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Teamshares Raised $245M in Venture Capital to Drive Small Business Employee Ownership

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Teamshares, a pioneering player in small business employee ownership, has announced that it has successfully raised a substantial $245 million in equity funding from prominent venture capital firms. This funding includes a recent Series D financing round that raised $124 million, with participation from key investors including QED Investors, Inspired Capital, Khosla Ventures, Slow Ventures, Spark Capital, and Union Square Ventures.

Led by QED Investors’ Frank Rotman, the Series D funding marks a significant milestone in Teamshares’ journey to scale its innovative model for small business employee ownership across the nation and propel its product development efforts. Teamshares is focused on creating a remarkable $10 billion worth of new wealth for employees through stock ownership.

Teamshares operates as an employee ownership platform catering to small businesses. Its approach involves proprietary software, financial products, and education to empower employee ownership. The company’s ultimate objective is to transform traditional small businesses by transitioning them to being 80% employee-owned within a span of 20 years. This strategy aims to safeguard jobs, offer a financially secure exit for retiring business owners, and create stock wealth for diligent employees.

Michael Sutherland Brown, Cofounder and CEO of Teamshares, emphasized the importance of their mission: “Teamshares provides retiring owners with a financial exit and a legacy of employee ownership, while also preserving jobs and creating stock wealth for hard-working small business employees.”

Frank Rotman, Cofounder and Chief Investment Officer of QED Investors, expressed enthusiasm for Teamshares’ distinctive approach: “Employee ownership aligns the interests of all stakeholders and makes companies and people better off financially.”

Since its inception, Teamshares has witnessed remarkable growth. From starting with four companies generating $10 million in revenue in January 2021, it has expanded to include 84 companies with over $400 million in revenue by July 2023. This expansion has led to the creation of 2,100 new employee owners across 29 states and 42 industries.

Teamshares’ innovative model has attracted experienced leaders from diverse backgrounds to guide transitioning companies as they adopt employee ownership. The company has garnered leaders from organizations such as Amazon, BCG, Deloitte, Tesla, USAA, Walmart, and branches of the U.S. military.

Teamshares’ remarkable growth and execution have garnered significant attention from investors, with Rebecca Kaden, Managing Partner at USV, noting, “Teamshares was a good fit for USV’s investment thesis. We have been impressed with the company’s growth and execution since first investing in March 2020.”

The success of Teamshares highlights the growing interest in employee ownership models as a way to drive business success, create wealth for employees, and foster alignment between stakeholders.

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