Patagonia founder gives away $3 billion company

The billionaire founder of outdoor clothing company Patagonia has given the company away.

Yvon Chouinard first founded the fashion brand in 1973, with the first store opening in Ventura, California.

Patagonia has gone on to become a global company leading to a revenue estimated at $1.5bn a year.

The billionaire has revealed the company has undergone a significant change, however, Chouinard has not sold the company, taken it public, or handed it over completely to his children.

Instead, Chouinard, his wife and two children have given the company away to non-profit organisation, the Holdfast Collective and the Patagonia Purpose Trust, in a bid to combat climate change.

The company's yearly profits - of around $100 million - will subsequently be used worldwide to protect the environment.

"Each year the money we make after reinvesting in the business will be distributed as a dividend to help fight the crisis," Chouinard stated.

The Patagonia Purpose Trust - led by the family - will own two percent of Patagonia's stock, while the Holdfast Collective will own 98 percent of the company.

The Holdfast collective is a charity based in the US which is 'dedicated to fighting the environmental crisis'.

The founder noted: "Despite its immensity, the Earth's resources are not infinite, and it's clear we've exceeded its limits.

"Instead of extracting value from nature and transforming it into wealth, we are using the wealth Patagonia creates to protect the source."

The change was revealed via an open letter by Chouinard titled, "Earth is now our only shareholder".

Chouinard stated how he 'never wanted to be a businessman' and started as a 'craftsman'.

Patagonia also announced the decision via its Twitter page on Wednesday, 14 September. The post reads: "Hey, friends, we just gave our company to planet Earth. OK, it’s more nuanced than that, but we’re closed today to celebrate this new plan to save our one and only home. We’ll be back online tomorrow.

"Instead of 'going public,' you could say we’re 'going purpose.' Instead of extracting value from nature and transforming it into wealth for investors, we’ll use the wealth Patagonia creates to protect the source of all wealth."

Chouinard's decision to try and distance himself from his mass wealth follows in the steps of Microsoft founder of Bill Gates.

Earlier this year, Gates said he fully intends to drop off his spot on the Forbes World's Billionaires List while he's still alive, vowing to follow the 'give while you live' principle.

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