0:00 Bill Bowerman, the co-founder of Nike, once picked up a running shoe and said, “If you set out to engineer a shoe to bend metatarsals until they snap, you couldn’t do much better than this.” Right.0:13 And the wildest part of that quote is that he was talking about a shoe his own company was selling.0:20 We talked last week about the unreleased histories of famous companies, and this story is the PERFECT example.0:27 The polished Nike myth...0:29 it leaves out the best parts.0:31 Wait, hold on.0:32 The company that became Nike started by selling shoes they believed were actively harmful to runners?0:39 That’s exactly right.0:40 Before there was Nike, there was Blue Ribbon Sports, or BRS, founded in 1964.0:45 And BRS was nothing more than the exclusive U.S.0:49 distributor for a Japanese shoe company called Onitsuka Tiger, which we know today as ASICS.0:55 So Phil Knight wasn't designing shoes in a lab.0:58 He was basically an importer.1:00 He was an importer with a plan.1:02 He wrote a paper at Stanford arguing you could compete with the dominant German brands—Adidas and Puma—by importing cheaper, high-quality shoes from Japan.1:13 His partner, Bill Bowerman, was the track coach, the product obsessive.1:17 He was the one tearing apart those Onitsuka shoes and trying to make them better.1:23 So Bowerman is seeing these flaws, like the one that could "snap" a foot bone.1:28 What's he doing about it?1:30 He's modifying them.1:31 He's sending notes back to Japan, pushing for better cushioning, better support.1:37 The first BRS retail store, which opened in Santa Monica in 1967, wasn't just a shop.1:43 It was a sanctuary for runners, a place where Bowerman could get direct feedback from the athletes he was trying to help.1:51 It was a lab, really.1:52 Okay, so you have this tense relationship.1:55 BRS is building a market in the U.S., but Bowerman secretly thinks the product is flawed, and Onitsuka is getting all this free R&D from him.2:05 That sounds...2:06 unstable.2:06 It was.2:07 And it blew up around 1971.2:09 Onitsuka saw how well BRS was doing and, um, they got greedy.2:13 They started talking to other potential distributors and tried to force a deal to buy a majority stake in Blue Ribbon Sports.2:21 They tried to cut Knight and Bowerman out of their own company.2:25 Completely.2:26 It was a total betrayal.2:28 Suddenly, Knight realizes his entire business is about to evaporate.2:33 They have no brand of their own, no designs they legally own, and no factory.2:38 They are about to have NOTHING.2:40 Wow.2:40 So this is the moment.2:42 This is where Nike is actually born.2:44 Out of desperation.2:45 Total desperation.2:47 They need a name, fast.2:48 They land on Nike, after the Greek goddess of victory.2:52 They need a logo.2:53 Knight finds a graphic design student, Carolyn Davidson, and pays her thirty-five dollars for a design.3:00 She gives them the Swoosh.3:02 Thirty-five dollars.3:03 That has to be the best investment in history.3:06 But what about the shoe?3:08 What did they sell?3:09 Here’s the turn.3:10 The first iconic Nike shoe, the Cortez, was a design that Bowerman had ALREADY developed… for Onitsuka.3:17 They just took the design they knew worked, the one they’d perfected, and slapped their new thirty-five-dollar logo on it.3:26 No way.3:26 So their first big hit was basically a rebadged version of their own work for their old partner?3:33 An imitation of their own innovation, yeah.3:35 It was a survival move.3:37 The truly original Nike tech came a bit later, in 1972.3:41 That was Bowerman, at home, pouring rubber into his wife's waffle iron.3:46 The famous waffle sole.3:47 The waffle sole.3:48 He created this lightweight, super-grippy sole that changed everything.3:53 The first prototypes were called "Moon Shoes" because of the print they left in the dirt.3:59 But even then, they were constantly on the edge of financial collapse.4:04 Lawsuits, cash flow crises...4:06 it was brutal.4:07 Bowerman famously said, "Business is a war without bullets." You know, that explains so much about Nike's culture.4:15 That aggressive, "Just Do It," win-at-all-costs mentality.4:19 It wasn't a marketing slogan they came up with in a boardroom.4:23 Not at all.4:24 It was forged in that initial betrayal.4:26 They had to fight for their life from the second they were born.4:31 The whole brand DNA is rooted in that memory of almost being wiped out.4:35 You don't get to be Nike by being nice; you get there by breaking the rules you need to break to survive.
