Is an EOT right for my business with 10–20 staff?

Naturally the Employee Ownership Trust (EOT) sales which make headlines are the household names. John Lewis, Richer Sounds, Go Ape etc. Whilst their size/financials vary, they’re all at least at the “M” of “SME”, if not larger.

But EOTs can also work for the “S” end of SME.

Go EO was started after the founder, Chris Maslin, sold what was his accounting firm (imaginatively named Maslins Ltd) to an EOT back in 2021. At the time, it had a dozen staff, and about £1million turnover. Whilst there were a few rocky moments along the way, at time of writing (autumn 2025) it’s doing better than ever!

Chris has been paid off in full, it’s almost double the size it was when the EOT sale happened, and all key metrics are on an upward trajectory. Chris set up Go EO aiming to help similar businesses achieve the same thing, easily and affordably.

What is an Employee Ownership Trust (EOT)?

An Employee Ownership Trust is a UK statutory structure that allows a controlling interest in a trading company to be held for the long‑term benefit of all employees.

In a typical EOT sale, existing shareholders sell a majority of shares to a trust. The purchase price is commonly funded over time from company profits. Employees don’t buy shares individually; instead, they benefit indirectly via the trust and through participation, culture and potential tax‑advantaged bonus schemes.

Why EOTs can suit businesses with 10–20 staff

• You’re big enough that value lives beyond the founder, but small enough to communicate directly and transparently.
• Continuity matters: client relationships, know‑how and cashflow depend on the existing team, not on a new external owner.
• Funding is realistic: a vendor‑financed structure repaid from profits can be sensible at this scale if margins are steady.
• Governance can be proportionate: a practical board and trustee setup without layers of bureaucracy.

Continuity is king in an EOT sale

In EOT transactions, the business continuing to operate profitably for multiple years post sale is vital. It’s not only how you’ll get paid out, but also how you secure the beneficial tax treatment, for you and staff.

With a trade sale, a buyer’s cash and integration plan can cover bumps in the road. In an EOT, your company itself funds the consideration over time. That means post‑transaction performance isn’t merely desirable, it’s critical.

Four areas deserve special attention

1) Client continuity

Map key accounts and decision‑makers, document handovers, and agree how and when to tell clients. The message should be simple: same team, same service, enhanced stability. Provide clients a single named contact and reassure them that whilst governance and ownership may have changed, their day‑to‑day experience hasn’t.

2) Leadership continuity

Be explicit about who will be running the business on Day 1, in a year, and thereafter. If you plan to step back, build a realistic timeline, and communicate it. A clear leadership plan is a central success factor in EOTs.

3) Operational continuity

Codify ‘how we do things’. Pricing, approvals, supplier relationships, key processes. Lightweight Standard Operating Procedures (SOPs) and dashboards reduce key‑person risk and maintain margins while EOT ownership settles in.

4) Financial continuity

Be realistic with cashflows/forecasts. The EOT working relies on future profits. Model conservative scenarios, maintain adequate headroom and be prudent with profit distributions.

Go EO’s core package helps with the legal/financial side of the transaction, but if you want support with communication/leadership transition, we work alongside trusted parties who assist with these.

Signs an EOT might fit a 10–20 person business

• You want to protect culture, customers and people, more than you want to court the highest speculative multiple from a trade buyer.
• The business is profitable, with relatively predictable, positive cashflow.
• Either you’re happy to continue to lead, or your senior team/person is capable and ready to step up.
• Clients value stability and continuity of service. Your brand is trusted locally or in a niche market.
• You’re open to being paid over multiple years, understanding there’s a direct trade-off between how good the deal is for you as vendor, and staff.

When an EOT might not be right (yet)

• Margins are volatile or heavily tied to the founder’s personal delivery.
• A third‑party buyer has strategic synergies that would create value the business cannot realise alone.
• You have significant near‑term investment needs that could stress cashflows during repayment.
• There is no clear leadership bench, and you’re not willing to stay involved during a transition period.

The formal pieces you must get right for successful EOT transition

• Independent valuation: A defensible open‑market valuation that underpins the purchase price and trustee decision‑making.
• Funding structure: At your size, vendor loan is your only realistic option. Whilst there are third party funders for EOT sales, they’re expensive, and often have a high de-minimis threshold to get involved.
• HMRC tax clearance support: Advance clearance gives comfort on tax treatment for a properly structured EOT.
• Legal documentation: Sale and Purchase Agreement (SPA), trust deed and governance documents.
• Trustee governance: Appointing capable trustees, including an employee and an independent, and setting clear reporting rhythms between the board and the trustee.

The above is Go EO’s core work. Valuation, tax and legal documentation, delivered efficiently and proportionately for smaller SMEs. Keeping the formalities tight is non‑negotiable, it’s the bedrock on which continuity sits.

Communication: get the message right for your people

An EOT only works if your team understands it. Employees need a realistic, plain‑English explanation of what’s changing, what isn’t, and how they can help make it a success. That’s where a thoughtful communication plan matters, before, during and after the announcement.

Go EO can support leadership with clear staff briefings, FAQs, myth‑busters and launch sessions. If you’d like support with this, we collaborate with Salad to communicate the story well across your website, client letters and internal channels, without over‑promising or creating confusion.

If leadership transition is happening too, plan it deliberately

Many owners choose to reduce day‑to‑day involvement around the time of an EOT. That can work brilliantly, but only if you plan it. Decide who will lead, how decisions are made, and which responsibilities move when. Align incentives and reporting so everyone is pulling in the same direction.

Go EO can help shape a pragmatic leadership transition, and we can draw on specialists such as Kate Mercer where deeper organisational development support will set you up for long‑term success.

Continuity checklist for EOT readiness (10–20 staff)

• Named leads for sales, delivery/operations and finance, with documented handovers where appropriate.
• Client communications plan drafted: timing, message, and who will give it.
• Three‑way forecast (P&L, cashflow, balance sheet) showing headroom under conservative assumptions.
• Sensible trustee/board setup researched and ready.
• Simple, positive employee briefing pack and Q&A.
• Risk register covering client concentration, key suppliers, and regulatory items.

Quick answers to common EOT questions

Will I lose control immediately?

Legally, yes. In practice, it’s more complicated. The trustees will acquire control, but you can stay heavily involved, especially during transition. Many founders remain as directors for a period to keep continuity strong.

How do employees benefit?

Employees don’t buy shares individually; they benefit collectively via the trust. Depending on performance and the law at the time, companies may pay income‑tax‑advantaged bonuses within statutory limits.

How is the purchase funded?

Usually via a vendor loan repaid from future profits, sometimes alongside bank finance. That’s why reliable cash generation and client retention are vital.

How long does it take?

A well‑prepared small‑business EOT can complete in a few months. The real work is in planning continuity and leadership, not just signing documents.

A quick real‑world note

It’s exactly what the founder of Go EO did in 2021 with Maslins Ltd. Transitioned to an EOT with a clear continuity plan and a sensible leadership shift. The company continues to thrive. That experience informs how Go EO help other owners achieve the same. Solid formalities, careful communication, and practical governance that preserves what already works.

Next steps

• Try the free EOT Explorer to assess fit and readiness.
• Book a short feasibility conversation to explore structures, valuations and timelines.
• If you decide to proceed, all our packages include the formal steps. Plus if you want, we can help coordinate a clear communications plan for staff and clients, as well as support your leadership transition.