San Francisco’s Fireclay Tile has followed its peer, Menke client Heath Ceramics, into employee ownership. Fireclay had previously given its employees a 14% stake in the company in 2013, and has now expanded the employee’s ownership stake by an additional 23%, meaning the workers own more than a third of the business.
Fireclay has more than 150 Employee-Owners
Home to 150 employee-owners, Fireclay Tile is the first and only tile maker to be certified as a B Corporation, meaning they are committed to social and environmental performance, public transparency, and legal accountability. They are also the first Climate Neutral Certified tile company. And now, as Fireclay stated in a press release, “the company has become a member of Certified Employee-Owned, completing a detailed process that ensures the ownership plan meets high standards of broad-based employee ownership.”
In addition to giving employees a larger stake in the company’s future, Fireclay CEO Eric Edelson announced that the company “purchased its Aromas, CA factory location, meaning that every day our team shows up to work, they will be doing so on property that they are part-owners in.”
Fireclay has increased its revenue eight times over since first giving employees a stake in the company in 2013, according to their company website. Nonetheless, they see room for improvement. In an interview with Business of Home, Edelson explained that Fireclay has previously struggled to inculcate a real sen
se and understanding of ownership for the employees. This expansion represents a chance to start fresh and put in the time and effort to make the employees feel like the company is truly theirs.
“Ownership is this thing that people don’t like to talk about,” says Edelson. “They say it’s complicated, it involves money, there’s legal work—but listen, we’re in the design industry. Design is complex. … Ownership is not that complicated. If we can acquire customers and get them custom fabric or tile, we can certainly figure out ownership.”
When Menke assisted Heath Ceramics with the implementation of their ESOP at the end of 2018, we were struck by just how much they cared about their employees. “From the start, with Heath, it wasn’t a typical situation,” Menke corporate counsel Michael Pasahow told Business of Home at the time. “The first thing they asked was, ‘How is this a benefit for our employees?’ In our business, that’s normally the second or third question. Heath was different. They wanted to make it sustainable.”
Heath wanted their ESOP to help their company grow, but also to ensure that it would outlast its leadership and put the employees in a position to benefit financially and equitably while maintaining their commitment to keeping their work local and sustainable.
Fireclay Tile’s decision to dive deeper into employee ownership carries those same qualities, which is consistent with their status as a B corp. “The rich are getting more rich, while employees are staying economically stagnant,” Edelson wrote in his statement to the employees. “Employee ownership is absolutely a way to move the needle, and we are excited to see how far it can take us.”
We here at Menke are thrilled to see another fantastic Bay Area ceramics company become employee-owned. Congratulations to everyone at Fireclay Tile!
What would employee ownership mean for the future of your company? Contact Menke today for your free preliminary analysis.
Menke & Associates, Inc. has helped over 3,500 companies successfully transition to employee ownership. Our holistic ESOP approach enables a positive outcome for the company, its employees and its shareholders. We believe ownership is powerful.
