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Patagonia Inc.

From the company's beginning to its Black Friday "fundraiser for the Earth"

On Black Friday, Patagonia sales reached $10 million, and they gave it all away to charity. That's pretty fucking cool. I can’t remember which came first, reading Yvon Chouinard’s book Let My People Go Surfing, or watching the documentary 180 Degrees South. Either way, both helped me get to know what Yvon and Patagonia are all about. Just looking at the title of Yvon's book, one can see why I have always been interested in Yvon and his story with Patagonia. Yvon is a climber and surfer, who just happened to fall into business. His book opens with him saying, "No young kid growing up ever dreams of someday being a businessman. He wants to be a fireman, a sponsored athlete, or a forest ranger. The Donald Trumps of the world are heroes to no one except other businessmen with similar values. I wanted to be a fur trapper when I grew up."

I can relate to that a lot. As a kid, I wanted to be a pro baseball player. I played my last baseball game at Dodger Stadium for the CIF Finals as a senior in high school, and playing in a pro stadium would be the closest I would get to my first dream. After that, I decided that I wanted to be a journalist or photographer for a magazine like Surfer or ESPN. I wanted to travel the world, and write stories or take pictures. My first major in college was Humanities and Arts, and spent most of my time studying philosophy and writing and art. It was very accidental the way I fell into business.

After running my first successful business in college– a small, house painting business with 5 employees and about $75000 in revenue– I started to really get into business. I looked for business people I could learn from and emulate. One of the first things I learned is that I wanted to do business how Richard Branson did it rather than how Donald Trump did it. After that, it was like Tony Hsieh of Zappos more than Steve Jobs. I admire Steve Jobs, and his biography by Walter Issacson is one of my favorite books of all time, but I didn't align with how Jobs ran his businesses as much as I aligned with Tony Hsieh. Back around 2008, I remember reading an article in Mens Health magazine about Blake Mycoskie and his growing shoe business called TOMS. Branson taught me that business could be cool, Hsieh taught me that people and culture are more important than product and profit, and Mycoskie taught me that business could be used to help people and make a social impact.

 The way I look up to and respect Chouinard is different than with Branson, Hsieh, and Mycoskie. It's on a much more personal level, more about lifestyle philosophies than about business philosophies. Yvon is a true dirtbag climber and surfer. He's one of the hardcore guys in Valley Uprising, the documentary about the rise of rock climbing in the Yosemite Valley in the sixties. The movie 180 Degrees South is about a modern day retracing of a trip that Yvon and North Face founder Doug Tompkins did back in 1968, driving down to the the tip of Chile and climbing in Patagonia. In his book, Yvon remembers that "during school holidays I would go with friends down to the wilds of Baja and the coastal mainland of Mexico to surf, driving the 39' Chevy I'd bought for fifteen dollars. After getting 19 flats on one trip, we stuffed our back tires with brush and weeds and inched the last dozen miles into Mazatlan." Minus the flat tires, that trip is on my bucket list.

In Yosemite we called ourselves the Valley Cong. We hid from the rangers in the nooks and crannies behind Camp 4 when we overstayed the two week camping limit. We took special pride in the fact that climbing rocks and icefalls had no economic value in society. We were rebels from the consumer culture. Politicians and businessmen were "greaseballs" and corporations were the source of all evil. The natural world was our home. Our heroes were Muir, Thoreau, and Emerson and the European climbers Gatson Rebuffat, Ricardo Cassin, and Herman Buhl. We were like the wild species living on the edge of an ecosystem –adaptable, resilient, and tough.

- Yvon Chouinard

The story of Patagonia is a long one, the company was founded in the mid sixties, as Chouinard Equipment. I think of the story in 3 main parts, the start, the turning point in the early nineties, and now. The company was started by Yvon making climbing equipment for him and his friends. As the demand for his products grew, he hired some friends and refined his craft. By 1970 Chouinard Equipment was the largest supplier of climbing equipment in the U.S., but despite the volume of sales the profits were only 1%. The first ideas for clothing were corduroy knickers and shorts made for climbing. Then they sold rugby shirts for climbing, and the clothing side of the business was a way to support the less-profitable hardware business. As they started to make more and more clothes, they needed a name for the clothing side of their business, and didn't want to dilute the image of Chouinard Equipment as a tool company. Yvon says, "To most people, especially then, Patagonia was a name like Timbuktu or Shangri-la –far off, interesting, not quite on the map. Patagonia brings to mind, as we once wrote in a catalog introduction, 'romantic visions of glaciers tumbling into fjords, jagged windswept peaks, gauchos and condors.' Our intent was to make clothing for those rugged Andes/Cape Horn conditions. It's been a good name for us, and can be pronounced in any language."

Yvon, his new wife Malinda, and Tom and Doreen Frost ran the company and sold more and more clothes from 1973-1975, but having no experience with clothing and making many mistakes, they nearly bankrupted the company in 1975, and the Chouinard/Frost partnership ended. With the Frosts gone, Kris McDivitt became the general manager and eventually the CEO, and continued in that role off and on until the early 1990s. Kris recalls the state of the company in an interview, "There were only 5 of us in the company in 1972. In 1977 there were 16 of us and my brother was general manager. In 1979 my brother quit, and Yvon didn't want to run the company–he wanted to climb and surf and all those things. So he gave me the companies, saying in effect, 'Here's Patagonia. Here's Chouinard Equipment. Do with them what you will. I'm going climbing. I had no business experience so I started asking people for help–if you just admit that you don't know something, they will fall all over themselves trying to help. So from there I began building the company. I was really the translator for Yvon's vision and aims for the company.'"

It was also at the time that Yvon started to realize that he actually was a businessman. Before then he viewed himself as a climber, surfer, kayaker, skier, and blacksmith who enjoyed making tools and functional clothes. But one day it dawned on him that he had responsibilities to the business, and that he would probably be a businessman for a pretty long time. At that point, he knew that he had to get more serious. But he also knew that he couldn't be happy playing by the normal rules of business.

"One of my favorite sayings about entrepreneurship is: If you want to understand the entrepreneur, study the juvenile delinquent. The delinquent is saying with his actions, 'This sucks. I'm going to do my own thing.' Since I never wanted to be a businessman, I needed a few good reasons to be one. One thing I did not want to change, even if we got serious: Work had to be enjoyable on a daily basis. We all had to come to work on the balls of our feet and go up the stairs two steps at a time. We needed to be surrounded by friends who could dress whatever way they wanted, even be barefoot. We all needed to have flextime to surf the waves when they were good, or ski the powder after a big snowstorm, or stay at home and take care of a sick child. We needed to blur that line between work and play and family."

- Yvon Chouinard

After that, Yvon started to do his homework and learn about business. He became interested in Japanese and Scandinavian styles of management opposed to American ones. Yvon says, "I didn't find any American company we could use as a role model. Either it was too large or too conservative for us to relate to, or it didn't have the same values. However, there was one company, Esprit, owned by my friends Doug and Susie Tompkins, that was contrary and shared our values. Doug was a climbing and surfing friend who in the early sixties started The North Face store in San Francisco. We linked up when he did the wholesale distribution for my hardware in 64-65. He was the one who introduced me to the remote region of Chile and Argentina called Patagonia in 1968, after he had sold The North Face, and in fact it was while we were on that trip that Susie and a friend started the business Plain Jane, which became Esprit. Doug always had a visceral dislike for authority and always relished breaking the rules." More to come on Doug Tompkins later.

Fast forward to 1990. Chouinard Equipment had been the target of several lawsuits and was gone (none of the lawsuits had to do with faulty equipment and climbers). Patagonia clothing sales had massively grown, but the company was making all the classic mistakes of a growing company. In the late 80s the company was restructured 5 times in 5 years, with no plan working better than the previous one, so they decided to get some help. Yvon says, "We contacted Dr. Kami, who had run strategic planning for IBM and at some point had turned Harley-Davidson around... Before he could help us, he said, he wanted to know why we were in business. I told him the history of the company and how I considered myself a craftsman who had just happened to grow a successful business. I told him that I'd always had a dream that when had enough money, I'd sail off to the South Seas looking for the perfect wave and the ultimate bonefish flat. We told him the reason he hadn't sold out and retired was that we were pessimistic about the fate of the world and felt the responsibility to use our resources to do something about it. We told him about our tithing program, how we had given away a million dollars just in the past year to over 200 organizations, and that our bottom line reason for staying in the business was to make money we could give away. Dr. Kami thought for a while and then said, "I think that's bullshit. If you're really serious about giving money away, you'd sell the company for a $100million or so, keep a couple million for yourselves, and put the rest in a foundation. That way you could invest the principal and give away $6-8million every year. And if you sold it to the right buyer, they would probably continue your tithing program because it's good advertising."

"I said I was worried about what would happen to the company if I sold out. "So maybe you're kidding yourself," he said, "about why you're in business." It was as if a Zen master had hit us over the head with a stick, but instead of finding enlightenment, we walked away more confused than ever."

And right after that, in 1991, the country entered a recession and Patagonia hit a wall. They laid off 120 employees (20% of the team) on a day they refer to as Black Wednesday. In 1992 Inc Magazine published an article called Lost In Patagonia (read the full article here), a negative article about the company's future. The article ended with "Yvon Chouinard touts his company as a model for the future, when, in fact, its time may already have passed."

Yvon says, "Our own company had exceeded its resources and limitations; we had become dependent, like the world economy, on growth we could not sustain. But as a small company we couldn't ignore the problem and wish it away. We were forced to rethink our priorities and institute new practices. We had to start breaking the rules." After that, Yvon took a dozen of his top managers to the real Patagonia to ask themselves the tough questions. Why were they in business and what kind of business did they want to be? They created philosophical and inspirational guides for the company, based on their shared values. Yvon started teaching these philosophies to employees in weeklong seminars in Yosemite, the Marin Headlands, and Los Padres National Forest.

"I realize now that what I was trying to do was to instill in my company, at a critical time, lessons that I had already learned as an individual and as a climber, surfer, kayaker, and fly fisherman. I had always tried to live my own life fairly simply, and by 1991, knowing what I knew about the state of the environment, I had begun to eat lower on the food chain and reduce my consumption of material goods. Doing risk sports had taught me another important lesson: Never exceed your limits. You push the envelope and you live for those moments when you're right on the edge, but you don't go over. You have to be true to yourself; you have to know your strengths and limitations and live within your means. The same is true for a business. The sooner a company tries to be what it's not, the sooner it tries to 'have it all,' the sooner it will die.

 

I've been a student of Zen philosophy for many years. In Zen archery, for example, you forget about the goal–hitting the bullseye–and instead focus on the individual movements in shooting an arrow. You practice your stance, reaching back and smoothly pulling the arrow our of the quiver, notching it on the string, controlling your breathing, and letting the arrow release itself. If you've perfected all the elements, you can't help but hit the center of the target. The same philosophy is true for climbing mountains. If you focus on the process of climbing, you'll end up on the summit. As it turns out, the perfect place I've found to apply this Zen philosophy is the business world.

- Yvon Chouinard

Yvon continued to teach the seminars, and through his teachings he found the real answer to Dr. Kami's question. "I knew after 35 years why I was in business. True, I wanted to give money to environmental causes. But even more, I wanted to create in Patagonia a model other businesses could look to in their own searches for environmental stewardship and sustainability... I'm glad I didn't follow Dr. Kami's advice... If I hadn't staying in business, I never would have realized–the hard way–the parallel between Patagonia's unsustainable push for growth and that of our whole industrial economy." And the story ever since has become one of Patagonia trying to live up to their mission statement:

Make the best product, cause no unnecessary harm, and use business to inspire and implement solutions to the environmental crisis.

Now fast forward to present day. Patagonia has donated $74 million in cash to grassroots environmental organizations with their 1% For The Planet campaign. In addition to clothes, they make food, and as of very recent, they even make beer. My personal favorite are the films they create, both short and feature length documentaries about environmental campaigns, and interesting stories about the sports and people they are inspired by.

After a Trump election and a brainstorming session, Patagonia came up with the Black Friday plan. Their CEO Rose Marcario posted this to their blog on November 20th.

We’re just days from Black Friday, one of the biggest consumer shopping days of the year in America. And as people think generously about family and friends, we also want to help our customers show love to the planet, which badly needs a gift or two (and still gets coal every year).

This year Patagonia will donate 100 percent of global Black Friday sales in our stores and on our website to grassroots organizations working in local communities to protect our air, water and soil for future generations. These are small groups, often underfunded and under the radar, who work on the front lines. The support we can give is more important now than ever.

We’ll also provide information in our stores and on our website about how to get in touch with these groups and easily be active in your own communities—on Black Friday and every day.

For decades, Patagonia has demonstrated that caring for our planet is not in conflict with running a successful business. We are always looking for ways to further reduce our manufacturing footprint, including our company’s reliance on fossil fuels. We also fund grassroots environmental organizations by giving away 1 percent of our sales. To date that amount totals $74 million.

But during a difficult and divisive time, we felt it was important to go further and connect more of our customers, who love wild places, with those who are fighting tirelessly to protect them. This we know: If we don’t act boldly, severe changes in climate, water and air pollution, extinction of species and erosion of topsoil are certain outcomes. The threats facing our planet affect people of every political stripe, of every demographic, in every part of the country. We all stand to benefit from a healthy environment—and our children and grandchildren do, too.

By getting active in communities, we can effect local change to protect the food our children and we eat, the water we drink, the air we breathe and the treasured places we love the most. And we can impact global priorities, too, by raising our voices to defend policies and regulations that will reduce carbon emissions, build a modern energy economy based on investment in renewables and, most crucially, ensure the United States remains fully committed to the vital goals set forth in the Paris Climate Agreement.

At Patagonia, we will grow and deepen our resolve to protect what we love. We will fight harder and smarter, and use every means at our disposal to prevail for the sake of the country, the planet, and the wild places and creatures that need our voice.

We are here and we’ll keep fighting. 100 percent on Black Friday, 1 percent every day.

And here's what happened:

Last week, when we announced we’d give 100 percent of our global retail and online Black Friday sales directly to grassroots nonprofits working on the frontlines to protect our air, water and soil for future generations, we heard from many of our customers calling it a “fundraiser for the earth.”

We’re humbled to report the response was beyond expectations: With your help, Patagonia reached a record-breaking $10 million in sales. We expected to reach $2 million in sales—we beat that expectation five times over. The enormous love our customers showed to the planet on Black Friday enables us to give every penny to hundreds of grassroots environmental organizations working around the world.

Many of these environmental groups are underfunded and under the radar, and they are overwhelmed with your commitment. On behalf of these activists and every Patagonia employee, we extend a heartfelt thank you to our customers, friends and community worldwide who showed up to #loveourplanet.

You can learn more about the past recipients of Patagonia environmental grants in your community here. This additional infusion of resources will go a long way toward addressing climate change and other serious environmental issues.

The science is telling us loud and clear: We have a problem. By getting active in communities, we can raise our voices to defend policies and regulations that will protect wild places and wildlife, reduce carbon emissions, build a modern energy economy based on investment in renewables, and, most crucially, ensure the United States remains fully committed to the vital goals set forth in the Paris Agreement on climate change.

Along with many loyal customers, the initiative attracted thousands who have never purchased anything from Patagonia before. We’re encouraged to see the great interest from so many in making buying decisions that align with strong environmental values—and taking steps to get more directly involved as well.

A list of all the grantees receiving the donations can be found here: http://www.patagonia.com/grants-listings.html

Towards the end of Yvon's book, he says "When I look at my business today, I realize that one of the biggest challenges I have is combating complacency. I always say we are running Patagonia as if it's going to be here 100 years from now, but that doesn't mean we have 100 years to get there!... Our current landscape is filled with complacency, be it in the corporate world or environmental front. Only on the fringes of an ecosystem, those outer rings, do evolution and and adaptation occur at a furious pace; the inner center of the system is where the entrenched, non adapting species die off, doomed to failure by maintaining the status quo."

There is nothing complacent about what Patagonia did on Black Friday. I'm inspired by it and I want to get more involved. And I hope other people and companies are inspired by it as well. The $10million will go fast, and that alone is nothing against the problems we are trying to solve. Other companies need to follow Patagonia's lead. And we as consumers need to find the will within ourselves to do what we can to help the cause, to be part of the answer, not the problem.

"The Zen master would say if you want to change government, you have to aim at changing corporations, and if you want to change corporations, you have to first change the consumers. Whoa, wait a minute! The consumer? That's me. You mean I'm the one that has to change?"

- Yvon Chouinard

I said earlier there would be more on Doug Tompkins. Doug recently passed away in a kayaking accident in Chile, the one year anniversary of his death is in 4 days. It wouldn't feel right writing about what Patagonia and Yvon have done without mentioning Doug and all of his conservation efforts. Doug married Kris McDivitt, the long time CEO of Patagonia. After Kris left Patagonia, her and Doug moved to South America and created a Foundation to conserve land and gift the land back as National Parks to the countries they are in. Collaborating with several presidential administrations and other partners, the Tompkins Conservation family of nonprofits has helped create six national parks in Chile and Argentina and is working to establish at least five more. This is one of my favorite videos, and it's very short and impactful 15 minutes.

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