Tuesday, March 31, 2009

Georges de Mestral

Today's hero was an inventor who found inspiration in a common problem for those who walk off the beaten path. But instead of trying to combat the burrs that stick to one's pants, Georges de Mestral (1907 - 1990) sought to mimic their stubborn ability to cling. After years of toil, de Mestral invented separable hook and loop fasteners and created the Velcro brand.

The story behind Velcro starts with a walk in the woods in 1941. De Mestral was interested in how the burrs from a burdock plant stuck to his clothes and his dog's fur. Using a microscope he noticed how the tiny hooks on the burdock seeds would snag onto fibers, particularly the looped strands in clothing. De Mestral was intrigued by the possibility of mimicking this phenomenon with fabrics, so he set about a process that culminated in a patent for separable fasteners 14 years later.

De Mestral first experimented with cotton. It worked, but the fibers stretched after moderate use. Through trial and error de Mestral discovered that nylon was the best alternative. Velcro emerged sometime in the late 40's ("Velcro" being a portmanteau of "velour" and "crochet"), but it took several more years to master the mass-production of the hooks and loops. Patents were granted and production began in the mid 1950's, but Velcro was slow to catch on. It gained prominence after use by NASA in their spacesuits and in the first artificial heart surgery.

Today we know of Velcro and non-Velcro brand fasteners predominantly from their use in shoes and clothing accessories, but the fasteners have many applications. One famous example was David Letterman adorning a Velcro suit and attaching himself to a wall. For improving upon nature's design and creating a product that has made life easier for millions of people, Georges de Mestral is very much a Hero of Capitalism.

Velcro Wikipedia entry

De Mestral NYT Obit 1990
American Physical Society

Monday, March 30, 2009

Trey Parker and Matt Stone

Today we celebrate Trey Parker and Matt Stone for their animated creation, South Park. Stone and Parker first met in 1992 as film students at the University of Colorado. When they agreed to collaborate on a class project - a film short titled: Jesus vs. Frosty - the main characters of South Park - Stan, Kyle, Cartman, and Kenny - were born.

Parker and Stone were commissioned to create a second film in 1995 with the same characters - the characters resembling those of today's episodes only with the names re-arranged - as a video Christmas card for a fee of $2000 - titled Jesus vs. Santa. The popularity of these two initial videos over the internet eventually led to talks of an animated series. In 1997, episode 1 of season 1 aired on Comedy Central. South Park is now in its 13th season and remains the highest rated series on Comedy Central.

South Park has won a series of awards including: the CableAce Award for best animated series, two Emmy Awards - backed by seven Emmy nominations - , and more. The success of the series led to production of a full-length movie in 1999. It has also expanded to a successful market for South Park merchandise - video games, toys, clothing, etc.

Trey Parker and Matt Stone are both fine examples of Heroes of Capitalism: they combined their intellectual and artistic abilities to create world-wide wealth in entertainment.

See South Park's take on the financial crisis (the Margaritaville episode) here.


Wikipedia - South Park
South Park Studios

Friday, March 27, 2009

Elias Howe

Elias Howe invented the basic tool—the sewing machine—that took the world from wearing mostly similar, rough, handmade clothes to the almost endless variety of machine-made modern clothing that we enjoy today.

Howe had worked as a machinist and had extensive experience in repairing precision instruments. Many others had tried to invent a practical sewing machine but had failed. In 1846, while working for Ari Davis in Boston, Howe developed and patented the first lock-stitch machine and proved that he could outpace five experienced seamstresses in a head-to-head competition.

After he demonstrated his device in America, he attempted to license its use in Britain. When he returned to the United States, he found many imitators, including Isaac Singer. Eventually, after a series of lawsuits, Howe prevailed and came to an agreement with Singer, then the leading seller of home-based sewing machines.

For contributing to the mass-production of clothes, which ironically made possible the elite limited-production haute couture fashion industry, Elias Howe is today's hero of capitalism.

Inventor Hall of Fame entry
Wikipedia entry
Profile at Rochester University
Idea Finder entry

Thursday, March 26, 2009

Ely and Jules Klapman

Today we honor Ely and Jules Klapman for their contributions to root beer lovers every where. Ely Klapman started a bottling company in 1937. This company went on to develop Dad's Root Beer. After Ely's retirement his son, Jules Klapman, took Dad's Root Beer from largely a Chicago known brand to a nationally recognized brand. Today the Dad's brand includes about nine different flavors. The brand is named for Ely's father, who brewed his own root beer at home.

Even for non-root beer lovers, Dad's has had a major impact on how we enjoy soda in general. According to the Dad's Root Beer website, Dad's was the first brand to adopt the six pack format we know today. Also, Dad's was the first to offer a half gallon option. In 1971, Jules Klapman sold the company to IC Industries. He stayed on as an executive until 1980.

Today the Dad's brand is owned by Hedinger Brands, LLC. It is because of Ely and Jules Klapman's pursuit of personal profit that we enjoy a great soda: Dad's Root Beer. We also enjoy market innovations (like 6 packs) as a result of the Klapmans' use of their private property.

Klapman Obituary
Dad's Root Beer on Wikipedia
Dad's Root Beer
Beverage World

Did I inspsire you to drink some root beer? Why not make your own?

Wednesday, March 25, 2009

Marion Donovan

If necessity is the mother of inventions, today's Hero of Capitalism quickly became inventive. Marion Donovan was a new, young mother when she became tired of cloth diapers that would immediately become soaked through.

Donovan began work on developing a waterproof diaper cover in 1946. Using a shower curtain and innovation, she developed a diaper cover that was reusable and leak proof. The new cover also did not create diaper rash, an improvement over the rubber baby pants. In 1949, Saks Fifth Avenue began selling her new product, now made out of parachute cloth and with the added invention of snaps to replace safety pins. Donovan's diaper cover was named the "Boater" because it helped babies stay afloat and was an instant success.

While Donovan had found a solution to her initial problem, she continued to work on developing a more user friendly diaper and invented the first disposable paper diaper. Donovan's second diaper invention was slower to sell. Her disposable paper diaper was seen as "unnecessary and impractical". Donovan worked to further develop the product herself and eventually sold the idea of disposable paper diapers to Victor Mills, the creator of Pampers.

Donovan's invention has made life simpler, cleaner, and more enjoyable for millions of parents. Her invention is just one of many in the history of the diaper, but the diaper and Donovan's inventions show that innovation is ever present in our daily lives and something that seems silly and unneeded now might soon seen like a God send and an example of "How did people ever live without this?" in a year.

MIT Inventor of the week: Marion Donovan
About.com - Marion Donovan

Tuesday, March 24, 2009

Daniel Okrent, Robert Sklar, Steve Wulf and Glen Waggoner

With the close of the World Baseball Classic (congrats to Japan) and with baseball’s opening day looming, nearly every sports website is aggressively promoting their own web service to manage your Fantasy Baseball league. So today we celebrate some of the men who have been credited with the creation of the phenomenon that is now called Fantasy Baseball.

Daniel Okrent, Robert Sklar, Steve Wulf and Glen Waggoner are the four more well-known names associated with the first such league. The four men were sportswriters and friends who would often engage in the male-bonding ritual of endlessly discussing their favorite ballplayers (From my experience, women LOVE it when you do this…having trouble with the ladies? This can’t miss!). The really fun part about discussions like this is that, without any way to quantify the discussions, there was no way to discern who the “winner” was. So these four gentlemen decided to come up with a way to try to quantify each person’s stock of knowledge in order to best measure who was really the most knowledgeable sports fan.

Their idea was to have each person in the discussion put their money where their mouth was. Instead of discussing who the best players were, each member would be challenged to put together a team, like a real General Manager of a baseball team, by bidding on the best players. Each team was given a cap of money they could spend ($260 in the original version of the game). Using a relatively simple ranking system the real world performances of the players on an individual’s team would be measured against the rival teams’ performances, and at the season’s end a winner would be crowned.

The first such competition occurred in 1980 and the league was named the Rotisserie League, after the restaurant at which the league members would typically meet, La Rotisserie Francaise. Rotisserie Baseball (since renamed Fantasy Baseball) was born.

Over the last three decades, the game has grown phenomenally, and many variants on the basic format have emerged. The internet was a major driver of growth for the game, as the compilation of statistics and day-to-day management of the league was made exponentially simpler. Estimates vary, but most seem to indicate that the audience for Fantasy Baseball has swelled to over 30 million players in the U.S. and Canada as of last year. The websites that offer to manage your leagues and compile the necessary statistics typically charge around $100 per league to do so, and leagues are often no more than 10-20 teams. As you can see, this represents a staggering amount of revenue for the websites which provide such services. Estimates of this revenue are also varied, but typically are in the neighborhood of $1.5 billion per year – for baseball leagues alone. With the popularity of Fantasy Baseball, variants have sprung up for every sport imaginable, with Fantasy Football being far and away the most popular. Player volume and revenue for Fantasy Football have surpassed those of baseball, and estimates of revenues from football leagues are upwards of $3 billion.

There are a few problems associated with this phenomenon. Purists of the sports involved like to complain that it is changing fans and the way that they root for the sport, causing them to cheer for individual players instead of teams. This may or may not be true, but it is difficult to argue that it is a problem. Fan interest in the major sports has never been higher, and those involved in leagues will often tell you that it has renewed or increased their interest in the sports that they loved as children. As an avid Fantasy sports player and sports fan in general, I can support this latter view.

Like most intellectual property, protecting ownership of the idea turned out to be tricky. Even if the founders had been able to patent the original idea, the thousands of varients that have since emerged would have eroded the property rights of these writers. Consequently, the founders are not able to claim part of the profits from this incredible surge in popularity. But they did not go away penniless. A series of books about the game and specifically about the Rotisserie League itself was published. In the days before the internet, these books were the main source of information about how to play the game and some basic strategic elements crucial for being a winning Rotisserie owner. As a result, these books were relatively popular and generated some wealth or these founders.

Other attempts to stake a claim to some of the revenues being generated through fantasy sports have also been unsuccessful. For example, Major League Baseball recently lost a lawsuit, seeking compensation from the websites that use their statistics for providing support to Fantasy leagues. (Somehow, this lawsuit made it all the way to the Supreme Court!)

Fantasy sports are another example of a relatively simple idea which found a niche and then combined with technology to become a phenomenon. Tremendous wealth opportunities are created for the websites who manage the game for its players, for the people who write about the sports in question, and for the players and owners in the sport who experience a surge in the popularity of the sport. For the creation of such wealth, Daniel Okrent, Robert Sklar, Steve Wulf, Glen Waggoner and any of the other contributing members of the original Rotisserie League should consider themselves Heroes of Capitalism.

Monday, March 23, 2009

Elisha Graves Otis

Elisha Graves Otis is the man who helped make skyscrapers possible. He contributed to capitalism by finding a way to make safe a concept that had been around for centuries—the elevator. 

Although primitive elevators go back to the third century BC, it was Elisha Otis who made them the safe, convenient forms of transport that we all know today. The primary problem with the old pulley-and-rope systems was the danger that the ropes would break (which they often did) and the elevator compartment would plummet down the shaft.

Otis had been working as a mechanic and laborer in New York when he and his sons hit upon an idea that would revolutionize the primitive elevator system. At New York's 1853 Exhibition of the Industry of All Nations, in the Crystal Palace Exhibition, Otis demonstrated his spring-loaded governor and toothed guide rail system. So confident of his invention, Otis undertook to demonstrate it by rising up an open elevator shaft in a "safety elevator" and then ordered his assistant to cut the ropes, and, much to the watching crowd's amazement, he didn't plummet to his death—his device worked. He began taking orders for his devices immediately, and by 1857, had installed the first passenger elevator in New York. Though he died in 1861, his sons carried on his legacy and the world began building taller and taller buildings. 

MIT Inventor of the Week profile
About.com profile
Wikipedia entry
Idea Finder profile
Elevator Museum profile
PBS "Who Made America?" biography

Friday, March 20, 2009

Robert Swanson and Herbert Boyer

When a paradigm-shifting event can happen over a couple of beers, we’ve got the makings of a couple of Heroes of Capitalism. In 1976, a venture capitalist and a scientist got together for a couple of beers and tried to design a way for this entrepreneur to invest in the scientist’s research into recombinant DNA. The objective was to develop an environment where a profit motive could accelerate research where a commercial application seemed likely.

The capitalist, Robert Swanson, believed that commercializing genetically engineered drugs was possible in the near future, as opposed to typical estimates that placed such applications as being at least a decade away. Herbert Boyer was a biochemistry and biophysics professor who had pioneered a technique to genetically alter DNA that seemed promising.

Swanson and Boyer sat down for a few beers and began to work on a business plan that would dramatically alter the way the pharmaceutical drugs would be produced. In that bar, the Biotech industry was formed. Swanson worked as CEO, marketing the idea to investors and Boyer managed the scientists. The company that Swanson and Boyer formed was called Genentech and it created the first genetically altered drug to receive FDA approval, human insulin. The basic idea of the Biotech firm is to develop the idea and do the preliminary research and testing before selling the idea to a firm that specializes in production and marketing of pharmaceutical drugs.

The idea was hugely successful for both Boyer and Swanson and was quickly copied by hundreds of small research-minded firms. The Biotech industry currently boasts over 1400 firms and represents over $40 billion in annual revenues in the US alone. Biotech firms have been responsible for over 200 new drugs and vaccines, including products to treat cancer and HIV/AIDS. Over 180,000 people worked in the Biotech industry as of 2006, and the U.S. portion of the industry is estimated to have spent over $27 billion on research and development in 2006 alone.

The moral of the story is clearly that we should all go out tonight and brainstorm while drinking a few beers. What could it hurt?

More on the Biotech industry today
Biotech facts

Thursday, March 19, 2009

Murray Rothbard

Today we celebrate Murray Rothbard (1926-1995) for his life-long devotion to capitalism. Rothbard's defense of capitalism is best know as anarcho-capitalism - "...a political philosophy which advocates removal of the state and the elevation of the sovereign individual in a free market. In an anarcho-capitalist society, law enforcement, courts, and all other security services are provided by voluntarily-funded competitors such as private defense agencies rather than through compulsory taxation."

Rothbard contended that "the difference between free-market capitalism and 'state capitalism' is the difference between 'peaceful, voluntary exchange' and a collusive partnership between business and government that uses coercion to subvert the free market."

Rothbard completed his B.A., M.A., and Ph.D in Mathematics and Economics at Columbia University. He also studied under Austrian economist Ludwig von Mises at New York University during his graduate years - much of his influence evolving from Mises' Human Action.

Among his major contributions to history, economics, and political philosophy are: For a New Liberty; Man, Economy, and State; and Power and Market.

For more on Murray Rothbard and other Austrian scholars see the links below.




The Austrian Economists

Charley Shin

Ohio is the birthplace of many popular restaurant chains thanks in part to its entrepreneurial immigrants. I can only honor one at a time, so I'll start with the founder of one of my favorite chains: Charley's Grilled Subs. Charley's is known in Ohio and beyond for grilling Philly Cheesesteaks in malls, airports, and gas stations. According to company legend, it all started when an Ohio State student had his first cheesesteak on a trip to the east cost.

Charley Shin immigrated with his mother and sister to Ohio from South Korea in the 1970's. His mother set up a Japanese restaurant in Columbus while he attended school, eventually enrolling at Ohio State. At some point his family is said to have taken a trip to visit family in New York when they found themselves in Philadelphia by mistake. That's when Charley had his first Philly Cheesesteak. The experience was apparently unforgettable; he didn't wait to graduate before convincing his mother to loan him money so that he could establish a sandwich shop next to campus in 1986.

After his first shop, Charley opened new stores in malls close to Columbus. Five years later, he began franchising the chain. Malls, gas stations, and airports were the target markets for Charley's. In recent years they've also had success on Air Force bases. Charley says he likes "captive audiences," but the brand is starting to appear in stand-alone locations.

I've lived in Philadelphia and can attest to the heart-palpitating tastiness of an original Philly Cheesesteak. In my humble opinion, Charley's steak subs are a good substitute. Not as greasy, of course. The service is less... abrasive. And Charley's kiwi lemonade is unmatched by other fast food, or "fast casual," establishments. I'll admit to having gone with a friend to the Columbus airport for the sole purpose of ordering a Charley's sub; I ordered subs from the food court while he drove around the loop. Charley Shin is an obvious Hero of Capitalism because of his entrepreneurial drive and remarkable success, but he deserves special note because those subs are so delicious.

Fast Casual magazine profile
Columbus Business First article
Distinguished Asian American Business Leaders - Charley Shin bio

Wednesday, March 18, 2009

Matt and Jessica Flannery

Today we honor Matt and Jessica Flannery for their wealth creating organization: Kiva. This husband and wife team found a way to connect micro-financiers with entrepreneurs. Kiva.org is a website where individuals can lend to entrepreneurs all over the world for small amounts of money that make a big difference.

Let me assure you, Kiva is no longer a small organization. According to Wikipidea, "As of December 18, 2008, Kiva has distributed $52,624,535 in loans from 383,042 lenders. A total of 75,681 loans have been funded. The average loan size is $443.16. According to Alexa, Kiva's website typically ranks well into the top 25,000 websites on the Internet." I especially appreciate Kiva's simplicity. An individual can choose from a list of businesses and loan all or part of the requested money. Kiva does a nice job of explaining micro-finance and explaining the risks to lenders.

They took their private property and created wealth. We honor Matt and Jessica Flannery for using their private property to create wealth all over the world. Their particular wealth goes far beyond material possessions. It comes in the form of empowerment, good feelings and capital accumulation.

A special thanks to "The Dangerous Economist" for the tip!

Kiva on Wikipedia

I had a little trouble finding written information about the Flannery's, so here is a youtube clip:

Tuesday, March 17, 2009

Arthur Guinness

On this holiest of days, St. Patty's Day, we honor the father of the Guinness Beer, Arthur Guinness, as a Hero of Capitalism.

Arthur Guinness (1725-1803) was born in Celbridge, County Kildare. He first learned the art of brewing from his father who worked as a land steward for Dr. Arthur Price. In 1755, Guinness leased his first brewery in Leixlip where he specialized in brewing ale.

Shortly after he opened this brewery, he left his brother in charge and moved to St. James Gate Brewery in Dublin. Guinness signed a 9000-year lease in 1759 with St. James Gate Brewery for an annual rent of £45. The site was only four acres and was in disrepair, but it had a good water supply.

When Guinness began his brewery, there were over 70 similar small breweries in Dublin. Guinness began work to make his brewery unique. While he started brewing ale, Guinness also began brewing a new type of dark English beer, porter. His porter was so successful that he decided to specialize and in 1799 stopped brewing ale. His young company began exporting beer to England within 10 years of its founding and the English quickly embraced his new porter. He was also made the master of the Dublin Corporation of Brewers in 1767.

Guinness and his wife Olivia Whitmore had 21 children, 10 of whom survived to adulthood. The Guinness Brewery was managed by a Guinness for six generations. His dry stout is the best selling alcoholic drink in Ireland of all time.

Today we honor Guinness not only for brewing a fantastic beer, but for recognizing the benefits of specialization, for successfully exporting his product even when the taxes of the time favored breweries in England, and for creating a company that is still thriving today.

Guinness Storehouse History
Wikipedia: Arthur Guinness

Monday, March 16, 2009

Jim Koch

In 1983, Jim Koch was working as a business consultant, making a good living telling other people how to make profits. But he decided to drop it all to “make and sell quality beer ,” like 5 generations of his family before him had done.

Koch’s father had been driven out of the beer business by the giant brewerys (Anheiser-Busch, etc), and thought Koch’s decision was destined to fail. Using a recipe developed in 1860 in St. Louis, Missouri by his grandfather, Louis Koch, Koch began producing Samuel Adams brand lager. Koch’s strategy was to NOT complete with the big guys – and the only way to do that was to make a superior product. Innovation rules again. Within months of its release, Samuel Adams was recognized as the best beer in America at the Great American Beer Festival in Denver. By 2001, Sam Adams beers enjoyed $200 million in sales, and Koch employed 350 people.

In a 2001 interview, Koch said his goal was to grow Sam Adams into "the No. 1 better beer in the United States.” Not only has he done that, but thanks to a series of mergers in the beer industry, including Anheiser-Busch’s merger with InBev, a Belgian-Brazilian company, Samuel Adams is now the largest independent, American-owned brewery left!

According to the Boston Beer Company’s Annual Report, Samuel Adams beers generated over $380 M in revenue in 2007, with profits of S189 M. Despite recent losses in the stock market, the Boston Beer Company still has a market cap of over $270M and employs nearly 500 people. Plus they make a quality beer. You’ve got to root for that.

For demonstrating that by making a quality product, even a little guy can survive (and thrive) in an industry populated by giants, Jim Koch has made his parents proud – and earned the designation as a Hero of Capitalism.

Koch Profile

Friday, March 13, 2009

Nikola Tesla

Nikola Tesla (1856-1943) was one of the leading figures of the electrical revolution. His innovations, inventions, and contributions to the fields of electricity, magnetism, power generation, and radio cannot be underestimated. He is often called the "man who invented the twentieth century."

Born in Serbia to Croatian parents, he studied electrical engineering in Austria. After leaving school he took up work on the first telephone company in Hungary, later transferring his life to Paris to work for the Edison company. In Paris, he developed the idea for an induction motor, one of the most important applications of alternating current to the problem of power generation.

Tesla came to the United States in 1884 to work for Thomas Edison. Though he contributed to solving many of Edison's problems in electrical generation, the two clashed over wages and, more importantly, whether AC or DC was a better source of power. Tesla eventually left the Edison company and worked for himself, when he joined Westinghouse. There he developed hundreds of innovations and received many patents for the crucial parts of our present electrical system, including polyphase motors and electrical transmission systems. He and Westinghouse demonstrated the usefulness of AC power when they used it to illuminate the 1893 World's Fair in Chicago.

Tesla made more accomplishments than I can possibly list and describe here, but among them are the first proof of radio communication, which antedated Marconi's demonstration, and a functioning spark plug. Among his other areas of theoretical research were the wireless transmission of power, a directed electric force weapon, and ionic flying machines.

Wikipedia entry
Margaret Cheney, Tesla: Man Out of Time
Nikola Tesla (and David Hatcher Childress), Fantastic Inventions of Nikola Tesla

Thursday, March 12, 2009

James Naismith

Today we celebrate James Naismith (1861-1939) for the wealth created as a result of his famous invention - the game of basketball.

Dr. Naismith was born in Canada and attended McGill University in Montreal. It was his job as an physical education director at the university, and later at the YMCA in Springfield, Massachusetts, that inspired him, in 1891, to invent a game that could be played indoors with a limited number of players. His first "court" lacked boundaries and made use of peach baskets as goals and soccer balls. The first formal rules of the game were established in 1892. The hammock-style goals, similar to what we know today, were invented a year later.

Naismith move to Denver, Co where he earned a medical degree in 1898. Shortly thereafter, he accepted a faculty position at Kansas University at Lawrence where he remained until his death. Of Naismith's accomplishments and thoughts on the game, The Kansas State Historical Society explains:

Dr. Naismith regarded his invention of the game as just an episode in a long career devoted to the improvement of the physical condition of succeeding generations. He thought wrestling was better exercise than basketball and one reporter said he drew as much pleasure from watching gymnasts as he did from K.U. basketball. When one of his former students, Forrest "Phog" Allen, told him he was going to Baker University to coach basketball Naismith said, "Why, basketball is just a game to play. It doesn't need a coach."

In 1936, the first year basketball was included in Olympic competition, money was raised to send Naismith to Berlin so that he could see his game played internationally. When he returned he commented that seeing the game played by many nations was the greatest compensation he could have received for his invention.

Dr. Naismith's basketball rules took one page and less than 600 words. Today, there are more than 30,000 words in the rules. The game is far more complicated than when Naismith hung up the peach baskets in Springfield in 1891.


Naismith at About.com


Wednesday, March 11, 2009

Adolf "Adi" Dassler

I return to the subject of footwear for today's hero: Adolf "Adi" Dassler, the founder of adidas. Adidas is today a ubiquitous brand of shoes and apparel, but its origins are found in the small laundromat of a German cobbler's wife.

Adi Dassler was one of the cobbler's sons. He was quiet, deliberate, and passionate about sports, particularly soccer. In the 1920's, Adi joined with his brother Rudolph to fashion and sell shoes to athletes, forming Gebrüder Dassler Schuhfabrik. Adi was the designer while Rudi handled marketing. Their first shoes were made for runners but they branched out to make shoes for soccer players within five years. The Dassler shoes were first worn by Olympians in 1928; Jesse Owens won gold medals in their shoes eight years later. Of course, being a German manufacturer, the Dassler factory supplied the German military with shoes during the Second World War. Adi ran the factory while Rudolph was drafted into the army.

The war and differing political views seem to have strained irrevocably the brothers' relationship. In 1948 Rudolph started his own plant across the river in the same town (his company would become Puma). Adi then renamed the original enterprise "adidas" and didn't skip a beat. The brothers' companies competed vigorously for sponsorships with German athletes, but adidas likely won the marketing war with the "Miracle of Bern." It was the 1954 World Cup and the underdog West Germans managed to defeat the Hungarian team while wearing adidas shoes. The team wasn't merely stylish with those stripes; they had an advantage on the rain-soaked turf with removable studs on their regular shoes.

The removable studs were Adi Dassler's innovative idea. The Miracle endeared the company to Germans and soccer fans around the world and merchants everywhere demanded the adidas shoes. Since then adidas has progressed from making quality, stylish shoes to become a marketing master. They've sponsored hundreds of notable athletes such as Spitz, Zidane, and Agassi, and inspired copycat designs by popular shoemakers. On a personal note, I'm happy to say that I've purchased a couple of pairs of adidas shoes myself. Because of his contribution to the worlds of sport and footwear, Adi Dassler is today's Hero of Capitalism.

Adi Dassler Wikipedia entry
About.com entry
The History of Adidas and Puma (Newsweek)

A tale of three stripes and family strife (ESPN)

German feud inspires boot town (BBC)
Rediff News profile

Sneaker Wars - book about the Dassler brothers

Tuesday, March 10, 2009

Joseph Rosefield

Today we honor Joseph Rosefield for creating non-separating peanut butter. Though Rosefield did not create peanut butter, he created peanut butter as we know it. Before his unique method of making peanut butter, the oil would separate from the peanut "grit." The trick was to use hydrogenated peanut oil. Also, this process meant that peanut butter lasted longer, sometimes for more than a year.

Rosefield's company, The Rosefield Packing Co., helped packed brands like Peter Pan and Skippy Peanut Butter. Some places even give Rosefield Packing Co. credit for the first wide mouth peanut butter jar.

It is for Rosefield's creation of modern peanut butter that we honor him today. He created wealth for himself, many companies and all peanut butter lovers in the world!

Joseph Rosefield on Wikipedia
Joseph Rosefield in Time
Joseph Rosefield on Skippy's Website

Here is a video about how peanut butter is made:

Monday, March 9, 2009

Al Copeland

Al Copeland (1944-2008) may seem like an unusual hero of capitalism. His famous company, Popeyes Chicken & Biscuits, had to file for bankruptcy under his leadership and he is often criticized for his outlandish lifestyle. However, Copeland created wealth for large numbers of people throughout his lifetime by using his own skill and talent.

Copeland was born in New Orleans, Louisiana. He took this regions idea of spicy food and in 1972 added it to his chicken recipe to help his young restaurant Popeyes become a favorite in Louisiana. In 1976, Copeland began franchising his restaurant. Over the next 10 years, 500 outlets were added and an additional 200 outlets were added later. By end of the 1980s, he owned or franchised over 800 restaurants.

Popeyes was the third largest chicken fried chain when Copeland decided to borrow heavily and purchased the second largest chicken fried chain, Church's Chicken. Shortly after acquiring the new chain the debt became too large and Copeland filed for bankruptcy.

Copeland lost Popeyes in the bankruptcy, but he did keep rights to many of the company's recipies and products. He began producing the spices in his plant, Diversified Foods and Seasonings. Copeland also owned multiple upscale restaurants, three hotels, and improv comedy clubs.

He was also known for his power boat racing teams, extravagant weddings, multiple divorces, and his large Christmas light displays. While known for his brash style, Copeland also used his wealth to enhance education programs, giving generously to Louisiana State University, Delgado Community College, and the National Food Service Institute.

Copeland was unsuccessful in a major business risk he took, but he did found a large, successful business. He rebounded after facing bankruptcy and continued to operate ate many successful businesses. Copeland is an example of both the successes and failures experienced in capitalism and he is a great example of the benefits of capitalism. Popeyes and Copeland's other companies have created jobs, opportunities, and good food for people since the 1970s and continue to do so today.

New York Times: Al Copeland, a Restaurateur Known for Spice and Speed, Dies at 64
Wikipedia: Al Copeland

Friday, March 6, 2009

Bill Veeck

Before baseball was a multi-billion dollar industry, and before national television deals and internet gamecasts provided hundreds of millions of dollars to baseball’s owners, the lifeblood of a baseball franchise was the revenue generated by fans showing up at the park. No one did a better job of getting fans to the ballpark than Bill Veeck.

Veeck owned three different Major League Baseball franchises from the 1940’s through his death in 1984, and the one common thread of all of these organizations was that their promotions were outrageous. Veeck was the person who arranged for 3 foot, seven inch Eddie Gaedel to appear as a pinch hitter for his St. Louis Browns. Other gimmicks Veeck used to attract fans included Grandstand Manager’s Day – where he allowed fans to plot strategy with the team’s manager through the use of cards distributed to a specific section, and the significantly less successful Disco Demolition Night – in which he invited fans to burn their disco records on the field… which led to a riot that caused his team to forfeit the game.

But not all of Veeck ideas were passing gimmicks (or dangerous flops). He integrated the American League, by signing Larry Doby to be the AL’s first black player, he introduced the concept of putting player’s names on the backs of their jerseys so the fans could more easily identify them and he introduced the “exploding scoreboard,” a scoreboard with electronic effects that were unleashed when the home team hit a home run. Fireworks displays at the ballpark and fan-appreciation nights are also Veeck originals.

But regardless of how successful his ideas were in the long run, Veeck was a genius at getting fans into the stadium. In 1948, over 2.6 million fans paid to watch Veeck’s Cleveland Indians, a staggering total for that time period, and better than several franchises can manage today.

Veeck’s spirit continues in baseball today through his son Mike, who is part owner of several minor league franchises, including the Charleston Riverdogs. The Riverdogs have gained notoriety for putting on unique promotions like “Nobody Night,” where fans were asked not to enter the park until after the 5th inning, so that the team could set a record for the lowest attendance.

More on Veeck

Thursday, March 5, 2009

Malcom McLean

Malcom McLean is a classic story of an American capitalist hero. He rose from humble beginnings as a truck driver to become someone who literally helped change the world. The Baltimore Sun ranked him "next to Robert Fulton as the greatest revolutionary in the history of maritime trade." Forbes called him "one of the few men who changed the world."

For all of the dramatic influence of his career and his accomplishments, McLean is almost unknown to most Americans. Yet the whole world has felt the changes he helped bring to international trade. It would be no mistake to say that without McLean's contributions, "globalization" would not be the same as what we know it to be today.

McLean began in the Great Depression as a co-owner and driver for McLean Trucking Co., a North Carolina firm that specialized in driving tobacco up and down the East Coast. The company would eventually become the second largest trucking concern in the United States. McLean used numerous innovations to facilitate the growth of his trucking company. He converted to diesel before his competitors, he used company accounts at preferred gas stations to negotiate discounts, he built an automated terminal in Winston-Salem, NC, and he deftly maneuvered around onerous ICC regulations to achieve massive efficiencies in the trucking business.

When McLean faced increasing transit times due to traffic congestion in the 1950s, he began thinking about a way to get his trucks loaded onto coastal shipping vessels to have them bypass the busiest sections of his routes. He figured that by loading a loaded truck onto a ship, say from New Orleans to New York, he could achieve a cost reduction by not having to unpack and repack it at each point. After much trial and error, McLean and his engineers came up with the forerunner of the modern shipping container—a uniform size, prepackaged, interchangeable freight package that could be loaded onto ships, trains, and trucks with ease.

As he began to perfect the containers themselves and to build the necessary infrastructure, McLean also had to fight the rent-seeking behavior of rail shippers and other maritime shippers, as well as continued harassment from the ICC and the Justice Department's Antitrust division. In the end, the concept caught on and the shipping world adopted McLean's idea. Although others had created some form of shipping containers before McLean, it was his innovations in standardization, in adopting a uniform business model, and in promoting the concept that ultimately made containerized shipping the force that it is today. He hired the engineers who invented the crucial components of the containers themselves, the massive cranes that load and unload the container ships, and the computers and programs that help facilitate the whole process.

Before McLean, the biggest expense in intercontinental trans-oceanic trade was the massive expense and duration involved in loading and unloading cargo by the piece (actual at-sea transit was only 15% of total cost). Longshoremen had been a frequent bottleneck with worldwide labor disputes and irregular working conditions. Shipping companies themselves had to struggle to load and unload ships in the proper order and with the cargo in the right compartments (some refrigerated, some with hazardous material, some with more or less ballast weight). McLean's standardized container revolution made it possible to speed up and reduce the cost of loading and unloading maritime ships dramatically. As a result of this innovation, Americans today import four to five times as many varieties of goods as they did in the 1970s. The container revolution also helped Asian economies to boom and grow as suppliers of goods for America and Europe.

For all of his contributions to this globalization revolution, McLean is today's hero of capitalism.

Marc Levinson, The Box
Wikipedia entry
Forbes excerpt of Levinson's The Box
Driver's Magazine profile

Wednesday, March 4, 2009

Patrick Meiering

Today we celebrate an entrepreneur who's product has succeeded in raising the standard of living - for our pets. Patrick Meiering's official title is "Head Bone Maker." He acquired this title after founding, in 1995, Zuke's - a company that manufactures and distributes "healthy treats for active [pets]."

As the story goes, Zuke's was founded "during a hike in the mountains of Durango, CO" when Patrick stopped for a break and a refreshing energy bar and his "tired chocolate lab named Zuke asked, 'Where's my energy bar?' He had a point," Patrick attests, "so we responded with an innovative line of super-healthy, pet-pleasing treats and edible chews." (see full story)

As a fellow pet lover - My girlfriend and I have two Labradors, Charlie (chocolate) and Ellie (black) - I fully appreciate Patrick's ambition to develop a product that promotes a healthy lifestyle for our greatest companions.

**This post was inspired by Ellie - today is her birthday, she's 8 (and loves the Hip Action treats).



Tuesday, March 3, 2009

Howard Schultz

Today's hero is Howard Schultz, CEO and founder of the modern-day Starbucks. Starbucks started out in early 1970's Seattle as a coffee roaster and retailer for enthusiasts. Schultz managed to land a marketing job with the company in 1982 after he came across them in his job as an appliance salesman. Schultz was inspired by Italian-style espresso bars and wanted Starbucks to offer coffee drinks, but the company's founders weren't interested. After starting his own chain of cafes, Schultz raised money to buy out the owners of Starbucks and consolidated his stores under the Starbucks name. His concept was, risking understatement, very successful.

Starbucks caught on quickly in the US and internationally. While espresso drinking has long been popular in southern Europe, Latin America, and various urban centers, the emergence of Starbucks has changed popular coffee consumption around the world. First, Starbucks helped to internationalize the espresso. Coffee houses spread from urban to the suburban. From the above-mentioned regions to areas without a coffee tradition. Snobs of every variety like to chide Starbucks for being commoditized and pedestrian, but what they often forget is that Starbucks raised the floor for everyone. Everyday Americans drink better coffee, and more coffee from coffee shops, than they did twenty years ago. The increased interest in espresso has been a boon to the independent coffee shops, but I imagine some of those shops would lose their cachet admitting as much.

Starbucks has been around long enough to experience growing pains as well as over-reach, and Schultz will be the first to say that the chain lost its edge as stores appeared on every corner. But that doesn't matter for this purpose of honoring an innovator. Many commercial chains come and go, but Starbucks has already left a mark worth noting. You don't have to like Starbucks to join me in appreciating Howard Schultz's role in developing coffee culture, particularly in the United States.

Wikipedia Entry
BusinessWeek Profile
Condé Nast Portfolio Profile
Slate.com on Starbucks and Independent Coffee Shops
Starbucks Company History

Monday, March 2, 2009

Dambisa Moyo

Today we honor Dambis Moyo for her creating wealth with her books and fighting for Capitalism in Africa. Moyo has written "Dead Aid: Why Aid is Not Working and How There is Another Way for Africa" as a follow up to her first book, "Dead Aid: Destroying the Biggest Global Myth of Our Time." See the links below for more information on these. Beyond all of this, Mayo works closely with several charities in her ongoing fight to raise the standards of living in Africa.

Moyo was born in Zambia. She holds a Phd and masters in Economics as well as an MBA. She is very accomplished in the world of finance and obviously has a heart for her home continent. In her interview in the NY Times she points out the ongoing hypocrisy of the West's attempt to "help" Africa. Moyo points out that she was the only African in the room during the World Economic Forum's party for Africa. Moyo argues that the aid from the West has kept Africa in poverty. Moyo's concluding quote from the article is powerful:
"I wish we questioned the aid model as much as we are questioning the capitalism model. Sometimes the most generous thing you can do is just say no."

Moyo continues her fight against current aid tactics aimed at Africa and advocates microfinance and solutions driven from within countries... not from foreigners. By publishing her books and standing up for Capitalism, Mayo generates wealth for herself, her publisher(s) and hopefully for her country.

A special thanks to "The Dangerous Economist" for the tip!

Dambisa Moyo's Official Page
Dambisa Moyo on Wiki
"Questions for Dambis Moyo" in NY Times
Dambisa Moyo's books on Amazon

Here is Dambisa Moyo on a newscast interview: