EO is a flexible option with any current ownership structure, and allows selling only a portion of the company to employees over time, maintaining the business's legacy and culture while transitioning ownership gradually.
If you have a business partner or family member who is not ready to sell their portion of the business, we would recommend getting alignment on the EO structure from the owners before wading into selling just yet, and you may have success in convincing any reluctant parties by explaining the benefits of EO to them.
For example, selling to your employees can provide more flexibility compared to a full business sale.
With an EO sale, you can sell only a portion of the business to your employees, rather than the entire company. This allows you to gradually transition ownership to your employees over time, even if your business partner or family member is not ready to sell their stake.
ESOPs have the ability to obtain significant leverage from banks to finance the purchase of shares. This can help facilitate a partial sale to employees.
The gradual, employee-focused nature of an EO transition can help ensure the business's legacy and culture are maintained, even if you and your partner/family member have different timelines for exiting the business.