Lessons on Capitalism from Patagonia’s Reluctant Billionaire

23:28Kara Swisher:From frontier models to out-of-the-box tools, Cohere gives you everything you need to build and deploy secure, scalable AI that drives growth and delivers results. Their platform is designed around your business with models that can be customized and trained on your proprietary data, so the solution is uniquely yours. And control doesn't stop at customization. Cohere is built with multi-layered protections, access, and industry-certified security standards that help safeguard your data while supporting privacy compliance and other requirements. As AI continues to transform every industry, Cohere gives you the power to put it to work today on your terms.

24:02Kara Swisher:Take charge of your AI with Cohere. To learn more, visit Cohere.com slash Vox.

24:14The Financial Times called the book awards an all portrayal of Shannard. You write, while Patagonia was in so many ways an extraordinary company, independent, idealistic, successful, generous, it was still fraught with fundamentally irresolvable tension. as you said, unsolvable paradox. Talk about the other paradoxes, you know, the work culture, for example. On one hand, they set an early example of work-life balance with let my people go surfing mentality. Everyone should be an adventurer. Patagonia is one of the first in the U.S. to get paid maternity leave and support working families with in-house child care.

24:45On the other hand, only one Patagonia location is unionized, and Shannard has regularly ignored calls to let employees participate in the company's financial success through stock ownership. Talk a little bit about that because the things that you would naturally – that would go along with it to create sort of a co-op mentality didn't happen here. Yeah. I mean the way I have come to understand this is that Chouinard really cared about nature more than he cared about people. And that truth sort of informs a lot of the decisions you just alluded to, especially on the stock ownership. I mean this was a real point of tension among employees over the years.

25:24No one went to Patagonia to get rich and people understood sort of the company that they were signing up for. And yet, as the company grew more successful, as Chouinard and his family had tens of millions and hundreds of millions of dollars to spend on large scale land conservation and environmental activism, there was a group of employees who said like, what about us? You know, they are living large. They don't have private jets, but they have nice homes in Wyoming and Ventura on the ocean. Why is it that we can't just get a bit more? And to that, you know, Shannard always said, like, he was still a dirtbag in his mind.

26:01And there is some truth to that, right? I've spent time with him at home. He does not live a fancy life by the measures of most billionaires. But why, though? Why didn't he want to share that? I mean, it would seem a natural thing if you're in one of these kind of companies. Listen, I'm not here to defend it, but my best read on why it is that happened is that he never really was in it for the money himself. And so he didn't think other people should be either. Now, that's simplistic, and I think it ignores a lot of the real-life concerns that people might have. Except he got the money, right?

26:29He got more than most. No doubt about it. Even if he's not in it, he got it. Completely. If he doesn't care about the money, why not give it to his employees? Because he cared about the damn acres in Patagonia more. There's just no other way to explain it. Because it's an unusual part of a company that's like this not to have those kind of worker sharing, etc. Yeah. I mean, no RSUs, no profit sharing, no ESOP. Here I will note, though, that his wife is a big character in the book. And she is even more press shy than he is. But Melinda Shinar deserves an enormous amount of credit for making Patagonia a place that takes exemplary care of its working mothers, as you noted, has done extraordinary things to elevate female leaders, including Rose, who you mentioned.

27:19And over the years has really created a culture that has become an exemplar to other companies and even governments as they try to understand how it is that corporations can support women in the workplace. And Melinda should get all the credit for that. So in terms of its legacy, Pataigone has consistently worked to improve its climate footprint, given money to environmental organizations, as you know, it didn't push other companies to do the same like the Alliance for 1 % for the Planet or unlikely collaboration with Walmart. On the other hand, it's also collaborated with the Pentagon and Patagonia Vest become part of the Midtown uniform for Wall Street hedge fund bros and many.

27:55I mean, I've seen so many Patagonia Vests. And of course, there's the impact of producing, as you noted, if you have these ethical standards around climate, for example, and production. There are going to be contradictions. Give me an example of what they do on Vest or something, like just not using that company or what? How far do they go? I was asking the same question during the reporting, like, what does this actually mean in practice? It's great to have all these standards. And what really made it clear to me was when I came to learn that, I don't know when it was, maybe 10 or 12 years ago, they set up a new quality standards division for their supply chain.

28:34Basically, it's a group of employees who monitor the working conditions and the environmental conditions of their first, second, and third tier factories. And what's so critical is that they are separate from the business unit division, which is to say that if the sportswear apparel says we need to contract with this company to make 200 ,000 t-shirts next year, This other team, if it's a new factory, gets to go in and audit that factory and say, is this factory up to our standards? And if it is not, they just get to say no. And even if the business team says, but we really need that factory for those 200 ,000 units, that veto power is separate and the incentive structure is separated from the business line, which creates, again, this sort of autonomy for people to not be penalized, not be swayed by the allure of trying to grow the business and cut corners in the process.

29:36And so that was one example was like, oh, that's actually a real mechanism to ensure quality. So give me an example. What like they were making, I don't know, fleece hoodies. I visited one of these factories that didn't make the cut and then finally did. It's a factory called TDV. They make mostly cotton gear, sweatshirts, T-shirts. And several years ago, they put in a pitch to Patagonia. They say, we want to be one of your factories. Already at that time, TDV was doing good work. Patagonia went down there. What they found was like, you're doing good work, but your water outflow is a total mess.

30:13You're still not taking good care of the community around you. Your labor standards are pretty good, but they could be a whole lot better. Your community relations, sort of the way the factory is showing up in the community was okay, but could be a lot better. And they were growing their own cotton. They were vertically integrated. And some of the stuff in the field was good. It was on the right path, but it could be a lot better. But they found them failing on a whole bunch of measures, even though they were trying to make good progress. They told TDV all this, and they said, we're going to say no for the time being.

30:45TDV went back to work. Two years later, they come back. They go to Patagonia. They say, we've sold X, Y, Z. We're still working on this one. And Patagonia says, okay, we'll give you a shot. They put in a small order, and they said, as long as you keep working on these things, we'll try to keep giving you more business. And they've sort of brought TDV along on this journey. So that's an example of how they try to work with their suppliers to improve things on the ground. Why would a lot of these companies care, like, if there's plenty of work with fast fashion or people who don't have those standards?

31:17Yeah, I mean, listen, I'm not going to sit here and sort of spout morality, but I'll note the most practical one is they get paid more. Patagonia pays more because it understands that it's getting a better product, a higher quality, as I noted, product. And they pay that fair trade premium. Patagonia has helped set up all these different groups, the Regenerative Organic Cotton Group, the Sustainable Apparel Coalition. And some of these organizations are actually designed to raise the amount of money that it actually pays its suppliers. So that's one reason. And that's what TDD was after. It was a sort of low margin factory producing commodity goods for all the usual suspects.

31:56And several years ago, a new executive, Wanzhou, came in and he said, this is a losing proposition. Let's actually up our standards so we can command the higher premiums. And so far, it seems to be working. And what is the reaction to other makers of goods that were trying to sort of put out this sort of nature-loving image? Is there anybody who is close to them or someone who is not, for example? I'm wearing a North Face jacket right now. Oh, boy. Don't tell Yvonne. Well, it was given to me. It was given to me. I wear whatever's given to me. Well, just by a point of contrast, did you know that North Face just did a ski line in collaboration with Skims and the Kardashians?

32:36No, I didn't know that. Oh, yeah. I mean, that's like – it's completely anathema to what Patagonia is all about. Patagonia – Well, they make a good pubic hair thong, but go ahead. I don't know if you know about that. Yeah. For better or worse care, I do. Yeah, it's sold out. I'm too online. Did they? Yeah. Yeah. All right. I'm going to – we need to nip that. Move along. along, folks. There will not be a Patagonia pubic hair thong. I thought we were moving along. I try to avoid saying like there is some hierarchy and Patagonia is at the top because as I know in the book, like they still have tons of problems.

33:11They're still microplastics. They're still PFAS. They're still working through all sorts of stuff. More interesting than like reaching some sort of higher standard that's idealized is recognizing the work and recognizing that it's like it's the process and it's asking these tough questions over and over again and trying to orient your decision against those longstanding values and then trying to move forward and make the next hard decision. So are there other companies? Sure. Listen, I'll note that it's easier than ever to greenwash. You can tell an environmental story all day long on the internet and very few people are going to go fact check that.

33:47So do they have more competition than ever? Absolutely. Is there real concern inside the company and in the Patagonia board, that they are at risk of falling behind in this kind of environment? A thousand percent. And then this raises big questions about the future of the company, right? There's the ownership change. We can talk about sort of how it's structured and what comes next. Yeah. So explain what greenwashing is for people who don't know. It's trying to tell an environmental story and saying you are, you know, super environmentally conscious and friendly and you're not. And green hushing is just being afraid to even talk about it at all, even if you're doing some of the work and you sort of care about it, but you're too afraid of President Trump to even talk about it.

34:24One of my favorites is always BP Beyond Petroleum, which makes me laugh every time I hear it. Let's talk about the last part of the title of the book, as you said, how he gave it all away. Since Patagonia is a family-owned business or was, Chouinard's succession plans have been a matter of speculation for a long time. And in Patagonia fashion, the exit strategy was also unprecedented. Explain what they created to do this. Because living beyond you, I mean, there's a Rupert Murdoch living beyond you, and then there's a Chouinard living beyond you. So Chouinard for decades has been thinking about what happens to Patagonia after he dies.

35:02He's 86 years old now. In 2017, Forbes magazine put him on their list of billionaires for the first time, and he freaked out. Said it was one of the worst days of his life. Started stomping around, furious, the office, saying like, you got to get me off this list. It took him five years to figure it out, but they finally did. And in 2022, I broke the news that Chouinard and his family had effectively given away their stock to a new set of trusts and organizations. And do you want me to just get a little wonky here for a minute and explain exactly how it worked? Okay. So at the time, in 2022, Chouinard, his wife Melinda, and their two children owned 100 % of the Patagonia stock.

35:412 % of the stock was voting shares. 98 % was non-voting shares. They took the 2 % and they put it in a new entity called the Patagonia Purpose Trust, which is a legal entity in California. And they paid$17.5 million for the privilege of putting that 2 % into the Patagonia Purpose Trust. The Purpose Trust now sits on top of Patagonia Inc., which is still a privately held for-profit corporation in California, as sort of an additional governance layer, an additional board layer. They took the 98 % of the non-voting shares and distributed them, donated them to a series of newly created 501c4 corporations called the Holdfast Collective.

36:23They did not get a tax benefit, a tax credit for putting them into those because they were 501c4s. And now here's how it works. The Patagonia Purpose Trust with the voting shares instructs Patagonia Inc. to donate 100 % of its profits not reinvested in the company, salary, R &D, all that, out the door to the Holdfast Collective. And the Holdfast Collective distributes those monies on an ongoing basis. And that's about$100 million in profits every year. So that's how it works now. That's the structure they came up with. And then there's this board that sits on top made up of just the family or others?

37:00It's the family and their friends. And this is, you know, what that looks like in 10 and 15 years, anyone's guess. Yeah. So what does it mean, real terms, for the Shannard and his family is kids aren't going to be living on their Patagonia salaries, I assume. And again, nothing for employees. Nothing for employees. And when the news broke three years ago, I was in touch with some of the employees. And there was a brief moment of elation for many of them, as they sort of understood that There was this grand act of generosity that they were in some tangential way a part of. And for many of them, they were like, well, what about us?

37:33And there was a sense of being left behind for many. As for the Chouinard family itself, listen, I don't have access to their financial records. They never opened up their books. What I did do routinely over the course of three years reporting this book was keep asking on the record, off the record, to them, their associates, do they have$100 million socked away somewhere? Do they have$50 million socked away? On the record, the answer always was no. Now, do they have some money that's going to sustain this family for the foreseeable future? Yeah, I think so. I don't think their kids or their grandkids have to worry about paying for college 20 years down the road.

38:15But I can also tell you that this is not a family that lives lavishly. I spent time with them at their home. We did our own dishes. We cooked our own meals. We made our own beds. There is no help running around this house. These people live pretty simply. And so that's how it all shakes out at the end. So every episode, we get a question from an outside expert. Here's yours.

38:37Kara Swisher:Hi, I'm Sven Beckert, and I'm a historian of capitalism teaching at Harvard University. I'm about to publish a global history of capitalism during the past millennium, and thus I'm deeply interested in your terrific book, David. I'm curious how you see Patagonia fit into the history of capitalism. It's an outlier, to be sure. But does it in effect demonstrate capitalism's unrealized possibilities? Will we have to rewrite the history of capitalism in the light of Patagonia's story? And if so, how? So talk a little bit about this, because not a lot of people are following in their wake. They're following in a more greedy wake, I would say.

39:13Yeah, yeah. But I love that phrase, the unrealized potential. I mean, that's right where we started the conversation, which is, you know, can. It shows what capitalism can do if the people in charge make a certain set of choices. And Kara, you know that there's no law in Delaware that says you have to treat workers poorly and maximize profits and shovel dividends. There's a mentality. There's a mentality. Exactly. And so if the mentality changes, if the incentive structures change, then business can show up in a different way in society. We can have a different relationship with it. And I think that's the perfect phrase, the unrealized potential.

40:02But it recognizes that there is still potential. Sure, but there is a feeling like during that first, for example, we'll get to the Trump administration in a second. We'll finish up with that. But of like, oh, I have to comment on every horrible thing he does, whether it's gay rights or racism or, you know, Charlottesville or whatever. And I think they felt that wasn't their job. job. And today, even when I was quite critical of their dinner at the White House, which was embarrassing for the rest of their lives, essentially, as far as I was concerned, one of them called me and said, you know, it's easy for you to say.

40:34I said, no, it really isn't easy for me to say. It's easy for you to do. So I'm not sure. I think they're an exception more than the rule, because I think most of people fold, correct? Yeah, yeah. And that is the truth. And again, I'm not sitting here saying that Patagonia is going to change capitalism overnight. And I'm quick to acknowledge that for all sorts of reasons we've already talked about, no company can snap their fingers and magically be just like Patagonia. But why don't they? I'm curious why they don't, because I think a lot of people feel – why are they – I mean, they are allowed to stay on top because they sell stuff people want.

41:08If they didn't, they'd be kicked to the curb, right? Correct? Also true. Also true. Why do you think people covering corporate responsibility don't follow this? What's the biggest pressure? I think fear. I think a lot of it's fear. A fear of their shareholders, fear of public blowback, fear of being on the wrong side of a tweet. But I also really encourage people to think sort of beyond the binaries and beyond the grand gestures and get out of this sort of all or nothing mentality. And if I can't be Patagonia, then I can't make any marginal change for good. What I think I show in this book is that the reason we have this idea of what Patagonia is today is because it's been a series of 50 years of little decisions.

41:53There's no one grand gesture that has defined this company. It's been all these little incremental changes along the way. And that's, I think, where the brand equity comes from. That's where the trust and the integrity comes from. It's not from one thing. It's also because one guy can do it, right, as opposed to many. And that's the problem here. We'll be back in a minute.

42:28Kara Swisher:Support for this show comes from Fetch Pet Insurance. Cats are special little creatures, so are dogs. I have both. I love my cats and dogs. And my cat's name right now is lovely, and she means a lot to me. and she's really quite narcissistic, but I enjoy it. She's been pretty healthy throughout her life, but I've had other cats who have gotten sick at the end. And I do think about what's going to happen in the next years ahead because she could get sick, have a health issue. And with previous pets I've had, the bills that racked up were enormous and I never got pet insurance. And I think it's really important going forward to do that because these are big surprises.

43:04Kara Swisher:And here's what surprises a lot of pet owners. Every six seconds, a pet owner in the U.S. gets hit with a vet bill of over$1 ,000. Emergency vet bills can run into thousands and always seem to land on a Sunday night. Be prepared for the unexpected with Fetch Pet Insurance. Fetch Pet Insurance is billed so you never have to worry about giving your pet the best care. Fetch is the most complete coverage for dogs and cats. You get paid back up to 90 % of vet bills for accidents, illnesses, diagnostics, and more. Every vet in the U.S. and Canada is in network so you keep the vet you already trust, which is really important.

43:38Kara Swisher:Plus, with Fetch, you can build a plan that fits your budget. Once your claim is approved, get paid back in as little as two days. Don't wait until your pet has a health problem. Believe me, go to Fetch.com slash save and get your free quote. It takes about two minutes. That's FetchPet.com slash save. Fetch. Love longer.

44:03Kara Swisher:Support for this show comes from Teleport. In the AI era, one of the biggest questions is how to contain agent behavior in your production infrastructure. In Teleport's survey of more than 200 infrastructure leaders, the company found that those confident in their AI deployments have more than twice the incident rate of those that aren't, 72 % versus 33%. Let's talk security basics. The most frequent causes of data breaches are human error and compromised credentials. But in the AI era, the challenge is that agents with broad privileges can find these credentials and gain access to sensitive data.

44:38Kara Swisher:Teleport establishes a unified identity layer for humans, machines, and agents that is cryptographically backed, which enables agents to be controlled and contained with the same rigor that you apply to other actors in your infrastructure. Security is complicated, but with Teleport, it doesn't have to be. Download the free report at goteleport.com slash onwithkara.

45:03Kara Swisher:Avoiding your unfinished home projects because you're not sure where to start? Thumbtack knows homes, so you don't have to. Don't know the difference between matte paint finish and satin, or what that clunking sound from your dryer is? With Thumbtack, you don't have to be a home pro. You just have to hire one. You can hire top-rated pros, see price estimates, and read reviews all on the app. Download today. Let me switch gears because you mentioned fear about Patagonia in the context of politics and the Trump administration. Fear is a huge factor in a lot of these behaviors that are happening now.

45:40Patagonia's financial restructuring didn't just provide a roadmap. It enabled to give more money to causes right now. And just over 15 months, the new Hold Fast Collective made grants commitments totaling$71 million, including contribution to politics. Is this different from what the company's been doing before in terms of political support? Different than what Patagonia was doing? Yeah, they were giving – are they giving more to politics or have they changed since it's been the whole Fast Collective? A lot of it was environmental before. I would say on an absolute basis they have given more money directly to political groups.

46:13But just because they're giving more money away overall. in terms of their political engagement. I think it was really during the Trump administration that the company got much more sharply partisan in its political posture. I mentioned earlier the lawsuit against President Trump, but that was just part of it. I mean, at one point, a designer embroidered on the back of the tags, vote the assholes out, which is a pretty deliberate reference to some - I'm just mentioning what this is, for people who don't know, In 2017, the company filed a lawsuit against the Trump administration over plans to shrink two national monuments, Utah's Bears Ears and Grand Staircase Escalante.

46:54Go ahead. Sorry, go ahead. Yeah, so I think that was a turning point in terms of how overtly partisan they were willing to get. A couple years after that, they pulled their clothing out of the largest retailer that was carrying their material in Wyoming. because the owner of the store hosted a fundraiser for Marjorie Taylor Greene. And they said, we don't even want – I think you said earlier in the conversation, they can't control who buys their products. And I was like, well, they actually can when they say you don't get to sell our products anymore because they don't want to be in business with that person.

47:27So that's continued. On an absolute basis, are they giving more to politics? Yes. But they contend that they are still largely doing this to support candidates who care about the environment and that it hasn't really shifted into full-on being sort of a dark money pack for the Democratic Party. So this past February, politically speaking, after a slew of billionaires lined up behind Trump at the inauguration, CEO Ryan Gellert wrote an op-ed in Time warning about the administration's plans to sell-off for at least 640 million acres of public lands to oil, coal, and other mining companies. Are they preparing to sue again given the increased attacks on national lands during Trump 2.0?

48:05It's even worse, correct? Yeah, well, they haven't yet. And I can't tell you what they are or aren't going to do. But so far, they haven't. And I think, you know, it's been nine months. And so if there was a case to have been filed that they were going to do, it seems to me that they had the opportunity to do it by this point, but we haven't seen it yet. So again, I'm not inside the company. I can't tell you if they're about to. But so far, they're taking a different tack. Are they scared at all? Are they scared-er, I guess, since they were pretty aggressive during the barriers and Grand Staircase lawsuit?

48:37Yeah, I asked Ryan Gellert this on stage two weeks ago at the Masters of Scale conference. I was up there with him and Hamdi from Chobani. And we had a conversation about sort of leadership in politically divisive times. And I asked Ryan, I was like, are you scared? Do you think twice? And, again, I don't want to put words in his mouth, but he acknowledged that, yeah, of course he's thinking twice before he speaks out. Any individual, any corporate leader, anyone representing an organization or a company can't help but not in this climate. And so, again, I can't say that's why they have or haven't filed a lawsuit.

49:13But, yes, even Patagonia is keenly aware of this political environment. Although it does certainly give them a step up with consumers, right? I mean, in terms of both the environmental and the political support probably help them keep in their audience. A lot of people could criticize them at the time. And I was like, no, no, they're serving. What's wrong with them serving their audience? That's their audience is interested in those things, too. I think among a core group, perhaps. But listen, I can't tell you how many people I know who I wind up talking to about this book who don't know anything about Patagonia's political activities.

49:47They just like this stuff because it's well-made and it's cool. It's Patagucci. Patagucci. I like it. It's very well-made. You can also, for people that don't know, bring back Patagonia stuff to them and they fix it or take it back or different things, which is interesting. Back in the early 2000s and 2010s, there was a lot of talk about corporate responsibility and a lot of pledges and promises were made. Where do we stand now? These strides have obviously shifted. They don't talk about it. They're eliminating DEI. They're eliminating everything. Is it just rebranding? They have new names for things.

50:17You know, Disney had a new name for DEI. It's the same name, really, pretty much. But talk a little bit about that. Where do we stand now? And do you see a shift back to it? It just depends on the political winds, presumably. Yeah. Listen, I'm loathe to forecast how CEOs are going to be positioning themselves six months from now. I think I would note a couple things. Number one, you said earlier, and I think you're spot on, CEOs don't want to be commenting on every news cycle. I mean, that's a losing proposition. And you're going to piss one side off and then piss the next side off. And so the companies that I've seen, and I've written a lot about this over the last 10 years, that have done the best job are those that are very clear about what they care about.

51:06They're a couple of issues and chime in when it's relevant and stay out of the rest of it. Um, that may not satisfy every consumer, may not satisfy every, uh, employee resource group that wants the company to take a stand, but it seems to be the best way for CEOs and leadership teams to sort of find their way through these really hyper-partisan. Pickup thing. You just gotta, you gotta know what you care about and stick to that. But the default in this environment becomes not at all. And it's that amorality I think is really dangerous. Agree. You know, Barbara Walter. who wrote How Civil Wars Start.

51:44She talks about the importance of the business community speaking up in moments of creeping authoritarianism. And she contrasts what happened in Brazil, where the business community stood up and said, it's not okay, and what happened in Hungary, where the business community went silent. And those are studies in contrast that I think are very instructive at this moment. And so when business leaders find themselves afraid to speak out right now, I refer them to those examples and ask which path they want to go down. No question. I just interviewed Kamala Harris, and she said the one thing that surprised me is all the business leaders who have said nothing.

52:21Like not even slight pushback. And in fact, giving money, this ballroom they just destroyed part of the White House in order to build, which of course they weren't going to touch it. Of course, he did, of course. $25 million gifts from some of these companies. It's really astonishing to build this monstrosity. They may need a bigger ballroom, I don't know. But it's really, they're beyond not commenting or not involving themselves. It's something quite different. Going back to the environment, and some of the biggest perpetrators are these tech companies. And they had been touting for years that they want to get net zero emissions.

52:58You recently interviewed the chief sustainability officers at Microsoft and Google, and they said they were still committed to that goal. But to be clear, they were set before the AI boom and huge data centers that have massively increased energy needs, which is Hamilton's sake talking about taking the energy of all the planet for AI. I was like, oh, well, I kind of like my light bulbs. But in January, you called AI a climate conundrum. And you wrote that you thought in the long run it could be good for clean energy. Of course, they're all investing in fusion and hydrogen and nuclear, et cetera.

53:28They are doing that. But that's largely for the bottom line, not because they love trees. Explain what you meant by that and how you're looking at AI's effects on climate change right now. Yeah, listen, it's a moment where we can see without question that AI is having real implications for the emissions trajectories of the big hyperscaling tech companies, where we can see that they are quite literally willing to keep gas plants and even coal plants online if it means securing reliable power for their data center. And that you could argue is like absolutely hypocritical with all the climate commitments that they have made.

54:08And yet, if we take away anything, it's that they are still companies, right? They are still businesses who believe that they are in an existential race to gain market share on a future technology that's going to be absolutely critical. So again, if we understand why companies don't speak out against the president, in the same way, just from a business perspective, I can understand why a company like Google or Meta or Amazon is setting aside for perhaps temporarily, perhaps a longer term, their climate commitments to go try to win the AI arms race. When they started doing this, I'm like, can you just shut up?

54:44Because you're not going to keep it if you don't. I was like, I don't believe that you'll keep it. Like to me, it didn't matter at all, their commitments, because they weren't real. Yeah, well, I think you're absolutely right to say that like commitments are a dangerous game. I think it's also fair to note, as you did, these are companies that have really invested in early stage technologies. technologies. You could say that's for the bottom line, but a lot of these initial power purchase agreements, a lot of these efforts to fund low carbon alternatives and carbon capture, that's not accretive in the short term.

55:17They're sort of placing bets that they're helping create a future energy system that is going to be lower emissions. They see the need. I don't think it's because they want the planet to be better. I think it's like, oh, we're going to need more energy. You're so cynical, Kara. I'm sorry, but I've heard them. When they did, you know, they tried to get me, Google guys, to write the don't be evil thing when I was covering them. They're like, can you write our mission? I was like, no, I'm covering you. And I remember when they said don't be evil, I said, that leaves a lot on the left of that. Like, don't be evil is way down.

55:46So you could do a lot of bad things. Evil is in the eye of the beholder. I know. I was like, how about just, like, not things that hurt this? And they just didn't. They wanted it to be evil so they could do all the terrible things. Too specific. because I've sat in these stupid cocktail parties where they go on and on about people, and then it's just exhausting. They're exhausting people. Yeah. So when you think about the future, Patagonia did not just change its ownership structure. The company is shifting into the food business, including pushing for a new grain called Kernza as a way to fix environmentally damaging farming.

56:21Chouinard has always been an innovator. Getting into food seems a departure. It's also a market opportunity. You talk about the potential risks and benefits of shifting gears and what it says. I mean, I need Kerenza. Sure, why not? Like, why not? It's fine. But listen, this is a tiny experiment. Let's be clear. It is part of their sort of philosophical efforts to understand how business can and can't show up in the world. Shannard told me he hopes that 50 years from now, Patagonia is best known as a food company, not an apparel company. I'm not going to take the over on that actually happening.

56:56I think that's an absolute long shot for all sorts of reasons. Food system is wildly complex, way more complex in many ways than the apparel business. And so, listen, they are out there. They are experimenting. The food business is growing. It's$20 million or so, roughly, and it's growing fast. But that's not going to change factory farming in the United States anytime soon. But it does represent his belief to go all the way back to some of the things we talked about at the start of the show. this question of whether business can be a force for good. At the highest level, he thinks that no matter how well you make a piece of clothing, it's still extractive.

57:37You're still taking things out of the earth. Whereas in food, he sees the path to be regenerative, right? To see food systems, whether they're fish and mussels that clean the water, whether it's crops like curanza that sequester carbon. He sees the potential to actually try to make the world, the environment a little better, a little cleaner. And so that's the sort of philosophical project that's animated the food business right now. So last question, Chouinard is not one of the signatories, the famous giving pledge, which may be not such a bad thing. According to a review, 15 years later, the wealth of those billionaires is growing faster than they're giving.

58:17A few are still working on it. And May, Bill Gates, probably the biggest philanthropist, I would say, announced he wanted to donate virtually all his wealth over the next 20 years. Mackenzie Scott, who's just sort of lapping all of them, has given away$19 billion over the past five years and reportedly cut her shares of Amazon stock by over 40 percent. But a lot of the money has gone into billionaire philanthropists, give them tax breaks. I'm thinking of Mark Zuckerberg reducing government tax income and making them richer. I'm thinking again of Mark Zuckerberg. Do you think Patagonia's giving model is one that more founders will or could follow, or will it remain different from everybody else?

58:53And how does he think of his legacy going forward? Yeah. So I think it absolutely is a model that more founders could follow because it's just about making choices if they have that equity. I think it's a model that a few founders will follow. And I know this because I'm talking to founders who are trying to figure out how they're going to do this. Um, and I also am not at all going to sit here and I tell you, it's the most effective way to donate large sums. Um, this is one of the things that was really perplexing about Chouinard's decisions over the years. And to this day is that he never maximized for impact.

59:32This was never a guy who was sort of looking at the spreadsheets and understanding, well, if I sold the company for$6 billion at that moment, when I had that offer on the table, I could set up an endowment that could spit off. $300 million every two years and use that. And that would be more impactful than the solution. He just never thought about things. He's not an effective altruist. No, maybe an ineffective altruist, perhaps. But he knew what he cared about. And those same concerns that he had at the very outset, right? When we were talking about who this guy was in 1973 when Patagonia started, he cared about land conservation.

1:00:09He cared about environmental activism, those are the things that still animate his decision-making today. And so that's why, you know, Patagonia is an experiment and others may take some parts of it and be inspired and try to mimic it. But I am not sitting here and saying every company and every executive should try to follow in Chouinard's footsteps with high fidelity. It seems like he wants Patagonia to be a model for other companies. He does. And he has always said that even more so than the clothes, even more so than the charity, he believes that the company's greatest contribution is just being a model to show what's possible.

1:00:53You know, an example, to go back to our caller, of the unrealized potential of capitalism. And what does he do day to day right now? All he does is fish. Fish. I chased him all over the world to report this book. And every single day I was with him, we went fishing. That's all he wants to do. Fish. All right. Well, there you have it. David, thank you so much. It's a really fascinating book. Always a pleasure.

1:01:25Today's show was produced by Christian Castor-Russell, Kateri Yocum, Michelle Eloy, Megan Burney, and Kaylin Lynch. Nishat Kerwa is Vox Media's executive producer of podcasts. Special thanks to Rosemary Ho. Our engineers are Fernando Arruda and Rick Kwan, and our theme music is by Trackademics. If you're already following the show, go fishing. If not, go put on your pubic hair thong. Go wherever you listen to podcasts, search for On With Kara Swisher and hit follow. Thanks for listening to On With Kara Swisher from Podium Media, New York Magazine, the Vox Media Podcast Network, and us. We'll be back on Monday with more.

1:02:06Kara Swisher:Thanks to Kohler Health for their support. We focus a lot on what we put in our bodies, but not nearly as much on what comes out. You get my point. Kohler Health is changing that with its Dakota tracker, which turns your everyday bathroom habits into meaningful insights about your gut health, hydration, and even presence of blood without any manual logging. Over time, Kohler Health helps you build your baseline so you know what's normal for you and you can take action when something changes. Learn more at KohlerHealth.com and use the code CARA1YEAR for a free annual membership on the Kohler Health app when you purchase Dakota.

1:02:41Kara Swisher:You want to get your backyard summer ready, but you don't want to break the bank? Wayfair gets it. Planning on dining alfresco or relaxing poolside? Wayfair has everything you need to prep your space. Shop now and save up to 70 % off during Wayfair's 4th of July clearance. Score huge deals on outdoor furniture, area rugs, and more. We're talking thousands of products for every style and budget. Plus, surprise flash deals July 6th. Don't wait. Shop Wayfair's 4th of July clearance now through July 6th at Wayfair.com. Wayfair, every style, every home. Hey, it's Ryan Reynolds here from Mint Mobile.

1:03:13Now, I was looking for fun ways to tell you that Mint's offer of unlimited premium wireless for$15 a month is back. So I thought it would be fun if we made$15 bills. But it turns out that's very illegal. So there goes my big idea for the commercial. Give it a try at mintmobile.com slash switch.

1:03:33Kara Swisher:Upfront payment of$45 for three months,$90 for six months, or$180 for 12-month plan required. $15 per month equivalent. Taxes and fees extra. Initial plan term only. Greater than 50 gigabytes may slow when network is busy. See terms.