Moog Music Inc. is now an employee-owned company, following the vision of Dr. Moog who wanted to share the company’s financial success to its employees.
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The special announcement was made by Moog Music President and CEO Mike Adams after he stopped production in the factory and gathered employees for a surprise afternoon announcement.
The transition officially took place on June 6, 2015, while the announcement to the employees came later on June 9. This move turns Moog Music into an ESOP (Employee Stock Ownership Plan) company, adding to the list of 7000 ESOP companies in the US out of around 30 Million operational companies.
ESOPs are known for having improved longevity and performance compared to conventional companies, with the stats saying that an ESOP is 25% more likely to stay in business and have 25% higher job growth. Obviously the ones that benefit the most in this move are the employees who get to become co-owners and enjoy 2.5 times greater retirement benefits.
This is a commendable and bold move for Moog Music, and if successful could be an ideal roadmap for other musical instrument manufacturers – especially in this time where buyouts and closures are all too common.
The story goes that Mike called for an impromptu meeting and started the announcement by saying, “I called you all here to let you know I sold the company.” He then followed up by saying, “The good news is I sold it to all of you.” While the financials of the company dramatically changed, the operations remained the same, with Mike Adams retaining his position as President and CEO.
The official press release mentioned that Moog Music Inc. underwent significant growth in the recent months and years, and I can guess that their recent guitar pedal releases played an important part in their success. Just five years ago, Moog Music had 27 full time employees, fast forward to the present, the company now have 62 full time employees, who are now co-owners of the company. It is said that they had an average of 18% revenue growth for the past 12 years, and their YTD revenue is up 46% over last year. Another testament to their success is the 38% production space increase which happened in the last fourteen months.
Dr. Moog’s widow, Dr. Ileana Grams-Moog said, “Bob and I consulted an expert in worker-owned businesses in 2001, but weren’t able to make employee ownership at Moog a reality. Bob would be thrilled that Mike Adams realized this shared dream fourteen years later.”
Mike Adams added, “The employees at Moog Music Inc. are what make this company successful. I feel the best way to recognize their passion and hard work is to give them ownership.”
While the quality of their products are enough for us musicians to chase after their gear, this unprecedented move by the company adds another reason for musicians to patronize their products. For more information on this story, visit Moog Music
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