Client Spotlight: Firebrand Artisan Breads Funds Alameda Bakery, Hiring of 40+ Employees Through ‘Perpetual Purpose Trust’

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Stoel Rives congratulates client Firebrand Artisan Breads on its new wood-fired brick oven bakery in Alameda, Calif., which will employ at least 40 employees once it begins operations as expected in April. Stoel Rives assisted the company in transitioning the controlling interest in the company to a “perpetual purpose trust,” a subset of trusts for which the legal beneficiary is a purpose instead of a family or a person, and concurrently obtaining financing. (Stoel Rives is a pioneer in the use of perpetual purpose trusts as an ownership structure that protects the mission of an enterprise over time.)

Matt Kreutz founded Firebrand in 2008, and the company has grown from having four employees to 55 after it moved to its current facility in 2017. To finance the Alameda facility, Kreutz wanted to avoid the easy path of obtaining funding from a venture capital firm, with the attendant uncertainty its involvement would bring for his workers and their families.

Kreutz considered several other options, including worker-owned cooperatives, benefit corporations and employee stock-ownership programs, or ESOPs — a currently popular vehicle for more inclusively sharing the proceeds of a successful business — but none addressed fully as did the trust his goals for future long-term ownership of his company.

When the trust was organized as the controlling owner of Firebrand, Kreutz donated 51% of his voting shares to the trust to hold in perpetuity. This structure attracted the interest of a growing number of investors who, rather than seeking the payout from a company in which they have invested going public or being acquired by a larger entity, are looking for ways to invest that will proactively address environmental injustice, structural racism or other ills.

The Stoel Rives’ team was led by Ronald McFall of the firm’s Minneapolis office and included attorneys Steven Bell, Laurie Huotari and Adam Schurle.

More information about Firebrand can be found in an article from nonprofit news organization Next City.

Key Contributors

Steven G. Bell
Laurie W. Huotari
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