Eric Braitmayer was born into a sailing family. His father worked in New Jersey, but in the summers, they’d go up to Marion, Mass., to sail on and around Buzzards Bay.

“Every Friday in the summer, he would drive from Patterson, N.J., to Marion,” Braitmayer says. “We would get on the boat, and then go off sailing for a couple of days. Everything was always about being on a boat. I was also a competitive sailor and eventually got into windsurfing during college.”

After attending the Westminster School in Connecticut and Bates College in Maine, he planned to be a schoolteacher but decided to “get a real job” for a year — driving launches at the yacht club. A friend was working at Imtra’s sister company, which had an opening in customer service. He took that job, thinking it’d be for nine months or so.

That was 36 years ago.

Attending his first New York Boat Show opened Braitmayer’s eyes to the boating industry as a true career path. “We were doing sailing products, so we had Spinlock, Marlow Rope and a bunch of that stuff,” he says. “I became the first product manager at Imtra. I did that for a while and then started getting more into the marketing side of the business. My dad invested in Imtra after I’d been there about five years.”

Today, as president and CEO of Imtra, Braitmayer is working to grow the business in a way that not only will succeed in the marketplace, but that also will help employees succeed in new ways so that they are more likely to stay with the company, work even harder to keep the company strong, and ultimately be better positioned for retirement.

Here’s our conversation, which has been edited for space and clarity.

How did Imtra grow into the business it is today?

We decided we wanted to go more toward OEM products and distribute nationwide. Whale products was our big line in the late ’90s. Then around 1990, we took on Sleipner. Whale came and went. We were like, “Maybe we need to have more diversity in our product supply and not put so many eggs in one basket.” That’s when we really started to flesh out the product lines.

We began creating channels of anchoring and docking products, lighting products and windshield wipers.
We started to define certain categories that we wanted to be experts in, and we wanted to make sure that our product offering covered the full gamut of what our customer base was going to need. We had three brands of windshield wipers that covered from an 18-foot runabout up into a 200-foot commercial ship. In the anchoring category, we had Lofrans windlasses and a line of bow rollers, and we were doing Bruce anchors, too. We also created our own rope-chain anchoring lines.

Lighting is a big category for Imtra. How did that product line evolve?

Imtra was one of the first players that really pushed into LED. We were doing Cantalupi lighting out of Italy, and in about 2000, we could smell that LED was going to be a good fit for the marine market. We found an engineering company in Long Island and said, “Can you help us make an LED fixture?”

I look at that light fixture now, and I go, “I can’t believe we sold one of those,” because the color temperature was so cold. It had these little filters, and it was, well, it would be so awful now. But at the time, it was really cutting edge, and that got us into lighting.

We built out our own range of LED downlights, reading lights and those sorts of things. And we went through this moment where we were like, we’re going to become a manufacturer. This is going to be easy. Well, we learned that manufacturing is not always as easy as you want it to be. You have to control a lot of different factors and figure out where you’re going to have stuff built. We weren’t physically doing the light engine manufacturing at our place. We were doing final assembly, and still have some of those products.

As lighting expanded, we realized we needed a whole suite of suppliers that can bring us different types of fixtures so that we can satisfy the whole bunch. So how are we going to deal with engine rooms and utility spaces? How are we going to deal with exterior lighting? How do we deal with underwater lighting? How do we deal with strip lighting? We are constantly evolving our lighting product line to make sure that we have the right selection that our clients are looking for.

What other parts of your business are growing?

Zipwake, the interceptors, those are blowing up. We’re having a lot of fun seeing people change the way they use their boats, both in terms of their performance and getting the boat going and running efficiently and at a pitch that they like, but also the roll control.

What does Imtra’s sales strategy look like today?

We have 15 salespeople all around the country. Four of them focus on the commercial market, but we also do a decent amount of business around land-based stuff like RVs, transportation and even things like selling wipers to those little tugs that pull planes around airports. We also sell into some military applications and provide pilot chairs to offshore oil and gas operations.

I wish I spent all my time selling, but sometimes I’m upside down in a boat fixing a problem or identifying what’s going on, or I’m on a production floor with a boatbuilder trying to help them figure out how to install stuff. I’m not just running around with catalogs trying to sell things.

How do you instill employees with the idea of providing great customer service?

We want to be personal and work with our customers directly when they call our office. A real person answers the phone. You don’t get a phone tree. We obviously have departments, but that person’s not just a receptionist. They provide triage. “What can I help you with?” “What product are you calling about?” “I’m going to give you to one of the customer service teams.” They’re used to that.

Sometimes I say that people work with us because of the service that we give them and the knowledge that we share. The way we transact is, we ship them a box with some stuff in it, and they send us money for that stuff. But why they work with us is because we support them so well. Everyone at Imtra is invested in providing our customers with a high level of service. It’s just who we are.

Is OEM the biggest part of the business?

We have three segments in our business: two large ones in recreational, and one commercial. Commercial is commercial marine and the land-based stuff like gas and oil that I talked about. Recreational splits into OEM and aftermarket.

Aftermarket is if we sell to a two-step distributor, a boatyard, or if a customer goes on our website and buys a wiper blade or a zinc. But the OEM-aftermarket ratio depends on what’s going on in the market. Our aftermarket sales depend on how much labor capacity is in the field. That has been a ceiling over our heads for several years now that there just aren’t enough techs. And our products usually take some technical expertise to install.

What does your facility’s footprint look like today?

Well, right now, we’re 38,000 square feet in New Bedford, Mass., of which 25,000 is warehouse space. We are about to sign a lease on an additional 15,000 square feet about eight minutes away, also in New Bedford.

We do a lot of trade shows and use a decent amount of our warehouse space for storing and setting up those operations. We just can’t afford that space anymore. So the new building is going to give us the opportunity to stretch out our trade show space. That also gives us opportunity to take on more new products. We don’t want to sell everything, but we’re always looking for innovative new things.

You recently launched an employee stock ownership program. How does that work?

Two families owned the business. It wasn’t exactly 50-50 — there were a couple of random shareholders — but call it 50-50. The founders, Chip Farnham and his family, who still works for us, is the other half. This is back, call it 2016. There was kind of this vision that they were going to want to get out when Chip got to retirement age, which isn’t too far away. At the time, I was like, “I’ll buy the other half of the business.”

We had an unsophisticated view of what the business might be worth. We didn’t really know. In 2018, we decided to get an evaluation done. We hired an outside firm — kind of an M&A type firm — and we told them we wanted to do an interfamily transaction, and that we didn’t want them to pump the number up for the sell side or the buy side. We asked for a fair value.

They came back with a number, and it was more than we thought, which was good, right? But for me, I was like, not great. For me, I was thinking, oh man, now I’m going to get deep into this thing, and then I’ve got to turn around in 10 or 15 years and figure out what I’m going to do about it.

I am part of a CEO peer group, and I went to them and said, “Oh my God, my plan is screwed. Good news is the company is worth a lot more. Bad news is what am I going to do? I don’t want to take on another partner. I don’t want to sell to one of our suppliers. They’re going to change our culture. We have this great, unique culture. No one’s like Imtra. We will never survive that. What am I going to do?”

One of the guys says, “Have you ever considered an ESOP?” I said, “What’s an ESOP?” And he was like, “We need to go to lunch.”

What did you learn at that lunch?

That guy was Paul O’Reilly from Newport Restaurant Group. They used to own the Newport boat show, but they own about 15 restaurants and have about 1,500 employees. They had been in ESOP for a long time. He explained it all to me over lunch, because in his experience, an ESOP professional will stick a fire hose in your mouth and then open the valve and spook you into a private-equity or other kind of sale.

He helped me go slow and learn. He introduced me to an ESOP attorney, who helped explain some of the potential tax advantages — you know, structurally how it works. I’m not a sophisticated corporate person, so I joined the ESOP Association, which is one of two major trade groups that support the employee-owned community, and I learned a lot very quickly.

What are the ESOP basics?

The easiest way is you set up this trust, which is a legal vehicle, and you have a trustee that represents the employees. The employees are shareholders, but they’re not individual shareholders. The trustee manages the shares for all employee owners. You can use an outside trustee, like someone you hire. You can also appoint internal people — a single person or a team of people — to be the trustee. That is typically something that you would only do when you’re a mature ESOP in today’s world.

ESOPs are subject to the Employee Retirement Income Security Act, which is government regulation around retirement accounts. So it is subject to the Department of Labor. It’s very important when you set up an ESOP that you structure it correctly. And by using an outside trustee, that trustee ultimately becomes your teammate. Then we went to our individual shareholders with a number lower than the low end and said, “If we could do a deal at this number, you guys want to do it?” Everyone was like, “Yeah, let’s do it.”

When we sold the business to the employees 100%, literally the next day we applied to be an S corporation. If you’re an S corp that’s owned by an ESOP, you pay no federal taxes. We literally wiped out our whole federal tax responsibility. And that becomes, to some degree, the fund driver — the money you would’ve sent to the government, you can now send to the trustee to buy the shares.

What happens next is you create a loan between the company, not the owners, the company and the trust. That’s really long; ours is 40 years. So that trust is going to buy a small parcel of shares, about one-fortieth every single year.

Do employees contribute any money into the ESOP?

Employees don’t put any money in. What happens is, every year the company gives money to the trustee. The trustee gives the money back, and in return we release shares. So from a cash-flow perspective, I’m just going to use the number $1 million. We send them $1 million, they put it in their bank for a day, and then they send it back to us and we go, OK, now we’re going to give you $1 million worth of shares at the transactional price.

So they’re buying shares?

The trust is buying shares, but the employees don’t pay into it. What happens is in the beginning, they’ll get a small parcel of shares. Let’s say a guy in the warehouse gets five shares. Our first year the shares are worth $25. Well, next year we’re going to make another payment. They’re going to get another tranche of shares, but it might change. It might be 4.8 shares. Now he’s got 9.8 shares, but now the valuation is $32.

Not only are our original shares worth more, but the new shares you got are worth more. Then the next year, maybe it’s worth $40. So they’re building this value in their account, and there’s a six-year vesting schedule. It takes some time before it’s truly there.

The first, call it 10 years, you’re paying off the original shareholders, but then you’re paying off your exiting employees. Now you’ve got a 10-year employee that’s had shares for 10 years, maybe longer. And then when they retire, they get to redeem their shares for cash, and the company pays them for their shares.

This is way too complicated, but you can either have them get redistributed to the other employee owners or you can bring them back into the company and build them up there and then do another sale, which is typically more like 25 years down the road.

How do the owners get their cut, in the end?

As a selling shareholder, I’m getting money for that. But in addition, when I retire, I will have an ESOP account that I’ll be able to trade in.

Let’s project into the future. Someone’s been in our ESOP for 23 years. They started when they were 30, so they’re 53 and getting close to retirement. I’ve got a lot of eggs in this Imtra basket. You can work a deal where you can take 25% out of that and then roll that into your 401(k), and invest that however you want. So there are lots of vehicles like that, that are going to help protect people.

I personally think ESOP is far and away the best vehicle that we can use in the States to address wealth inequality. It’s still a capitalist thing. It is not a socialist environment. All of us, all 80 of us at Imtra, we all want the company to grow and be more profitable. Everyone has the same share price, but it’s in our best interest to be capitalist, and all the money is not coming to me. I’m not sitting there and working my people to build my summer home. They’re all part of it.

There are a handful of very large public businesses that are gobbling up small marine companies because there’s a thing called the “silver tsunami” with baby boomers reaching retirement age. I don’t want that for Imtra. This is the best plan for everyone.