Davis Smith | Crain's

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Davis Smith


Salt Lake City, Utah-based Cotopaxi is an outdoor gear brand with a social mission. It designs, manufactures, and sells packs, water bottles, apparel, and gear while raising money for various humanitarian causes.

The Mistake:

Not holding my employees accountable enough.

One of the biggest challenges in running a business is the people element – managing teams and relationships. And that doesn’t exclude partners. A former business partner and I had worked together for about six and a half years on our first business and had a really positive experience building that company. We both went to graduate school at the same time and we decided after that to do another business together. We came up with 60 ideas one summer and narrowed them down to four.

We spent the bulk of a summer testing and vetting them to figure out what we wanted to do next. By the end of the summer we had identified a business opportunity that we were really excited about. Ultimately, the business exceeded our expectations. Within 18 months of launching, we had raised about $40 million in venture capital and had a team of about 300 people.

But at the same time, my partner and I were for the first time experiencing relationship challenges. I think a lot of that had to do with the size and scale of the business and maintaining a culture while the business was growing so big.

We had split up the responsibilities in a way that made sense. There was a lot of complexity. But after three and a half years, my partner approached me and said, “This isn’t working. Being co-CEOs isn’t working anymore.” He went on to tell me that I wasn’t very good at managing my team, and that I wasn’t very good at holding them accountable.

It was hard feedback for me. My management style was to hire people much brighter than me who were incredibly experienced and let them build their team without a lot of hand-holding. If a micromanager was on one end of the spectrum, I was on the other. While it was hard to hear what he had to say, I agreed that I wasn’t the kind of manager or leader that was as involved as I probably should have been.

Although the team loved me and I loved them, and had a lot of trust in them, I needed to do things better. After some self-reflection, I agreed that it made sense to have him run the business and instead of taking another role, I would leave the company and start fresh. I agreed with my partner that the company needed a single leader, and a unified vision.

A little bit of pride contributed to the decision. I was embarrassed to take another role in the company and I also felt if the relationship with my partner and I wasn’t working, it likely wouldn’t get better if I stuck around.

It’s through these painful experiences that we grow the most.

The Lesson:

After a period of transition, I started the business I’m running now. The first thing I did was put together a core team to build the brand. About five of us spent the first couple of days together discussing what the brand represented, what were the core values of our business and how we wanted to build those values into every aspect of the business and brand culture.

I worked hard at being better at managing and setting clear expectations and holding people accountable to them. Every month, I have a 1:1 with every direct report. During those meetings, I get and receive feedback.

That relates to one of the mistakes I’d made before. I was blindsided because I’d been operating for 10 years without realizing what I was doing wrong. Had I been more open about asking for feedback, I could have addressed that sooner.

Every month, I also give feedback to my direct reports as to what they are doing well, and where I’d like to see them improve. And they do the same for me. We report on them the next month.

In the end, it was all a great learning experience for me as an entrepreneur and CEO. A few months ago, Cotopaxi was named the No. 1 company to work for out of 3,900 companies. We’re seeing hundreds of applications for each job, and I believe we’ve built an exceptional culture.

I have committed to our team that they will learn and grow as long as they are a part of this business. A lot of that came from that really hard and incredibly painful experience. But it’s through these painful experiences that we grow the most.


Follow Cotopaxi on Twitter at @Cotopaxi.

Pictured is Davis Smith. | Photo courtesy of Cotopaxi.

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