Was KKR’s $4.75 billion sale of CoolIT Systems, announced last week, good for workers? That depends on who you ask.
Many employees of the Calgary-based CoolIT seemed happy, judging from the made-for-media moment when they opened their pay envelopes. According to KKR, all 650 workers received cash payouts, averaging $240,000. Some long-tenured employees walked away with up to eight years of annual pay. ImpactAlpha talked to one employee, hired only last week, who got the equivalent of a full year’s pay.
KKR’s Pete Stavros, who has championed broad-based employee ownership across the portfolio of the $744 billion firm, got his flowers (see Stavros’ Q&A with ImpactAlpha, “Employee ownership is a competitive advantage in private equity”).
In the impact investing community, the reaction was more complicated. Some critics pointed out that the ~$150 million that workers received represents only 3.5 cents of profits from the sale, while KKR’s fund and its co-investor, the Abu Dhabi sovereign wealth fund, Mubadala, kept approximately $4.3 billion. The rich payout – KKR and Mubadala paid ~$300 million for CoolIT three years ago – reflects the dramatic growth of data centers and demand for the company’s cooling systems.
When smart and well-intentioned people disagree, it is often a sign of a difference in framing. Those who celebrate the deal compare 3.5% to the $0 that workers receive at most private equity exits. Those who are more skeptical compare 3.5% to the value workers generated and conclude that workers who scaled CoolIT’s revenue from $155 million to $550 million while raising margins in the three years KKR owned the company deserved a far greater share of what they built.
Brian and Katie Boland of the Delta Fund were particularly dismissive, challenging the use of the word “ownership” at all. Brian called KKR’s employee equity plans, as well as the broader private-equity initiative Ownership Works “little more than a PR effort designed to make workers work harder and give some shine to PE” (prompting me to propose that we call the divergent framing for these deals the “Bolands-Stavros spectrum”).
Both views are right—depending on the viable alternatives. If we accept that 3.5% is better than zero but worse than what workers deserve, then we should spend less time debating what KKR did and more time building an economy where workers have better options.
Sharing wealth with workers creates value for private equity buyout firms. So why not share more?
Workers of the world, get financing!
At its core, the question we need to addres is what will it take so that the American economy can create the conditions in which working a single job well for more than 40 or 50 years should be enough to provide financial security for a family?
Raising wages will not be enough. If even a small part of the anticipated AI disruption occurs, sharing ownership more broadly will be imperative to ensure the benefits of America’s dynamic private sector are more broadly shared. Expanding employee ownership will be essential to give more workers a meaningful stake in the companies they help build, the ability to determine who benefits when owner profits grow faster than wages rise, and a reconnection between company productivity and retirement security. We will also need to expand benefits that support workers to gain financial security, and finance the early stage companies innovating to make a rapidly changing job market more accessible to more people.
None of this will happen without financing. Few workers have the cash to buy their companies, just as few labor market entrepreneurs have the cash to scale their business. Fortunately, inspiring innovators across the country are working to get financing into the hands of people who are using the capital to improve the lives and prospects of working people.
Apis & Heritage, co-founded by Todd Leverette, Phil Reeves, and Michael Brownrigg, has pioneered an employee-led buyout, or ELBO, product that raises investor capital to purchase companies from founders then transfers 100% of the equity to workers through a tax-privileged Employee Stock Ownership Plan trust. Workers pay nothing upfront; they accumulate shares as company profits repay the financing and then sets the company up to refinance with bank debt.
A&H’s first fund financed five buyouts and transitioned more than 400 workers into ownership. They announced this month the close of a second, $250 million fund to expand this work, along with an investment partnership with Calvert Impact to address the capital market constraints to pulling off more transactions.
Mosaic Capital Partners and Common Trust offer complementary employee-ownership models. Mosaic deploys a more traditional private equity structure that takes equity alongside workers. Common Trust favors Employee Ownership Trusts that provide immediate profit-sharing. In 2025, Common Trust advised the sale of Consumer Direct Care Network, setting up 135,000 workers to participate in the financial success of their company.
In-home caregivers get a stake as bigger companies discover employee ownership trusts
Loan rangers
Not every company is a buyout candidate. But investors are proving it is possible to improve worker financial security even without owning equity. Lafayette Square lends to middle-market businesses and offers borrowers an interest rate discount of up to 0.25% when they implement worker financial security programs, including savings accounts provided by Sunny Day Fund and no-interest emergency loans.
Lafayette Square’s Damien Dwin: Investing in working-class people and places
Lafayette Square’s logic is straightforward: financially secure workers are more productive and less likely to leave, which makes borrowers more creditworthy. Lafayette Square reports worker impacts in its formal SEC filings, and last year spun out its Worker Solutions program as a standalone company serving investors who want to improve outcomes for workers.
NineDean, a holding company launched in 2025 by private equity veteran Aren LeeKong is also setting out to demonstrate how treating workers better makes businesses more valuable, attracted the largest-ever direct investment from Ford Foundation’s Mission Investment Fund.
VCs in the labor market
A third lever is financing the companies building better pathways into good jobs. JFFVentures, the impact investing arm of Jobs for the Future, backs early-stage companies targeting specific failures in US labor markets. World Education Services, a nonprofit social enterprise, is on a journey to align 100% of its assets with mission, investing impact-first capital into organizations improving workforce mobility and economic inclusion for immigrants and workers who mainstream investors overlook. WES was also an early investor in Apis & Heritage, helping catalyze that fund’s launch.
Together, JFF and WES show how mission-driven organizations can reshape labor markets using investment capital, extending the reach of efforts that include grants and advocacy
What would FDR do?
Using investment to improve the financial security of workers has obvious public benefit and government leaders are taking notice
The financing barriers facing worker-ownership funds like A&H make it hard for them to compete with large incumbents with established pipelines to institutional investors.
New entrants will scale faster with low-cost capital and liquidity mechanisms that the private market doesn’t yet reliably provide.
The bipartisan American Ownership and Resilience Act, introduced in both houses of Congress last year proposes the creation of an Employee Ownership Investment Company program, modeled on the federal Small Business Investment Company, or SBIC, program. The legislation would make $5 billion in low-cost loans available to fund managers financing worker ownership transitions. This capital will allow them to compete better with established firms in winning investment mandates. Like SBICs, the program is designed to be self-sustaining, with fees covering losses, and requiring no net taxpayer funding.
This type of market-shaping intervention is not a left or right idea. It draws on a long tradition of government shaping markets to harness private capital to national priorities, such as the creation of the 30-year fixed-rate mortgage during the Great Depression, the now-$400 billion Farm Credit System, and the Low-Income Housing Tax Credit that has been credited with helping to finance more than 3 million affordable homes.
Changing the game
Celebrating the CoolIT workers’ bonuses is right. So is being honest about the limits of what they received. The workers at CoolIT helped build a company worth $4.75 billion. They got $156 million, no doubt a genuinely life-changing amount for many of them, and far better than nothing.
But imagine if the workers had been able to access the capital to buy CoolIT themselves in 2023?
The next time a high-growth company like CoolIT comes up for sale, imagine if we’ve built the conditions in which workers can sit across the table from the private equity firm and make a competing bid. They might be backed by fund managers like Apis & Heritage or Mosaic, enabled by a financing infrastructure like the American Ownership and Resilience Act, and supported by lenders like Lafayette Square, helping workers arrive at that moment with greater financial resilience. Imagine the workers not just getting 3.5 cents on the dollar, but keeping the whole bag.
That world is not out of reach. The investors and entrepreneurs building it are already at work. The policy tools to accelerate it exist or are drafted.
If the American Dream is to remain something people can earn through work, it must be rebuilt on new foundations and an expansion of who can access capital to turn hard work into financial security for their families and communities.
So let’s celebrate KKR distributing $156 million to the workers of CoolIT. And let’s get back to work making sure that the next time the options available to workers are so much better.
