Pursue your Crazy Idea and your calling. Don't chase money or simply a job.
"Let everyone else call your idea crazy... just keep going. Don't stop. Don't even think about stopping until you get there, and don't give much thought to where 'there' is. Whatever comes, just don't stop... I believe it's the best advice -- maybe the only advice -- any of us should ever give."
"I'd tell men and women in their mid-twenties not to settle for a job or a profession or even a career. Seek a calling. Even if you don't know what that means, seek it. If you're following your calling, the fatigue will be easier to bear, the disappointments will be fuel, the highs will be like nothing you've ever felt."
Knight's passion for running gave him his Crazy Idea -- importing running shoes from Japan and selling them in America.
Knight understood the importance of having a global perspective when starting a business. He knew in order to leave his mark and build a successful company, he needed to embrace opportunities worldwide rather than confine himself locally.
At age 24, Knight traveled to Japan and convinced Onitsuka, a shoe manufacturer, to let him be the distributor in America. Knight had to lie about having a company (Blue Ribbon, named after decorations on his childhood wall) to achieve this deal.
Blue Ribbon soon became a real company.
Knight sent shoe samples to his college coach Bill Bowerman, who was a well-known Olympic coach. Bowerman liked them so much that he wanted to join the business.
Bowerman obtained 49% of Blue Ribbon. Knight had 51% with the help of an investment from his father.
Blue Ribbon soon sold out all the shoes by going to track meets and had to order more shipments.
Even though the shoes were selling well, the shipments would often come late, causing difficulties in meeting bank loan payments. Knight struggled with cash shortages and financing for many years as the business grew.
A successful company requires a great team. Other than Knight, the other key members of Blue Ribbon were Bill Bowerman, Jeff Johnson, and Bob Woodell.
Bowerman's reputation grew as his athletes won Olympic medals. He also provided improvements for the shoes to better fit the heavier American athletes.
Jeff Johnson knew Knight from college. He is also passionate about running and is known to be hard working. He continued to sell shoes even after a serious car accident. He was responsible for opening the first retail store.
Bob Woodell is a former paralyzed track star. He ran the company's second retail store. He overcame his disability and grew with the company.
Knight trusted his team. He knew he hired people that believed they were making a difference in athletes' lives. He did not micromanage them. He inspired a fun work environment, and gave his team the autonomy to excel and innovate in their roles. As a result, his team consistently exceeded his expectations.
"Don't tell people how to do things, tell them what to do and let them surprise you with their results."
Knight realized Onitsuka wanted to use other American distributors even though they just signed a three-year contract. Knight decided to threaten to sue other potential distributors, and then find another manufacturer with a backup company.
Knight created a backup company called Nike (Greek goddess of victory). The name was suggested by Johnson and Knight didn't love it at first.
The famous Nike Swoosh, which Knight didn't love, was designed by Carolyn Davidson for $35.
Knight found financing from a Japanese trading company, Nissho Iwai, who also connected him with shoe manufacturers.
Onitsuka voided Blue Ribbon's contract and sued them after Onitsuka found out about Nike. After a tough legal battle, Blue Ribbon won because the judge found their testimony more truthful.
Nike faced financial troubles from Knight's aggressive growth pursuit. They often depleted cash reserves paying for large shoe orders. Eventually Nike's bank dropped them, leaving Nike unable to pay anyone. Nissho audited Nike, found poor finances but believed in the potential, and paid off Nike's debts so they could continue to operate.
After the bailout, Nike sought to innovate. Bowerman used a waffle iron to create gridded rubber soles. It became a breakthrough product and a mainstream success.
Innovation is how Nike outshined established companies like Adidas and Puma. Constant innovation is critical to remaining competitive.
Knight initially studied Adidas. It is important to know what your competitors are doing and learn from them.
Nike's first two signed athlete endorsers were tennis star Ilie Nastase and runner Steve Prefontaine. They treated endorsers as valued team members, not just as advertisers. Nike's generous treatment earned loyalty, and athletes were proud to represent Nike.
Nike hired Prefontaine as Director of Public Affairs since Olympians couldn't take endorsement money.
Nike's eventual signing of basketball superstar Michael Jordan is one of the most influential deals of all time. Nike could be said to be lucky to have signed Jordan, but it couldn't have happened without perseverance and hard work. You don't get lucky by passively waiting for it.
In 1977, US Customs fined Nike $25 million for retroactive shoe import duties that would bankrupt Nike. In response, Nike aired an ad depicting government suppression of business and garnered public support. US Customs reduced the fine to $9 million and Knight reluctantly settled.
Nike overcame many challenges on their journey. Successful entrepreneurs view setbacks as opportunities to learn and emerge stronger rather than reasons to quit.
After long deliberation, Nike went public in 1980 and the founding members made millions. Knight retained most of the control and kept 46% of the company so Nike's culture and vision could remain focused.
Reflecting after 40 years as CEO, Knight attributes Nike's success to creating an identity customers bought into, which consists of understanding athletes as the heart of the company, innovating designs for performance, and embodying a winning mindset (like "Just Do It").