In 1968, Eddie Smith Jr. bought a struggling boat company in Greenville, North Carolina, that was barely staying afloat.

He put in 100-hour weeks to turn it around.

Over the decades, he built Grady-White Boats into a powerhouse in high-end recreational fishing boats.

The company now generates hundreds of millions of dollars in annual revenue and has been profitable for 50 years.

Smith did it without outside investors and without ever taking the company public. "I had a burning desire" to prove he could do it alone, he told The New York Times.

Now, at 83, he has made his most consequential decision yet.

He walked away from a potential $400 million sale of Grady-White and committed the company's future profits to charity instead, according to the Times.

"God has really blessed me to put me in a position to give away the vast majority of my net worth," Smith said.

"I don't need a 200-foot yacht or to spend the winters in the Mediterranean.

I'm really happy here in eastern North Carolina."

Smith has quietly moved Grady-White's voting shares into a purpose trust that will hold them permanently.

The company cannot be sold.

The trust and a companion nonprofit, which now hold the non-voting shares, will oversee the company through independent boards, without Smith directly involved.

Each year, Grady-White will set aside tens of millions of dollars in profits beyond what the business needs to run and grow, and send that money to the nonprofit arm, which will direct it toward conservation, healthcare and education.

Smith stays on as chief executive emeritus.

Smith has said Patagonia founder Yvon Chouinard inspired the structure.

In 2022, instead of selling Patagonia or taking it public, Chouinard transferred ownership into two entities: a purpose trust holding the voting stock to keep the company aligned with its values, and a nonprofit holding the non-voting shares and receiving the roughly $100 million a year in profits.

Patagonia kept operating as a for-profit business.

It simply stopped being ownable.

The takeaway for founders approaching an exit is not "give your company away."

Most will not, and should not.

The takeaway is narrower and more useful: an exit is a design decision, not a single binary choice between selling and not selling.

Smith and Chouinard both concluded that the standard menu, sell to a strategic buyer, sell to private equity, or go public, did not fit what they had actually built.

So they designed a fourth option.

Founders rarely ask that question early enough.

By the time a $400 million offer arrives, the ownership structure, the investor base and the board are usually already locked into a shape that makes only the standard exits possible.

Smith had spent 57 years deliberately avoiding that lock-in.

That, more than the charitable commitment itself, is the part worth studying.

Most founders cannot replicate the scale of the gesture, and few would want to.

But the underlying discipline, keeping ownership options open instead of letting outside capital quietly foreclose them, is available to a business with 350 employees or with five.

The decision that matters happens years before the offer arrives, in whatever paperwork determines who gets a vote when a buyer eventually calls.

Grady-White's 350 employees will keep sharing in profits under the new structure, a detail Smith built in deliberately rather than as an afterthought.

It is a reminder that the people who build a company's value over 50 years rarely appear anywhere in the standard exit calculation.

Source: Entrepreneur, citing The New York Times.