The Reluctant Entrepreneur: Turning Dreams into Profits

PHILIP KNIGHT’S STORY

In the late 1950s, Phil was a middle-distance runner on the University of Oregon track team. At the time, American track shoes were made from little more than reprocessed wastage from tire companies. A new pair cost only five dollars. But it didn’t last much longer than a single, five-mile race. Phil customized his track shoes as best he could, and was somewhat successful at getting better traction and durability.

Later, while in graduate school at Stanford, he took a course in small business development. One of the assignments was to invent a new business. Remembering his experience as a college athlete, Phil came up with the idea of making and selling superior athletic shoes. To keep costs down, he would manufacture them in Japan. (It was a lot cheaper than doing it in the United States back then.) And he would then market his shoes in competition with Converse and Keds and other popular American brands.

I don’t know what grade he got on that assignment, but I’m guessing it was pretty good.

After graduate school, Phil traveled to the Far East. In Japan, he was drawn to the athletic shoes he saw in department stores. He was especially impressed with the Tiger brand. So, on impulse, he made a call to the head of the company. He told him about his bad experience with American shoes. They met to discuss a potential business deal. And soon thereafter, Phil was given the right to distribute Tiger shoes in the western United States.

While waiting for his samples ...