Most of our billionaires are either flying off into space while the others are busy with shitposting on Twitter. But among this sea of privileged white men, there’s one who is not only staying aground but also putting money where his mouth is. Today, news came out that Yvon Chouinard, founder of Patagonia, an outdoor apparel selling company, has given away his $3 billion company to help fight climate change.
The 83-year-old whose personal wealth currently stands at $1.2 billion wrote in an open letter that all of the company’s voting stock will be transferred to its Purpose trust, to protect its values. While its non-voting stock will be transferred to Holdfast Collective, a non-profit combating the environmental crisis.
However, it is easy to get lost in the numbers, without paying closer attention to Chouinard, whose story is one for the textbooks. Here’s why.
While Gates and Bezos were hustling in their garages trying to make it big one day, Chouinard never had the ambition to become a businessman. He was born on November 9, 1938, in Maine to a French-Canadian father, who worked as a mechanic, handyman, and plumber.
After the family moved to Southern California in 1947, Jr Chouinard developed a liking for rock climbing at the age of 14. When he was 16, Chouinard drive a 1940s Ford he’d rebuilt to Wyoming, spending the summer learning how to use pitons, and metal spikes. At 24, he learned blacksmithing, to develop his climbing tools for himself, later selling them to his friends for $1.50 apiece. This led to him starting Chouinard Equipment, a startup that he ran in the back of his car, selling climbing gear while on the road in Wyoming.
The OG Environmentalist
A few years down the line in the 60s, Chouinard was still on the road, becoming an important figure during the “Golden Age of Yosemite Climbing.” In 1964, he was part of the first ascent of Yosemite’s North America Wall, done without the help of fixed ropes. During the same decade, he introduced chrome-molybdenum steel pitons to the Shawangunk Ridge area, which is heralded by revolutionizing climbing protection.
The business was booming for a while. In the 70s, Chouinard took a trip to Scotland and brought it back to the US for his climbing expeditions. The sturdy fabric proved to be a boon during climbs, while the collar protected him from climbing sling. At the behest of his friends, in 1973 Chouinard Equipment’s started selling Rugby t-shirts, along with gloves, hats, and shorts. A few years later, Chouinard baptized his apparel business, naming it Patagonia.
It was smooth sailing for a while, but trouble soon begin to swoop in. While Chouinard began focusing on his new apparel company, he had mostly hived off the equipment business, Chouinard Equipment. Then in 1989, a series of lawsuits were filed by injured climbers over defective equipment. Soon, Chouinard Equipment was forced into bankruptcy, after a climber died in the Teton Range while using the company’s harness. By this time, Peter Metcalf, Chouinard’s protégé who was running his original company made an offer of $900,000 to buy the company’s liquidated assets. He then renamed it Black Diamond Equipment and moved its HQ from Patagonia to Salt Lake City.
An Offer He Had To Refuse
At the same time, Patagonia had its own turmoil. The company was reportedly making 50 percent YOY profit, which led Chouinard to borrow more from the banks. Then the recession hit, dipping the profits. Interest rates grew higher, while bankers barked. Patagonia laid off one-fifth of its workforce, 120 employees in total. At one point, an accountant introduced Chouinard to a mafia member in Los Angeles, who offered him a loan at 28 percent. Chouinard began to ponder if he should stay in the game at all.
He declined the offer, asking friends and family for help instead. Patagonia remained afloat. As the economy picked up, revenue skyrocketed from $20 million to $100 million by the mid-90s. But during the turmoil, it dawned on Chouinard that he was indeed a businessman. “If I had to be a businessman, I was going to do it on my own terms.” He wrote in his book.
And hence, the company did away with private offices in 1984, pledging 10 percent pre-tax profit to grass-root environment groups, later upping the pledge to 1 percent of its sales, if the amount was higher. In 1988, Patagonia launched its first environmental campaign, in a bid to de-urbanize Yosemite Valley.
The Reluctant Billionaire
In 1996, Patagonia switched from normal cotton to organic cotton, after Chouinard was made aware of the environmental impacts. Customers were dissatisfied, with sales dropping by 20 percent. But instead of reverting, Patagonia started programs on organic farming, for farmers. A few years later, the profit margins stabilized.
At the turn of the century, Chouinard founded the international organization 1% for the Planet. Here companies (including Patagonia) will pledge 1 percent of their annual sales to environmental causes. So far, over 5,000 individuals and businesses have signed up.
In his book, Chouinard has a rather unique take on the term billionaire and businessman, writing “I’ve never respected the profession. It’s business that has to take the majority of the blame for being the enemy of nature. I’ve been a businessman for almost sixty years. It’s as difficult for me to say those words as it is for someone to admit being an alcoholic or a lawyer.”