ou've probably heard of ESOPs but don't really understand how they work.

You may know that they have something do to with employee ownership. Which, if you're listening to this podcast because you want to be the owner of your business, may not be all that appealing.

But I encourage you to keep an open mind.

Today's guest, Chris Fredericks, has built an ESOP holdco.

Empowered Ventures has 5 operating companies, 300 employees, and north of $120m in revenue.

In addition to the great story of how he got here, Chris provides an excellent primer on what ESOPs — employee stock ownership plans — actually are.

And not only that, but why they could be a model searchers explore.

There are significant tax benefits. Culture benefits (if done well).

And exit benefits. That is, if you already own a business, exiting to an ESOP that you create is a real option.

In fact, it was how Chris was first exposed to ESOPs.

The owner of the business that Chris would go on to lead, wanted to exit. But he didn't want to sell to a strategic or private equity, and there just weren't other viable buyers.

An ESOP was the answer.

The seller had his exit and liquidity event, and the employees (including Chris) became owners.

Chris was president, and this ESOP business became so profitable that it served as the foundation for what is today a holdco with north of $120m in revenue.

There is a lot to model here. See if you agree.

Here is Chris Fredericks, CEO and employee-owner of Empowered Ventures.