saying, is that the name is that the name is that the name and somehow landed on Empowered Ventures. I still like it. I don’t know if other people do.

Emily Bopp: But I find myself using the empowered word all the time. And I’m always saying not to overuse our name. And I’m like, it’s probably a good name because it just comes up in our conversation. Okay, you’ve got a. My goodness, there’s so much that goes into building a business. So now you’ve got a name and a brand and logo, and you’ve got somebody who knows how to find businesses in this very personal way that you had decided that you wanted to emulate. And so tell us about the first business. How did that happen?

Chris Fredericks: Yeah, so Firstar precision ended up being our first acquisition April of 2021. And really, that was through Spencer’s efforts to talk to business brokers. Just like there’s real estate brokers out there selling homes and real estate, there are business brokers, local kind of folks who represent business owners who have decided it’s time to sell their company. So we looked at hundreds and hundreds of those opportunities over the course of the first year, of year and a half of searching, and Firstar was one of these companies that was represented by a broker that we got in touch with. And Spencer and I actually met at Firstar to meet Firstar’s management team. This would have been early 2021, and that was our first time meeting in person, too. Because of COVID we actually worked remotely the whole first year and a half together, never met in person. And then we met at Firstar, first time out front, walked in, met their management team, Dave and Jack, and had a great meeting. And it was our first management meeting, and it just felt perfect. Dave and Jack were. We had a terrific rapport with them. We learned a lot about the business, but came away feeling like, okay, this feels like could be the one. And finding that first business to buy, we wanted to be so careful that we wanted it to go well. We looked at so many companies that we could have purchased, and we wanted to be very comfortable that we found the right one, and I’m certain we did.

Emily Bopp: I just want to call out for anybody from Firstar who’s listening. Actually paramount, actually TVF, all of our family. But you’re lucky we don’t just grab it, anything. You’re lucky to be a part of this. Yeah. Okay. So I don’t want to derail that. So, Firstar, how long had they been in business? What’s just a teeny, tiny history of Firstar?

Chris Fredericks: Yeah, I think over 20 years. Dave had started Firstar after having a career in the machining industry. And, yeah, Dave had built a great business. Jack joined within the first year, his partner in crime, and they built a terrific business up to, I think they had around 30 something employees when they joined Ev. And it was just classic, like, Dave had built this company. He had a really, the one thing I love about Dave is he’s really self aware. And one of the things he told us in the first meeting was he’s taken this business as far as he can personally. Not only is he thinking it’s time to maybe slow down and maybe not work so hard after so many years of working incredible hours to build this company and not taking vacations and all those types of things, but he was very self aware around. He doesn’t know how to take it to the next level. He’s reached the limit of his personal kind of approach, and he was really looking for a home for the company that would appreciate what he’s built, take care of it, like, care for the employees, not strip it down and combine it with another company and ruin what he’s built, basically. But also someone who could bring some vision to like, okay, how do we take this business from here to the next level and have it succeed long into the future? So that was music to our ears, because even though we come in and it’s super important to us that we don’t want to change anything for the negative, we take a very hands off approach. It also is just a natural part of any transition of a company. When it’s acquired, it’s going to evolve over time into the future. And for the seller, the business owner who’s selling, that can be a challenging feeling just to see it change, even if it’s changed for the better slowly over time. So knowing Dave really cared for that, appreciated that change needs to happen over time, slowly meant he was a great partner for us, and that totally played out the way we hoped it would.

Emily Bopp: What was the response at TVF with that first?

Chris Fredericks: Yeah, there was a lot of excitement. I’m sure there was some fear. Just, I think, like, excitement that this is really happening for sure, but I’m sure fear, I’m sure some fear.

Emily Bopp: And then how much longer between. So we’re three companies today, TVF, Paramount and Firstar. How much of a lag was there between Firstar joining the family of businesses and then Paramount coming along?

Chris Fredericks: Yeah. So that happened quickly. So Firstar was April, Paramount was December of 2021. So right after Firstar, Spencer got back in touch with a broker who we’ve gotten to know who knows Paramount. And actually, the funny story about Paramount is I had found back in 2019 when we decided to do Ev, we hadn’t named it yet. I started doing a little bit of outreach on my own before we were even a thing yet, just to see if there’s any business opportunities in Indiana that could be candidates for us to go and acquire even before we’d gotten going, mostly just to explore the possibility of what this is like. And Paramount was one of the first companies I actually came across. I did go and meet with Paramount in 2019, and it just wasn’t the right timing. So it didn’t feel like the exact right timing to do something like that. But they were interested in what we were thinking about doing. And I think if we would have been ready at that point, we could have acquired Paramount almost two years earlier, which it just didn’t work out, and that’s okay. But it came back around. So after Firstar, we got back in touch and learned that they were still looking for the right home for their company, too. And so we immediately picked up the ball again on Paramount and started the process. And it worked out that time.

Emily Bopp: Probably not a lot of people have heard that Paramount was one of the first looks. So short history on Paramount. How long had that company been in existence?

Chris Fredericks: Since the 80s. So a very long standing business, family owned, family built and owned. And, yeah, just a really great kind of classic Indiana manufacturing company filling a niche for the larger RV and marine production companies and really just a really neat, innovative company. Ultimately, the way Paramount goes about producing these, like they do the dashboards and other things, but especially dashboards for the class ARVs, the big ones, it’s kind of an art, not a science. Their business, and that’s a really neat part of it, is the skill set involved with the people and these unique processes they have. So we were pretty enamored with that company, the more we got to know. And really the big selling point, just like Dave, was a huge selling point. Dave and Jack, for us with Firstar Curtis Elliott, the president of Paramount today, he was the general manager at the time of Paramount, had only been with the business for two years. A huge question for us is always, who’s going to lead this company if we buy it? And it’s usually not going to be the selling owner if they have an interest in retiring, which is going to be the case a lot of times. So with Paramount, it was an open question who should run this company? Because Curtis had been there a couple of years, he wasn’t the president of the company, he was general manager of the operation. But we got excited the more we got to know Curt, and it was our idea, like, he can run this business and we’d be happy for Curt to run this business. Curt told me just recently when I called him, and, hey, like, we want to move forward and we want you to run the company. It meant a lot to him. And I think the world occurred that came together in a really important way, too.

Emily Bopp: That’s so awesome. So 2021 was a big year in EV’s history. 2016, the idea dawned on you. 2018, coming together. 2019, you’ve got a business name, you’re moving forward. 2021, these two acquisitions, and now here we are in 2024. What has been happening in our more recent history?

Chris Fredericks: Yeah, we paused a year and a half, two years, looking at new deals, really. We kept looking, but we decided to slow down and build our team and our systems so that we both wanted to support Firstar and Paramount and make sure they got off to a great start being part of EV. And also Spencer and I both felt like, okay, we’re not going to be able to keep doing this ourselves. There’s a lot of work involved with everything we’re doing. And if we want to be able to really steadily scale this thing and keep growing, we’re going to need to go to a next level, meaning build the team, build our processes and our systems. So, yeah, pretty much that led to kind of a step approach to adding Tabitha, you joining, Mike Algram joining, and all the while just steadily creating some new processes and systems and implementing software that we use to track our projects now and other things. It’s been a building phase, even adding this communications, like we didn’t have any way of reaching our people all Evers, I should say so. Just steadily putting the building blocks in place to be able to scale this to the next level. And we’ve been back at it now looking for more companies to buy, but we’re still so picky that we haven’t done one yet, at least as of this recording. We’re feeling optimistic that growth is on the horizon. That’s for sure.

Emily Bopp: So looking back, it’s an awesome story. And looking back, is there anything that you’re so glad that this is how this happened and you’re just so thankful and or is there anything you would do differently?

Chris Fredericks: There’s always ways. I’m very self critical, so there’s lots of ways I could have done things better differently. By no means has it been perfect but I am really proud of what we’ve accomplished and how far we’ve come. And I’ve enjoyed this so much. I really love when people have that aha. Moment of like, oh, my gosh, I saw my first contribution into the ESOP and now I’m thinking about if I stay another 10-20 years, what could that mean for me? And also the camaraderie and the employee ownership culture is building and I’m sensing this progress in this company. That’s the moment I want to hear that over and over again when people feel that experience and then they become invested and start talking about us to people they know. And it’s so not about us. And that’s what I love so much about this, is it’s about all of our employees and their experience. Yeah, there’s lots of things we could have done differently, but I think the outcomes that we’re wanting are definitely happening because good things are happening for the employees of all of our companies. So I think that’s really awesome.

Emily Bopp: I love it. That’s awesome. To wrap up, back to Casey Kasem… Paramount, thank you for the question. This one’s for you. Dedicated to Paramount, our second diversifying acquisition, but third, business to join the family and, yeah, follow along as the story unfolds. Our history is just at the beginning. In another five years, we’re going to have a lot more story to tell. So thanks for walking us back through time. Thanks for just letting us inside your head of what you were thinking and how that all happened.

Chris Fredericks: Thank you so much, Emily. I hope that conversation was interesting and informative. Huge thank you to the team at Paramount Plastics for sharing your question with Emily. Thank you to Emily for joining me and Share Your Genius for producing the episode. As always, remember, we want to hear from you. If we mentioned anything that sparked a question or idea, please share it with us. To reach us email [email protected]. Thanks for tuning in.

Tags: Podcast
Episode Twenty-Six… Unveiling the Power of Employee Ownership Culture with Blake Theademan
Episode Twenty-Eight… The Human Side of Business with Kim Dinwiddie
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