Davinci Sign, others awarded state grant for conversion to employee ownership

DENVER — The Colorado Employee Ownership Office awarded grants to four companies that converted to employee ownership.

The office is a division of Colorado’s Office of Economic Development and International Trade. The Employee Ownership Grant launched in 2021 to provide Colorado-headquartered small businesses with funding to reimburse professional technical service expenses incurred when transitioning to employee ownership.

Businesses that applied to the program and converted to an employee ownership structure offering at least 20% of the company’s equity to employees received a $3,000 grant to cover conversion expenses, including accounting, legal, business valuation and other technical services.

Four businesses completed the transition to an employee-owned structure in the latest round:

• Davinci Sign Systems Inc., Windsor, (Employee Stock Ownership Plan).
• Enduro Bites, Colorado Springs, (Direct Stock Grant).
• Fancy Tiger Crafts, Denver, (Cooperative).
• Mile High Audio Video, Englewood, (Restricted Stock Plan).

“One barrier that businesses face in converting to employee ownership is transition costs. Our goal is to mitigate this barrier via this program and the new Employee Ownership Tax Credit Program,” Nikki Maloney, interim director of business support and rural prosperity at OEDIT, said in a prepared statement. “The Employee Ownership Grant program has four cycles in 2022, with each round open to up to 20 converting businesses. Our goal is to make the process more accessible, so more Coloradans can start experiencing the many benefits that come from employee-ownership.”

The Employee Ownership Office will offer four grant rounds in 2022 for businesses to participate in the program. Round two will be open for applications from April 4 until May 6, with a successful conversion required by June 17 to be awarded funds. To receive funding, each round requires that businesses complete their transition by the deadline stated on the Employee Ownership Grant webpage.Businesses in the early stages of conversion may explore the Employee Ownership Tax Credit program, which is available to Colorado-headquartered businesses converting to either an Employee Stock Ownership Plan, Worker Owned Cooperative or Employee Ownership Trust. The program offers tax credits based on the structure type to cover up to 50% of a qualified business’ conversion costs for use on state income taxes.