After his business relationship was fractured, Smith found himself in a dark place. Then 36 hours of inspiration led him to dream up Cotopaxi, whose mission is to change lives and sell ‘gear for good.’
Davis Smith and his cousin Kimball Thomas were more like brothers. They attended business school at the same time, founded and ran two businesses together, and bought houses on the same street. Their latest venture, Baby.com.br, sold baby gear to families in Brazil, and was part of a significant e-commerce boom there in the early 2010s.
Despite fast growth and millions in venture-capital funding, however, disagreements over strategy ultimately fractured the relationship between the 50-50 partners. For Smith, the stress of running a fast-growing company became too much.
“Our relationship fell apart,” said Smith on the Inc. podcast What I Know. “Ten years later, it’s still one of the saddest things in my life.”
After walking away from the company, Smith fell into a depression. “Everything I had was tied up in the business that I was leaving behind. I worried: if I failed, what would people think of me?” One night, though, he stared at a Post-it note he’d written as a New Year’s resolution in 2013: Change someone’s life. He wondered whether he might be able to do that with another business.
He knew what he’d do differently this time around. He’d set up a sturdy business foundation alongside a steadfast mission statement, and vision for giving back. He’d set it up as a public-benefit corporation, or B-Corp, from day one, and donate 1 percent of profits to communities experiencing poverty.
“I had what I would call a spiritual experience,” Smith says. “During the next 36 hours, I came up with this idea of building a business that could be a force for good.”
Davis imagined a company that sold outdoor gear, and was named after a mountain important to his youth in Equador: Cotopaxi. He imagined a logo of a llama, which he’d encountered in packs there, roaming wild. He would move back to the United States and set up shop in Salt Lake City, and set to work.
“At Cotopaxi, we knew what our core values were before we sold a single product, and we built rituals and traditions around those values from day one to reinforce that. Our culture was built around that mission. And we deeply ingrained our purpose to everything that we did,” Smith says. Today, Cotopaxi employs more than 300 people and has been profitable for the past three years. It made more than $100 million in revenue in 2022, is a member of 1 Percent for the Planet, and set up its own foundation to oversee its charitable giving.
To hear my full interview with Davis Smith, click on the player above, or find What I Know on Apple Podcasts, Spotify, Stitcher, or anywhere you listen to audio.
