When Buyers Don't Knock: ShopBot's Profitable EOT Exit

Meet Ted Hall, founder and board chair of ShopBot Tools, and Anne-Claire Broughton, founder of Broughton Consulting and former executive director of the North Carolina Employee Ownership Center. Founded in 1996 in Durham, North Carolina, ShopBot designs, manufactures, and distributes computer numerically controlled (CNC) routers with about 35 employees.

Some takeaways:

• How being an open-book management company with profit sharing perfectly paved the way for their EOT transition.
• Ted’s innovative earn-out structure as a 70% shareholder—taking 10% every year for 10 years—aligning his incentives with the company’s ability to operate profitably, reinvest, and continue profit sharing throughout the buyout.
• Why ShopBot’s fluctuating profitability made it less appealing to third-party buyers, even though it was consistently profitable overall, making employee ownership the most sensible exit path.
• The importance of state trust laws when planning for an EOT transition—North Carolina’s trust law played a key role in ShopBot’s unique governance structure.

Click here to watch this episode on the Zolidar YouTube Channel.

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CHAPTERS

• (00:00) - Introduction to ShopBot Tools and Employee Ownership
• (02:54) - The Challenge of Transitioning from Business Owner to Exiting
• (08:34) - Common Experiences in Business Succession Planning
• (09:37) - Family Legacy and Profit Sharing in Business
• (13:38) - Open Book Management and Employee Engagement
• (15:49) - Understanding EBITDA and Its Role in Business Transition
• (16:26) - Realizations About Employee Ownership and ESOPs
• (17:24) - Discovering the EOT Model and Its Benefits
• (21:36) - Establishing Governance and Employee Voice in EOT
• (24:35) - Navigating the Transition Process and Legal Considerations
• (26:38) - Navigating Funding Challenges for Employee Ownership
• (31:46) - Transitioning to Employee Ownership: Lessons Learned
• (35:50) - The Roadmap to Employee Ownership Transition
• (37:54) - Evaluating Employee Ownership as an Exit Strategy
• (41:59) - The Role of Technology in Employee Ownership
• (45:25) - Empowering Employees Through Financial Literacy
• (47:18) - Podcast Outro

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KEY TERMS USED IN THIS EPISODE:

• EOT (Employee Ownership Trust)
• ESOP (Employee Stock Ownership Plan)
• EBITDA
• Open Book Management

Click here to view the episode transcript.

REFERENCED IN THIS EPISODE:

• Chris Michael (EOT Advisors) 
• Purpose Trust Ownership Network (PTON)
• The Great Game of Business
• North Carolina Employee Ownership Center
• Broughton Consulting
• National Center for Employee Ownership (NCEO)

WHAT TED WANTS TO HEAR FROM AUDIENCE MEMBERS

• Ted wants to hear from other companies or founders considering a transition - especially those who may be interested in learning more about Employee Ownership Trusts (EOTs) or are navigating their own transition planning process. Find Ted on the Grid!

 © Copyright 2025 Zolidar, Inc.
Note: This podcast is not investment advice and is intended for informational and entertainment purposes only. The views expressed in this episode are solely those of the guest(s) and do not necessarily reflect the opinions of the host or Zolidar.

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