Paragus Strategic IT has officially become a 100 percent employee-owned business, a move that the founder believes will cement the company’s future success.

“Our underlying motivation is growth,” said Delcie Bean, founder and CEO of Paragus Strategic IT The latest move is valued at about $5 million.

Delcie Bean (L), CEO of Paragus Strategic I.T. in Hadley, checks in with Roger Oprecht, client support manager. (Don Treeger / The Republican) 3/11/2024The Republican

Paragus Strategic IT provides information technology services to small- and medium-sized businesses in Massachusetts and the surrounding area. It lives by four pillars of service — on-demand support, security and compliance, strategic planning and business automation.

A recent video created to celebrate its new employee ownership focused on the people who work together to make Paragus the success that it is. While the business has experienced serious growth and its employees regularly demonstrate their strong work ethic, a fun workplace at Paragus comes standard: Its open floor plan has ample room for its ping pong tables and occasional Nerf gun wars.

Delcie Bean is the CEO of Paragus Strategic I.T. in Hadley. (Don Treeger / The Republican) The Republican

Bean started the IT support business in 1999 as a project while he was a 14-year-old Amherst Regional High School sophomore. Without a driver’s license at the time, he needed rides to job sites. In 2011, Bean changed the company name to Paragus — formerly Vertical Horizons and then Valley Computer Works — in honor of Hadley’s most famous export: asparagus.

As the company grew, Bean struggled to reconcile that the employees were not benefiting as much as him.

“It made sense to explore an employee-ownership model,” said Bean. “Beyond feeling like this was the right thing to do, it was also a bet on our future. A bet that we’d grow even faster as an employee-owned company.”

In 2016, the company started an employee stock ownership plan that turned over 40 percent of the business to its employees, worth about $1.6 million. The company grew to 65 employees and completed multiple acquisitions.

Paragus Strategic IT now has offices in Hadley and Worcester, and is considered one of the fastest-growing IT businesses in the area and the largest IT provider in its market — something Bean contributes to the employee stock ownership model.

After its initial waves of success, Bean and the company needed to decide what direction to go in. They knew they could bring in capital to expand, but they decided to “go all-in” on being employee-owned.

“The employees have known it was coming for 18 months, so we didn’t have a big unveiling,” recalled Bean, “but we did have an end-of-the-year party to celebrate.”

In addition to having a big financial impact on many people, the move also keeps jobs and resources in the community — something that is often lost when outside capital is brought in or private equity firms take over a business.

“This is not simply an investment in ourselves,” Bean said. “It’s also an investment in our clients and the communities where they reside. We have seen firsthand the impact on innovation and customer experience that employee ownership can have.”

Although the employee stock ownership model is not particularly popular among businesses, probably because of the “incredibly complex government and tax laws,” and the drawbacks of time and expense, said Bean. In addition, there seem to be a lot of misconceptions about the model, such as that the business owner will lose control of the business, which is not what Bean has seen.

He felt that the work and cost were worth it in the end. And, he thinks that the market is starting to really appreciate such commercial endeavors.

“People who are consumers want to buy from companies they believe in,” said Bean. The biggest consumer generations, those in their young adult and middle-aged years, can move more businesses in this direction, “if the market keeps demanding it.”

There are about 700,000 businesses with employee stock ownership models in place in the United States, which is a very small community in the business world.

With the employee ownership firmly in place, Paragus Strategic IT has set new goals, one of which is to serve 1,000 small businesses across the country. Paragus would also like to have a top line income of about $100 million in 10 years.

“To accomplish that audacious goal, we are going to need the continued commitment, passion and dedication of our incredible employee-owners,” said Bean. “With 100% employee ownership, I’ve never been more confident that we will succeed.”

- Tina Lesniak