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Authors: Phil Knight

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I was picking up the language, slowly. I knew the Japanese word for shoe:
gutzu
. I knew the Japanese word for revenue:
shunyu
. I knew how to ask the time, and directions, and I learned a phrase I used often:
Watakushi domo no kaisha ni tsuite no joh hou des.

Here is some information about my company.

Toward the end of the picnic I sat on the sand and looked out across the Pacific Ocean. I was living two separate lives, both wonderful, both merging. Back home I was part of a team, me and Woodell and Johnson—and now Penny. Here in Japan I was part of a team, me and Kitami and all the good people of Onitsuka. By nature I was a loner, but since childhood I'd thrived in team sports. My psyche was in true harmony when I had a mix of alone time and team time. Exactly what I had now.

Also, I was doing business with a country I'd come to love. Gone was the initial fear. I connected with the shyness of the Japanese people, with the simplicity of their culture and products and arts. I liked that they tried to add beauty to every part of life, from the tea ceremony to the commode. I liked that the radio announced each day exactly which cherry trees, on which corner, were blossoming, and how much.

My reverie was interrupted when a man named Fujimoto sat beside me. Fiftyish, slouch-shouldered, he had a gloomy air that seemed more than middle-age melancholy. Like a Japanese Charlie Brown. And yet I could see that he was making a concerted effort to extend himself, to be cheerful toward me. He forced a big smile and told me that he loved America, that he longed to live there. I told him that I'd just been thinking how much I loved Japan. “Maybe we should trade places,” I said. He smiled ruefully. “Any time.”

I complimented his English. He said he'd learned it from the
American GIs. “Funny,” I said, “the first things I learned about Japanese culture, I learned from two ex-GIs.”

The first words his GIs taught him, he said, were, “Kiss my ass!” We had a good laugh about that.

I asked where he lived and his smile disappeared. “Months ago,” he said, “I lose my home. Typhoon Billie.” The storm had completely wiped away the Japanese islands of Honshu and Kyushu, along with two thousand houses. “Mine,” Fujimoto said, “was one of houses.” “I'm very sorry,” I said. He nodded, looked at the water. He'd started over, he said. As the Japanese do. The one thing he hadn't been able to replace, unfortunately, was his bicycle. In the 1960s bicycles were exorbitantly expensive in Japan.

Kitami now joined us. I noticed that Fujimoto got up right away and walked off.

I mentioned to Kitami that Fujimoto had learned his English from GIs, and Kitami said with pride that
he'd
learned
his
English all by himself, from a record. I congratulated him, and said I hoped one day to be as fluent in Japanese as he was in English. Then I mentioned that I was getting married soon. I told him a bit about Penny, and he congratulated me and wished me luck. “When is wedding?” he asked. “September,” I said. “Ah,” he said, “I will be in America one month after, when Mr. Onitsuka and I attend Olympics in Mexico City. We might visit Los Angeles.”

He invited me to fly down, have dinner with them. I said I'd be delighted.

The next day I returned to the United States, and one of the first things I did after landing was put fifty dollars in an envelope and airmail it to Fujimoto. On the card I wrote: “For a new bicycle, my friend.”

Weeks later an envelope arrived from Fujimoto. My fifty dollars, folded inside a note explaining that he'd asked his superiors if he could keep the money, and they'd said no.

There was a
PS
: “If you send my house, I can keep.”

So I did.

And thus another life-altering partnership was born.

ON SEPTEMBER 13,
1968, Penny and I exchanged our vows before two hundred people at St. Mark's Episcopal Church in downtown Portland, at the same altar where Penny's parents had been married. It was one year, nearly to the day, after Miss Parks had first walked into my classroom. She was again in the front row, of a sort, only this time I was standing beside her. And she was now Mrs. Knight.

Before us stood her uncle, an Episcopal priest from Pasadena, who performed the service. Penny was shaking so much, she couldn't raise her chin to look him, or me, in the eye. I wasn't shaking, because I'd cheated. In my breast pocket I had two miniature airplane bottles of whiskey, stashed from my recent trip to Japan. I nipped one just before, and one just after, the ceremony.

My best man was Cousin Houser. My lawyer, my wingman. The other groomsmen were Penny's two brothers, plus a friend from business school, and Cale, who told me moments before the ceremony, “Second time I've seen you this nervous.” We laughed, and reminisced, for the millionth time, about that day at Stanford when I'd given my presentation to my entrepreneurship class. Today, I thought, is similar. Once again I'm telling a roomful of people that something is possible, that something can be successful, when in fact I don't really know. I'm speaking from theory, faith, and bluster, like every groom. And every bride. It would be up to me and Penny to prove the truth of what we said that day.

The reception was at the Garden Club of Portland, where society ladies gathered on summer nights to drink daiquiris and trade gossip. The night was warm. The skies threatened rain, but never
opened. I danced with Penny. I danced with Dot. I danced with my mother. Before midnight Penny and I said good-bye to all and jumped into my brand-new car, a racy black Cougar. I sped us to the coast, two hours away, where we planned to spend the weekend at her parents' beach house.

Dot called every half hour.

1969

S
uddenly, a whole new cast of characters was wandering in and out of the office. Rising sales enabled me to hire more and more reps. Most were ex-runners, and eccentrics, as only ex-runners can be. But when it came to selling they were all business. Because they were inspired by what we were trying to do, and because they worked solely on commission (two dollars a pair), they were burning up the roads, hitting every high school and college track meet within a thousand-mile radius, and their extraordinary efforts were boosting our numbers even more.

We'd posted $150,000 in sales in 1968, and in 1969 we were on our way to just under $300,000. Though Wallace was still breathing down my neck, hassling me to slow down and moaning about my lack of equity, I decided that Blue Ribbon was doing well enough to justify a salary for its founder. Right before my thirty-first birthday I made the bold move. I quit Portland State and went full-time at my company, paying myself a fairly generous eighteen thousand dollars a year.

Above all, I told myself, the best reason for leaving Portland State was that I'd already gotten more out of the school—Penny—than I'd ever hoped. I got something else, too; I just didn't know it at the time. Nor did I dream how valuable it would prove to be.

IN MY LAST
week on campus, walking through the halls, I noticed a group of young women standing around an easel. One of them was daubing at a large canvas, and just as I passed I heard her lamenting that she couldn't afford to take a class on oil painting. I stopped, admired the canvas. “
My
company could use an artist,” I said.

“What?” she said.

“My company needs someone to do some advertising. Would you like to make some extra money?”

I still didn't see any bang-for-the-buck in advertising, but I was starting to accept that I could no longer ignore it. The Standard Insurance Company had just run a full-page ad in the
Wall Street Journal
, touting Blue Ribbon as one of the dynamic young companies among its clients. The ad featured a photo of Bowerman and me . . . staring at a shoe. Not as if we were shoe innovators; more as if we'd never seen a shoe before. We looked like morons. It was embarrassing.

In some of our ads the model was none other than Johnson. See Johnson rocking a blue tracksuit. See Johnson waving a javelin. When it came to advertising, our approach was primitive and slapdash. We were making it up as we went along, learning on the fly, and it showed. In one ad—for the Tiger marathon flat, I think—we referred to the new fabric as “swooshfiber.” To this day none of us remembers who first came up with the word, or what it meant. But it sounded good.

People were telling me constantly that advertising was important, that advertising was the next wave. I always rolled my eyes. But if icky photos and made-up words—and Johnson, posed seductively on a couch—were slipping into our ads, I needed to start paying more attention. “I'll give you two bucks an hour,” I told this starving artist in the hallway at Portland State. “To do what?” she asked. “Design print ads,” I said, “do some lettering, logos, maybe a few charts and graphs for presentations.”

It didn't sound like much of a gig. But the poor kid was desperate.
She wrote her name on a piece of paper. Carolyn Davidson. And her number. I shoved it in my pocket and forgot all about it.

HIRING SALES REPS
and graphic artists showed great optimism, and I didn't consider myself an optimist by nature. Not that I was a pessimist. I generally tried to hover between the two, committing to neither. But as 1969 approached, I found myself staring into space and thinking the future might be bright. After a good night's sleep, after a hearty breakfast, I could see plenty of reason for hope. Aside from our robust and rising sales numbers, Onitsuka would soon be bringing out several exciting new models, including the Obori, which featured a feather-light nylon upper. Also, the Marathon, another nylon, with lines sleek as a Karmann Ghia. These shoes will sell themselves, I told Woodell many times, hanging them on the corkboard.

Also, Bowerman was back from Mexico City, where he'd been an assistant coach on the U.S. Olympic team, meaning he'd played a pivotal role in the U.S. winning more gold medals than any team, from any nation, ever. My partner was more than famous; he was legendary.

I phoned Bowerman, eager to get his overall thoughts on the Games, and particularly on the moment for which they would forever be remembered, the protest of John Carlos and Tommie Smith. Standing on the podium during the playing of “The
Star-Spangled Banner,” both men had bowed their heads and raised black-gloved fists, a shocking gesture, meant to call attention to racism, poverty, human rights abuses. They were still being condemned for it. But Bowerman, as I fully expected, supported them. Bowerman supported all runners.

Carlos and Smith were shoeless during the protest; they'd conspicuously removed their Pumas and left them on the stands. I told Bowerman I couldn't decide if this had been a good thing or a bad
thing for Puma. Was all publicity really good publicity? Was publicity like advertising? A chimera?

Bowerman chuckled and said he wasn't sure.

He told me about the scandalous behavior of Puma and Adidas throughout the Games. The world's two biggest athletic shoe companies—­run by two German brothers who despised each other—had chased each other like Keystone Kops around the Olympic ­Village, jockeying for all the athletes. Huge sums of cash, often stuffed in running shoes or manila envelopes, were passed around. One of Puma's sales reps even got thrown in jail. (There were rumors that Adidas had framed him.) He was married to a female sprinter, and Bowerman joked that he'd only married her to secure her endorsement.

Worse, it didn't stop at mere payouts. Puma had smuggled truckloads of shoes into Mexico City, while Adidas cleverly managed to evade Mexico's stiff import tariffs. I heard through the grapevine they did it by making a nominal number of shoes at a factory in Guadalajara.

Bowerman and I didn't feel morally offended; we felt left out. Blue Ribbon had no money for payouts, and therefore no presence at the Games.

We'd had one meager booth in the Olympic Village, and one guy working it—Bork. I didn't know if Bork had been sitting there reading comic books, or just hadn't been able to compete with the massive presence of Adidas and Puma, but either way his booth generated zero business, zero buzz. No one stopped by.

Actually, one person did stop by. Bill Toomey, a brilliant American decathlete, asked for some Tigers, so he could show the world that he couldn't be bought. But Bork didn't have his size. Nor the right shoes for any of his events.

Plenty of athletes were training in Tigers, Bowerman reported. We just didn't have anybody actually
competing
in them. Part of the reason was quality; Tigers just weren't good enough yet. The main reason, however, was money. We had not a penny for endorsement deals.

“We're not broke,” I told Bowerman, “we just don't have any money.”

He grunted. “Either way,” he said, “wouldn't it be wonderful to be able to
pay
athletes? Legally?”

Lastly, Bowerman told me he'd bumped into Kitami at the Games. He didn't much care for the man. “Doesn't know a damn thing about shoes,” Bowerman grumbled. “And he's a little too slick. Little too full of himself.”

I was starting to have the same inklings. I'd gotten a sense from Kitami's last few wires and letters that he might not be the man he'd seemed, and that he wasn't the fan of Blue Ribbon he'd appeared to be when I was last in Japan. I had a bad feeling in my bones. Maybe he was getting ready to jack up our prices. I mentioned this to Bowerman, and told him I was taking measures to protect us. Before hanging up I boasted that, though I didn't have enough cash or cachet to pay athletes, I did have enough to buy someone at Onitsuka. I had a man on the inside, I said, a man acting as my eyes and ears and keeping tabs on Kitami.

I sent out a memo saying as much to all Blue Ribbon employees. (By now we had around forty.) Though I'd fallen in love with Japanese culture—I kept my souvenir samurai sword beside my desk—I also warned them that Japanese business practices were thoroughly perplexing. In Japan you couldn't predict what either your competition or your partner might do. I'd given up trying. Instead, I wrote, “I've taken what I think is a big step to keep us informed. I've hired a spy. He works full-time in the Onitsuka Export Department. Without going into a lengthy discussion of why I will just tell you that I feel he is trustworthy.

“This spy may seem somewhat unethical to you, but the spy system is ingrained and completely accepted in Japanese business circles. They actually have schools for industrial spies, much as we have schools for typists and stenographers.”

I can't imagine what made me use the word “spy” so wantonly, so
boldly, other than the fact that James Bond was all the rage just then. Nor can I understand why, when I was revealing so much, I didn't reveal the spy's name. It was Fujimoto, whose bicycle I'd replaced.

I think I must have known, on some level, that the memo was a mistake, a terribly stupid thing to do. And that I would live to regret it. I
think
I knew. But I often found myself as perplexing as Japanese business practices.

KITAMI AND MR.
Onitsuka both attended the Games in Mexico City, and afterward they both flew to Los Angeles. I flew down from Oregon to meet them for dinner at a Japanese restaurant in Santa Monica. I was late, of course, and by the time I arrived they were full of sake. Like schoolboys on holiday: Each was wearing a souvenir sombrero, loudly woohooing.

I tried hard to mirror their festive mood. I matched them shot for shot, helped them finish off several platters of sushi, and generally bonded with them both. At my hotel that night I went to bed thinking, hoping, I'd been paranoid about Kitami.

The next morning we all flew to Portland so they could meet the gang at Blue Ribbon. I realized that in my letters to Onitsuka, not to mention my conversations with them, I might have overplayed the grandeur of our “worldwide headquarters.” Sure enough I saw Kitami's face drop as he walked in. I also saw Mr. Onitsuka looking around, bewildered. I hastened to apologize. “It may look small,” I said, laughing tightly, “but we do a lot of business out of this room!”

They looked at the broken windows, the javelin window closer, the wavy plywood room divider. They looked at Woodell in his wheelchair. They felt the walls vibrating from the Pink Bucket jukebox. They looked at each other, dubious. I told myself: Whelp, it's all over.

Sensing my embarrassment, Mr. Onitsuka put a reassuring hand on my shoulder. “It is . . . most charming,” he said.

On the far wall Woodell had hung a large, handsome map of the United States, and he'd put a red pushpin everywhere we'd sold a pair of Tigers in the last five years. The map was covered with red pushpins. For one merciful moment it diverted attention from our office space. Then Kitami pointed at eastern Montana. “No pins,” he said. “Obviously salesman here not doing job.”

DAYS WENT SWOOSHING
by. I was trying to build a company and a marriage. Penny and I were learning to live together, learning to meld our personalities and idiosyncrasies, though we agreed that she was the one with all the personality and I was the idiosyncratic one. Therefore it was she who had more to learn.

For instance, she was learning that I spent a fair portion of each day lost in my own thoughts, tumbling down mental wormholes, trying to solve some problem or construct some plan. I often didn't hear what she said, and if I did hear I didn't remember it minutes later.

She was learning that I was absentminded, that I would drive to the grocery store and come home empty-handed, without the one item she'd asked me to buy, because all the way there and all the way back I'd been puzzling over the latest bank crisis, or the most recent Onitsuka shipping delay.

She was learning that I misplaced everything, especially the important things, like wallets and keys. Bad enough that I couldn't multitask, but I insisted on trying. I'd often scan the financial pages while eating lunch—and driving. My new black Cougar didn't remain new for long. As the Mr. Magoo of Oregon, I was forever bumping into trees and poles and other people's fenders.

She was learning that I wasn't housebroken. I left the toilet seat up, left my clothes where they fell, left food on the counter. I was effectively helpless. I couldn't cook, or clean, or do even the simplest things for myself, because I'd been spoiled rotten by my mother and
sisters. All those years in the servants' quarters, I'd essentially had servants.

She was learning that I didn't like to lose, at anything, that losing for me was a special form of agony. I often flippantly blamed Bowerman, but it went way back. I told her about playing Ping-Pong with my father when I was a boy, and the pain of never being able to beat him. I told her that my father would sometimes laugh when he won, which sent me into a rage. More than once I'd thrown down my paddle and run off crying. I wasn't proud of this behavior, but it was ingrained. It explained me. She didn't really get it until we went bowling. Penny was a very good bowler—she'd taken a bowling class at Oregon State—so I perceived this as a challenge, and I was going to meet the challenge head-on. I was determined to win, and thus everything other than a strike made me glum.

Above all, she was learning that marrying a man with a start-up shoe company meant living on a shoestring budget. And yet she thrived. I could give her only twenty-five dollars a week for groceries, and still she managed to whip up delicious meals. I gave her a credit card with a two-thousand-dollar limit to furnish our entire apartment, and she managed to buy a dinette table, two chairs, a Zenith
TV
, and a big couch with soft arms, perfect for napping. She also bought me a brown recliner, which she stuck in a corner of the living room. Now, each night, I could lean back at a forty-five-­degree angle and spin inside my own head all I wanted. It was more comfortable, and safer, than the Cougar.

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