I had to fly to Japan again, and this time two weeks before Christmas. I
didn’t like leaving Penny alone with Matthew, especially around the
holidays, but it couldn’t be avoided. I needed to sign a new deal with
Onitsuka. Or not. Kitami was keeping me in suspense. He wouldn’t tell me
his thoughts about renewing me until I arrived.
YET AGAIN I found myself at a conference table surrounded by Onitsuka
executives. This time, Mr. Onitsuka didn’t make his trademark late entrance,
nor did he absent himself pointedly. He was there from the start, presiding.
He opened the meeting by saying that he intended to renew Blue Ribbon
for another three years. I smiled for the first time in weeks. Then I pressed
my advantage. I asked for a longer deal. Yes, 1973 seemed light-years away,
but it would be here in a blink. I needed more time and security. My bankers
needed more. “Five years?” I said.
Mr. Onitsuka smiled. “Three.”
He then gave a strange speech. Notwithstanding several years of sluggish
worldwide sales, he said, plus some strategic missteps, the outlook was rosy
for Onitsuka. Through cost-cutting and reorganization his company had
regained its edge. Sales for the upcoming fiscal year were expected to top
$22 million, a good portion of which would come from the United States. A
recent survey showed that 70 percent of all American runners owned a pair
I knew that. Maybe I’d had a little something to do with that, I wanted to
say. That’s why I wanted a longer contract.
But Mr. Onitsuka said that one major reason for Onitsuka’s solid numbers
was . . . Kitami. He looked down the table, bestowed a fatherly smile on
Kitami. Therefore, Mr. Onitsuka said, Kitami was being promoted.
Henceforth he’d be the company’s operations manager. He’d now be
Onitsuka’s Woodell, though I remember thinking that I wouldn’t trade one
Woodell for a thousand Kitamis.
With a bow of my head I congratulated Mr. Onitsuka on his company’s
good fortune. I turned and bowed my head at Kitami, congratulating him on
his promotion. But when I raised my head and made eye contact with Kitami
I saw in his gaze something cold. Something that stayed with me for days.
We drew up the agreement. It was four or five paragraphs, a flimsy thing.
The thought crossed my mind that it should be more substantive, and that it
would be nice to have a lawyer vet it. But there wasn’t time. We all signed it,
then moved on to other topics.
I WAS RELIEVED to have a new contract, but I returned to Oregon feeling
anxious, more so than at any time in the last eight years. Sure, my
briefcase held a guarantee that Onitsuka would supply me with shoes for the
next three years—but why were they refusing to extend beyond three? More
to the point, the extension was misleading. Onitsuka was guaranteeing me a
supply, but their supply was chronically, dangerously late. About which they
still had a maddeningly blasé attitude. Little more days. With Wallace
continually acting more like a loan shark than a banker, a little more days
could mean disaster.
And when the shipments from Onitsuka did finally arrive? They often
contained the wrong number of shoes. Often the wrong sizes. Sometimes
the wrong models. This kind of disarray clogged our warehouse and rankled
our sales reps. Before I left Japan Mr. Onitsuka and Kitami assured me that
they were building new state-of-the-art factories. Delivery problems would
soon be a thing of the past, they said. I was skeptical, but there was nothing I
could do. I was at their mercy.
Johnson, meanwhile, was losing his mind. His letters, once mumbly with
angst, were becoming shrill with hysteria. The main problem was
Bowerman’s Cortez, he said. It was simply too popular. We’d gotten people
hooked on the thing, turned them into full-blown Cortez addicts, and now
we couldn’t meet the demand, which created anger and resentment up and
down the supply chain.
“God, we are really screwing our customers,” Johnson wrote. “Happiness
is a boatload of Cortez; reality is a boatload of Bostons with steel wool
uppers, tongues made out of old razor blades, sizes 6 to 6½.”
He was exaggerating, but not much. It happened all the time. I’d secure a
loan from Wallace, then hang fire waiting for Onitsuka to send the shoes,
and when the boat finally docked it wouldn’t contain any Cortezes. Six
weeks later, we’d get too many Cortezes, and by then it was too late.
Why? It couldn’t just be Onitsuka’s decrepit factories, we all agreed, and
sure enough Woodell eventually figured out that Onitsuka was satisfying its
local customers in Japan first, then worrying about foreign exports. Terribly
unfair, but again what could I do? I had no leverage.
Even if Onitsuka’s new factories ended all delivery problems, even if every
shipment of shoes hit the water right on time, with all the correct quantities
of size 10s, and no size 5s, I’d still face problems with Wallace. Bigger orders
would require bigger loans, and bigger loans would be harder to pay off, and
in 1970 Wallace was telling me that he wasn’t interested in playing that
I recall one day, sitting in Wallace’s office. Both he and White were
working me over pretty good. Wallace seemed to be enjoying himself,
though White kept giving me looks that said, “Sorry, pal, this is my job.” As
always I politely took the abuse they dished out, playing the role of meek
small business owner. Long on contrition, short on credit. I knew the role
backward and forward, but I remember feeling that at any moment I might
cut loose a bloodcurdling scream. Here I’d built this dynamic company,
from nothing, and by all measures it was a beast—sales doubling every year,
like clockwork—and this was the thanks I got? Two bankers treating me like
White, trying to cool things off, said a few nominal things in support of
Blue Ribbon. I watched his words have no effect whatsoever on Wallace. I
took a breath, started to speak, then stopped. I didn’t trust my voice. I just
sat up straighter and hugged myself. This was my new nervous tic, my new
habit. Rubber bands were no longer cutting it. Whenever I felt stressed,
whenever I wanted to choke someone, I’d wrap my arms good and tight
around my torso. That day the habit was more pronounced. I must have
looked as if I was practicing some exotic yoga pose I’d learned in Thailand.
At issue was more than the old philosophical disagreement about growth.
Blue Ribbon was approaching six hundred thousand dollars in sales, and that
day I’d gone in to ask for a loan of $1.2 million, a number that had symbolic
meaning for Wallace. It was the first time I’d broken the million-dollar
barrier. In his mind this was like the four-minute mile. Very few people were
meant to break it. He was weary of this whole thing, he said, weary of me.
For the umpteenth time he explained that he lived on cash balances, and for
the umpteenth time I suggested ever so politely that if my sales and earnings
were going up, up, up, Wallace should be happy to have my business.
Wallace rapped his pen on the table. My credit was maxed out, he said.
Officially, irrevocably, immediately. He wasn’t authorizing one more cent
until I put some cash in my account and left it there. Meanwhile, henceforth,
he’d be imposing strict sales quotas for me to meet. Miss one quota, he said,
by even one day, and, well . . . He didn’t finish the sentence. His voice
trailed off, and I was left to fill the silence with worst-case scenarios.
I turned to White, who gave me a look. What can I do, pal?
DAYS LATER WOODELL
showed me a telex from Onitsuka. The big spring
shipment was ready to hit the water and they wanted twenty thousand
dollars. Great, we said. For once they’re shipping the shoes on time.
Just one hitch. We didn’t have twenty thousand dollars. And it was clear I
couldn’t go to Wallace. I couldn’t ask Wallace for change of a five.
So I telexed Onitsuka and asked them to hold the shoes, please, until we
brought in some more revenue from our sales force. “Please don’t think we
are in financial difficulty,” I wrote. It wasn’t a lie, per se. As I told
Bowerman, we weren’t broke, we just had no money. Lots of assets, no cash.
We simply needed more time. Now it was my turn to say: Little more days.
While awaiting Onitsuka’s response, I realized that there was only one
way to solve this cash flow problem once and for all. A small public offering.
If we could sell 30 percent of Blue Ribbon, at two bucks a share, we could
raise three hundred thousand dollars overnight.
The timing for such an offering seemed ideal. In 1970 the first-ever
venture capital firms were starting to sprout up. The whole concept of
venture capital was being invented before our eyes, though the idea of what
constituted a sound investment for venture capitalists wasn’t very broad.
Most of the new venture capital firms were in Northern California, so they
were mainly attracted to high-tech and electronics companies. Silicon
Valley, almost exclusively. Since most of those companies had futuristicsounding names, I formed a holding company for Blue Ribbon and gave it a
name designed to attract tech-happy investors: Sports-Tek Inc.
Woodell and I sent out fliers advertising the offering, then sat back and
braced for the clamorous response.
A month passed.
No one phoned. Not one person.
That is, almost no one. We did manage to sell three hundred shares, at
one dollar per.
To Woodell and his mother.
Ultimately we withdrew the offering. It was a humiliation, and in its wake
I had many heated conversations with myself. I blamed the shaky economy. I
blamed Vietnam. But first and foremost I blamed myself. I’d overvalued Blue
Ribbon. I’d overvalued my life’s work.
More than once, over my first cup of coffee in the morning, or while
trying to fall asleep at night, I’d tell myself: Maybe I’m a fool? Maybe this
whole damn shoe thing is a fool’s errand?
Maybe, I thought.
I SCRAPED TOGETHER
the twenty thousand dollars from our receivables,
paid off the bank, and took delivery of the order from Onitsuka. Another
sigh of relief. Followed by a tightening in the chest. What would I do the
next time? And the next?
I needed cash. That summer was unusually warm. Languorous days of
golden sunshine, clear blue skies, the world a paradise. It all seemed to mock
me and my mood. If 1967 had been the Summer of Love, 1970 was the
Summer of Liquidity, and I had none. I spent most of every day thinking
about liquidity, talking about liquidity, looking to the heavens and pleading
for liquidity. My kingdom for liquidity. An even more loathsome word than
Eventually I did what I didn’t want to do, what I’d vowed never to do. I
put the touch on anybody with ears. Friends, family, casual acquaintances. I
even went with my hand out to former teammates, guys I’d sweated and
trained and raced alongside. Including my former archrival, Grelle.
I’d heard that Grelle had inherited a pile from his grandmother. On top
of that, he was involved in all sorts of lucrative business ventures. He worked
as a salesman for two grocery store chains, while selling caps and gowns to
graduates on the side, and both ventures were said to be humming along. He
also owned a great big chunk of land at Lake Arrowhead, someone said, and
lived there in a rambling house. The man was born to win. (He was even still
running competitively, one year away from becoming the best in the world.)
There was an all-comers road race in Portland that summer, and Penny
and I invited a group of people to the house afterward, for a cocktail party. I
made sure to invite Grelle, then waited for just the right moment. When
everyone was rested, a couple of beers to the good, I asked Grelle for a word
in private. I took him into my den and made my pitch short and sweet. New
company, cash flow problems, considerable upside, yadda yadda. He was
gracious, courteous, and smiled pleasantly. “I’m just not interested, Buck.”
With nowhere else to turn, with no other options, I was sitting at my desk
one day, staring out the window. Woodell knocked. He rolled into the
office, closed the door. He said he and his parents wanted to loan me five
thousand dollars, and they wouldn’t take no for an answer. They also
wouldn’t tolerate any mention of interest. In fact they wouldn’t even
formalize the loan with any sort of papers. He was going to Los Angeles to
see Bork, but while he was gone, he said, I should drive to his house and
collect the check from his folks.
Days later I did something beyond imagining, something I didn’t think
myself capable of doing. I drove to Woodell’s house and asked for the check.
I knew the Woodells weren’t well off. I knew that, with their son’s
medical bills, they were scuffling more than I. This five thousand dollars was
their life savings. I knew that.
But I was wrong. His parents had a little bit more, and they asked if I
needed that, too. And I said yes. And they gave me their last three thousand
dollars, draining their savings down to zero.
How I wished I could put that check in my desk drawer and not cash it.
But I couldn’t. I wouldn’t.
On my way out the door I stopped. I asked them: “Why are you doing
“Because,” Woodell’s mother said, “if you can’t trust the company your
son is working for, then who can you trust?”
PENNY WAS CONTINUING
to find creative ways of stretching her twentyfive-dollar grocery allowance, which meant fifty kinds of beef Stroganoff,
which meant my weight ballooned. By the middle of 1970 I was around 190,
an all-time high. One morning, getting dressed for work, I put on one of my
baggier suits and it wasn’t baggy. Standing before the mirror I said to my
But it was more than the Stroganoff. Somehow, I’d gotten out of the
running habit. Blue Ribbon, marriage, fatherhood—there was never time.
Also, I’d felt burned out. Though I’d loved running for Bowerman, I’d hated
it, too. The same thing happens to all kinds of college athletes. Years of
training and competing at a high level take their toll. You need a rest. But
now the rest was over. I needed to get back out there. I didn’t want to be the
fat, flabby, sedentary head of a running-shoe company.
And if tight suits and the specter of hypocrisy weren’t enough incentive,
another motivation soon came along.
Shortly after that all-comers race, after Grelle refused me the loan, he and
I went for a private run. Four miles in, I saw Grelle looking back at me sadly
as I huffed and puffed to keep up. It was one thing to have him refuse me
money, it was another to have him give me pity. He knew I was embarrassed,
so he challenged me. “This fall,” he said, “let’s you and me race—one mile.
I’ll give you a full minute handicap, and if you beat me I’ll pay you a buck for
every second of difference in our times.”
I trained hard that summer. I got into the habit of running six miles every
night after work. In no time I was back in shape, my weight down to 160.
And when the day of the big race came—with Woodell on the stopwatch—I
took thirty-six dollars from Grelle. (The victory was made all the sweeter the
following week when Grelle jumped into an all-comers meet and ran 4:07.)
As I drove home that day I felt immensely proud. Keep going, I told myself.
AT ALMOST THE halfway mark of the year—June 15, 1970—I pulled my
Sports Illustrated from my mailbox and got a shock. On the cover was a Man
of Oregon. And not just any Man of Oregon, but perhaps the greatest of all
time, greater even than Grelle. His name was Steve Prefontaine, and the
photo showed him sprinting up the side of Olympus, aka Bowerman
The article inside described Pre as an astonishing, once-a-generation
phenom. He’d already made a big splash in high school, setting a national
record (8:41) at two miles, but now, in his first year at Oregon, running two
miles, he’d beaten Gerry Lindgren, who’d previously been considered
unbeatable. And he’d beaten him by 27 seconds. Pre posted 8:40.0, thirdfastest time in the nation that year. He’d also run three miles in 13:12.8,
which in 1970 was faster than anyone, anywhere, on earth.
Bowerman told the writer from Sports Illustrated that Pre was the fastest
middle-distance runner alive. I’d never heard such unbridled enthusiasm
from my stolid coach. In the days ahead, in other articles I clipped,
Bowerman was even more effusive, calling Pre “the best runner I’ve ever
had.” Bowerman’s assistant, Bill Dellinger, said Pre’s secret weapon was his
confidence, which was as freakish as his lung capacity. “Usually,” Dellinger
said, “it takes our guys twelve years to build confidence in themselves, and
here’s a young man who has the right attitude naturally.”
Yes, I thought. Confidence. More than equity, more than liquidity, that’s
what a man needs.
I wished I had more. I wished I could borrow some. But confidence was
cash. You had to have some to get some. And people were loath to give it to
Another revelation came that summer via another magazine. Flipping
through Fortune I spotted a story about my former boss in Hawaii. In the
years since I’d worked for Bernie Cornfeld and his Investors Overseas
Services, he’d become even richer. He’d abandoned Dreyfus Funds and
begun selling shares in his own mutual funds, along with gold mines, real
estate, and sundry other things. He’d built an empire, and as all empires
eventually do it was now crumbling. I was so startled by news of his downfall
that I dazedly turned the page and happened on another article, a fairly dry
analysis of Japan’s newfound economic power. Twenty-five years after
Hiroshima, the article said, Japan was reborn. The world’s third-largest
economy, it was taking aggressive steps to become even larger, to
consolidate its position and extend its reach. Besides simply outthinking and
outworking other countries, Japan was adopting ruthless trade policies. The
article then sketched the main vehicle for these trade policies, Japan’s hyperaggressive sosa shoga.
It’s hard to say exactly what those first Japanese trading companies were.
Sometimes they were importers, scouring the globe and acquiring raw
materials for companies that didn’t have the means to do so. Other times
they were exporters, representing those same companies overseas.
Sometimes they were private banks, providing all kinds of companies with
easy terms of credit. Other times they were an arm of the Japanese
I filed away all this information. For a few days. And the next time I went
down to First National, the next time Wallace made me feel like a bum, I
walked out and saw the sign for Bank of Tokyo. I’d seen that sign a hundred
times before, of course, but now it meant something different. Huge pieces
of the puzzle fell into place. Dizzy, I walked directly across the street,
straight into the Bank of Tokyo, and presented myself to the woman at the
front desk. I said I owned a shoe company, which was importing shoes from
Japan, and I wanted to speak with someone about doing a deal. Like the
madam of a brothel, the woman instantly and discreetly led me to a back
room. And left me.
After two minutes a man walked in and sat down very quietly at the table.
He waited. I waited. He continued waiting. Finally I spoke. “I have a
company,” I said. “Yes?” he said. “A shoe company,” I said. “Yes?” he said. I
opened my briefcase. “These are my financial statements. I’m in a terrible
bind. I need credit. I just read an article in Fortune about Japanese trading
companies, and the article said these companies are looser with credit—and,
well, do you know of any such companies that you might introduce me to?”
The man smiled. He’d read the same article. He said it just so happened
that Japan’s sixth-largest trading company had an office right above our
heads, on the top floor of that building. All the major Japanese trading
companies had offices in Portland, he said, but this particular one, Nissho
Iwai, was the only one in Portland with its own commodities department.
“It’s a $100 billion company,” the banker said, eyes widening. “Oh, boy,” I
said. “Please wait,” he said. He left the room.
Minutes later he returned with an executive from Nissho Iwai. His name
was Cam Murakami. We shook hands and chatted, strictly hypothetically,
about the possibility of Nissho financing my future imports. I was intrigued.
He was quite intrigued. He offered me a deal on the spot, and extended his
hand, but I couldn’t shake it. Not yet. First I had to clear it with Onitsuka.
I sent a wire that day to Kitami, asking if he’d have any objections to my
doing side business with Nissho. Days passed. Weeks. With Onitsuka,
silence meant something. No news was bad news, no news was good news—
but no news was always some sort of news.
WHILE WAITING TO
hear back, I got a troubling call. A shoe distributor
on the East Coast said he’d been approached by Onitsuka about becoming
its new U.S. distributor. I made him say it again, slower. He did. He said he
wasn’t trying to make me angry. Nor was he trying to help me out or give
me a heads-up. He just wanted to know the status of my deal.
I began to shake. My heart was pounding. Months after signing a new
contract with me, Onitsuka was plotting to break it? Had they been spooked
when I was late taking delivery of the spring shipment? Had Kitami simply
decided he didn’t care for me?
My only hope was that this distributor on the East Coast was lying. Or
mistaken. Maybe he’d misunderstood Onitsuka. Maybe it was a language
I wrote to Fujimoto. I said I hoped he was still enjoying the bicycle I
bought him. (Subtle.) I asked him to find out anything he could.
He wrote back right away. The distributor was telling the truth. Onitsuka
was considering a clean break with Blue Ribbon, and Kitami was in touch
with several distributors in the United States. There was no firm plan to
break my contract, Fujimoto added, but candidates were being vetted and
I tried to focus on the good. There was no firm plan. This meant there
was still hope. I could still restore Onitsuka’s faith, change Kitami’s mind. I
would just need to remind Kitami of what Blue Ribbon was, and who I was.
Which would mean inviting him to the United States for a friendly visit.