As I approached the Ritz Carlton Hotel, and pushed on the revolving door, my self-consciousness  increased dramatically.  Once inside, I bounded quickly up the carpeted, marble staircase and walked through the Tea Room.  I felt as self-aware as a 15, year- old- girl.  In my mind everyone had to be staring at me.   Crossing the floor I headed into a small private dining room.  A man with long blond hair, curled almost in ringlets, stood up to greet me.  “Hi, I’m Phil Knight, and this ( gesturing to a pretty woman sitting at the table) is my wife Penny.”  As we shook hands he looked down at my Nikes.  Instinctively I also lowered my vision.  He was wearing Foot Joy wingtip tassel loafers!  My face flushed.  I would learn a lot that day … about myself … business …  and life.

  The lunch had been arranged by a Lehman Brothers investment banker.  It was 1980 and our firm had filed a securities registration with the S.E.C. to bring Nike public.  A couple of weeks before the lunch, the Wall Street Journal ran a story criticizing the company in the most widely read part of the paper ...  the Heard on the Street column.  The essence of the article was that Phil Knight, realizing the running boom was about to peak, was intentionally selling out at the top.   At the time Nike had revenue of 257M.  Out of concern, I kind of believed what I read in the paper, and I called the investment banker on the account.  “Frank, I’ve known Phil for many years,” he said.  “He’s a really good guy.  But you don’t have to take my word for it.  He’s going to be in Boston for a road show.  Come to lunch and make your own decision.”  So there I was … about to hear the Nike story.

  It had started as an MBA thesis at Stanford University.  Phil Knight believed the Japanese could replicate the success they had in taking the camera business away from Germany … this time in running shoes.  The sneaker business at that time was dominated by two German brothers who had founded Adidas and Puma.  After graduation he convinced the Japanese company Onitsuka, the manufacturer of Tiger running shoes, to let him be the sole United States distributor.  In 1964 he formed Blue Ribbon Sports with Stanford classmate Jeff Johnson and his former Oregon track coach Bill Bowerman.  They started with 300 pairs of Tiger shoes which Phil sold part- time out of the trunk of his car.

  Apparently it can be possible to be too successful.   As time went by, and the business grew,  Onitsuka demanded that he sell Blue Ribbon Sports to them.  Phil Knight refused and Onitsuka stopped sending shoes.  It was decision time.  He could continue making a good living as an accountant, his real “day” job or follow his passion.  Later I would learn, from professor of mythology, Joseph Campbell, this was known as following your bliss.

  The three men decided to make their own shoe which was called Dimension Six.  Yes, it sounds like computer software.  But as I would learn retrospectively, when you follow your bliss, inspiration follows.  One night, at three in the morning, Phil got a phone call from his business partner Jeff Johnson … an extremely excited Jeff Johnson.  “Phil, Phil, I just had a great dream!!  Remember at Stanford that marketing class? … the one where we always sat in the back of the room?  Remember?  ‘Yeah, yeah,’ grumbled a sleep- deprived Phil Knight.  Well I was dreaming about a class where the professor said “Many of the great consumer names have E and K sounds.  Like Coca-Cola, Kleenex, Kotex.  Remember? Well I woke up and it hit me.  NIKE !!! The Greek goddess of victory.  It’s perfect!!!”

  That same year, 1970, Bill Bowerman also had an inspiration.  His was a serendipitous experience.  Serendipity, as you may know, is the effect by which one accidentally stumbles upon something fortunate, especially while working on something unrelated.  It’s common in drug discovery.  Penicillin comes readily to mind.  But who would expect it to happen while making breakfast?  One Sunday morning Bill Bowerman told his wife he just didn’t feel like going to church and she should go without him.  As he poured batter into a waffle iron … it hit him!  You could do the same thing with molten rubber on the sole of a running shoe!  The waffle sole was thus born giving Nike a unique product.

  At lunch that day I learned the importance of having the right partners in business … and in one’s personal life.  Of all the corporate business lunches I’ve attended over 45 years, Penny Knight was the only wife I ever met.   I also learned that business partners with a common bliss can create what seems to be retrospectively, almost magic.  Their shared bliss was ultimately what made Nike a 20 billion global business.  The Wall Street Journal could not have been more wrong … nor the Lehman Brothers’ banker more correct.   But then in 1980 investment banking was a relationship business.  One knew and had an obligation to the client.  It was a social contract ...  as it always should be.  Over the following two decades the investment banking business was hijacked and transformed into an impersonal transaction oriented business, greedy for quick profits and a disdain for pesky clients.  This all culminated in the collapse of Wall Street.  Look no further than Lehman Brothers. 
 

Francis Patrick Boland

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