Journey to an ESOP & Beyond
ESOPs are gaining traction. In the "Journey to an ESOP & Beyond” podcast, Doeren Mayhew's Jason Miller and Makenzie Wirth explain the process of the ESOP transaction and address ESOPs from a business owner's perspective. They illuminate the simplicity of ESOPs and debunk common misconceptions that ESOPs are immensely costly and complicated.
--
“Doeren Mayhew" is the brand name under which Doeren Mayhew Assurance and Doeren Mayhew Advisors, LLC and its subsidiary entities provide professional services. Doeren Mayhew Assurance and Doeren Mayhew Advisors, LLC (and its subsidiary entities) practice as an alternative practice structure in accordance with the AICPA Code of Professional Conduct and applicable law, regulations and professional standards. Doeren Mayhew Assurance is a licensed independent CPA firm that provides attest services to its clients, and Doeren Mayhew Advisors, LLC and its subsidiary entities provide tax and business consulting services to their clients. Doeren Mayhew Advisors, LLC, DM Payroll Solutions, Doeren Mayhew Capital Advisors and their subsidiary entities are not licensed CPA firms.
Journey to an ESOP & Beyond
EP3 - Construction Industry Spotlight: Interview with Joe Jones, Audit Partner at Berman Hopkins
Use Left/Right to seek, Home/End to jump to start or end. Hold shift to jump forward or backward.
In this episode, Makenzie Wirth interviews Joe Jones, Audit Partner at Berman Hopkins. As lead of the firm’s Construction Advisory Services Team, Joe shares his perspective on the recent trend of construction companies transitioning ownership to ESOPs. From audit considerations, valuation risks, bonding, backlog quality, governance, and jobsite culture, Makenzie and Joe provide practical advice for construction owners considering employee ownership.
Listen to this episode to understand how ESOPs impact construction businesses and get actionable guidance for your company’s transition.
Construction Industry Spotlight Interview with Joe Jones, Audit Partner at Berman Hopkins
Audit, Bonding, Culture, and Succession Planning Insights from the Field
Episode Summary
In this episode, Makenzie Wirth interviews Joe Jones, Audit Partner at Berman Hopkins. As lead of the firm’s Construction Advisory Services Team, Joe shares his perspective on the recent trend of construction companies transitioning ownership to ESOPs.
From audit considerations, valuation risks, bonding, backlog quality, governance, and jobsite culture, Makenzie and Joe provide practical advice for construction owners considering employee ownership. Listen to this episode to understand how ESOPs impact construction businesses and get actionable guidance for your company’s transition.
Key Topics Covered
- Why construction companies are well-positioned for ESOPs
- ESOPs as a workforce retention and succession planning tool
- Owner exit strategy vs. long-term involvement
- Bonding, leverage, and financial reporting considerations
- Estimating, backlog, and cash flow in ESOP valuation
- Jobsite culture and employee accountability under employee ownership
Transcript
Editorial note: This transcript has been lightly edited for clarity and readability while preserving the original meaning of the conversation.
Welcome to the Podcast
Makenzie Wirth:
Hi everyone, and welcome back to another episode of Journey to an ESOP and Beyond. I’m your host, Makenzie Wirth, and today I’m excited to welcome a very special guest.
If you’re watching this episode on YouTube, you might be wondering how we managed to get Scottie Scheffler on our ESOP podcast. Believe it or not, it’s just his doppelgänger. I’m excited to welcome Joe Jones to the podcast.
Joe is an audit partner with Berman Hopkins CPAs & Associates. For longtime listeners, you know our podcast is supported by Berman Hopkins, so we’re excited to bring Joe on to share his expertise—especially as it relates to the construction industry and ESOPs.
Joe, thanks for joining us. I’ll pass it to you for a quick introduction.
Joe Jones’ Background in Construction and Audit
Joe Jones:
Thanks, Makenzie. I know I look a little like Scottie Scheffler, but I wish I had his golf swing—I’d be on the course instead of a podcast.
I’m an audit partner at Berman Hopkins and have been a partner for almost a year. Before that, I spent about 12–13 years with a Big Four firm, primarily working in the construction space.
Since transitioning to Berman Hopkins, most of my clients are construction companies. Over the past couple of years, ESOPs have become a very common topic, and I’m excited to share my perspective.
Why Construction Companies Are a Strong Fit for ESOPs
Makenzie Wirth:
From your perspective, what makes construction companies uniquely positioned for ESOPs?
Joe Jones:
Construction companies create value differently than many other businesses. The value isn’t just equipment or backlog—it’s the people, estimation discipline, project execution, and institutional knowledge.
All of that aligns really well with employee ownership, which is why we’re seeing ESOPs grow so rapidly in the construction industry.
ESOPs, Labor Shortages, and Retention
Makenzie Wirth:
Do you see ESOPs helping with workforce retention, especially given labor shortages?
Joe Jones:
Absolutely. ESOPs aren’t just an exit strategy—they’ve become a tool for retaining key people. Employees at all levels have ownership, which helps keep talent in place.
It also gives owners an alternative to selling to private equity or competitors. Instead, they’re selling internally and preserving the company’s legacy.
Owner Exit Strategy vs. Growth Strategy
Makenzie Wirth:
Are owners typically exiting quickly after an ESOP transaction, or staying involved?
Joe Jones:
Most owners stay involved. For first-generation owners who built their companies from the ground up, it’s hard to walk away completely.
An ESOP often allows owners to remain involved—sometimes at the board level—while still using it as a long-term growth strategy.
Succession Planning Challenges
Makenzie Wirth:
What challenges do construction owners face when contemplating an ESOP?
Joe Jones:
The biggest question is bench strength. Owners want to know they have the right leadership team in place to run the business if they step back.
That hesitation is valid. Starting succession planning early is critical—the worst time to plan is when an owner wants out in a year.
Bonding and Financial Considerations
Makenzie Wirth:
Bonding is huge in construction. How does an ESOP impact that relationship?
Joe Jones:
Bonding agents focus on leverage, working capital, and cash flow. ESOP transactions often add debt, which can be concerning if the surety isn’t familiar with ESOPs.
That’s why it’s important to involve your entire ecosystem early—CPAs, banks, bonding agents, and advisors—so there are no surprises.
Audit, Valuation, and Backlog
Joe Jones:
From an audit and valuation perspective, backlog and estimates are critical. Clean work-in-process schedules, disciplined estimating, and properly tracked change orders all directly impact ESOP valuation.
Those numbers don’t just affect bonding—they affect employees’ retirement value.
Culture and Employee Ownership
Makenzie Wirth:
How does employee ownership change jobsite culture?
Joe Jones:
If the company already has a strong culture, ESOPs enhance accountability and pride. Employees understand they’re owners and that their performance matters.
But an ESOP won’t fix a broken culture—that foundation needs to be in place first.
Educating Employees on ESOP Value
Joe Jones:
Education is essential. Employees don’t need the technical details, but they do need to understand how estimating, job performance, billing, and cash flow impact share value.
That understanding is what makes ESOPs truly powerful.
What Stood Out Most About ESOPs
Joe Jones:
What surprised me most was seeing how value is created across the entire organization—not just leadership.
Seeing jobsite employees build real retirement value over decades was incredibly impactful.
Advice for Construction Owners
Joe Jones:
Start early. Focus on estimating discipline, cash flow forecasting, leadership development, and clean financial reporting.
Bring in all stakeholders early so banks, bonding agents, and advisors stay aligned.
The Future of ESOPs in Construction
Joe Jones:
With many owners approaching retirement and a major wealth transfer ahead, ESOPs are only going to become more common—especially in construction.
Final Takeaways
- Construction companies are people-driven, making them ideal ESOP candidates
- ESOPs support retention, succession, and long-term growth
- Early planning improves outcomes and reduces risk
- Financial discipline is critical to ESOP success
- Education drives employee engagement and value creation
Listen to the Episode
🎧 Journey to an ESOP and Beyond
https://www.journeytoanesop.com/podcast/episode/795ecba5/ep3-construction-industry-spotlight-interview-with-joe-jones-audit-partner-at-berman-hopkins
