David i dont consider myself a journalist. And nobody else would consider myself a journalist. I began to take on the life of being an interviewer even though i have a day job of running a private equity firm. How do you define leadership . What is it that makes somebody tick . I have worn your shoes for many years, and now i finally get a chance to talk about them. I will talk about my shoes a little bit later. When you first started the company in come i guess, 1962, around then, you knew nothing about shoe design. You did not know a lot about management, and you did not have any money. So today, the company is worth roughly a market capitalization of 100 billion, revenues of 30 billion, 62,000 employees. Did you ever imagine when you first started this company in the early 1960s that it would could ever be what it became . Phil sometimes i would get that question and i would say, we are exactly on plan. [laughter] phil with you i cant be a smart david i wasnt the first to ask you mean that was an original question question mark i thought i was the first person to ask that. Phil it was a ride that nobody an original question . I thought i was the first person to ask that. Phil it was a ride that nobody could see. When we started out, total sales were about 2 billion, now we are 9 billion. We took advantage of the running boom which became a jogging boom which became a fitness boom. We have benefited from all of that. David would you say it benefited more from being a good Marketing Company or a technology company, having a better product or better marketing, or a combination of both . Phil i have said we are a Marketing Company and our product is our most important marketing tool. David the skill set that you brought to it, what would you say the skill set was, great intellect, great drive, great leadership . What would you say . Phil all of that. [laughter] david in equal amounts . Phil if there is one thing, i it has been i have been pretty good at evaluating people. And that was one of the things i wanted to get through and i hope did come through in the book, was how valuable those early partners were, my fellow employees, my teammates. They were terrific. David speaking of that book, here it is. Phil yeah. David shoe dog, i must confess before i read the book, i did not know what a shoe dog was. What is a shoe dog . Phil in 25 words or less, it is somebody who really loves shoes, and that was me. I was a runner. There is no such thing as a in the mile. All you really care about are the shoes, so that became important to me, and has been with me ever since. David you are from oregon, and i think i read that the first fossil we have of issue that ever existed is 9000 years old, and it was, came from oregon, do you take that as a special sign that it was designed for you to start this company in oregon . Phil i have not thought about it that way, but i will take it. [laughter] david ok. You grow up, your father was a editor, and when you wanted a job once, he told you he would not hire you. Why wouldnt he hire you . Phil he knew me pretty well. There were two major newspapers in portland at the time. The journal, which he was publisher of that and he wouldnt hire me, so i went across the street to the oregonian, applied for a job and got it, and i worked there for three summers. David in high school, you are an athlete and ran, but where you a superstar athlete, average athlete, or what would you say . Phil i was a little better than average, but i certainly was not a superstar. David you got a scholarship to go to to the university of oregon . Phil no, i did not. I was a walk on. David or a run on, i guess. Phil a run on, ok. David your best time was 4. 13. I gave you three seconds. Phil i should have taken it. David suppose i told you you could have either built nike or run a 3. 56 mile . Phil 3. 56 mile or build nike . David yes. Phil i will take nike. But i did pause. [laughter] david ok. So you lettered in three years, and after which you went into the army, after a year in the army, you served in the reserves for a number of years. You went to Business School at stanford. How did you pick stanford for a business goal . Phil it was and is a good school. David there was a university of oregon runner, steve prefontaine, a legendary track star, and you became close to him. How did you get him to wear your shoes . Phil well, we worked at it and worked at it and worked at it. He had worn adidas his whole life, but he was right there in eugene, and we had a small office in eugene, and the guy who ran the office became his brother practically and ultimately convinced him to switch to nike, and he was our first roll prominent track and field athlete. David you win after others. You have to pay them to use your shoes or they just like it so much they use your shoes . Phil they just like it so much. David really . Phil no. [laughter] phil if they are good enough, they demand an endorsement fee from us or whoever. The one that comes immediately to mind is Michael Johnson at the 1996 olympics in atlanta, wore the gold shoes, which lifted us significantly. David you made those gold shoes . Early on, john mcenroe, he would from time to time lose his temper, and did that reflect poorly on your shoe . Or you didnt care about his image . This image was a great tennis player, but sometimes he would lose control, some people might say, and that did not bother you, or did it help sales . Phil the latter. David oh, it did . Ok. Phil he had a bad temper. But i always remember that Arnold Palmer had a bad temper too, but he would keep it in control. You could see him standing there ready to lose it. John went over. He was Arnold Palmer who did not keep it in control, but he was probably the most exciting player of his era. In private, he was a perfect gentleman. It was just that he was so intense that it would get away from him sometimes. He lost his temper a lot, but when he played bjorn borg, he never lost his temper once. David wow. I never really knew john mcenroe as a tennis player, but when i practiced law, the office next to mine was held by man named john mcenroe senior, and he always told me his son was a High School Tennis player and was really good. Of course you always roll your eyes when you hear this, but then i finally realized he was not exaggerating. [laughter] david lets talk about golf. A man named tiger woods came along and you signed him up relatively early in his professional career, i guess at the beginning of it, so was that hard to convince him to do this . Phil tiger woods, you could see coming from way back. He had won three u. S. Amateurs win threeent on to u. S. Amateurs in a sixyear span from the time he was 15 to 20, and so we, he would play occasionally in the portland area and we would always invite him and his father out to lunch, so we were working on that for three years before we actually signed him. David when you signed him up, he wears your shoes exclusively, but you also then began to make golf equipment as well, so you make golf balls and golf equipment, but now you are out of that business. Is that because you want to focus on shoes and not other types of equipment . Phil it is a fairly simple equation. We lost money for 20 years on equipment and balls and realized next year was not going to be any different. David so you got out of that. You are doing casual wear as well, the aerobics effort, and there was casual wear. You have decided to make athletic shoes into a casual kind of shoes. Did that work as well . David sportswear, shoes and clothing is still a significant part of our business. David and so, in other words, it is not just for athletes. You now try to design shoes for people who are wearing them casually, and so so you like it when people are wearing suits and wearing your shoes as well . Phil you look great. David do you wear anything other than nike shoes . Phil no. David you wear a tuxedo or something and you wear nike shoes . Phil i wear black nike shoes. David in basketball, you have somebody named Michael Jordan, a basketball player, youve heard of, right . Phil i have heard of him. David was it hard to sign him up, and why was his shoes so successful, became the most successful shoe ever in the athletic world . Phil it was hard to sign him up because everybody wanted him. And we won that bid. We won that war. David was it on your personality . Phil clearly. [laughter] david not money, just personality . Phil we offered pretty good. We had a lot of good players. We did not have really great players, and we thought he had the chance to be that. Obviously he was way better than we could have imagined, but when he started wearing shoes, we made them dramatic. They were red, black, and white. He was a very exciting player. Shotmped and was quick and well. He was handsome, spoke well, and the shoe was distinctive looking and david stern did as a huge favor, he banned it in the nba. And so we ran a big ad that said banned in the nba and every kid one of the shoe then. [laughter] David Michael jordan has not played in the nba for more than a decade and yet the shoe is still your bestselling basketball shoe, why is that . Phil when Michael Jordan retired from the game of basketball, we were selling 700 million worth of jordan product. It has now become a brand and we are selling over 3 billion, but knowhere are some kids who who he was, but some kids dont even know who he was. It became a brand. It went from an endorsement into a brand. David when you wear his shoes, can you jump higher . If i wore those shoes, i would not jump higher, right . Phil i think you might. David im going to go get some. Lets talk about your philanthropy for a moment. When you realize you cant take it with you and it is better to give it away . Phil it was late in the process because i kept thinking it was all going to disappear. I often said, if this is a dream, dont wake me. David so when you give a 500 million gift, you write a check out or you wire the money and it is hard to write that check . Phil yes. David because of the success of the company you are one of the wealthiest men in the United States and in the world. You are also one of the biggest philanthropists in the United States and the world. When did you realize you just cant take it with you and it is better to give it away . At what point do you say i have to do something with this other than hold onto it . Phil it was fairly late in the process because i always thought was going to disappear. I often said, if this is a dream, dont wake me. Yes, as the years went on, it seemed more real, so as i got older, i said you cant take it with you, but i wanted to focus on threefour main charities rather than to try and spread it across the board. David to the university of oregon, you have given a couple of hundred Million Dollars related to athletics, but you have also given 500 million recently for a science center, so why have you decided to be so generous to your alma mater . Phil basically, i have to laugh because two of the great entrepreneurs, bill gates and steve jobs, basically dropped out of college when they were freshmen, and my story is the exact opposite. The company nike is the result two universities, the university of oregon, which started the idea of running shoes, and stanford, which at the business education, so i tried to get back to those two schools. The other which means a lot to the other which means a lot to me is oshu, which has an outstanding leader in their Cancer Research area. David the oregon Science Health university, you gave them 500 Million Dollars for Cancer Research. You have also given recently 400 million for a program at stanford university. So when you give a 400 million or 500 million gift, do you write a check out or wire the money, and is it hard to write the check . [laughter] phil yes. Some of it has been given in stock and some paid out over a few years. David you had two sons, one died tragically in the scuba diving accident. In his honor you have done some things. How have you tried to memorialize him in that way . Phil he was a big sports fan, so we gave some money to the university of oregon for their new basketball arena, which was named after him. David today, what is left for you to accomplish and what do you want to accomplish that you havent accomplished . Phil i look back on the last couple of years and i am happy, particularly around the philanthropy that i have been able to do, and there will be take myng ahead, but i thin time to think about those things and im feeling good about things right now. David so do consult with your wife on things like that . Phil absolutely, she has final approval. [laughter] david where did you meet your wife . Phil i taught two years at portland state, and she was one of my students. David she was a good student . Phil she was a better student than i was. David it is unrealistic to make these kinds of products in the United States, you would say, the issues or those kinds of things . Phil it is as we speak, but the Manufacturing Technology is changing very rapidly, so 510 years, there will be some shoe manufacturing done in the United States, which is supposedly good news. The bad news is there will not be a lot of jobs. It will be very automated. David you were a runner for quite some time. Up until the age of 70, you would run. You never actually hurt your knees much . You dont have artificial knees or hips. Phil i do not. David so how did you avoid those problems by running so much and not having damage your body, you were just a graceful runner, or the shoes . Phil i dont have very much muscle mass, so i was lucky that way. Yeah, i still get out and walk. When i was 70, when i was out for one of my runs, i was passed by a woman with a baby carriage and realized that maybe i should quit trying to run and just walk. David the athletes you have met over the years, you have been involved with some of the most famous athletes, tiger woods, john mcenroe, steve prefontaine, Michael Jordan among others, are any of them that stand out to you as role models for youth, or do think all of them are, and which ones have you developed the closest personal relationship with . Phil they are all of that bit different. Was john mcenroe a role model . Yeah, kind of, but a lot of people would disagree with that. But which one stands out more than the other i really do look at them as my children, and who is your favorite child . You cant say that. David does tiger woods give you golf tips, or you dont play golf . Phil i do, badly. He tried to give me a tip, but it didnt work. David the high point of your career you would say was when nike went public or when nike came to the success it currently has . What would you say is the most favorite memory you have . Phil i kind of look at nike as my work of art, if you will, and just the whole painting is what matters. David lets talk finally about leadership. Leadership is not clear to people, whether you are born with it, inherit it, or become a leader by education. What you think makes a great leader . Phil they come in all shapes and sizes, dont they . Obviously hollywood, tall, handsome, strongjawed, but a lot of times the real good leaders are just the opposite. First of all, they have to want it, but they come in all shapes and sizes. I dont know there is anyone any one lesson. David now you are famous for wearing sunglasses, and i appreciate you not wearing them for this interview. Is that because you are shy by nature . You just dont want people to see you . Phil no, basically i wear contact lenses and it makes the sun bright. The future is so bright that i wear them all the time. [laughter]