Cotopaxi: From Selling $6M of Pool Tables to Scaling $150M in Revenues and Challenging…

Harry, it’s such a pleasure. I’ve just I’ve loved, your podcast. I’ve loved listening to it, and so it’s an honor to be here with you.

My mind changed a lot, but I I definitely had, like, a common thread, which was I I had a real deep desire to help other people. I had moved to Latin America as a four year old. Grew up in a number of different countries. The Dominican Republic, where we first moved when I was four, and then we ended up, I spent a bunch of my childhood and teenage years in Ecuador. You know, I’d always known that I wanted to find a way to help people.

I look at my childhood pictures, like, in school, and I’m like, I just stand out. Like, I look nothing like everyone else around me in my in my class pictures and just such beautiful moments that I had as a child. A lot of times where I didn’t connect with everyone, where I didn’t I didn’t fit in, I had I thought differently. I, you know, of course, looked different. And I I think that ended up being a real strength for me as I got into adulthood, where number one, I had a lot more compassion and empathy for others that maybe didn’t fit in.

The other thing is I was okay to think diff it was okay to think differently. As an entrepreneur, it certainly helped, shape that path. So you get out of college

Yeah. Yeah. So I was in college, and I met a man named Steve Gibson, an adjunct professor at the university, Brigham Young University, I’d gone to undergrad. He was a successful entrepreneur, and I I had this chance to sit down in his office and talk with him. And he instead convinced me if I wanted to make a difference in the world that I should become an entrepreneur. Totally shifted the way I was thinking about my role in the world and how I could make a difference.

And so I started brainstorming ideas. One of the ideas that came to my head was, you know, I started selling dive gear, scuba gear on eBay just because I I love diving and, had no money, but it was like, hey. If I could maybe buy and sell some dive gear here, maybe I can make enough money to go on a trip and go diving somewhere. One night, was talking to a friend of mine, and he mentioned pool tables, and it just clicked. And it was like, you know, I I could do that.

Like, I I bet I could go to China. So, so So you went to

Exactly. Flew to China, and with my cousin, the two of us went out there, and we I found a couple factories. I had googled pool table factory China, found this a couple factories in China, flew out there, and started buying them and selling them on the Internet.

didn’t have the cash. But what we decided to do is when we listed them on eBay, we said ten week lead time. Custom made hardwood pool table, ten weeks. And so people were you know, a lot of people probably are like, I’m there’s no way I’m waiting ten weeks. But other people are like, hey, I’m building my house or I have ten weeks. No big deal. And so enough people were willing to do it where we actually use customers to finance the first inventory. Then we went to my grandma.

My grandma, think she lent us $10,000. Then we went to the bank, and we got a small small business loan. And, you know, I think it was $25,000. And so we just kinda, you know, pulled together some money from friends and family and just ended up pulling a little anything we had out of savings, borrowed from credit cards. We got credit cards in the mail that was like that we used to go finance the business. So

It’s interesting because, I actually got married when I was in college. Married very, very young. I’d spent two years away from college on a on a church mission in Bolivia. So I finished college a couple years later than most people do. But I was 22. I got married and then finished finished college, and then my wife and I had our first baby, like, immediately after. My life was so different from what most people experience when they’re in college and when they finish college. So, you know, honestly, I was very grounded.

I had so much responsibility. I, like, I had to provide. I had to be a dad, and I had to be a good husband. And so my focus was totally different from my probably most 23, 24 year olds.

You know what? I don’t. I felt so much purpose and, clarity in my life. You know, it’s interesting, Harry. This is such an odd thing to be talking about on a podcast, but I have actually never I’ve never had alcohol ever. I don’t have a craving for it. I don’t desire it. Like, I don’t even know. And honestly, like, I don’t feel I’m missing anything. Like, I have such a fulfilling life. I have a beautiful family. I have purpose. And in a lot of ways, it’s it’s it’s very different.

My experience growing up, my experience as an adult has been very different, but it’s been incredibly fulfilling.

So my cousin and I, you know, we’d spent about six years building this pool table business. It was bootstrapped, you know, no venture money, and it was kind of the leader in online pool table sales. So we built something that worked. And so we decided, you know, my cousin was like, hey, you know, Davis, I’m going to business school. I wanna my dream has always been to go to Harvard Business School. I wanna go. And I’d always thought it’d be really amazing to go to the Wharton School.

They have this this dual degree program, an MBA and an MA in international studies called the Lauder Institute. I was like, you know what? I’m gonna do it too. So we both applied to business school. I only applied to Wharton to this dual degree program. I was lucky enough to get in. He got into Harvard. And then we spent two years thinking about what we were gonna do next. We still had the pool table business kinda on the side, being run. And we decided, you know, I’d met Mark Lauri a few years earlier.

I had this interesting business, pooltables.com. He had this business, diapers.com. We started chatting. And over the next several years, I watched his business go from 5,000,000 to 20,000,000 to 70,000,000. And in the meantime, I’m building this pool table business that’s not growing in that way, and I’m thinking, wow. He’s got a much more interesting and exciting business than I do. You know, when I was in business school, a lot of my friends were Brazilian. I just started thinking a lot about Brazil and if there’s an opportunity there.

And it just kind of this idea happened where it’s like, hey. What if I went down to Brazil and started basically a a diapers.com, an e commerce platform for baby product, a marketplace for baby products. And so that’s what we ended up doing.

This is a wild story. So we’re in school. We raised, like, $4,500,000 based on a PowerPoint. We’d had the success to build off of of this pool table business. Right? And so people saw these two young ambitious kids that had had, you know, gone to great schools and that had built a business previously. We moved down to Brazil. We launched the business, and it it kinda catches fire. I mean, things are going hot. I mean, we grow to, like, 300 employees in, like, eighteen months. It’s ends up being kind of a darling of the the startup story in Brazil.

And we were the startup of the year in 2012, a lot of exciting growth, lots of venture capital. First time we’d raised venture capital. It ends it ends up being a very tragic story, Harry. Basically, my cousin and I, we were like brothers, closer than brothers. I mean, we did everything together. We’d lived on the same street in The US. We’d gone to school at the same time. You know, we went to Brazil and started this business together, and our relationship fell apart. And honestly, it’s like, it’s been it’s been over a decade, and it’s like the saddest thing in my life.

Why did

I you know, it’s it’s complicated. I think in over time, we just grew apart. We had different desires, different interests, and, a different vision for what we wanted to to do. And we were co CEOs, and it it just created a lot of tension.

You know, we often hear that you shouldn’t start a business with a family member. You know, I I think that’s wise advice. Maybe the lesson I learned was and I did something differently when I started my the following business, which was instead of just choosing my partner from the beginning and saying, okay, hey, let’s go work together. Let’s go find something to do together. Instead, I tell entrepreneurs, why don’t you go identify your idea? Why don’t you go figure out what you wanna go build? And then go find the best person in the world to go help you solve that problem?

It probably is not gonna be your cousin. Go find the right person that has the right skill set that can help you go solve the problem versus someone that you you think you’d really love working with because they can create a lot of pain. And especially with a family member, it’s like, I I can’t just walk away. We have family reunions, and I and I care for him. I ended up deciding to leave. I I decided to leave Brazil, and it was very painful. Our investors had invested a lot of money.

At that point, we’d raised around $40,000,000 in venture capital. And I would

He ran the business for, I think, another five years, four and a half or five years. And over that period of time, the business ended up failing. It’s not the story that I think we all hoped and wanted it to be.

Yeah. In some ways, it’s interesting because it actually happened over, like, a thirty six hour period. And at the same time, it’s something that took it was like a lifetime of experiences building up until this culmination experience. I was basically in bed in Brazil. I’m so unhappy. I’m depressed. I’m so sad about the loss of this relationship. I’m thinking about this desire I’ve had my entire life to find a way to help others. And I’d made a New Year’s resolution that year, and I had it on a Post it note in the bathroom on the mirror that I wanted to change somebody’s life.

And I was feeling so discouraged that I’d spent ten years as an entrepreneur. I had not yet figured out how to make a difference in the world. I had this goal. It’s like, okay. I’m gonna make this small goal, just one person. I don’t need to change the world, just one person. And it’d been, like, four and a half months, and I still hadn’t done anything. And I was like, what am I doing with my life? Like, I just don’t feel fulfilled. I’m not happy. As I laid in bed, I just started having ideas kinda come to my head about what I could do next.

And, I got out of bed. I sat on the couch all night, the next day, and the entire following night. So thirty six hours on this couch. And during that period and I took detailed notes. I still have the journal entries on my computer. And I basically had the entire idea for Cotopaxi, this idea of building an outdoor brand that could fight poverty, where we could use our our brand and our profits to go make a difference in the world. And we could hopefully I wrote in my notes, like, alone, this a single brand can’t change the world.

But if we can create a brand that can inspire thousands of other businesses and millions of consumers to think differently about the purpose of business, I think we really could change the world. And so that was that was the hope.

Yeah. I mean, brand, it really comes down to values. What’s at the very heart of what you’re doing? Why why? For us with Cotopaxi, I always tell people we’re not a backpack company. We’re not a jacket company. We’re not an outdoor brand. We’re a movement of showing that business can be a force for good in the world. You know, we stand for fighting and eradicating poverty.

Yeah. Fair. I really like that definition. And at the same time, I would say, I think it goes beyond just how someone feels. I think certain people like, maybe it’s a car brand, you know, people maybe like Tesla. And part about driving is, like, it says something about what matters to them, what their values are. Right? This is some this kinda shows what matters to me.

We actually know the answer to that because we’ve done a lot of research on this. And, and actually, I I would kind of rewind because it goes back to when I first had the idea. I was talking to the to one of the founders of Warby Parker. And I was telling him about this vision that I had of building this brand. And he’s like, Davis, I love it. You know, Warby Parker has a mission of using their business to do good. They help people get eye care in the developing world.

But it’s kind of a little more on the periphery of their brand. It’s not the first thing you know about. A lot of people probably don’t even know about it. And the advice that he gave me was like, look, Davis, that’s wonderful, but people are not gonna buy your product because you’re doing good in the world. You need to first create a great product. And he was absolutely right. So I really do think that’s first. Like, you have to go build a great product. But at the end of the day, we’re in the outdoor industry.

There’s, like, a thousand other brands just like ours. What really sets us apart is what we stand for. So it’s the reason that we’ve had success.

Yeah.

You know, I did it a little differently, actually. So, you know, I mentioned earlier about if you’re gonna go start a business, go try to find someone that can help you solve a specific problem. So I knew I needed to start this outdoor brand. So I went on LinkedIn. You know, I I was in Brazil at the time. I just go do these LinkedIn searches for 20 different brands that I really admired in the outdoor space, and I started doing searches for designers that had worked for these brands.

And I found a few designers, a woman that had worked for a number of these brands before that did apparel, this amazing guy that had done a bunch of packs and gear. And I reached out to them on LinkedIn. I just said, hey, I wanna connect with you. I’m I’m an entrepreneur. I built a few businesses in the past, but I have this vision for building this outdoor brand that’s about fighting poverty. And I’m wondering if you jump on a call with me. And we we jumped on a Skype call.

I just kinda sold them on this vision, and both of them said, I’m in. That’s how we started. And because they had relationships with factories already, we flew out to these places, The Philippines and other places where we where we make our product, and we had relationships already in these because they had relationships, these factories that normally wouldn’t have given us the time of day as a brand new brand, they said, sure. You know, I really like this designer, and why don’t we give it a shot?

Absolutely. Absolutely possible. And you have to get creative. Like, you know, with them, it was like, you know, give them a little bit of equity, and, we figured out some creative structure around compensation if we ended up fundraising. If we didn’t fundraise, it was like I didn’t have to pay anything. So they were taking a little bit of risk with me, but because of that, they got some upside with equity and it’s, you know, it’s been a win for them. And so, yeah, I think the greatest entrepreneurs are incredible salespeople.

They know how to sell. They know how to sell a vision. They know how to sell an idea. They know how to sell a product. And so you’re selling every single day as an entrepreneur. And I I think that starts with that original idea and getting people on board.

So, you know, as a member of the Church of Jesus Christ of Latter day Saints, they call us Mormon sometimes. Like, I I was a missionary. Yeah. I mentioned this. I was a missionary when I was 19, 20, 21, moved to Bolivia. It was a life altering experience for me. I think about it every single day for the last twenty five years. One of the Why?

Okay. A few things. Number one, I developed such a deep love for the people there. I talked with the people I met there almost daily, even after twenty five years. And number two, I became so deeply rooted in my purpose in life during these two years. I knew what I stood for. I knew what mattered most to me. I think a lot of times entrepreneurs, they’re distracted by things that just don’t matter. I’m I’m in Brazil now, and we haven’t talked about that yet. But I’m back in Brazil right now, And I’m seeing how it’s become so clear to me over the last six months of being here, how, how distracting the world can be.

We focus on the wrong things, materialism, buying things. We think happiness comes from the more stuff we have. That never brings us joy. And we’ve known this for the whole of human history. I mean, like, the wisest people have said this for thousands of years. Right? But somehow, we keep chasing the wrong things. And I think those two years as a young 19 year old, every day was never about me. And as a 19 year old, usually life is about you. It’s like, how do I go get pleasure?

How do I go have fun? What am I gonna do when I grow up? It’s like it’s all about you. But when I was 19, those two years, it was every single day you woke up at 06:30 in the morning, Every night you went to bed at 10:30 at night. There was never a day off. There was never a vacation. You woke up, and every single day was you’re going out and you’re looking to serve and help people. And so it changed the lens in which I saw the world.

Wealth. It’s the wrong focus. I think so many entrepreneurs today. The the reason they go start a business and what drives them is, like, how much money can I raise so that I can make as much money as possible? It’s the wrong thing to focus on. I think if you focus instead on why do you exist, what is your purpose, how can you make the world a better place, how can I make my employees, how can I give them a life changing experience working with this brand?

If you’re focused on on the things that make your team happy and on make and add value to the world, everything else will work out. I think that’s where entrepreneurs get get it wrong. They spend so much time focused on things that really are the wrong thing. It ends up hurting them.

Yeah. You can absolutely raise venture capital. I mean, I think there’s obviously different ways to build businesses. And, you know, I have the pool table business, which is a longer story there. We sold it. I actually bought it back a few years ago. So I actually own the business still, the pool table business. But I’ve seen I’ve seen two very I’ve had two very different experiences. One business where I I own outright, bootstrapped, and then another business where we’ve raised venture capital has grown very, very quickly.

And I have all sorts of different pressures, external pressures that don’t exist with the pool table business. And so there’s different ways. There’s not one way that’s right or wrong. But if but

Yes.

agree, Harry. Totally agree. And this is what’s unique, I think, about Cotopaxi. It’s the thing is my focus is not personal wealth. I have enough. Know, You I live a very simple life. I I don’t need much. But what I am chasing, I’m ambitious. I’m ambitious because I wanna go do something that’s gonna be significant, and I wanna go build a brand that’s gonna change the world for the better. I wanna eradicate extreme poverty in my lifetime. The way that we do that is by building a massive business.

You go build a multibillion dollar brand that can use its profits to go change people’s lives, and that can inspire many other businesses to look differently about how to build a business. So I wanna accomplish the same thing that a VC wants to accomplish. Let’s go make something massive.

There’s a misalignment. Harry, I will tell you there is misalignment. There’s absolutely misalignment. At the same time, I think we all want the same thing, ultimately. We wanna grow. We wanna grow, and, you know, I’m okay getting people great return. I’m okay providing a fantastic return to investors. Our investors have made great money. Our early investors had great outcomes. Our investors that are coming later, Bain Capital, they, you know, they invested two and a half years ago. Okay.

people out. Yeah. Bain Capital, they bought out a lot of our early investors, and those early investors made a fantastic return. And now Bain Capital invested 2.5 ago. We’ve more than tripled our revenue, you know, since they’ve invested two and a half years ago. Now Bain Capital is gonna get a return. That said, Harry, you’re right. There’s a misalignment, and I don’t know the answer yet. I’m trying to figure out. And I’ll just tell you, I haven’t talked publicly about this. But earlier this year, about twelve months ago, I knew I was leaving the company, leaving my CEO role to go lead a mission for my church in Brazil.

My church asked me if I would leave my life behind, my with my family, move to Brazil, go lead a church mission. It makes no sense. Right? It’s like, why would you possibly why would you go leave this brand that’s growing? You know, we’d grown a 100% almost a year before. Why would you possibly leave? And we can talk more about that. But it’s like, you know, was so aligned with what mattered to me. And so I made the decision to leave, but I started thinking a lot about what what was the future of Cotopaxi.

And I had this misalignment where I had Bain Capital and some other investors that were looking and saying, hey. You know, this has been a great investment for us. How do we get out? How do we go create a return for our investors? Which is fine. I’m happy for them. At the same time, I want to build a brand that can that can be durable over decades. I wanna build a brand that’s not beholden to an investor. I wanna build a brand that’s that’s beholden to our mission and our purpose.

And so I actually went out and I tried to fundraise. And I went through a process about six months long that was painful. I pitched over a 100 different investors, lots of family offices, And I told the story of this brand that was over 100,000,000 in revenue. It was growing, you know, at this at this crazy rate. It would’ve been profitable for four years. I thought, this is a great story. I’m gonna be able to go raise money from an investor that’s committed to at least ten years.

That’s what I’m looking for. It’s like, I want someone that’s committed for ten years. I failed. It was painful. It was sad. Like, I was so disappointed in myself. And I and I’m and I would say I pride myself in in knowing how to fundraise and knowing how to tell the story. But there was some What do

I don’t know. I don’t know. It was probably a combination of a few things. Like, number one, timing of the market, very hard market. You know, anything in the public markets, as we all know, is just a disaster. You know, that that definitely impacts things. I think part of it too, maybe too ambitious. You know? I I wanted to restructure the organization that took power away from investors and gave power to our foundation to go drive decisions, to go use the business truly to do good, and at the same time, promising great returns.

It’s like, we are going to be a multibillion dollar business. It’s just a matter of time, and we’re profitable, and we’ll continue to be profitable. But we don’t want to be driven to make the wrong decisions because that’s the the biggest thing that we need to protect as a brand is our purpose and our mission. And so I think I was too ambitious. And, I think there weren’t enough and there are not enough investors that will that say, hey. I’m willing to stick to something for ten years.

I’m, you know Do you you think

Sure. For many investors, is. When I started the brand, same thing. I pitched a 100 investors to get our first investor. You know, Kirsten Green, a forerunner, she she backed us. I pitched a 100 investors in our first to raise that seed round. I led with our mission. It’s like, we are building a brand that is going to fight poverty. We’re gonna use profits. And, actually, we’re gonna use money before we have profits to go fight poverty. So I really needed investors that bought into it, and some did.

What was the price on that first round? We raised $3,000,000, so a seven pre 10 post. Woah. Yeah. This is back in 2014. You we know, hadn’t sold anything. It was just literally a PowerPoint. But you know what? People believed in us. And Kirsten and those other early investors, they made the right decision. They invested in a what ended up becoming a really great brand and a great investment for them. Harry, the interesting thing, though, I will say, I don’t know I can’t really explain why.

Our first major investor, Kirsten Green. Our second major investor, Ellie Wheeler from Greatcroft. Our third major investor, Brooke Harley. Our fourth major investor, Lauren Ivison. Our last investor with Bain Capital, Cecilia Chouin. There’s a trend. Women are leading rounds in our business. I really believe that women better understood and understand purpose in business than men did. But, yeah, you’re right. Many investors, because of our mission and purpose, are like, I just don’t know if this is right for us.

I think a few things. Number one, I don’t think most people understand how hard it is. You will get rejected a lot. And it’s a tricky balance to understand. When do you walk away and you say, hey. I’m just realizing that the mark the market isn’t right. The timing isn’t right. I’m not at the right place for the business to go raise money. Or being persistent and saying, hey. I’ve got it right. I just need to listen and figure out how to better present what I’m trying to build to connect with investors.

I hear a lot of times young entrepreneurs saying, hey. You know, I’ve tried to raise, and for whatever reason, everyone I I’ve been rejected 10 times. And it’s like, 10. That’s yes. Of course, you’re gonna reject if you only pitch it 10 times. You need to go do this a lot, lot more. The other thing is I think a lot of entrepreneurs don’t understand how big and ambitious the idea needs to be to go raise venture capital. A lot of times, I get to send a deck and say, hey.

I’m gonna go raise money. Here’s the deck. I’m looking five years out. They’re raising you know, they’re they’re selling $15,000,000 of product or something. It’s like, venture capital is not gonna fund that business. You need to go build something that’s that’s gonna do a billion dollars in revenue. You need to have that vision, and you you need to go sell that vision to an investor and, with confidence. And you need to go have the data behind it to kind of explain how it’s gonna how you’re gonna get there.

So, yeah, I think people a lot of times don’t understand what VCs are looking for in terms of what kind of returns they need to get. They they know most of the the businesses are not gonna make it, so they need the ones that do make it need to be very, very big.

Yes. I believe we are, and and only based on the experience I had in the last twelve months. Like, I wanted permanent capital. Even in the last twelve months since I started that fundraising process, we’ve think business has increased 50%. It would have been a great investment for someone that would have come in and said, hey. We believe you’ve already been growing on this amazing tear. We believe in your vision, and we’re committed to a a ten year commitment or a fifteen year commitment. And it’s like, let’s go build this together.

Let’s go build the next billion, multibillion dollar brand. But very, very few investors are committed to that kind of timeline. They’re all everything’s so short term minded, which is frankly I mean, this is this is the world we live in. Everyone is focused on short term versus long term. How do I get happy quickly? How do I go satisfy this instant desire that I

I think when you chase happiness, we’re oftentimes chasing the wrong thing because just human nature, we think what brings us happiness is things that don’t. We’ll never find happiness when we’re thinking about our ourselves. And I found the most happiness when I’m out working towards a greater cause. You know, this last six months for me has been some of the greatest joy. And if I’m being honest, like, was I scared to leave Cotopaxi? Absolutely. Was I sad to leave? Very sad. I’m still sad. I’m still sad.

I love that brand. It was the greatest professional achievement of my life, and I’m still sad thinking about walking away from that. And at the same time, every minute of my day these days is focused on someone else. This is what truly brings joy, what truly brings happiness. This is the stuff that fills the soul. Every minute, thinking about somebody else. And so this is where, know, at least for me, where I found happiness. And I think that there’s nothing wrong with wanting to be happy.

We need to remember what actually brings happiness.

think? I mean, I think humans, were wired very similarly. I actually have a hard time believing that that materialism brings anyone lasting joy. And I think just part of being human is, like, we care deeply for others. I mean, that’s what makes us human. It’s like we have empathy and compassion for other people. And I think, yes, are there exceptions? Of course. There are exceptions. But I think overwhelmingly, humanitarianism

It’s possible that that’s that’s true. I also tend to think that humans, in a lot of ways, were better than we ever have been. I mean, I think we live in while there’s so much violence in the world, there’s so much, pain and suffering, we actually look at the world. It’s so much better than it was a couple hundred years ago. There is less violence than there was a few hundred years ago. There’s less poverty. You know, 94% of the world lived in extreme poverty two hundred years ago.

In 1820, almost the entire human population lived in extreme poverty. It’s now eight and a half percent. It’s like it’s an amazing world we live in. You know, are there things I worry about? Of course. You know, I I think I wish we had a world that that was less about tearing others down and more about building others up. And, you know, I think we have a a fundamental lack of great leadership in in the world. And at the same time, like, why does anyone why would anyone wanna lead?

Because when you when you volunteer to lead, you get torn down. You get picked to pieces if you ever disagree with someone or think differently. Right? So it’s like there’s not a lot of incentives to want to go take on these I look at, the presidential election in The United States, and it’s like, how in a in a country that size do we not have more inspiring leadership that’s stepping up?

I think they provide tremendous value. Actually, I think it’s a game changer for me. You know, I’ve done both, and I’d say one of the greatest advantages is the value add of investors. Having brilliant minds around the table that are helping you make better decisions. It’s not just the money.

You know, I think of the investors I’ve had around the table. You know, I’ve just I’ve made much better decisions, and I’ve been able to recruit better talent because I have I have credibility, because we have someone with credibility that’s at the board table. They help me close, you know, hiring. It’s like I I say, okay, I need this person closed. I go get Kirsten Green or someone from our board to go jump on a call. I can attract and retain talent better. I’m making better decisions as a business leader.

And so What was the

With a venture capitalist? Kirsten Green, that one was really special for me because I I saw it in her eyes. She believed. She believed in this vision. You know, I I didn’t win her over instantly. There was some arms twisting that had to happen. I think she felt the passion that I had for why this brand needed to exist. And, ultimately, she she took a bet on us, and I’m so grateful for it.

Yeah. COVID was an interesting time for us. In some ways, it was what allowed us to break out. Although it wasn’t interesting, it wasn’t our highest growth. Our slowest growth year in the last ten years was actually 2020. We grew 40% that year, but we were profitable, significantly profitable. And it was because we tightened our belt in such a big way. We didn’t lay people off, but we all rallied together in a big way. And I just told the team, look, I don’t wanna do layoffs.

I’m gonna take a big pay cut. The executive team is gonna take a big pay cut. We’re gonna ask the entire team to take a 10% pay cut for three months and then a 5% pay cut for the rest of the year. Let’s all experience a little bit of pain together to save everyone’s jobs, and let’s rally together. We doubled down on our social mission. We gave 3% of our revenues that year to impact work. You know, when everyone else would have said, hey. Let’s not give money this year.

Like, we don’t have the money to give. It’s it’s it’s a scary time. Day one of the pandemic, I committed to our team that we would not waiver on our impact work. And so we rallied together, and we innovated. We started selling masks, face masks, which was outside of the scope of what we normally did, but we sold a lot of them. And it really kind of saved our business during that that Does anyone

Well, look. You know, we have a team of believers. You know, they are not there because this is a career move. They’re there because it’s a calling. They feel called to this work. And at the end of the day, you know, we ended up giving everyone what they what they’ve given up. At the end of the year, we gave everyone bonuses. We we gave them everything that they’ve given up and more. What I think we all believe is that when we do the right thing, when we commit to our mission first, the business is gonna be better.

Of mean, of course. Of course. And I think in the short term, yes. Quick example. You know, when I was in Brazil, I was living in Sao Paulo, 20,000,000 people, very busy city. Traffic is crazy. It would take an hour and a half to two hours to commute eight kilometers, five miles. You know, I had two little girls at home, and, I wanted to be a great dad. And so I decided I was gonna leave the office at at five, 05:30 every single day, which in Brazil was unheard of.

You know, most people would work till seven or eight or nine, especially in a startup. It’s like, what are you doing leaving at five or 05:30? And I actually had one of our investors say, you know, Davis, if you leave at that time, your entire team’s gonna leave at that time. And I said, you know what? I’m I’m great with that. I want these people to go home and and balance their family life and this work life. In the end, what ended up happening was people did leave when I left.

And we also ended up recruiting some of the most amazing female talent in the country because we started having this a huge number of female executives that heard about this and said, I want to be a mom too. I have kids at home, and I don’t wanna just work till 9PM. And this is a place that respects families. And so we had men and women that started joining our team saying, I wanna work at this place. I’m willing to take a pay cut. I’m willing to wait to go go to join the startup that’s high risk versus, you know, this big company I’m at because I wanna go be part of a brand and culture that that aligns with my values.

So I think in the short term, sure, maybe. But I think in the long term, when you’re doing the right thing, you end up having great results.

You know what? I think I disagree with this one. I I disagree. I think Can you name can you name me one? Sure. So you mentioned you mentioned Patagonia, and, I think this is a great example.

He was unhinged. But, you know, at the same time, Yvon Chouinard, he took massive amounts of time off. You know, he went and traveled down to Patagonia with the founder of The North Face, one of his best buddy. They went and took, like, six months, and when he traveled, they climbed climbed rocks. Right? It’s like for many years of his career, the bulk of the growth of Patagonia happened when he was working six months on, six months off. You know, he’s going out and fishing and disappearing for six

just look at the Cotopaxi case. For ten years, did I put a lot of work into the business? Of course, I did. I put a lot of work into the business. And at the same time, I really did have balance. And it’s not that every single day was perfectly balanced. That’s not, of course, not the case. But when I look at the whole of my time building this business, I was very balanced as a father. I’ve got I’ve got four kids. I spent a lot of time with my family.

I spend a lot of time doing social impact work that I care about. I spend a lot of time volunteering with my church. I prioritize the things that matter to me, and they weren’t just work. And at the same time, you look at what Cotopaxi has done. Are we a multibillion dollar business? Not yet. We will be. And if you look at the percentage of businesses that has that have started in the last ten years, we are in the top 1%. I think we’re a great example of a business that that has shown that, yes, you can have balance, and you can still build an extremely efficient and great business that’s doing great work.

You don’t have to put in a hundred and twenty hours a week, a hundred hours a week, and not have any balance and and torch family relationships and everything else just to to go build a business.

Yeah. You know, this is the most painful thing for a founder when you get to the point where you recognize I may not be the right person to continue building this brand and leading this brand. Was that it here, though, or was it the the calling? You know, I would say it’s a little bit of both. They kind of coincided simultaneously. I’d say, you know, my this is one of the advantages of having a great board is they help you see blind spots. And I you know, my board was so proud of the work that I’d done in building this brand.

And at the same time, I was started hearing from board members saying, hey. We think you’d benefit from having a right hand, a a company president that had done this before, that had taken a business from 150,000,000 in revenue to 1,000,000,000.5 in revenue. You’ve never done that, Davis. And they’re right. I had never done that. I had no idea how to do that.

For sure. You know? And could I have stayed could I have stayed and kept doing it? Sure. I I probably would have figured it out. At the same time, I care a lot more about I wanna go have the biggest impact we can possibly have. If I can get someone to come in and do a better job than I could do, I’m gonna go have a bigger impact. It’s not about what’s best for me or what I want. It was for me, it was really about how do we go have the biggest impact?

And so I listened to the board, and I thought, you know what? I think they’re right. I would benefit from this. And I started a process. Bain Capital gave me a handful of search firms to go talk to. I talked to four or five of them. I didn’t want I didn’t hire any of them. And I decided I’m gonna go run the process myself. And Capital was like, that is a mistake. You should not do it. You should hire these professionals to go do it. But look, like, I asked them to give me blind profiles, profiles of people that they would go put in this role.

I looked at these lists and it was like, number one, I know, like, 30% of the people on the list already and there are people I would not choose for this role. Or I’m looking at them and it’s like, these are not the kind of people I’d want. And I felt like if I pay them a bunch of money and Bain Capital is on my is on my tail, like saying, hey, who are they bringing to you? Who’s gonna be the best person? Once they we narrow it down to the top one or two or three people, I’m gonna be forced to choose one of those people because we just ran this expensive process.

Instead, I said, hey. I know what I want. I know what the brand needs, and so I’m gonna go run the process. I reached out to about a 100 different friends, Joey from Allbirds being one of them and a bunch of others. And I just said, hey, who are the best leaders you know? When you think about a consumer brand leader, who are the best leaders you know? Who are the people I should be talking to? And, former president of The North Face that I reached out to has who has become a friend, he said, hey, there’s one person I think you should be talking to.

And, his name is Damian Wong. He’s the CEO of Eddie but he previously led product at Patagonia. He led product here for me at The North Face. He is brilliant. Maybe the most talented product person in the outdoor industry. I don’t know that he’d ever leave his job at Eddie Bauer. If you could get him, he’d be amazing. So I get on the on this phone call with Damian, and I start telling him about this vision for this brand. And it turns out, you know, the name Cotopaxi is named after volcano in Ecuador where I lived as a teenager.

It turns out that Damian had done a study abroad when he was at Duke for, like, six or nine months in Ecuador. He’d climbed Cotopaxi, the volcano. He felt deeply connected to our mission. He both of his parents are immigrants. All of a sudden, it was like this dream person that you just would hope that someone like him would be willing to take the role was interested. The only problem is he wanted to be CEO. He didn’t wanna be president. He didn’t wanna be my right hand.

And I had some other options that were really great right hands that would have been happy being president forever. And at the end of the day, I I just decided, you know, I’m not in this so that I can be the CEO forever. I’m in this to go have an impact. And so I I chose to hire Damian. And then shortly thereafter, my church asked me if I’d be willing to go to Brazil. And so, it all kind of lined up and worked out perfectly.

I don’t think they have. I think they’ve stayed true to their mission so, like, incredibly well over decades. And in fact, this last move, think, by Yvon Chouinard was brilliant, in a way to protect the brand and say, hey, we don’t care about getting the most money out of this business. I guess if there was a criticism I’d have is why after forty years was he the only shareholder? I fundamentally disagree with this. We have people that work in our warehouse, that lead our retail store operations, that have equity.

I believe that wealth needs to be better distributed. I don’t wanna give the company away to a to a foundation. I actually want to create something that can create wealth for many people within our organization and that can allow them to go pass on this to their children and allow their children to go have new opportunities. I’m a believer in capitalism. I believe that capitalism, if it’s done right, and it needs to be done better than it has been, but I think that it can it can solve a lot of problems.

And so, yeah, that’s something I I aim to maybe do a little differently.

I think it’s hard like, to your point, it’s hard to balance the ambition to go build something great and to be excellent at it and to be a great dad. One thing one realization I had a few years back was that I was being more deliberate and intentional about my company culture than I was about my family culture. I’ve been very specific in Cotopaxi about identifying core values, specifically creating rituals and traditions that reinforce the values. Every single day, I tracked and measured our culture.

measure? There’s a number of great tools. One of my favorites is actually a company called Office Vibe. It sends out polls through Slack. I measure literally every day. I’m I’m tracking and measuring our culture. And I can try I can slice the data based on gender, based on tenure in the company, based on all these different metrics. I can look at each department, and I kinda see where are their issues, where are their problems. And I can identify things before they blow up. And so I can start seeing trends.

And I I was so intentional about my company culture. And when I came to my family culture, the organization that mattered the most to me, I was not following any of those things. And so my wife and I actually sat we sat down, and we created the values that mattered most to our family. And we put them on our wall, and they actually they’re they’re aligned with the s m I t h. Our last name, Smith. Each one of those stands for something. Our children all know what they stand for.

Once a week, we have a meeting, with the whole family, a family evening that we have together, and we talk about our goals. We talk about these values. We’ve created rituals and traditions that have changed our our family culture. And so I think being a great dad is being intentional.

Honestly, I think time. We can’t make up for time. I mean, we can we can create all the rituals and traditions we want, but if we’re not giving our our children time, you can’t make up for that. And so I think that’s the biggest mistake people make is they think, I’m too busy to go spend the time, and I’ll go make up for it by taking them on it. I’ll take them to to Disneyland, or I’ll take I’ll go, buy them something that they want, an iPhone.

Those things will never make up for lost time with your children, and they grow up so quick. I have, you know, I have four kids. I my two oldest daughters are are older now, and I have two little boys that are five and eight. And so, like, I watched my daughters how and how fast they grew, and it’s sad to watch how I I miss those those early days when they were little. We have to give them time.

Oh, it’s just gotten better. It’s so fun. But it is different. I mean, our first child, it was, you know, we were so young that we we kinda grew up together, my wife and I. But Were you nervous?

I I was terrified. It wasn’t about me anymore. My business had to work because if it didn’t, it was like I was other people were gonna suffer because of me. Right? So it created a lot of pressure. And at the same time, it was the best thing that ever happened to me. I had to grow up. I had to grow up very quickly, and I I had to focus on what mattered most. And so families are a gift. I’m just so, yeah, so grateful.

I kind of look at it as a matrix, and it’s, you have love and expectations. You have to have so much love, but also high expectations. I need to balance those things. And so I think, sometimes as a parent, you’re attempted to just show so much love, but you’re you’re not willing to correct. You’re not willing to push them to be the very best they can be. Or sometimes as a parent, you’re you’re criticizing. You’re too critical of a child, and they don’t know that how much you love them.

And so I think this constant balance, and I think I’m getting better and better at it, which is like, they have to know how much you adore them, how much you love them. And when they know that, and then you give instruction on how they can be better, they’re a lot more willing to listen to it. That’s, that’s something I wish I would have better understood as a as a young parent.

Well, you know, I talked to you about that that failed fundraising process. I was so convinced twelve months ago that I would never take this company public, that I didn’t wanna sell it to anyone. I just wanted to stay independent and private forever, and I’d say I’ve changed my mind. I’m open to all options. All that matters to me is that we stay true to our values. And if we can do that through an m and a process, if we can do that by going public at some point, You know, going public is I have a number of friends that have taken companies public over the last few years.

It has been depressing to watch what they’ve gone through. So there’s not a lot. I look at that. I’m like, why would I ever wanna do that? But I think at the right time, let’s say the, you know, let’s say Cotopaxi is, you know, 500,000,000 in sales and has, you know, 75 or $80,000,000 in EBITDA. At that point, it’s like, you know, the business is stable. That is kind of a phase where you could go public, and it would be okay. I think a lot of companies are going public way too early.

They’re not profitable enough. They’re not stable enough. They’re not meeting expectations of investors, and I think that’s the biggest risk is, you know, going public too early. But if we did it at the right time, maybe it would make more sense.

Of course. No. Of course, I worry about it. And I I think this is the challenge of public markets is Joey is a great example. Albert Albert’s you know, their their peak valuation versus versus where they are today, it’s down, like, 95%, right, or or more. But their revenue is still they have a great company. They have an incredible brand. Joey’s done such a beautiful job in building this company, and they’ve got great great product. You know, they’ve had some challenges. And, you know, revenues, I think, have maybe shrunk a little bit.

I’m not sure. Not 95%, but the public markets, they’re so fickle. It creates a real challenge to run a business when you’re so dependent on what the public markets are valuing the business at. That’s where that’s the nice thing about being in the private markets. You know? VCs, PEs, they’re they’re not gonna look at your business and devalue the business by that much just because a hiccup in the business. You can choose a dinner guest,

Okay. So I don’t wanna be too religious, but I would say, you know, Jesus Christ would be the top of my list. After Jesus Christ okay. Let’s put Jesus Christ aside. I love adventure. I love risk taking. I love seeing the world. I love discovering things. You know, every year, I do a survival trip or two where I go survive on an island, bring no food, spearfish, eat coconuts, build a shelter. I love this type of thing. I love reading about explorers. I love reading about people that have done really hard things.

So Ernest Shackleton is just this figure that I just admire so much. I love the story of the HMS Endeavor and how he goes down, gets stranded in Antarctica for two years. They live on this iceberg, basically. Everyone survives. Like, he is such an inspiring figure. So someone like Ernest Shackleton, you know, Roald Amundsen, you know, the Norwegian explorer. Know, You there’s some really great explorers that I’d love to to have at the dinner table.

I hope that one day, if I were to be remembered by anything, it’s just that I cared deeply for others, that I loved I loved others, and that I, that I used my life to serve. If I had to be remembered by anything, more than by a brand I built or or anything else, it would just be that I I loved and served others.

You know, as an entrepreneur, so much is about it’s about you. Right? And, especially as you build a brand or a platform like you’ve built, it’s like a lot of it is about is about you. And so I’d love to be to get to a point where I’m I’m less less self concerned.

You know, the last six months for me has been painful. This has been hard. Leaving everything behind, we moved into, an apartment here in Brazil. It is just the most intense work that I’ve ever done in my life. It is physically, mentally, spiritually exhausting. I’d say the first two months were incredibly painful. Why? A lot of discomfort. I don’t know what I’m doing. Like, I’m used to leading a business. Like, this is not a business. The language, like, I’m having to communicate in this language that you know, I grew up speaking Spanish and English, like Portuguese.

I speak Portuguese, but not like I want. And, like, I’m having to communicate difficult things. I’m working with, you know, I’m helping these young missionaries, and I’m creating, hopefully, creating people that when they’re done with their two years of service here, that they go back and they become their generations humanitarians. They’re they’re the people that are out there making the world a better place. And at the same time, they’re here going through a really hard time themselves. They just gave up two years of their life.

They’re leaving college and their families behind to come here. They’re learning new languages. They’re getting rejected all day every day. They have their own mental health challenges. Like, they’re such amazing people. These young people. I’m so inspired by them. And at the same time, like, I’m having to communicate with them in this language that I hardly speak sometimes. And, like, you know, when someone’s crying and they’re they’re pointing out their soul to you in a language that you’re like, I’m not even capturing 50% of what you’re saying, it’s like, I’m stressed out.

Like, I wanna help you, but I don’t understand everything you’re saying. And then seeing poverty, heartbreaking poverty, people that are just living in conditions that no human should live in. It pulls at your heart, and it makes you want to do more. And so it’s been hard, and at the same time, I’m so grateful for it. I’m so grateful that we left everything behind to go do something that really truly matters.

I I do know this. This time will come to an end in three years, and Cotopaxi is it it’s a life long commitment that I’ve made. I’ve committed my life to fighting poverty, and that platform of Cotopaxi is gonna be a really powerful platform. I also know I’m not the CEO anymore, and I have a CEO that’s we got a major upgrade when I left. And so I’m not gonna be the CEO, but my hope is that I continue to focus on purpose and mission and impact.

And my scope will will be a little more outwardly focused instead of just focusing on the impact that Cotopaxi can have. I hope that I can go out and and rally other business leaders and brands and businesses to join us in this movement of doing good. And so I think that’s what I’d like to spend my time on when I get back.

Well, Harry, thank you. You’re such a kind and thoughtful interviewer. Thank you for the thought you put into this. And, man, you I will say, you asked me some hard questions.