How Employee Ownership was the natural next step in the We Are Adam Journey

You’d be forgiven for thinking the We Are Adam journey has been boring, the same as every other recruitment agency out there: a standard case of exceptional recruiters breaking ranks from corporate life to build their own vision of a better service.

But that couldn’t be further from the truth.

We’ve always carved our own path.
We Are Adam first grew legs around a kitchen table in Stockport. Back in 2006, our disillusioned Co-Founders fled the corporate, KPI-driven world to realise their vision for better recruitment. They saw an opportunity to redefine the industry by putting relationships – not numbers – at the core of their business. The emphasis wasn’t on making money; it was about transforming lives. A lofty claim, I hear you cry, but hear us out.

Recruitment is typically a world where numbers and KPIs reign supreme. Not here. Mastering the perfect cocktail of professionalism, warmth and experience has been the key to our success for more than 17 years. And how did we do it? By putting people first, of course.

Because we’ve built an unrivalled reputation, there have been many offers to buy the business. M&A transactions, mergers and outright sales have repeatedly been on the table over the years. And we’ve explored them all – trade sale, merge with a larger head hunter, becoming the regional office of a corporate staffing business – but they all felt too clinical. Too... well, not Adam.

For those not familiar with the sale process, the business world often uses a concept called "multiples" to determine the value of a company. These multiples are essentially ratios as a multiple of sales or EBIT, which then lead to a more complex valuation carried out and approved by professionals. To complicate things, different industries have their own rules. For example, in the Professional Services sector, companies might be worth 1-2% of their sales. But if you're in the more attractive pureplay technology sectors, your value could be 10 times your sales (or higher) because investors really like what you're doing.

Now, when it comes to the recruitment industry, if you're in a hurry to sell, your company might be worth 3-4 times its sales. But if you've got a solid track record, sustainable business model and lots of good contracts, it could be worth 6 or more times your sales. For the biggest players in the staffing world, we’re talking 8 to 10 times their sales.

While it's not an exact science, the recruitment sector has seen its fair share of big companies failing to follow through with their promises on the second payments. In some high-profile cases, they've even left vendors feeling let down during the buyout process. So, when you're thinking about selling or passing your business to new owners, it's crucial to have a well-thought-out strategy for a smooth transition and a happy team.

None of the ‘traditional’ options presented a credible route forward following the founders’ exit. Anything that created an uncertain future for our current employees simply didn’t sit well. After all, the business was built on putting people first. And, importantly, there wasn’t much of an appetite in the leadership team to step away from the business yet. Securing its’ future was their number one priority; protecting the legacy of what We Are Adam offers to its’ candidates, clients and employees was paramount.

Enter the Employee Ownership Trust.
After taking advice from many successful post-EOT businesses, the Founders resolved that this route provided the most certainty, stability and transparency. For starters, an EOT safeguarded the valuation of the business from potential predatory buyers. Secondly, the timescales for transfer of ownership could be adapted. It ensured the sale suited both the vendors and the future management team, who may not have been ready to be part of a Management Buy Out or to take complete ownership of the business at the current time. But perhaps most importantly, it offered a guarantee of very little change in the short term.

A trade sale would likely have resulted in rationalisation of the team, meaning redundancies across support functions such as finance, marketing and administration. Quite frankly, that goes against the core values of We Are Adam. So, in the end, an EOT was the only truly viable option.

Transformation Takes Time.
For some businesses, transitioning to an EOT is a monumental change. For We Are Adam, it was a natural fit. The right ethos was already in place, meaning the transition was more like an extension of our existing values. Some time ago – before the world as we knew it fell apart due to the dreaded P word – the team spent 2 years fully committing to carving out our culture. The result of which is the Mission Power Compass – a visual representation of what lies beneath the phone calls and emails. You can dig deeper into our cultural identity here. With culture already a huge tick on the EOT checklist, we got to work implementing some cracking projects.

In the first year of the EOT, we’ve reinvested heavily into the business. We’ve had a complete overhaul of our tech stack, updating systems and introducing efficiency tools to allow the team to focus on what they do best – transforming lives. There are no lone wolves either; we’ve moved beyond taking a collaborative approach to seeing employees take a vested interest in overall business performance. Already an adult culture, our team have fully embraced the autonomy that comes with being part owner. From fully agile working hours to embedding ‘House Rules’, creating new incentives to embracing automation and AI – we’ve ramped up every aspect of the business.

However, when we recently got together to discuss how the first 6 months of the EOT had gone, some people felt as though nothing had changed. It was funny to hear it presented in a negative light – after all, the entire motivation for pursuing an EOT was to avoid the significant change an alternative form of sale would bring.

The fact is employees were anticipating a massive shift in culture. We now know that, for some at least, this thought was quite intimidating. Would they be expected to manage the P&L now? Should they have oversight of every penny the business spent? Did being employee-owned mean all levels of the team would have to make those difficult decisions every leader fears will come their way?

Despite huge change, not much had really changed at all.
Part of the ongoing EOT process is, of course, succession planning. Who takes over once the transfer of the business is complete? Right now, the leadership at We Are Adam is the same. The Founders, plus those Directors brought into the senior team, very much remain at the helm. And whilst they have no plans to disappear into the sunset, we are faced with an opportunity to look at expanding senior roles, plan the next steps for We Are Adam and shape our long-term future.

“I’m always aware that great things don’t last forever and that at some point the Founders of We Are Adam will be ready to move on and evolve the business in some way. To hear about the EOT was both exciting and reassuring, there’s a lot of M&A activity in the recruitment sector, which can have a huge impact on employees whereas this safeguards the business for all of us while enabling a gradual transition which focuses on development and career paths. Wearing a second hat of Trustee of the EOT is a real honour, as I can see the level of rigour and transparency that goes into it, along with a genuine desire to see everyone grow and succeed, it’s very much an ‘in it together’ approach.” – Lindsey Wroe, Associate Director

Immediately, two long-serving employees were promoted to Associate Director, further strengthening the leadership team. However, over the next 5 years, we expect there to be a growing number of opportunities for people to step up; whether that’s managing people or major projects as we continue to invest in growth. And it’s with growth in mind that we have homed in on upskilling existing staff. By investing in the personal development of our team, we foster a culture of belonging and accountability – two things we believe are core to a successful EOT.

An EOT offers benefits beyond the current team.
Alongside elevating our current team, we intend to increase headcount by bringing on some exceptional people. Our focus is on building the next generation of We Are Adam. One that exudes our core values and will only continue to develop and improve on the service we offer today.

Research shows that many people make career decisions based on their values and actively seek opportunities to drive change in their organisations. Having employees involved in making business decisions wasn’t a new concept at We Are Adam, but the EOT has provided more opportunities for them to step up, transition to senior roles, and wield more influence – both over their own careers and the business.

When employees feel empowered at work, their engagement and motivation increase. Companies with highly engaged workers can lower their retention rate by nearly a third. We Are Adam can boast a superb retention rate already, thanks to years of hard work building an inclusive culture, offering a market-leading remuneration package and clear career progression that has enabled our people to stay with us for the long haul. Most of our employees have been with us for more than 5 years – a stark contrast to the whopping industry average of 43% turnover rate in the UK.

The move to an EOT model is a natural progression. Our people are the heart and soul of our business, and becoming an employee-owned company is our way of rewarding the loyalty and dedication that our team has shown us over the years. Our employees can now have a huge part in shaping the legacy of the entire business.

But I don’t work for you, so why should I care about your EOT?
As a client of We Are Adam, you’ll be used to working with a highly skilled and experienced team. Now you’re dealing with an invested team, too. A team who knows they are part of the long-term future, for as long as they choose to be. The EOT means they're not working to line the pockets of faceless executives; they have a horse in the race and are much more invested in success.

“I think it’s great for every member of We Are Adam to feel truly part of business and brand. It’s pretty unusual to have an EOT in the recruiting industry and certainly a differentiator for promoting long term careers and an environment where people feel heard and feel they are truly adding value.” – Lorna Meredith, Associate Director

We're genuinely different in an industry where everyone claims to be unique. The recruitment world is awash with people claiming to do what we do - but so many simply talk the talk. Same ‘We do things differently’ messaging, same blog topics, even the same clients in times gone by. But take a peek inside We Are Adam and you’ll find a trusted team of genuine experts. Our consultative and holistic approach means when you engage us to support your talent acquisition goals, you are embarking on a partnership. You won’t find any cookie cutter recruiters here!

I’ve worked with your Founders for years. The idea of them leaving puts me off.
Don’t worry – our leadership team aren’t going anywhere! They are here to stay and grow with the business. Employee ownership wasn't about buying out shareholders to rush them off to greener pastures. They are committed to We Are Adam's long-term future. We see a bright outlook on the horizon with our current employees, the talented and dedicated individuals that you work with currently, developing into the senior leadership team of tomorrow.

We launched We Are Adam for the love of connecting people and transforming lives. That hasn’t changed. Just try and push us out of the door!

Finally … are you a stakeholder in your business wondering if EOT could be right for you?

We Are Adam CEO, Richard Gahagan, led this process and over time has built up a trusted network of specialist EOT providers and consultants. If you’d like a private, confidential chat for a more in-depth look behind the scenes of an EOT, simply reach out and he’ll be happy to arrange a call. Richard received a lot of help and advice on this journey and would very much like to pay it forward to support anyone seriously thinking about how an EOT can elevate their organisation.

-

If you're seeking a genuinely unique partner for your recruitment needs, We Are Adam is ready to offer you the perfect blend of professionalism and friendliness. Our service is anything but cold and corporate; it's warm, empathetic, and deeply human. We're excited to be on this transformative journey, and we invite you to be a part of it. Together, We Are Adam, and together, we are transforming lives.