Book Shoe Dog: A Memoir by the Creator of Nike

In his autobiography, Phil Knight shares the amazing tale of Nike, the company he started and led from 1964 to 2004. He takes us on a remarkable journey, from borrowing $50 from his father and having a few sports shoes in his car’s trunk to building a fortune and making his brand known worldwide.

By Phil Knight, 2018, 550 pages

Book review and summary of “Shoe Dog” :

Dawn

In 1962, Phil Knight came back to his hometown in Oregon after being away for seven years. He had recently completed a year in the military and earned an MBA from Stanford’s top-notch business school after several years of studying.

At the age of twenty-four, Phil had some uncertainties. Like his friends, he wanted to succeed, but he didn’t necessarily have the same aspirations of getting married, accumulating wealth, having children, and owning a house. While he recognized the value in these conventional goals, there was a deeper part of him seeking something more. He had a strong feeling that life was short, and he desired a life filled with purpose, passion, creativity, significance, and most importantly, uniqueness.

Being deeply passionate about sports, particularly running, Phil Knight had dreams of becoming a top-tier athlete. However, destiny had other plans, and he realized he was meant to be a “good athlete” rather than a “great athlete.” As a result, he shifted his focus from pursuing an athletic career to venturing into entrepreneurship, in search of a fulfilling and meaningful path in life.

“I wanted to leave a mark in history. I wanted to win. At least, I definitively did not want to lose.”

Chapter 1 – 1962

1.1 – The crazy idea 

While Phil Knight was studying and researching shoes, he had a remarkable idea that he fondly referred to as his “Crazy Idea.” This concept began to consume him, starting with his academic work on footwear and his participation in an entrepreneurship seminar. It soon evolved into an all-encompassing obsession. Phil Knight delved into extensive research to gather knowledge that could assist him in bringing his “Crazy Idea” to life.

Upon returning to Oregon, something extraordinary happened to Phil during one of his runs. It was like a powerful vision that transformed into a resolute certainty: he had to pursue his “Crazy Idea” project at any cost.

So, what was this “Crazy Idea”? Phil Knight’s grand plan was to establish a company that would import high-quality yet affordable athletic shoes from Japan and sell them in the United States.

To make his “Crazy Idea” a reality, Phil understood that he needed to go to Japan. Once there, he would have to convince a Japanese company to supply him with shoes for his venture back in Oregon.

This enterprising young man not only dreamed of exploring the world’s most beautiful places to gain a deeper understanding of humanity but also envisioned embarking on an extensive backpacking journey around the globe, with a crucial stopover in Japan, all to bring his “crazy idea” to fruition.

1.2 – Trip around the world

At the age of 24, Phil Knight received his father’s support and set off on a journey to Hawaii, accompanied by a college friend. Honolulu captivated them so much that they decided to extend their stay. They rented a boarding house, enjoyed surfing, and embraced a carefree lifestyle. Phil initially worked as an encyclopedia salesman and later as a financial products salesman, earning a decent income while relishing his bohemian existence. However, his passion for travel continued to burn within him.

Eventually, Phil decided to bid farewell to his job and purchased an “open” airline ticket, which allowed him to travel with any airline to any destination for a full year. His travel companion, on the other hand, chose to remain in Hawaii with a young local woman he had met.

With unwavering determination, Phil Knight embarked on a solo journey to Japan, ready to pursue his entrepreneurial dreams.

1.3 – Tokyo and the visit to Onitsuka

Upon his arrival in Tokyo, Phil Knight experienced a period of adjustment. Japan still bore the scars of its war with the United States, and the country lay in ruins. Additionally, he needed time to immerse himself in Japanese culture and surroundings, which captivated his interest.

Phil sought guidance from two former U.S. soldiers stationed in Japan who operated a magazine focused on importing. They provided valuable insights into Japanese business practices. Armed with this knowledge, Phil journeyed to Kobe to meet with the leaders of a shoe manufacturing company called Onitsuka.

His visit to the Onitsuka factory was followed by a meeting with a group of executives. Phil had rehearsed this encounter in his mind numerous times and, drawing from his prior research, projected an image of eloquence that left a strong impression on the Onitsuka leadership. They bombarded him with questions while displaying various shoe models. However, when asked about the name of his company, Phil Knight was taken aback:

“Suddenly, a rush of adrenaline surged through me, triggering a desire to flee and seek refuge in what I considered the safest place on earth: my parents’ home.”

As he mentally visualized the interior of his childhood home, an idea struck him:

“I had covered a wall with blue ribbons, awards I had earned from track and field, the one thing in my life I deeply cherished. And I blurted out, ‘Blue Ribbon. Gentlemen, I represent Blue Ribbon Sports from Portland, Oregon’.”

Ultimately, the Onitsuka team agreed to the deal. Phil Knight placed an initial order of $50, but without the necessary funds, he found himself turning to his father for a transfer of the required amount to Onitsuka.

1.4 – Greece: the trip’s climax

Young Phil continued his extensive travels, venturing through a multitude of diverse destinations such as Hong Kong, the Philippines, Bangkok, Vietnam, Calcutta, Kathmandu, Mumbai, Kenya, Cairo, Jerusalem, Istanbul, Rome, Florence, Milan, Venice, Paris, Munich, Vienna, and London.

Yet, for Phil Knight, the pinnacle of his journey was undoubtedly Greece. Besides presenting his “Crazy Idea” to the Japanese, the prospect of visiting the Acropolis had been the most exhilarating aspect before his departure. While ascending the steps of this iconic monument, he experienced a sensation he describes as “this is where it all begins”:

“As I gazed upon these magnificent columns, I felt an exhilarating jolt, the kind you experience in the presence of great beauty. Simultaneously, I felt an overwhelming sense of… déjà vu? […] It was as if I had been here before.”

Phil Knight points out three noteworthy aspects, almost as if to highlight the uncanny coincidences. It’s worth noting that his company would later be named Nike (and even Athena in Taiwan), without him intentionally seeking these connections:

The sensation of “déjà vu” occurred just meters away from the Temple of Athena Nike (the Greek goddess Athena is associated with victory, known as Nike in Greek).

The marble façade of the temple featured sculptures, with the most renowned depicting the goddess adjusting the strap of her shoe.

In Aristophanes’ play titled “Knights,” similar to the entrepreneur’s surname, a warrior presents a gift of new shoes to the king in the Temple of Nike.

Chapter 2 – 1963

After returning to his parents’ home, Phil Knight patiently waits for nearly a year, anticipating the arrival of his shoes from Japan. During this time, he pursues an accounting degree, becoming a CPA (Certified Public Accountant), and secures a job at an accounting firm. He uses his earnings to purchase a car.

Chapter 3 – 1964

3.1 – Phil Knight and Bill Bowerman: two partners in sales of the first Tigers

After waiting for over ten months, Phil Knight finally receives the shoes from Japan. Believing in the shoes’ potential and their appeal to his former track-and-field coach, Bill Bowerman, Phil Knight sends him two pairs out of the twelve received.

At that time, Bill Bowerman was a highly renowned track coach in the United States, and he quickly takes an interest in these shoes known as Tigers, along with Phil Knight’s proposal.

In January 1964, the two men decide to join forces for this project. Phil Knight, excited about partnering with the influential Bowerman, orders an additional 300 pairs of shoes. He also asks Onitsuka to become the exclusive distributor of Tigers shoes in the Western United States. To cover the $1,000 cost of the order, his father, despite his reservations, assists him.

3.2 – The beginnings of Blue Ribbon

Phil Knight is pleased with his progress. He swiftly sells his athletic shoes:

• To coaches, runners, and spectators at numerous local track-and-field events.
• Via mail orders.

A few months later, he places a new order, this time for 900 pairs, amounting to $3,000.

“I had a true partner, a bank worthy of the name and a product that sold like hotcakes. I was on top of the world.”

3.3 – First entrepreneurial challenges

As Phil Knight enjoys his journey, he faces his first business challenges. A wrestling coach, nicknamed the “Marlboro Man” for his appearance in Marlboro ads, claims to have an exclusive deal with Onitsuka to distribute Tigers shoes in the United States. He demands that Blue Ribbon (Phil’s company) stop selling the shoes.

Initially disheartened, Phil Knight decides to confront the issue directly. He travels to Japan to resolve the matter with his suppliers. Fortunately, he emerges victorious from the trip. They agree that Phil Knight can continue selling shoes in the western United States (comprising 13 states). Marlboro Man can sell wrestling shoes nationwide but is limited to selling running shoes in the eastern United States.

Chapter 4 – 1965

4.1 – The first brush-ups with the bank: equity

“Mr. Knight, you have to slow down. You do not have enough equity for this kind of growth.”

Phil Knight adopts a simple strategy: he reinvests every dollar earned back into the company, except for the loan repayment, despite warnings from his bank. He doesn’t see the point in not using the money they’ve earned:

“Was it too careless? Not using available cash did not make sense to me. This would probably have been a more cautious and conservative strategy, but too many cautious and conservative entrepreneurs had failed. I wanted to keep my foot on the accelerator. That said, I kept silent during the exchanges with my banker.”

However, this approach presents daily challenges. Shipments from Onitsuka consistently arrive late, and the time between shoe sales and loan repayment shrinks significantly.

4.2 – An accountant position in parallel with his company

While Phil Knight is in the process of hiring his first full-time employee, Jeff Johnson, he decides to secure a job as an accountant at Price Waterhouse alongside his shoe sales business, just in case his business doesn’t go as planned. This decision serves several purposes:

1. He can invest a significant portion of his salary into Blue Ribbon’s bank account, bolstering the company’s equity.
2. By auditing various clients of Price Waterhouse, he gains insight into what makes businesses succeed or fail.
3. Phil Knight continues to fulfill his obligations in the US Army Reserve during weekday evenings from 7 pm to 10 pm.

Chapter 5 – 1966

5.1 – First managerial questions and first retail outlet

During this period, Phil Knight immerses himself in reading about generals, samurai, shoguns, as well as biographies of his three main role models: Churchill, Kennedy, and Tolstoy. While he wasn’t drawn to the violence, he found the concept of leadership under extreme conditions fascinating. He draws a parallel between war, the most extreme situation, and the business world, often referred to as a “war without bullets.”

Phil Knight then shares his early managerial challenges with his employee, Johnson, who frequently seeks his attention. Despite Johnson’s persistent demands, Phil adopts a distant and “cold” management style, refraining from responding to these requests. Nevertheless, Johnson continues to demonstrate exceptional creativity and energy, working seven days a week to achieve remarkable sales and promote Blue Ribbon. Impressed by Johnson’s dedication, Phil Knight eventually allows him to realize his dream of opening an athletic shoe store in Santa Monica. This store isn’t just a place to buy shoes; it’s a sanctuary that celebrates runners and their passion.

5.2 – Exclusive distribution rights in the United States

Phil Knight encounters another distribution rights issue involving the well-known “Marlboro Man.” To resolve this problem permanently and secure exclusive distribution rights for running shoes in the United States, Phil Knight embarks on another trip to Japan. As part of the solution, he agrees to oversee nationwide distribution. This means that Blue Ribbon must establish offices not only on the West Coast but also on the East Coast and in the Midwest.

Ultimately, Onitsuka and Blue Ribbon sign a three-year commercial partnership contract to solidify their collaboration.

Chapter 6 – 1967

After recruiting Jeff Johnson, who manages the East Coast store, Blue Ribbon makes several more hires. They bring in Bork to oversee the Santa Monica store, Geoff Hollister, a former runner trained by Bowerman, and Bob Woodell, a renowned Oregon track-and-field athlete who was unfortunately in a wheelchair due to an accident.

In late 1967, Bowerman publishes his book “Jogging,” which becomes a massive success, selling one million copies. It’s seen as a significant message for a nation not accustomed to such sermons.

Meanwhile, Blue Ribbon’s sales keep surging. In response, Phil Knight decides to relocate the company’s office from his apartment to Wellesley, near Boston.

Chapter 7 – 1968

7.1 – How to devote more time to Blue Ribbon

Phil Knight realizes that his true passion lies in Blue Ribbon, but the company can’t yet afford to pay him a salary. To support himself financially, he takes on a job as an assistant accounting professor at the University of Portland. This position helps cover his expenses while giving him more time to focus on his beloved Blue Ribbon.

7.2 – A happy marriage

While working as a professor at the university, Phil Knight falls in love with one of his brightest students, Penelope Parks. He soon hires her at Blue Ribbon for accounting, where she becomes highly valued by her colleagues and exhibits exceptional dedication. Phil and Penelope’s professional relationship evolves into a deep bond, and their connection grows stronger over time. As Phil prepares to travel to Japan, he realizes the significance of their relationship and how much Penelope means to him. Their love becomes official when they marry on September 13, 1968, in Portland.

Chapter 8 – 1969

In a short time, Blue Ribbon experiences significant growth and positive developments:

• The company performs well enough to support a full-time salary for its founder, Phil Knight, at $18,000 per year.
• Bill Bowerman, assistant coach of the United States Olympic team during the Mexico City Olympics, achieves legendary status due to his role in securing numerous gold medals.
• Blue Ribbon hires a spy, Fujimoto, from Onitsuka’s export department. This espionage practice is common and accepted in Japanese business networks.
• Blue Ribbon relocates to Tigard in South Portland, moving into clean and nearly luxurious premises.
• Phil Knight’s family grows as Penelope gives birth to their first son, Matthew. They also buy a house in Beaverton to accommodate their expanding family.
• This period marks the beginning of a strong friendship between Bob Woodell and Phil Knight, characterized by countless conversations, laughter, shared revelations, confidences, and discussions about their business’s potential and challenges.

“I can hardly remember it. I close my eyes and try to think back, but all these precious moments – countless conversations, endless laughter, revelations, confidences – have left my memory forever. And I only remember sitting up half of the night, talking about the past and making plans for the future. I remember that we talked about what our business was, what it could become and what pitfalls to avoid. How I wish I would have used a tape recorder during those nights. Or kept a journal, like during my trip around the world.” 

Chapter 9 – 1970

In 1970, Phil Knight faces a series of shipping problems, including inaccurate shoe quantities, wrong sizes, and models. Onitsuka prioritizes local distributors, causing delays and frustration for Blue Ribbon’s salespeople.

Additionally, Phil Knight encounters increasing pressure from banks due to his company’s rapid growth (doubling turnover annually). Delays in shipments shorten loan repayment deadlines.

To address these challenges, Phil manages to raise $20,000 with help from friends and family. However, tensions with the bank escalate.

Furthermore, despite signing a three-year contract with Onitsuka, Phil discovers that the Japanese supplier is secretly seeking to break their commitment. Onitsuka has been in talks with other U.S. distributors to replace Blue Ribbon.

 

Chapter 10 – 1971

10.1 – Onitsuka’s proposal to buy out Blue Ribbon

Phil Knight invites Onitsuka to the United States with hopes of strengthening their partnership. However, the visit didn’t go as planned. Kitami, the Onitsuka representative, highlights problems with Blue Ribbon’s bank, expresses dissatisfaction with their performance, and rejects financial solutions proposed by Phil Knight.

To make matters worse, Kitami suggests buying Blue Ribbon or working with other distributors. Despite feeling hurt and frustrated, Phil Knight believes it’s best to maintain a good relationship with Onitsuka. He wants to convince Kitami not to abandon them because he has no alternative solution at the moment. So, he needs Onitsuka to continue sending shoes for as long as possible.

10.2 – The bank puts an end to the collaboration with Blue Ribbon

Around the same time, the First National Bank, which had been working with Blue Ribbon, decides it doesn’t want to continue doing business with the company. Blue Ribbon goes without a bank for three weeks until they finally find a temporary solution with the Bank of California.

“It was only a short-term solution. Regardless of our turnover, Bank of California would soon be alarmed by our cash balance close to zero. […] I had to prepare right away for that fateful day.”

10.3 – Nissho and counterattack

To ease the concerns of his bankers, Phil Knight reaches out to the Japanese trading house, Nissho Iwai. They agree to provide additional funds to Blue Ribbon on top of their bank loans and offer to introduce them to various high-quality shoe producers in Japan.

Phil Knight realizes that the collaboration between Blue Ribbon and Onitsuka is coming to an end. He devises a plan:

• Step 1: Scare off any distributors targeted by Onitsuka to replace him by threatening legal action if they breach their contracts with Onitsuka.
• Step 2: Find a new supplier to replace Onitsuka.

Things move quite swiftly from there. Phil Knight visits a factory in Guadalajara, which he had heard about. While the agreement with Onitsuka prohibits Blue Ribbon from importing running shoes, it doesn’t mention football shoes. Consequently, Blue Ribbon places an order for 3,000 pairs of leather football shoes from this factory.

10.4 – The creation of the “swoosh”, the logo

Football shoes needed to have a distinct identity separate from Onitsuka and Adidas. This required creating a unique logo. Phil Knight reaches out to Carolyn Davidson, a struggling artist he had met when he was a university professor. He offered her a job at Blue Ribbon for $2 per hour. He asks her to design a logo that conveys a sense of motion.

Among the various designs Carolyn presents, one catches their attention: “It looked like a wing,” one person thought. “It looked like a whoosh of air,” someone else thought. “And it also looked like what a runner might leave in his wake. We all agreed that it was timeless.”

Blue Ribbon pays her thirty-five dollars for her work, and she departs. Phil Knight admits, “I sighed, ‘I don’t find it exceptional. But maybe it will grow on me’.”

10.5 – How the name of Nike is born

They faced the challenge of choosing a name to complement the new logo. The Blue Ribbon team dedicated hours to discuss and assess various options like Falcon, Dimension Six, Bengal, and Condor. However, after much debate, they found all these names unsatisfactory.

Then, on the crucial day of making a decision, a call came in from Jeff Johnson, who was now overseeing the company’s operations on the East Coast. Phil Knight recalls the moment when his team shared the call’s content with him:

• “Johnson called first thing this morning. Apparently, a new name came to him in a dream last night.
• A dream? I blurted, incredulously.
• He’s serious.
• He’s always serious.
• He says he jumped out of his bed in the middle of the night and saw the name before him.
• And what is it? I asked, sitting up in my chair.
• Nike.
• Excuse me?
• Nike.
• Spell it for me.
• N-I-K-E.”

I jotted down the name on my notepad. It reminded me of Greek mythology and the concepts of victory, the Acropolis, the Parthenon, and the Temple. I spent the entire day pondering Johnson’s idea.

“Johnson had pointed out to me that all the seemingly emblematic brands had short names. Two syllables or less. Moreover, these names still had a strong sound, a letter like “K” or “X”, which stuck in the mind. Nike fit this description. I also liked the fact that Nike is the goddess of victory.”

That evening, Phil Knight decided to name his shoe brand “Nike.”

10.6 – Production of the first Nike shoes

The initial football shoes from the Canadian factory turned out to be disappointing due to their poor quality. Blue Ribbon needed to find a better factory to produce more durable and weather-resistant shoes. With the assistance of Nissho, they decided to work with a large factory in the southern islands of Japan called Nippon Rubber, resulting in higher-quality shoes.

10.7 – Shoes with waffle soles

During breakfast, while sitting with his wife, Bowerman gazed at their waffle iron, particularly its grid pattern. This was the pattern he had been searching for, and it finally clicked. This pattern served as the inspiration for Nike’s distinctive insole design. After creating a sample pair of shoes with the textured soles, Bowerman showed them to Phil Knight, who promptly sent them to the new Nippon Rubber factory.

The following year, when Phil Knight filed a patent application for Bowerman’s “embossed” shoe design, it was a moment of pride for both partners. The author reflects on Bowerman’s contribution, wondering:

“I wonder if he knew he was writing history by revolutionizing an industry and transforming the way athletes would run and jump for generations.”

Chapter 11 – 1972

11.1 – The first sales of “Nike”

At the Chicago Sporting Goods Show, Blue Ribbon chooses to unveil Nike to the world for the first time. Despite an initial batch of low-quality shoes, they receive numerous orders. Nike shoes quickly become the highlight of the show!

11.2 – Blue Ribbon loses Onitsuka, its first supplier

However, the word spreads quickly, and Blue Ribbon attempts to keep the sales of Nike shoes hidden from Onitsuka, but the truth eventually surfaces. Onitsuka notifies Phil Knight of the contract breach and requests $17,000 in damages. Since Onitsuka rejects any out-of-court settlement, the matter goes to court.

11.3 – End of Bowerman’s career

In the summer of 1972, Bowerman is excited to coach the US track-and-field team at the Olympic Games in Germany. However, these Olympics take a tragic turn when, during the second week of the trials, eleven Israeli athletes are kidnapped by eight armed men. Bowerman is deeply affected by this event and decides to retire from coaching.

Chapter 12 – 1973

12.1 – Two sports celebrities wear Nike

Romanian tennis champ Ilie Nastase, also known as “Nasty,” signs a $10,000 contract with Nike, which is a significant expense for the company but brings them a famous champion.

Another significant development is that Prefontaine, often referred to simply as “Pre,” becomes an official partner of Nike. He’s not just an athlete; he’s a true icon, often compared to famous figures like James Dean, Mick Jagger, or Muhammad Ali.

When Prefontaine breaks the US record in the 5,000 meters, he’s wearing Nike shoes, which prompts Blue Ribbon to hire him. The partnership benefits both parties: Nike gains valuable advertising and a reputation for rebellion, while Pre receives a $5,000 annual salary, an apartment, and doesn’t have to overwork himself. He also agrees to wear Nike t-shirts and serve as a model for Bowerman’s shoe experiments..

“Pre preached Nike as others preach the gospel, which attracted thousands of new pilgrims to our church.”

12.2 – Between legal problems and supply problems, the risk of losing everything

Towards the end of 1973, Blue Ribbon’s revenue experienced a substantial 50% increase, reaching $4.8 million. However, amidst legal challenges and worries about the supply chain, Phil Knight grappled with the fear of losing everything.

Regarding the court case with Onitsuka, as Onitsuka filed lawsuits in Japan, Blue Ribbon countersued them in the United States for breach of contract and trademark infringement. Phil Knight lacked the financial means to hire a lawyer, so his cousin Houser and collaborator Strasser stepped up to defend Blue Ribbon. This legal battle brought Phil closer to his father, strengthening their bond as they faced this critical fight together.

In 1973, the sports shoe industry faced severe supply and demand challenges that seemed insurmountable. The global demand for running shoes skyrocketed, exceeding the available supply, creating a shortage of shoes in production.

Chapter 13 – 1974

13.1 – The trial with Onitsuka

In this section, Phil Knight provides an overview of the entire legal battle between Blue Ribbon and Onitsuka. He recounts how, on April 14, 1974, his own testimony was acceptable, while the statements from other participants varied in quality, ranging from excellent to poorly prepared.

When the trial concluded, the court was more persuaded by Blue Ribbon’s account of the events and rendered a verdict in favor of Blue Ribbon. As a result, Phil Knight’s company:

1. Retains complete rights to the Boston and Cortez shoes.
2. Is awarded damages because the company experienced a decline in revenue and the brand was misappropriated.

13.2 – Relocation of production and purchase of a plant in New England

“We were trying to build a brand but also a culture, we were fighting against conformism and boredom. More than a product, we wanted to sell an idea, even a state of mind.”

Due to the changing value of the yen and increasing labor costs in Japan, it becomes increasingly challenging for Blue Ribbon to manufacture most of its shoes in Japan. Consequently, the company must seek out alternative factories in other countries.

While considering Taiwan as a potential option, they find that it’s not yet suitable for their needs. In the meantime, Phil Knight decides to import partially finished shoe components from Puerto Rico and then complete the assembly process in New England. To facilitate this, they acquire a factory specifically for this final assembly work.

Chapter 14 – 1975

14.1 – Banking problems and serious consequences

In 1975, the assets and stocks of Blue Ribbon expanded rapidly, once again putting pressure on the company’s cash reserves. This is a common issue for high-growth companies. However, Phil Knight was adamant about not reducing the size of their orders. He believed that not growing meant risking the company’s demise, even though many observers considered this approach risky.

The cash flow problems at Blue Ribbon became a serious concern for the company’s bank, the Bank of California. They decided to sever ties with Blue Ribbon, causing significant challenges for Phil Knight. He had to manage paying employee salaries, settling with creditors, and dealing with Nissho. The bank even threatened to involve the FBI, suspecting fraud.

Nissho ultimately came to the rescue, lending Blue Ribbon an additional million dollars and paying off all of Blue Ribbon’s debt to the Bank of California. As a result, the company secured a new banking partner, the First State Bank of Oregon.

Throughout this ordeal, Phil Knight often repeated a phrase:

“You are remembered for the rules you break.”

14.2 – The death of Prefontaine

A tragic event occurred that year: Prefontaine, aged 24, tragically lost his life in a car accident.

Chapter 15 – 1976

15.1 – Blue Ribbon becomes Nike, Inc. and continues to grow

In 1976, the company continued to experience growth:

• Blue Ribbon became Nike, Inc.
• Nissho extended millions of dollars in loans to Nike, strengthening their relationship.
• Nike explored various financing options, including the idea of going public, but ultimately decided against it to maintain control and independence.
• Inspired by the success of the Waffle shoe model, Phil Knight envisioned transforming athletic shoes into everyday footwear.
• Nike set up new production facilities in Taiwan to meet the increasing demand and solidify its identity in the industry.

15.2 – Buttface seminars

During this period, Phil Knight began organizing seminars known as “buttfaces” with Woodell, Strasser, Haye, and Johnson. These retreats addressed various stressful company issues, such as finances, logistics, and marketing. Despite the challenges, Phil Knight found these seminars to be enjoyable and not like work at all. They were a time for the team to come together and tackle the world’s problems as a united front.

Phil Knight cherished the opportunity to share these retreats and festive evenings with his “remarkable” team, describing them as full of quirks and eccentricities. Each team member had experienced early-life failures, which created a unique bond among them. Phil felt a deep connection to his colleagues, sharing their experiences of being underdogs and believing that together, they would ultimately become winners.

The author fondly reflects on the sense of pride and friendship that tied him to his colleagues during these retreats.

“Sometimes, after cathartic laughter, I looked around the table and was overwhelmed by emotion. I was moved by all this comradeship, loyalty and all this recognition. One could even feel some form of love. I was shocked to realize that it was me who had gathered these people around my project and that they were part of the founders of a multi-million-dollar company…specializing in athletic shoes. This team was unlikely: a paraplegic, two obese individuals, a guy who smoked like a chimney…”

15.3 – Father and manager

At this time, Phil Knight keeps wondering about:

His management style

Phil Knight had a unique management style where he placed total trust in his employees and didn’t micromanage them. This approach built strong mutual loyalty. His management style wouldn’t have suited those who needed constant guidance, but his team found it liberating and empowering. He allowed them to be themselves, make their own decisions, and learn from their mistakes, much like how he preferred to be treated.

Additionally, Phil Knight often emphasized the idea: “Never tell people how to do things. Tell them what to do and they will surprise you with their ingenuity.”

His father role

As a father, Phil Knight felt guilty about not spending enough time with his two sons, Matthew and Travis. He observed differences in their attitudes towards him, with Matthew harboring resentment while Travis showed unwavering loyalty. Balancing family and running Nike was a complex challenge, akin to managing the demands of three different “boys”: A, B, and Nike.

Chapter 16 – 1977

16.1 – Innovations and building an identity

At Nike, we weren’t just a brand; we represented a form of self-expression.

Nike took a unique approach to advertising in the 1970s. Instead of focusing solely on the product itself, they emphasized the spirit and essence of the product, a novel approach at the time. Additionally, Nike was at the forefront of introducing innovative concepts that were considered modern and forward-thinking.

One such innovation came in 1977 when Frank Rudy and Bob Bogert presented Phil Knight with insoles containing injected air bubbles. Initially, Knight thought it might be a joke, but he soon recognized the potential of the technology and decided to pursue the project.

During that same year, Nike accomplished several milestones:

• Signing numerous new collaboration contracts with athletes, coaches, and educators.
• Expanding its manufacturing facilities to meet the increasing demand in countries like Japan, Taiwan, Korea, Puerto Rico, and Exeter.
• Dealing with issues related to counterfeit products.

16.2 – A $ 25 million bill!

In late 1977, Phil Knight faced a staggering $25 million bill from the United States Customs Service. This enormous sum is actually unpaid taxes spanning three years. The issue originates from Nike’s U.S. competitors who persuaded customs authorities to hinder the brand using an outdated law known as the American Selling Price.

To tackle this problem, Phil Knight appoints Richard Werschkul to handle Nike’s legal case against the U.S. Customs.

16.3 – Lifestyle adjustments

This recent development has a significant impact on Phil Knight, who is increasingly burdened by guilt for not spending more time with his children. In an effort to avoid falling into depression, he makes a commitment to change, meditate, and run twenty kilometers each night. Additionally, the couple decides to purchase a larger home.

“It may seem strange to do this in the midst of a daunting battle with the government, but I liked the notion that we were living our lives as if things were going to improve,” Phil Knight reflects.

He adopts a new daily routine that places a greater emphasis on athletics, especially teaching his children about sports. However, his sons do not show much interest:

“On New Year’s Eve 1977, I felt as though there was a deep crack in the foundation of my existence. My life revolved around athletics, my company was built on athletics, and my relationship with my father was built on athletics. But my two sons wanted nothing to do with sports. … I found it unfair.”

Chapter 17 – 1978

17.1 – A Nike clothing line

In 1978, Nike’s sales continued to soar, and the quality of their products greatly improved. The company was also a leader in innovation. Despite their ongoing battle with the government, life at Nike was thriving.

The company moved to a larger 3,700 square meter building in Beaverton to accommodate their growth. Additionally, they initiated a new project to develop a clothing line. This project had two main objectives: first, to attract top athletes with larger contracts, similar to Adidas; and second, to diversify their offerings in case they decided to go public.

Under Woodell’s leadership, the clothing line quickly gained attention and respect in the community.

17.2 – The launch of the Tailwind with air injected soles

At the close of 1978, Nike introduces the Tailwind, a remarkable shoe featuring a shiny silver design and incorporating twelve groundbreaking innovations, including the iconic Rudy air-injected soles. To Phil Knight, it’s not just a shoe; it’s considered a true masterpiece of postmodern art. Despite some imperfections, the Tailwind achieves massive commercial success.

Chapter 18 – 1979

Since Werschkul couldn’t handle the customs case effectively, Phil Knight takes charge of the fight himself. He frequently travels to Washington to meet with politicians, lobbyists, consultants, bureaucrats, and anyone who might assist him. For months, he delves into the peculiar world of politics, studying extensively to grasp the intricacies. Meanwhile, Nike opens a successful 325-square-meter store in downtown Portland and relocates to a much larger building of nearly 4,300 square meters.

Chapter 19 – 1980

19.1 – Opening of two Nike factories in China

In 1980, Nike aims to establish factories in China, but the process is challenging and requires significant effort. Eventually, Nike manages to secure agreements with two Chinese factories, making it the first U.S. shoe manufacturer permitted to operate in China.

19.2 – The end of the case with customs and going public

After successful negotiations led by Phil Knight, Nike agrees to a settlement of $9 million in its case with the government. This situation prompts the idea of taking the company public, and this time, it appears possible to do so without losing control of the company. By issuing two types of shares (class A and B shares), Nike can raise significant funds, accelerate its growth, and ensure that Phil Knight maintains control.

This idea is a breakthrough for Phil Knight, offering a solution to the company’s ongoing cash flow challenges. The process of going public is initiated with unanimous support. Phil Knight will own 46% of the class A shares, allowing him to lead the company with a firm and consistent voice. To attract potential investors, the team embarks on a “dog-and-pony show,” and the initial public offering (IPO) takes place on December 2, 1980, with the company’s assets valued at $178 million at that time.

Night

Phil Knight’s business journey concludes in 1980. In this final chapter, the author takes us about 40 years into the future, to the night when Phil Knight decides to write his autobiography. By this point, he has amassed a fortune of 10 billion dollars and mingles with some of the world’s wealthiest individuals. During that night, Phil Knight reflects on his childhood, his career, significant milestones over the past four decades, and the serendipitous moments he has experienced.

His childhood

Phil Knight fondly recalls specific moments from his childhood. He remembers how his grandfather used to buy him doughnuts, and he visualizes himself sitting on the edge of his grandfather’s truck bed, enjoying the fresh breeze and savoring a warm doughnut. He ponders whether he could have taken the risks and challenges in his life, teetering between safety and peril, without the early sense of contentment and freedom he felt during those cherished moments.

The impressive evolution of his company

Phil Knight steps down from his role as CEO at Nike after four decades with the company. However, he remains as the chairman of the board and continues to visit his office nearly every day.

In his final year of work in 2006, Nike’s revenue reaches $16 billion, and its products, including shoes and clothing, are available in 5,000 stores worldwide. Nike employs a total of 10,000 people.

The global headquarters in Beaverton, where 5,000 employees work, is situated on a beautiful university-like campus spanning 80 acres, complete with woodlands, Japanese gardens, streams, and sports fields.

His trip around the world

Phil Knight often reflects on a pivotal journey he took at the age of twenty-four. He vividly recalls standing on the heights of Athens, gazing at the Parthenon, and experiencing a profound sensation of time blending together.

He also mentions meaningful coincidences, such as the company’s phone number ending in 6453, which spells ‘Nike’ on a phone keypad, and the fact that “Pre,” referring to Steve Prefontaine, achieved his best time in the mile. These synchronicities hold a special place in his memories.

The death of his son, Matthew

Phil Knight emotionally recalls the tragic death of his eldest son, Matthew, in a diving accident. He reflects on Matthew’s lifelong search for meaning and identity, as well as his yearning for a more present father figure. The devastating moment came when Matthew lost consciousness at a depth of forty-five meters while diving.

Phil remembers receiving a phone call from El Salvador, and witnessing his wife Penny’s emotional collapse, supported by their son Travis. Overwhelmed with grief, he walked away, tears streaming down his face. During this painful moment, seven words echoed in his mind like a fragment of a poem: “So this is the way it ends.”

His father

Phil Knight reflects on the complex and evolving relationship he had with his father throughout his life. It took time for his father to fully embrace and support his son’s business endeavors. Nevertheless, Phil’s father played a significant role in his life and provided daily support during his entrepreneurial challenges.

As his father’s health declined, Phil Knight took him on an extensive journey, a final adventure, to understand if his father was proud of him and to express his own pride in his father. They traveled the world, visiting Nike locations in different countries, and Phil noticed the admiration in his father’s eyes whenever they saw the Nike swoosh.

After recounting this poignant experience, Phil Knight’s statement, “This is the story of fathers and sons since the dawn of time,” takes on a profound meaning, emphasizing the timeless significance of the relationships between fathers and sons.

Those who built Nike and are no longer with us

Phil Knight shares that Bowerman passed away on Christmas Eve in 1999, and Strasser sadly died of a heart attack in 1993.

Criticism of working conditions in factories and improvements made

In this part, Phil Knight addresses the issue known as the sweatshop controversy, which involves criticisms directed at Nike regarding the working conditions in its overseas factories. Knight acknowledges these criticisms and expresses his determination to address them by making significant improvements in the factories. Nike has taken steps to remove carcinogens from its production facilities and has initiated programs like the Girl Effect, in collaboration with the United Nations and various partners, to combat poverty in the world’s most underprivileged areas.

International trade and the Vietnam War

Phil Knight reflects on the poverty he witnessed during his global travels in the 1960s and emphasizes that creating entry-level jobs is crucial to combating this issue. He believes that international trade benefits both trading nations and promotes coexistence and cooperation. Knight also highlights the role of business in preventing conflicts, stating that peace is nourished by prosperity.

In 1997, Nike operates four factories in Saigon, and Phil Knight learns that the Vietnamese government is recognizing the company as one of the top currency generators in the country. During his visit to Vietnam, Knight shares his unique encounter with General V. Nguyen Giap, an 86-year-old military leader who successfully faced off against the Japanese, French, Americans, and Chinese.

Nissho

Phil Knight regards Masuro Hayami, the former CEO of Nissho, as one of the wisest individuals he has ever encountered.

His continued learning with universities that chose Nike as a subject for study

For almost three decades, both Harvard and Stanford universities chose Nike as a topic for academic research. This gave Phil Knight the opportunity to participate in numerous scholarly discussions worldwide and keep expanding his knowledge.

What became of Hayes, Woodell and Johnson

Hayes now resides on a forty-five-acre farm in the Tualatin Valley, complete with an extensive collection of bulldozers and heavy equipment.

Woodell and his wife live in Oregon. Despite doubts about his abilities due to his disability, he flew his own plane for many years.

Johnson’s home is nestled in the scenic wilderness of New Hampshire, resembling a poem by Robert Frost. Despite two divorces, he has transformed an old barn into a luxurious mansion filled with thousands of books. This unique space is open 24/7, welcoming anyone in need of a place for reading and contemplation.

The beginnings of his wealth

Phil Knight mentions that when they began earning substantial wealth, he and his colleagues underwent some changes, but these changes were relatively minor and short-lived. The reason for this is that none of them were primarily motivated by money:

“Money, by its nature, tends to influence our lifestyles, whether we possess it or not, whether we desire it or not, and whether we appreciate it or not. As human beings, our responsibility is to ensure that money doesn’t become overly central in our lives.”

Phil Knight commits to donating $100 million annually to various causes, and he plans to leave the majority of his wealth to charitable endeavors after his passing.

The idea of this autobiography

After watching the movie “The Bucket List,” Phil Knight, struggling to sleep, gets the idea of narrating the Nike story. He reflects on his own life and what he still wants to achieve:

“As I lay in the darkness, I pondered my own list. Visiting the pyramids? Done. Exploring the Himalayas? Done. Experiencing the Ganges? Done. So, do I have nothing left to do? I contemplate the final things I’d like to accomplish before departing this world—assisting universities in changing the world and contributing to cancer research. That’s about it… Perhaps it’s a good notion to recount the Nike story.”

For Phil Knight, writing this autobiography serves as a wonderful way to pass on his experiences to the younger generation. He believes that young people can find inspiration, comfort, and valuable lessons while also being cautioned about potential pitfalls.

The life lessons he would like to pass on

Phil Knight offers some valuable advice:

1. Take the time to reflect on how you want to spend your life and who you want to spend it with over the next forty years.
2. Pursue your calling rather than settling for just a job, profession, or career, even if you’re not entirely sure what your calling is.
3. Be prepared for challenges and setbacks, especially if you’re exceptional, innovative, or rebellious. Success often comes with criticism.
4. Understand that America is not necessarily the paradise for entrepreneurs that it’s often portrayed to be.
5. Don’t blindly follow advice that tells you to never give up. It’s essential to know when to give up on certain pursuits, but always keep moving forward.

“Sometimes finding the right moment to give up and try something else is a kind of genius. To give up does not mean to stop. Don’t ever stop.”

• Luck plays a big role:

“Hard work is essential, having a good team is essential, reflection and determination are crucial, but t luck may decide the outcome. Some call it otherwise: Tao, Logos, Jñ na, Dharma, Spirit or God.”

• Have faith in yourself:

“Have faith in yourself, but also have faith in faith. Not faith as others define it. Faith as you define it yourself. Faith as you define it in your heart.

Ultimately, everything is a question of will and determination”

Conclusion

This book “Shoe Dog” by Phil Knight is an engaging story filled with excitement and unexpected twists. It follows the journey of a young entrepreneur who, despite the eventual global success of Nike, faced numerous challenges in the company’s first two decades. The narrative vividly portrays his courage, passion, and determination in realizing his entrepreneurial dream. Readers witness the ups and downs, pitfalls, anxieties, responsibilities, risks, betrayals, moments of happiness with his team, occasional mistakes, and numerous triumphs.

The author’s writing style combines humor, realism, and humility, making the book emotionally touching. It imparts valuable life lessons, particularly in the final section, where Knight reflects on his life with nostalgia, modesty, and wisdom.

“Shoe Dog” is not just a success story but a source of inspiration. Nike, now a global brand recognized by its iconic “swoosh” logo, achieved its status through a journey marked by challenges and sacrifices. The book highlights that fulfilling one’s dreams and achieving success isn’t easy, but it’s possible with dedication and determination.

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