In one sentence: Phil Knight’s memoir of Nike’s first eighteen years is the rare founder story that is honest about how close the company came to dying every year, told with affection for the oddballs who built it, and it is also an authorized self-portrait written half a century later by one of the richest men alive, with reconstructed dialogue and a labor defense that is his alone.
At a Glance
Author: Phil Knight
First published: 2016 (Scribner)
Category: Business / Memoir
Length: about 386 pages, about 118,000 words (Scribner hardcover)
ISBN-13: 978-1-5011-3591-0 (Scribner hardcover)
Summary reading time: about 12 minutes
Book reading time: about 8 hours
Notable adaptations: none, though Knight dedicates the book to his grandchildren “so they will know”
Content note: This is an authorized memoir, written about fifty years after most of what it describes, with dialogue reconstructed from memory. Knight half concedes the point when he admits the documents contradict his recollection of one key date. Japanese and Chinese speakers are rendered in broken English throughout. The epilogue contains Knight’s own defense against the factory-labor criticism of the 1990s, which is his account and not an independent one, and this summary treats it as such. The book also describes the death of his son Matthew.
Phil Knight was a runner from Portland, Oregon, with a Stanford MBA, an accounting job and what he called a Crazy Idea: that Japanese running shoes could do to Adidas what Japanese cameras had done to German ones. Shoe Dog is his account of what followed, from a 1962 sales call in Kobe to Nike’s 1980 public offering. It opens with a prologue called Dawn, runs year by year through Part One (1962 to 1975) and Part Two (1975 to 1980), and closes with an epilogue called Night, written in 2007. The chapter titles are simply the years, the right shape for a story in which every year asked whether the bank would let the company live.
Read it if you want to know what building a company feels like, which on Knight’s telling is mostly terror about cash, or if you want a founder memoir better written than almost anything else in the genre. Skip it if you want an independent history.
The Big Idea
The popular story of Nike is one of vision: a swoosh, a slogan, Michael Jordan. Knight’s book has little of that. On his telling, Blue Ribbon Sports, the company that became Nike, was a sixteen-year cash crisis interrupted by shoes. His banker told him he was growing too fast for his equity, and his method was deliberate: place an order double the last one, borrow against it, sell out, repay, repeat. Every year the company was both booming and nearly insolvent, and the book is honest that those were the same condition.
What held it together, Knight writes, was belief, and a small cast of loyal eccentrics who shared it. The book argues by example that a company is a group of people who have decided to trust each other through years of bad news. Whether a reader accepts that depends on remembering who is arguing it, and when.
Key Ideas
1. The company was invented on the spot
The Crazy Idea came out of a Stanford seminar paper that bored Knight’s classmates. He funded a round-the-world trip with a stop in Japan out of about 1,500 dollars of savings and the sale of his MG. In Kobe in late 1962, asked what company he represented, he blurted “Blue Ribbon”, after the track ribbons on his bedroom wall. There was no such company. He told the room the American market could be worth a billion dollars, a number he admits he invented, and his father wired fifty dollars for samples.
2. Bowerman made the shoes and Knight kept control
Bill Bowerman, Knight’s track coach at Oregon, used his runners as test subjects, restitching shoes in kangaroo skin and cod. His rule was that an ounce off a shoe is fifty-five pounds saved over a mile. Over a hamburger in January 1964 he asked to be let in and took forty-nine percent, structured by a lawyer so Knight kept operating control. He fused parts of two Tiger models into the Cortez, and he wrote a book called Jogging that sold a million copies and said almost any shoes would do, which Knight read with dismay.
3. Growth was the business, and growth was the problem
The first order was three hundred pairs of Tigers at 3.33 dollars a pair, sold from the trunk of a Plymouth Valiant and by mail order from his parents’ basement. Sales went from about 8,000 dollars in the first year to 1.3 million in 1971 and nearly 70 million in 1977, every number financed by debt. Oregon had two banks, one had already refused him, and when First National cut off his letters of credit in 1971, Bob Woodell’s parents lent him their last savings. The lender of last resort became Nissho Iwai, a Japanese trading company, on one condition: it never took equity.
4. The break with Onitsuka was won by means Knight tells as comedy
His Onitsuka counterpart, Kitami, demanded fifty-one percent of Blue Ribbon. Knight had already planted a paid informant inside the supplier, then told all forty employees in a memo that he had a spy, which he calls a mistake. During Kitami’s visit he took a folder from the man’s briefcase and found a list of eighteen other American distributors. He ordered shoes from a Mexican factory under a contract he says did not technically break his agreement. The 1974 trial settled for 400,000 dollars. Out of the break came the name, which Jeff Johnson phoned in out of a dream hours before a telex deadline. Carolyn Davidson, a design student, was paid thirty-five dollars for the logo.
5. The people were odd, loyal and underpaid
Jeff Johnson, the first full-time employee, was a former social worker who wrote Knight daily letters that Knight deliberately did not answer. Johnson built the customer index cards, the first store and the East Coast operation, and invented full-length midsole cushioning with shower-shoe rubber. Bob Woodell, a long jumper paralyzed under a parade float, ran operations. Penny Parks was a student in his accounting class, then an employee, then his wife. Knight’s father asked how long he planned to keep jackassing around with shoes. Steve Prefontaine, who died in 1975 at twenty-four, runs alongside.
6. The government nearly did what the banks could not
In late 1977 the United States Customs Service demanded twenty-five million dollars in retroactive duties under a rule called the American Selling Price, after competitors made a few token “similar” shoes and priced them high. That was close to Nike’s sales for the year. Nike made a cheap nylon shoe in Maine to create a low reference price, filed an antitrust suit and lobbied two senators. Knight writes that he wanted to pay nothing, because even one penny would be unfair. It settled for nine million.
7. Going public felt like loss
Nike went public on December 2, 1980, with two classes of stock so Knight kept control, at twenty-two dollars a share because Apple was going out that week at twenty-two. His arithmetic the night before: Bowerman worth nine million, four lieutenants about six million each, and himself 178 million dollars. His reaction was closer to regret than triumph. The epilogue continues the accounting with a list of regrets: picking Ryan Leaf over Peyton Manning, three rounds of layoffs totaling fifteen hundred people that still haunt him, and above all not spending more time with his sons. His son Matthew died scuba diving in a lake in El Salvador, and Knight writes that he chooses to believe Matthew felt euphoria at the end, because it is the only way he can go on.
Context and Analysis
What holds up is the texture. Most founder memoirs are written backward from success, so every decision looks like foresight. Knight’s is written forward from a bank balance, and it is honest that the company spent eighteen years nearly insolvent under a man who kept a day job. The portraits of Bowerman, Johnson and Woodell are affectionate and specific. The customs fight and the bank chapters are the best popular account of how a company with rising sales still dies, by running out of cash while selling everything it makes. The epilogue’s reckoning of what forty years cost him is more candid than the genre allows, and Knight is better than most on luck, saying outright that it may decide the outcome.
The problems are those of an authorized self-portrait written half a century on. The dialogue is reconstructed. Decades-old conversations appear verbatim, and Knight admits the documents contradict his memory of when the Bowerman partnership was signed. The self-deprecation does real work. Knight tells his sharper moves as rueful comedy, softening them: the invented company, the cheap-labor flyer, the informant, the folder, the Mexican technicality. A reader who likes him reads these as scrappy. They are also what they are. The labor defense in the epilogue is his own and it is thin where it matters. Knight says reporters never reported how much better conditions were than when Nike arrived, never said the factories were not Nike’s own, and searched until they found a worker with complaints. He lists remedies, including a bonding agent he says eliminated ninety-seven percent of the carcinogens, and says low wages reflect each country’s structures. He concedes he reacted with self-righteousness and anger. The defense names no country, no wage figure and no worker, the renter claim sits against Nike’s control over what those factories made and how, and his concession is about his tone, not the conditions. Only Knight’s side is heard. No Japanese voice narrates, Kitami is a caricature, and Jeff Johnson’s contributions reach the reader through Knight’s retelling. Women are nearly absent: his sister works for a dollar fifty an hour, Penny gives up her degree, and the designer of the world’s most valuable logo gets thirty-five dollars and no surname.
On this site it pairs naturally with Sam Walton: Made in America, the other great American founder-operator memoir, also a story of thin margins, borrowed money and odd loyal people. For the counterargument, read Anything You Want by Derek Sivers, the short anti-empire case for staying small and never taking the money, a sharp test of what Knight’s path cost him.
What It Teaches
Five things the story shows, whether or not Knight meant them.
1. Growth and solvency are not the same thing. Blue Ribbon roughly doubled every year and was one missed loan from closing for most of them.
2. Keep control of the terms that matter. Knight gave Bowerman forty-nine percent, refused Nissho Iwai equity, held out against Kitami and went public with two share classes.
3. Loyal people are worth more than qualified ones early on. A former social worker and a paralyzed long jumper built the company.
4. Know when to switch, not when to stop. Knight’s distinction between giving up on a thing and stopping altogether describes the Onitsuka break and the name change.
5. Count the cost honestly. The epilogue’s list of regrets is the part most founders would have left out, and the part that makes the rest believable.
Memorable Lines
“Belief, I decided. Belief is irresistible.” (Phil Knight)
“I wanted to leave a mark on the world. I wanted to win. No, that’s not right. I simply didn’t want to lose.” (Phil Knight)
“Hard work is critical, a good team is essential, brains and determination are invaluable, but luck may decide the outcome.” (Phil Knight)
“Sometimes knowing when to give up, when to try something else, is genius. Giving up doesn’t mean stopping. Don’t ever stop.” (Phil Knight)
“It’s never just business. It never will be. If it ever does become just business, that will mean that business is very bad.” (Phil Knight)
“Of course, above all, I regret not spending more time with my sons.” (Phil Knight)
Should You Read the Full Book?
Verdict: Recommended
This summary carries the shape of the story, the numbers and the questions to ask of it. The full book adds the feeling of the years: the unanswered letters, the bank meetings, the small humiliations that make the ending land. It is the best-written founder memoir there is, and the most honest about debt. Read it knowing that it is Knight’s version, told from a great distance, with the dialogue rebuilt from memory and the questions about the factories answered only by the man who owned the brand. Enjoy the story, and keep one eye on who is telling it.
The Shoe Dog book page has the full details and where to get a copy.