Some Jersey Mike’s employees will see a 200% bonus post-IPO — how majority shareholder Blackstone is spreading the riches

The debut marks the first time Blackstone has brought one of its broad-based employee ownership programs to the public market, offering an unusually detailed look at how it works in a way that previous private deals didn’t require.

Who gets the bonus and who doesn’t

Blackstone announced in May 2024 that all future U.S. private equity control investments would include broad-based employee ownership programs. Jersey Mike’s is the first company to go public under that commitment.

Here’s how it works: corporate employees — the 293 people working at Jersey Mike’s New Jersey headquarters — are eligible for bonuses ranging from 0%–200% of their eligible compensation. The payouts are funded directly by Blackstone’s IPO proceeds, Business Insider reports.

The final amount depends on Blackstone’s return on its original investment and may be prorated based on how long an employee has been with the company. To qualify, employees must have been at the firm for at least one year at the time Blackstone gives up control.

Executives will also receive stock grants, aligning their incentives with investors in the more traditional private equity fashion.

What the plan doesn’t cover is just as notable. Franchisees, their sandwich-making staff and employees of corporate-owned stores are all excluded. That means the people actually slicing the deli meat and assembling the subs — the vast majority of people whose daily efforts helped build the brand — won’t receive any of the bonus pool.

The bigger picture: Private equity’s profit-sharing moment

The Jersey Mike’s IPO is Blackstone’s first public demonstration of a strategy the private equity industry has been building toward for years. KKR pioneered the model through its nonprofit Ownership Works. Since 2015, it has awarded billions of dollars in equity to more than 120,000 non-management employees across more than 55 companies.

Notable examples include Ingersoll Rand, which has granted equity to more than 28,000 employees since 2017, and Lineage Logistics.

Jersey Mike’s had 293 corporate personnel eligible for the program as of the end of last year. Blackstone-owned Copeland, which filed for an IPO at that time, has 18,000 employees eligible for similar benefits.

“In what we’re trying to do across our portfolio, broad-based equity ownership is just a part of a much more important path,” Joseph Baratta, Blackstone’s global head of private equity, told ImpactAlpha in 2024.

Across its portfolio of more than 270 companies, Blackstone says it employs about 700,000 workers worldwide.

What Blackstone changed and what it didn’t

In less than two years, Blackstone has reshaped Jersey Mike’s leadership. It brought in Charles Morrison as CEO — the executive who led Wingstop through its 2015 IPO — replacing founder Cancro, who moved to a board role, Business Insider notes.