Rick Carlson and his wife, Shelley, started Inland Waterproofing Services Inc. at their kitchen table and grew the specialty construction company into a business with large commercial accounts.
When Boeing built its 40-58 777X composite wing factory in Everett, the Coeur d’Alene company waterproofed 2 miles of tunnels underneath the facility. The company also waterproofed foundations for Seattle skyscrapers, light rail systems and luxury homes near Lake Washington.
The Carlsons knew they wanted Inland Waterproofing to continue after they retire in about five years. The couple recently sold the business to their workers through an employee stock ownership plan, or ESOP. “We wanted to make sure the name carries on,” Rick Carlson said, “and that the employees who helped us grow the company were rewarded.”
About 50 people work for Inland Waterproofing, which was founded in 2005. The company does work locally, but the bulk of its growth has occurred by securing contracts in the booming Seattle-area market. “Seattle is just on fire with growth,” Rick Carlson said. “We’re working on the Amazon building in Spokane, and we’ve done jobs for Washington State University in Spokane and Pullman. … but we also realize that most of our potential to grow is in Seattle.”
As the Carlsons contemplated their succession plan for the company, they worked with Spokane attorney Philip Carstens to evaluate whether an ESOP would be a good fit for what they had in mind. After a third-party valuation of Inland Waterproofing was done, the Carlsons sold their stock in the privately held company to the ESOP.
Individual employees will acquire shares over time, eventually becoming vested stockholders. The decision to convert Inland Waterproofing to an ESOP pushes back the couple’s retirement by a few years, but it was a trade-off they were willing to make, Rick Carlson said.
The couple considered selling the company, but “there were no guarantees” with an outside owner, he said. They worried that a new owner would strip the company’s assets and close it down.
A board of directors was set up to run Inland Waterproofing. The Carlsons will remain active in the company until they retire. “We still have quite a bit of skin in the game,” Rick Carlson said.