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Shoe Dog by Phil Knight.
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Like many entrepreneurs, Phil Knight started by solving his own problem – running shoes. A former runner himself, Phil knew what his customers wanted, how they thought, and what would get them onboard.

Phil Knight started his shoe career selling imported Japanese shoes from the company Onitsuka, not by manufacturing his own. He sold his first shoes at track meets out of the trunk of his car, and their design and quality become a hit.

Over time, frictions with the Japanese company over distribution rights, slow shipments, and creating new shoe designs forced him to found Nike. (If they’d kept their partnership amiable, Phil might have kept working with Onitsuka, and Nike might never have happened.)

Management Style

Phil surrounded himself with good people and recruited trusted friends and partners. The Nike team was a ragtag team, including an overweight accountant and a paralyzed track star. What they have in common is Phil trusts them to perform. He followed General Patton’s advice: “Don’t tell people how to do things. Tell them what to do and let them surprise you with their results.”

One of Phil’s key partners was Bill Bowerman, a star Olympic track coach and Phil’s former running coach from college. Bowerman was the mad scientist of the group, experimenting with new shoe designs and rubber formulations to produce a better running shoe. In one landmark experiment, he squeezed rubber in his wife’s waffle iron, producing the waffle sole.

In Shoe Dog, Phil is refreshingly generous about giving credit – other people came up with the name Nike, designed the famous swoosh logo, and designed the first Nike shoes. He admits some of his ideas were pretty terrible (like calling his company “Dimension Six”).

Phil is also frank about his shortcomings. Phil Knight admits that he rarely gave positive feedback or expressed gratitude to team members, and would often be insecure about his decisions.

Financial and Legal Difficulties

Nike wasn’t an overnight billion-dollar company. They started with just $8,000 in sales in their first year, but then they saw regular growth doubling year over year. They kept growing with the reputation of a good product (innovative, stylish shoes) and celebrity endorsements.

Despite strong sales and annual growth, finances were constantly a difficulty for Nike. Phil started his business in the 1960s, well before venture capital was an established industry and before high-growth high-risk companies were the norm. This led to constant financial frictions with his banks, when he asked for larger credit lines and they pushed back. Phil pushed the finances to the limit, barely being able to pay back creditors. This wasn’t out of needless risk, but because he recognized the fundamental demand for Nike was strong. Phil eventually solved this by finding a large Japanese trading company that saw their vision and would support them financially.

Nike ran into continuous problems as it grew – constant problems with manufacturing and finances, failed new shoes, a $25 million fine from US Customs triggered by rival shoe manufacturers. But the perseverance of the team and the high demand for Nikes persisted and drove the company past its problems. Phil notes that when you follow your calling, you can suffer through fatigue and disappointments, and the highs will be incomparable to anything else in life.

The 50-Year Path of Nike

The main chapters end with Nike going public with an IPO in 1979, making Phil’s early lieutenants millionaires. Annual sales exceeded $100 million, a far cry from the $8,000 15 years earlier. The future looked bright - Nike expanded to China, had started an apparel line, and continued racking up celebrity endorsements.

In the epilogue, Phil jumps to 2006, when he stepped down as CEO. Sales were $16 billion that year, to Adidas’s $10 billion. Nike had 5,000 stores worldwide. They’d signed endorsements with sports’ leading names, like Michael Jordan, Tiger Woods, and Lebron James; many of them...

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Shoe Dog Summary 1962

Phil Knight has graduated from the University of Oregon and earned an MBA from Stanford, and he doesn’t know what to do. He is 24.

His best lead is a final paper he wrote on shoes. Having been a decent runner on the U of Oregon track team, he’s obsessed with shoes. His paper’s thesis: Japanese companies are poised to burst into the shoe market, just as they had for cameras and displacing the German incumbents. This is his Crazy Idea. His way of making a mark on the world.

It seems obvious to him. He now has to travel to Japan, find a shoe company, and pitch them his Crazy Idea. Along the way, he wants to see and feel the world, for how can you change the world without seeing it? His traveling ambitions have a spiritual air, longing to understand how the Chinese and Buddhists and Greeks and Christians have thought about life for millennia.

There’s one barrier: he needs money. And his father is his best shot. Phil describes his father as obsessed with respectability and grounding in traditional values, and wandering the earth seemed the antithesis of this. Phil’s quite sure his father will demur from funding his wanderlust. But to his surprise, the elder Knight approves, bemoaning his own lack of travel experience in younger days. Phil later realizes a major motivation for his global journey might be to define himself in opposition to his father – to be one who’s not obsessed with respectability.

With his Stanford friend Carter, they fly directly to Hawaii as their first stop. They are smitten by life on the island. Frolicking in the waves and surrounded by beautiful women, Phil decides his plan can wait.

So they get jobs as encyclopedia salesmen. Phil is a terrible encyclopedia salesman. He switches jobs to sell securities, which essentially means cold-calling customers to sell funds. He isn’t a smooth talker, but he knows his product, and he speaks the truth, and his customers like that. He quickly earns enough to cover rent and plenty of surfing time.

Eventually, though, his journey calls to him again. He has...

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Shoe Dog Summary 1963-1964

1963

Six months after he first left for Hawaii, Phil returns home to Oregon. He greets his family warmly, but he’s concerned about one thing – have the shoes from Onitsuka arrived?

They haven’t.

He sends a letter to Onitsuka, and they reply, promising the shoes will come in a couple of days. In the meantime, he needs a job. His father’s friend, CEO of a publicly-traded company, advises him to get a CPA. If Phil changes jobs, both CPA and MBA degrees would surely prevent his salary from dropping.

Phil takes accounting classes, earns his CPA, then joins an accounting firm. It’s small – with just 4 employees, they work 70-hour weeks. While he waits for shoes to arrive, he yearns to travel, and wonders whether his journey was the peak of his life. Accounting is not his thing.

1964

The Onitsuka shoes arrive! Phil thinks they’re beautiful. After all, they are the embodiment of his future. Immediately, he sends two pairs to his old track coach at U of Oregon, Bill Bowerman.

Phil considers Bill part father figure, part army general. A gruff, tough-love descendant of Oregon Trail pioneers, Bill Bowerman was revered by the track team. Obsessed with performance, Bowerman constantly experimented with shoes to improve his runners’ performance, particularly to make shoes lighter. Bowerman stressed that an extra ounce to a shoe added 55 pounds of lifting over one mile. As a mediocre runner, Phil was Bowerman’s favorite guinea pig (he wouldn’t dare jeopardize the top runners with experimental shoes).

Bowerman was the most famous track coach in America, training local champions and many sub-4 minute milers. So Phil is shocked when Bowerman says not only did he like the shoes, he wants in. They work out a deal – Blue Ribbon would order 300 pairs of shoes, costing $1,000. They’d each put in half the money, and they’d split the company 51-49 – Phil with the 51. Once again, Phil gets his $500 from his father, who has reservations about his MBA son leaving his respectable accounting job to become a wandering shoe...

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Shoe Dog Summary 1965

As it relates to selling shoes, there are a few things to remember about this time. First, running wasn’t really considered a sport or a hobby. It’s hard to believe today, but in the 1960s, jogging to get exercise was something only maniacs would do. To be fair, everyone still smoked like a fiend, and heart disease hadn’t been figured out yet. So Blue Ribbon is still selling the Onitsuka shoes primarily to student athletes – popular as they were, they appeal to just a small niche of the population.

Second, venture capital the way we understand it today didn’t really exist. Small businesses got their startup cash from banks, but banks had very different priorities from today’s venture capital firms. For one, banks didn’t want companies to grow too quickly. They wanted new companies to get profitable quickly and to never let sales exceed their cash balance.

So fast-growing Blue Ribbon run by ambitious Phil is constantly running into issues with their cash balance. Even though their sales are doubling regularly, this cash is quickly turned around to order the next, larger shipment of shoes. Thus Blue Ribbon constantly skates on thin ice with its bank.

Compounding this problem, Onitsuka is painfully unresponsive with Phil and Blue Ribbon. Their shoe shipments often arrive late, which gives Blue Ribbon less time to sell shoes, which then makes each loan repayment period tougher.

Fearing the worst from all these problems, Phil decides to hedge his bets by returning to accounting at Price Waterhouse. He doesn’t love the work, but it pays the bills.

Despite all this bad news, there are two positive developments. First, Phil hires his first full-time employee, a fellow Stanford runner named Jeff Johnson who will sell shoes in...

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Shoe Dog Summary 1966-1967

1966

Blue Ribbon’s first salesman, Johnson has a personality quirk – he sends Phil mountains of letters, detailing his every development, every sale and notable customer. (Shortform note: Just take a minute to remember that business used to be done entirely through phone and letters, not email). Johnson sends advertising ideas (Phil doesn’t believe in advertising), shoe designs (Phil already has enough to deal with Bowerman), and his insistence on opening a retail shop in Los Angeles.

Phil feels smothered and rarely replies to Johnson’s letters. From studying war heroes and generals, he holds a virtue: “Don’t tell people how to do things, tell them what to do and let them surprise you with their results.”

And Johnson delivers results. His customers love him, depending on Johnson to solve their problems in both running and life. Even when he gets in a car crash and breaks his skull, he continues to sell shoes. Phil even issues him a challenge – sell 3,250 pairs of shoes in a few months, and Johnson could open his retail space in LA. And sell he does – now Blue Ribbon has an official runner mecca in Los Angeles.

At one point, Johnson sends one letter that Phil can’t ignore. One of Johnson’s customers says that he can start getting Tiger running shoes from another seller – a wrestling coach somewhere in the East Coast. That same wrestling coach from 1964 who was supposed to stick to wrestling shoes.

This simply can’t do. The wrestling coach is stepping on Blue Ribbon’s turf, capitalizing on all the hard work they’ve done building brand recognition for Onitsuka.

Phil flies to Japan immediately to meet with Onitsuka. (Financially, this is no small feat – he doesn’t have the money, so he puts the charge on his credit card.) He has a new contact – a slick-looking man named Kitami. They settle into a large conference room with other executives.

Phil lays out his case. They’d been doubling their sales each year and projecting $84,000 in sales in 1967. He’d like to become Onitsuka’s exclusive US distributor for...

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Shoe Dog Summary 1968

Blue Ribbon sales are set to double yet again, for its fifth straight year. But they’re still skating on such thin ice that Phil can’t afford to draw a salary.

His accounting job at Price Waterhouse takes up 6 days a week, and Phil wants more time for Blue Ribbon than just weekends and late nights. He quits and takes up a teaching position at Portland State University, paying $700 a month.

He teaches Accounting 101, where a striking young woman with blond hair and blue eyes sits in the front row. She reminds him of Cleopatra and Julie Christie. During roll call, he learns her name – Penelope Parks. She’s shy but is a star student, scoring at the top of her class, and she asks Phil to be her adviser. Phil has a better idea – she should join Blue Ribbon. She agrees.

Penny readily completes miscellaneous operational tasks for Blue Ribbon – bookkeeping, typing, scheduling – with an enthusiasm that lightens the air in their small worn-down office. Phil is bewitched, and they exchange long meaningful glances.

Phil finally asks her out on a date. She shares her background – with four siblings, money was always an issue in her house. She wants security in her life. That’s why she likes accounting – it’s a solid, dependable job.

They keep dating and eventually meet each other’s parents. Penny’s mom, Dot, is a spirited character, seeming like an eternal teenager and more like Penny’s sister than mother. They go out drinking together and Dot seems to approve of Phil.

The relationship moves quickly. Phil wants to elevate their relationship beyond just teacher-student dating (which Portland State doesn’t approve of). They get engaged, just like that, after a few months of dating.

The next day Phil leaves for Japan to develop Blue Ribbon’s partnership with Onitsuka. Newly engaged, he feels like never before that Penny is his partner in life.

“The single easiest way to find out how you feel about someone. Say goodbye.”

In Japan, Kitami (the slick executive from before) greets...

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Shoe Dog Summary 1969-1970

1969

Once again, sales are poised to double for Blue Ribbon, now at $300,000 this year. Phil feels it’s finally safe to pay himself a salary ($18,000 a year), and he quits Portland State to go full time at Blue Ribbon.

In his last days on campus, he meets an artist, Carolyn Davidson, who complains about not being able to find work. With Blue Ribbon growing and getting press, they could use help with their marketing – print ads, charts, and maybe a logo. He doesn’t know the significance of this meeting until far later.

No momentous business events happen this year, though there are some rumblings of problems to come. Most importantly, Phil starts to doubt Kitami’s sincerity from recent wires and letters. Maybe Onitsuka’s getting ready to raise prices on Blue Ribbon. Maybe they’re making secret arrangements with new distributors again. Phil just senses there’s something off.

So he has a backup plan – an inside man at Onitsuka who can keep tabs on Kitami. In a memo to his company, Phil announces that he’s “hired a spy.” He stresses that this is completely accepted in Japanese business culture. The spy is Fujimoto, the man whose bicycle he replaced.

Blue Ribbon finds a new office in Tigard. Woodell, the former runner in a wheelchair, is promoted to operations manager at Blue Ribbon. Despite his injury, he’s ecstatic at Blue Ribbon – the mission fills his spirits and he always gets the job done.

Now married, Phil and Penny learn to live together. Phil is absentminded and messy, but Penny adapts to him. She adapts to everything, including his meager salary. She learns to stretch the budget each week in groceries.

Penny gets pregnant, and they move into a house in Beaverton, OR. It’s a boy.

1970

The contract with Onitsuka to supply Blue Ribbon with shoes is ending soon. Phil flies to Japan and asks for a 5-year contract with Onitsuka – after all, most of the US success was due to Blue Ribbon, and a survey shows 70% of American runners own Tigers. But Onitsuka is adamant to keep the deal for only 3 years....

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Shoe Dog Summary 1971

A groundbreaking year for Phil Knight and Blue Ribbon.

Kitami visits in March, and Phil wants to wow him, make him fall in love with Oregon and Blue Ribbon. They drive him around the Pacific Northwest, feeding them salmon and wine.

But Kitami causes trouble. At First National Bank, he demands that they give Blue Ribbon more money, to everyone else’s chagrin. Then, at Blue Ribbon, he insults the company by saying doubling isn’t enough - sales should be tripling every year. He shoots down Phil’s Japanese trading company idea, fearing that these companies make investments only to research companies, learn their trade secrets, and compete directly with them.

While Kitami’s in the bathroom, Phil steals a folder from Kitami’s briefcase. Their suspicions are confirmed – it lists 18 athletic shoe distributors in the US, and appointments with half of them. Phil feels betrayed – they’d revolutionized Onitsuka, shown them how to make a better shoe, and now Onitsuka was planning to cut them out.

Kitami’s trip ends with dinner at Bowerman’s house. Penny, Phil’s wife, is driving Kitami. They get a flat tire on the road, and Kitami stays in the car and doesn’t help – Penny has to fix it herself.

As betrayed as Phil feels, he believes then that the best course is to keep the peace, to convince Kitami not to abandon Blue Ribbon. Without Onitsuka and their shoes, he wouldn’t know what to do.

Kitami leaves Portland to travel around the US, but he doesn’t reveal his intentions. When he returns, he has a new solution – sell Onitsuka 51% of Blue Ribbon. It’s an ultimatum – accept the deal, or Onitsuka will set up new distributors. Phil is shocked, and he tries to stall by saying he needs to talk with Bowerman.

In a moment of clarity, Phil realizes a few things:

  • Onitsuka and Kitami cannot be trusted.
  • Blue Ribbon and Onitsuka are definitely going to sever ties.
  • But they need to stay together as long as it takes to develop other supply sources.
  • Step 1: scare off other distributors Onitsuka is meeting...

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Shoe Dog Summary 1972

This is the year they announce Nike at the National Sporting Goods Association Show in Chicago. Right before this, Onitsuka publicly announces they’d acquired Blue Ribbon. This is a bluff to pressure them to sell.

For their debut, Phil wants to package shoes in bright orange boxes to stand out. When they receive the shoes, the boxes look great, but the shoes inside are terrible – they look cheap and shiny, and logos are crooked.

They think they’re doomed, but people crowd around, asking questions and actually buying shoes. What’s going on? The salesmen have been doing business with Blue Ribbon for years, and they know Blue Ribbon isn’t a fraud. Their reputation precedes them.

Word travels to Japan, and Kitami from Onitsuka shows up two weeks later. “What’s Nike?” he asks. Phil responds that it’s a backup in case Onitsuka cuts ties with Blue Ribbon. He lies that Nike isn’t currently yet in stores. Kitami travels to Blue Ribbon’s Los Angeles store to inspect. The store manager Bork is instructed by Phil Knight to deceive Kitami, but he finds hundreds of Nike boxes in the storage room. The gig is up.

A bit later, Kitami shows up with a lawyer. He formally voids Blue Ribbon’s contract with Onitsuka, citing the Nike play as a breach. Kitami has the gall to request Bowerman’s services as a consultant, which of course they refuse.

The next day, Phil addresses his team. He shares news that Onitsuka has terminated their contract, and they may have to face lawsuits for breach of contract. And they’ve got an uphill battle – Nike shoes have quality problems, and they have little margin for error. Everyone looks dejected, especially as there’s an economic recession going on. But Phil rallies the team, saying this is the moment they’ve been waiting for. The chance to make their own brand, and break free of Onitsuka’s limitations. This inspires the crew, and they begin the fight for survival.

In preparation for the 1972 Olympics, the US track-and-field trials are...

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Shoe Dog Summary 1973-1974

1973

Prefontaine is in a funk from getting 4th in the 1972 Olympics. But he eventually gets his fire back, and he’s wearing Nikes while winning. Because US Olympic athletes at the time couldn’t collect endorsement money, Pre is also destitute. So Nike signs him as a “National Director of Public Affairs,” or a celebrity endorser, paying $5000 a year. Everywhere Pre goes, Nike goes. People flock to see him, and Pre urges them to give Nike a try.

Phil strongly requests two employees, Woodell and Johnson, to trade roles and locations, transferring between Boston and Oregon. Interestingly, he writes, “in keeping with my personality...I expressed no gratitude. I spoke not a word of thanks or praise.”

Sales are higher than ever at $4.8 million, but this year they lose $57,000. Their investors, the debenture holders, are shocked, even though Nike is gaining national traction. Phil placates them by giving them a fixed conversion rate on stock for five years, and he thinks he’ll never want to go public and have to deal with thousands of shareholders.

As expected, Onitsuka files a suit for breach of contract in Japan. Nike quickly files against them in the United States. Phil is deposed, and some facts don’t look great, like his memo about hiring a spy in Onitsuka, and stealing Kitami’s folder from his briefcase to find he was courting distributors. Despite this, Phil has a legal team he trusts and who insist they’re going to win.

Another problem in the business is creating enough supply to meet the massive demand for their shoes. Their factories are churning out shoes reliably, unlike with Onitsuka, but it’s hard to ramp up supply without taking on inventory risk from unsold shoes. Nike is already walking a fine line of profitability, and any missed shipment would delay payment to Nissho, which would cut down their ability to borrow, which would in turn delay their next factory order.

So Phil has an idea – what if they go to retailers and ask for large upfront orders 6 months in advance with big discounts, up to 7%? At first, the...

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Shoe Dog Summary 1975

Financially, Phil Knight constantly pushes the pedal to the metal. He knows there is huge demand for Nike shoes, and he can’t sell them quickly enough. So why limit factory orders to go in the black, when you know the demand is out there? He doesn’t see this as reckless – the demand is there.

This means Blue Ribbon lives check to check, barely making their monthly payments to the Bank of California and Nissho. Just one late payment to Blue Ribbon, and the whole tower might crumble.

And one day, that one check from a retailer is late. They’re $75,000 short, out of a total $1 million, to pay Nissho. To make it work, they deplete the bank accounts of all their retail stores and factories.

Then the factory workers’ paychecks bounce. And their creditors’ checks bounce.

Then Bank of California tells them they no longer want Blue Ribbon’s business, they’re freezing their funds, and they’ve contacted the FBI, since it looks like fraud to them.

Phil Knight takes all this to Nissho. They’re sympathetic, knowing that businesses run on float, but they insist on looking at Blue Ribbon’s books. Sumeragi and Ito, a senior manager, park in Blue Ribbon’s office to audit their finances.

Through all of this, Phil Knight finds it hard to sleep, thinking about his life and questioning his decisions up to that point. If only he’d been a good encyclopedia salesman, he wouldn’t be in this mess.

Near the end of the audit, Sumeragi admits the situation is even worse than it first appeared. He’d delayed sending invoices to Blue Ribbon until he knew they could pay them back. In reality, Blue Ribbon was never paying Nissho on time. Ito questions Sumeragi on why he would do this, and Sumeragi replies that he thinks Blue Ribbon...

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Shoe Dog Summary 1976

This year is relatively crisis-free, and Phil Knight and his team spend their time thinking about the future. Now that Nike is becoming a national, household brand, they officially incorporate as Nike, Inc.

When introspecting about what the ultimate goal of Nike is, Phil comes up with a single word: “winning.” Phil feels personally affronted when runners are wearing shoes other than Nikes. At the 1976 Olympic Trials, multiple qualifying runners are wearing Nike as they qualify to represent the US, and Nike is the talk of the athletic town. But in the actual Olympics, a runner who had previously worn Nikes at the Trials was now wearing Onitsuka Tigers – he wasn’t confident Nikes would last a whole marathon. Phil is crushed. Every rejection of Nike is a rejection of himself.

Luckily, the Nike waffle trainers are more popular than ever. They’re breaking out of athletic uses and becoming an everyday lifestyle shoe, something competitors found hard to do. Sales double again to $14 million.

With this popularity, Nike needs to find new manufacturers who can handle scale, and they finally turn to Taiwan. After scouring dozens of dirty, crowded factories, they find a few shoe dogs they can trust and sign deals. Phil and his mentee drink heavily, prompted by the Taiwanese businessmen. Importantly, given the frictions between Taiwan and China, Phil sets up a sub-company called Athena. He wants to preserve the potential to enter China, with its two billion feet to put shoes on.

Despite their massive sales, finances are continuously an issue, and they continuously ponder whether to go public. It would raise cash to fuel growth, but they feel it would sell their soul and control. So they keep punting it to later, raising loans from new banks.

One loan requires Phil and Bowerman to personally guarantee the loan, which Bowerman doesn’t want to risk anymore. Bowerman wants to sell 2/3 of his stake in Blue Ribbon, which Phil reluctantly accepts. But Bowerman starts feeling idle in retirement and disrespected by Nike, even though they’re giving him the...

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Shoe Dog Summary 1977-1979

1977

Nike continues its inexorable climb upward. They continue catching national attention. They sign dozens of college sports teams and legendary coaches. There’s a funny story about how in a press release they misspelled Iona as Iowa. Iowa’s head coach calls, angry that Nike had incorrectly claimed a partnership that didn't exist—but then asks to sign with Nike too.

Endorsements: In tennis, they don’t get star Nastase (who asks for $100,000/year), which Phil thinks is irresponsible. But at Wimbledon, they find a young hothead named John McEnroe, and Phil falls in love with him. They have Nikes showing up in Hollywood, with Farrah Fawcett wearing Seniorita Cortezes in Charlie’s Angels. Phil’s father even mentions how prominently Nikes are featured in a basketball game, and Phil feels that he’s finally earning his father’s respect and pride (a longstanding chip on Phil’s shoulder).

They continue their track record of shoe innovation. Bowerman designs the LD 1000, a shoe with a flared heel meant to reduce pressure on the knee. But it’s finicky and requires an exacting stride to avoid injury. Nike recalls and braces for backlash, but instead they receive plaudits – they’re seen as the major innovator in shoes, and their customers are grateful for experiments, failed or not.

And there is one major innovation on the horizon – air in the soles. An aerospace engineer approaches Nike and tells them he can inject air into running soles. Phil is skeptical of this pale lanky man with a “severe vitamin D deficiency,” but he tries a hastily assembled prototype of air soles in his running shoes. He thinks there might be something there.

Rising demand is always a manufacturing problem, but they continue building partnerships with factories in Taiwan, Korea, and Puerto Rico. Funnily, a Korean factory Nike doesn’t partner with sends him a perfect replica of a shoe. Phil writes back with an angry cease and desist and also an offer to partner. They start working together.

Nike launches memorable ad campaigns, centered around a slogan: “There is no...

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Shoe Dog Summary 1980

This is the final year detailed in Shoe Dog, the year when Nike finally goes public through its IPO.

Tired of the plodding pace with US Customs, Nike goes on the offense. First, Nike launches its own low-cost nylon shoe, called the One Line. The import duties use a comparable shoe as the pricing benchmark, giving rise to the $25 million price. By using their own shoe as the comparable, they might reduce the claim.

Next, they produce a TV ad telling the story of the little Oregon company fighting the big bad government. Being forced to do this was un-American, it says.

Finally, Nike files a $25 million antitrust suit against its competitors and rubber companies, who had conspired to cripple them.

With so much heat, US Customs decide they wanted to move on. They initiate settlement talks, starting at $20 million, then $15 million. Phil doesn’t want to pay anything, even though they need to resolve this to go public, and they need to go public to survive. Eventually, they settle on a final number - $9 million. Phil doesn’t like it, but he agrees. When writing the check, he muses that Nike has come a long way since he wrote his $1 million check in 1975 to pay Nissho – $1 million that he didn’t have.

Now they can go public, but Phil is still terrified of losing control of Nike, that thousands of shareholders will ruin the Nike culture. Their solution is to issue two classes of stock – ordinary class B shares with one vote, and preferred class A shares for the current team that would let them name ¾ of the board.

Nike in China

Nike makes its first inroads into China. Two billion feet is their target prize. Phil wants Nike to be first, knowing it’ll be a huge advantage.

They recruit a China expert called David Chang, who gets them through the bureaucratic nightmare to get a tour in China, hosted by the Chinese government. They see landmarks like the Great Wall and visit old, decrepit factories that produce defective shoes. The Chinese find it common practice to wear mismatched shoes on the right and left. Phil is appalled, but he sees...

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Shoe Dog Summary Night

In 2006, Phil steps down as Nike CEO. Sales are $16 billion that year (to Adidas’s $10 billion). Nike has 5,000 stores and 10,000 employees worldwide. China is its largest producer of shoes.

Their world headquarters in Beaverton houses 5,000 employees in buildings named after people who helped create the company above a brand – Tiger Woods, Mia Hamm, Steve Prefontaine. The two main streets are named after Bowerman and Hayes. Phil is grateful, and he can’t help feeling the universe has been guiding him, nudging him through success.

The spirit of Nike seems to continue with their newest employees. They come in interested in company history and have an informal discussion group called the Spirit of 72.

Superstar athletes are grateful to Nike and to Phil too. Lebron James gives Phil a Rolex from 1972, engraved with “Thanks for taking a chance on me.” Michael Jordan reserves a front-row seat for Phil at his father’s funeral. Phil considers them family.

In 2000, Phil’s son Matthew dies in a diving accident. Phil and Penny are devastated. Every Nike athlete contacts them, but Tiger Woods is the first one, calling in at 7:30 AM. Phil will never forget this.

There are other losses along the way. Bowerman dies in 1999 in his hometown. Phil recalls crying so much that he gave up on tissues and just draped a towel over his shoulder.

Strasser (the lawyer who guided them through the Onitsuka trial and took on active roles in signing endorsements) dies in 1993. But before this, they have a falling out. Strasser was instrumental in signing Jordan and creating the Air Jordan brand. This success got to Strasser’s head, and he didn’t want to take orders from anyone. After clashes, he quit and went to Adidas, a betrayal that Phil never forgave. (They did, however, hire his daughter, Avery Strasser.)

Phil feels the same sense of betrayal when Nike comes under attack for the sweatshop controversy. Reporters never ask how much worse a factory was before Nike went in, made them better, safer, cleaner. They never see that Nike is just a renter of the factory, not...

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Table of Contents

  • 1-Page Summary
  • 1962
  • 1963-1964
  • 1965
  • 1966-1967
  • 1968
  • 1969-1970
  • 1971
  • 1972
  • 1973-1974
  • 1975
  • 1976
  • 1977-1979
  • 1980
  • Night
  • Exercise: Reflect on Nike’s Story