Grady-White Boats market their vessels as the “finest boats ever crafted” which is quite the statement.
GNN can’t comment on boat quality, but they certainly don’t make humans like Grady-White’s ex-CEO much anymore.
For 58 years, Eddie Smith Jr. worked 80-100 hour workweeks to salvage the near-bankrupt boat builder and turn it into a 9-figure revenue generator that will now power philanthropy in perpetuity.
That’s because Smith turned down multiple offers around half a billion dollars in order to pass controlling stakes in Grady-White Boats to a “purpose trust” that will operate it according to his values and convert its bottom line into community service, conservation, and other philanthropic causes.
Profiled by Preston Foore at Fortune Magazine, Smith said he was inspired by entrepreneurs like Yvon Chouinard, the founder of Patagonia, who also turned the brand into a financial engine for conservation and climate change prevention.
“I just think that those of us that are fortunate enough to be in a position to help others…It’s really a gift to me to be able to do what I do,” Smith told Fortune.
Born to a father who was orphaned at age 10 during the Great Depression, Smith Jr. grew up near the poverty line. The first break was when his father worked enough odd jobs to start a mail order business. The son, who remembers eating SPAM 3 times a week, then lied about his age to get a job on a paper route, before becoming the first in his family to graduation from college (U of North Carolina) in 1965.
Finding Grady-White Boats in a near-bankrupt state, Smith Jr., who described himself as having an “entrepreneurial itch” to prove himself, borrowed some money and took over the business, forsaking golf, his favorite pastime, for over 30 years.
He proceeded to pour his heart and soul into the project before successfully turning it around to the state it’s in today—where revenues average over $100 million per annum.
After he lost his wife and then his son to ALS, his golden years seemed abruptly grey, and suddenly the big offers he was receiving to sell the company—and potentially destroy the culture of self-betterment and hard work he tailor-made over the decades—became easy to turn down.
READ ABOUT CHOUINARD: Patagonia Gives Away Its Entire $3 Billion Worth To Fight Climate Change
He looked around at his other CEO friends, and saw that those who sold their businesses had “lost their way.”
“All of them were really disappointed in what happened to their companies after the sale. They lost their way,” Smith told Fortune. “They lost their culture that they had built, and I just couldn’t bear the thought of that happening.”
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Instead, Smith signed Grady-White Boats over to a perpetual purpose trust, who collected his controlling state as voting shares in the company under conditions that they never be sold. The trust will continue to operate the business under Smith’s values, including profit sharing and spending big on employee education resources.
The rest of the non-voting shares will be placed in a 501(c)4—a social welfare organization—that will donate all profits to charitable causes.
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