Edmund Weil outlines the benefits of employee partnership in a bar business.
For many bartenders, the dream of owning their own bar is a seductive one. Those long shifts and late nights suddenly feel far more meaningful when rewarded with the autonomy and creative freedom of running your own show – crafting the kind of venue you’ve always wished existed. Yet, between the soaring costs of opening a bar – lease premiums, rent deposits, legal fees, fi t-outs – and the steep learning curve of managing fi nances, operations and a team, that dream often feels out of reach. With capital and fi nancing increasingly diffi cult to secure for new hospitality concepts, the barriers seem higher than ever. And even if you manage to overcome those hurdles, as exhilarating as bar ownership can be, I can personally attest that it often comes with a sense of loneliness and burden that few anticipate.
For both bartenders dreaming of ownership and operators looking to build a team of long-term, committed professionals, employee shareholding off ers an intriguing middle ground. By granting equity, operators can share the rewards of success with key team members while building a more stable and engaged workforce. For employees, it provides a rare opportunity to gain a meaningful stake in the business they help create, without shouldering the full fi nancial and operational burden of ownership. This approach has become an essential part of our own journey in the bar world, starting in 2010 with our very fi rst venture and evolving into a cornerstone of our business philosophy.
Our journey into employee partnership began back in 2010 with Nightjar. At the time, we were still fi nding our feet as operators, and our inexperience led us to off er equity to secure the commitment of Marian Beke, a skilled and trusted bar manager who could help guide us through those early days. That initial leap taught us the power of shared ownership. Over time, we extended small equity stakes – around 1% – to other key team members, recognising their contributions and giving them a vested interest in the bar’s success.
The impact was tangible: key man retention at Nightjar and Oriole was exceptionally high. Each of those partners eventually moved on with modest payouts in the low fi ve fi gures – certainly not life-changing sums, but meaningful rewards for their time with us. But it wasn’t until we embraced employee partnership on a larger scale that we truly saw its potential. With our third concept, we already had two venues and two young children keeping us busy and knew we didn’t have the bandwidth to lead Swift from the front all the way.
We handed a significant equity stake (which was subsequently increased via share purchase) to Bobby Hiddleston and Mia Johansson, a couple whose vision, talent and industry clout were instrumental in bringing the concept to life. The rest is history. Swift swept the boards, becoming an industry favourite, earning awards, expanding to three locations, and ultimately providing Bobby and Mia with a substantial payout when they exited – enough to help them buy a flat in Stockholm, where they have recently relocated to start a family of their own.
We now have a successful business with a long-serving and excellent employee in Coral Anderson, who’s followed a natural progression to managing director with an equity stake of her own.
We’ve now adopted a similar model with the reopening of Oriole, cutting our front of house, bar manager and chef into substantial equity shares in the business. Although during the fit-out and opening Rosie and I were very hands-on, we know that for day-to-day operations, there are trusted partners in place who know, love and understand the brand and share our commitment.
This option isn’t going to work for everyone, but for those who have brought a bar concept to maturity and may be looking at other outlets in life – or for those with a bit of capital who may feel daunted by the prospect of going it alone in bar ownership – it’s certainly something to consider. Below are a few tips for those who may be thinking of embarking on either side of a partnership based on sweat equity:
Do your research
There are several routes to employee ownership, from government-approved schemes such as EMI to share options to straight equity. All of them require legal work and expense to set up properly, so be sure which route suits you best before drafting agreements. Both sides should take legal advice before entering the arrangement.
Be prepared to work on your relationship
Entering an employee shareholder agreement means you’re not only betting on the success of the business but also the strength of the relationship between partners. This can be a real positive: when both parties have more at stake, it often motivates constructive and fruitful collaboration. But it’s important to acknowledge and address challenges proactively.
Ensure everyone understands the business plan
In an ideal world, you and your partners build such a wildly successful business that a cash-rich buyer comes along within a few years, making everyone wealthy. Of course, it rarely plays out that way. If you’re lucky enough to share a profitable bar, you’ll need a clear plan for what happens to the profits. Will they be distributed to shareholders via dividends, or reinvested into expansion? Everyone involved should agree on the balance between ‘jam today’ versus ‘jam tomorrow’.
Have an ‘exit plan’
in place for both parties Most agreements include a minimum term of service before an employee shareholder can realise the value of their shares. This could be a fixed cut-off (eg, five years) or a taper system where the value increases with tenure. It’s also vital to agree on an independent valuation process for when a shareholder leaves, and to grant the majority owner ‘pre-emption’ rights – giving them the first option to buy shares at fair value.
Sweat equity isn’t a one-size-fits-all solution, but when approached thoughtfully, it can be a game-changer for both operators and aspiring bar owners. It’s a model that has brought immense value to our business – not just financially, but in the relationships and shared successes it has fostered. And who knows? If you’ve got a brilliant idea, a solid work ethic, and maybe a fondness for late-night business chats over cocktails, there may be people – like us – who are open to a conversation. After all, the best partnerships often begin at the bar.