Fanatics: Michael Rubin

Summary

How I Built This with Guy Raz: Fanatics’ Michael Rubin

Release Date: January 27, 2025

In this captivating episode of How I Built This, host Guy Raz delves deep into the entrepreneurial journey of Michael Rubin, the visionary founder of Fanatics. From his humble beginnings as a young entrepreneur to building a $25 billion sports merchandise empire, Rubin shares intimate insights, challenges, and the relentless drive that fueled his success.

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Early Beginnings: From Childhood Hustler to Teenage Tycoon

Michael Rubin’s entrepreneurial spirit manifested early. Despite struggling academically and athletically, Rubin found his niche in business from the age of eight.

• Starting Young: At just 8 years old, Rubin began selling snow shovels door-to-door during snowy seasons.

• First Business Venture: By age 12, a friend inspired him to start a ski tuning shop. “I would go around door to door, sell the snow shoveling, and then hire six kids at five bucks an hour to shovel all the driveways” (09:10). This venture quickly scaled, leading him to open multiple ski shops by his mid-teens.

• Rapid Growth: By 15, Rubin operated five ski shops, generating significant revenue. “When I was 13 years old, I did $25,000 in revenue” (11:42).

Navigating Challenges: Bankruptcy and College Departure

Rubin’s early success was met with obstacles that tested his resilience.

• Financial Setbacks: At 16, after making expansive purchases, Rubin faced bankruptcy. “I prepared to go bankrupt... I thought I was a complete failure” (16:57). However, his creditor meetings revealed his true age and secured him a deal to settle his debts with parental support.

• College Experience: Rubin briefly attended Villanova University but found little interest in academics. “I remember always sitting in the parking lot of Villanova on this giant cell phone, buying and selling things” (18:18). Ultimately, he left college after one semester to focus on his burgeoning business.

Building GSI Commerce: Pioneering E-Commerce in Sports

Transitioning from local ski shops to a national e-commerce powerhouse, Rubin founded GSI Commerce.

• E-Commerce Innovation: In 1998, recognizing the potential of the Internet, Rubin launched GSI Commerce, securing e-commerce rights for major sporting goods retailers. “I wrote the plan for GSI Commerce to run the Internet business for major retailers like Dick's Sporting Goods and Sports Authority” (35:37).

• Dot-Com Bubble and Resilience: Despite the dot-com bubble burst in 2001, Rubin capitalized on the downturn by acquiring competitors at lower prices and strengthening his business model. “Every period of controversy... was a big opportunity” (37:26).

The Fanatics Era: From Acquisition to Global Dominance

Rubin’s acquisition and subsequent growth of Fanatics marked a pivotal shift in the sports merchandise industry.

• Acquiring Fanatics: In 2011, after eBay’s acquisition of GSI Commerce, Rubin repurchased Fanatics for $330 million. “We bought back Fanatics, including the licensed business that GSI had, for $330 million” (42:27).

• Strategic Vision: Rubin transformed Fanatics from a mere retailer into a vertically integrated, direct-to-consumer powerhouse. “We wanted to do something special, like respond in real-time to sports events and fan demands” (44:20).

• Seamless Integration: By collaborating closely with sports leagues, Fanatics enhanced its product offerings and expanded its reach. “We gave sports leagues the ability to drive a much bigger percentage of business through their own direct-to-consumer business” (44:08).

Leadership Philosophy: Grinding and Growth Mindset

Rubin attributes his success to an unwavering work ethic and a focus on continuous improvement.

• Relentless Grind: “I attribute 100% of it to the grind... I am a top grinder. I'll outwork, I'll out-hustle anybody” (60:19).

• Embracing Challenges: Rubin thrives on overcoming difficulties, viewing each obstacle as a chance to innovate. “We focused on the business and built a much better business during that period” (39:19).

• Operational Strengths: While recognizing his limitations in operations, Rubin excelled in vision and strategy, surrounding himself with competent teams to handle execution. “I was good at developing the idea, the vision, the strategy, and leading the people around me” (38:22).

Personal Insights: Balancing Success and Well-being

Rubin opens up about the personal sacrifices and mental health challenges that accompany his professional life.

• Sacrifices Made: Rubin acknowledges the time and personal relationships he has sacrificed but frames them as necessary for his passion. “There are lots of sacrifices that I've made and will continue to make, but they don't feel like sacrifices to me because I'm doing what I love” (55:32).

• Mental Health Struggles: Dealing with anxiety and physical health issues, Rubin emphasizes the importance of addressing personal well-being. “I have one of the worst... where it keeps enlarged... the only way to fix it is sleep” (58:21). He strives to improve his sleep habits despite the challenges.

Future Outlook: Continual Innovation and Expansion

Despite Fanatics’ immense success, Rubin remains committed to innovation and scaling new heights.

• Constant Improvement: Rubin maintains a startup mentality, always seeking ways to enhance Fanatics’ operations and fan experience. “We're not thinking about what we've done well, but what we're not doing well... What can we be better?” (44:24).

• Expanding Horizons: Beyond merchandise, Fanatics is venturing into collectibles and sports betting, aiming to dominate these new markets. “Fanatics’ Sports Betting business... being the underdog is fun” (51:01).

• Commitment to Fans: Rubin prioritizes enhancing the fan experience, ensuring that Fanatics remains beloved by sports enthusiasts. “We need to be better to be beloved by sports fans” (50:34).

Conclusion: A Legacy of Innovation and Resilience

Michael Rubin’s story is a testament to the power of grit, strategic vision, and unwavering dedication. From shoveling snow as a child to leading a multi-billion-dollar enterprise, Rubin exemplifies the entrepreneurial spirit. His ability to navigate challenges, embrace continuous improvement, and prioritize the fan experience positions Fanatics as a dominant force in the sports merchandise industry.

“I've been at this for a long time, but I still feel like a startup” (46:41), Rubin reflects, highlighting his enduring passion and commitment to growth.

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Notable Quotes:

• “I always had to pay him right on time that he gave me an A for my co-op program.” – Michael Rubin (13:30)
• “I can do anything I set my mind to.” – Michael Rubin (08:29)
• “Luck and time are a very important ingredient. That said, I attribute 100% of it to the grind.” – Michael Rubin (60:19)

Key Takeaways:

• Early entrepreneurial ventures can lay the foundation for future success despite academic or athletic challenges.
• Resilience in the face of financial setbacks is crucial for long-term growth.
• Strategic acquisitions and leveraging e-commerce innovations can transform a business landscape.
• Continuous improvement and a relentless work ethic drive sustained success.
• Balancing personal sacrifices and maintaining well-being are essential aspects of an entrepreneur’s journey.

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For more inspiring stories from the world's best-known entrepreneurs, listen to How I Built This on the Wondery App or your preferred podcast platform.

Transcript

[Guy Raz]

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[Michael Rubin]

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[Guy Raz]

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[Michael Rubin]

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[Guy Raz]

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[Nike]

Look, this is no secret. We went through a, you know, tough experience earlier this year in our partnership with Major League Baseball and with Nike, where, you know, Nike redesigned a jersey that we'd been making for and, you know, there was a really negative reaction to it.

[Michael Rubin]

And with Major League Baseball for the uniforms.

[Nike]

It was the official Major League Baseball.

[Michael Rubin]

Uniform and some of the players complained about it.

[Nike]

Players complained, fans complained relentlessly. They didn't like, say a little bit. They said a lot. They spoke loudly.

[Michael Rubin]

They could see through it and all this stuff.

[Nike]

Yeah. And for us, that was actually an incredible moment. We embraced the ass Whipping. We said we need to be a lot better. You know what, we gotta speak up louder. We gotta be stronger. We can't, you know, you can't just go along for the ride. So like, that's why I'm so excited about this business, because I get to learn every day. It's a, you know, if you like action, this is the job for you.

[Michael Rubin]

Welcome to How I Built this. A show about innovators, entrepreneurs, idealists, and.

[Guy Raz]

The stories behind the movements they built.

[Michael Rubin]

I'm Guy Raz and on the show today, how Michael Rubin started his first business at age 8, made his first.

[Guy Raz]

Million in his teens, and then built.

[Michael Rubin]

Fanatics into a massive one stop shop for sports.

[Guy Raz]

We've had hundreds of brilliant entrepreneurs on this show over the past several years, and in each case, I've learned a lot from their experience and I imagine many of you have as well. But every once in a while, we tell the story of a founder who is a true entrepreneurial savant, a prodigy.

[Michael Rubin]

A. Michael Rubin.

[Guy Raz]

Michael Rubin was not a good student. He barely finished high school and only attended college for a single semester. So it's safe to say that as far as academics go, he was close to being a failure. But when it came to business, he was a superstar already at age 12. That's when he opened his own ski tuning shop. By 15, he had a brick and mortar ski shop on the outskirts of Philadelphia. Before he graduated high school, he had five of these ski shops. And before he turned 20, Michael was making hundreds of thousands of dollars a.

[Michael Rubin]

Year buying and selling ski excess sporting.

[Guy Raz]

Goods and footwear from big brands. As you'll hear in this conversation, what.

[Michael Rubin]

Michael lacked in academic prowess, he more.

[Guy Raz]

Than made up for in instincts and street smarts.

[Michael Rubin]

He figured out how to take big but calculated risks.

[Guy Raz]

Risks that would eventually lead him to the business he's probably best known for today. Fanatics. If you're a sports fan and bought an officially licensed hat or jersey or collectible, or even bet on a game, you have likely spent money on a fanatics product. Today the brand is worth roughly $25 billion and it's still privately owned, though there are rumors it could go public in 2025.

[Michael Rubin]

As for Michael, he's become something of a brand himself.

[Guy Raz]

More than a million people follow him on Instagram, where he posts videos and photos about his life and his business. For the past several years, he's hosted an annual celebrity filled party, the White Party in the Hamptons. A party, by the way, not to be confused with another White Party, the Infamous one hosted by the now disgraced rap mogul Diddy. And Michael's net worth, it's estimated at around $10 billion.

[Michael Rubin]

Now, not surprisingly, to fuel all that.

[Guy Raz]

Success, Michael has a restless, driven nature.

[Michael Rubin]

And a confidence so powerful that it.

[Guy Raz]

Can feel like a physical force. A force I certainly felt when I met him in the studio in San Francisco.

[Michael Rubin]

And by the way, if you're listening with kids, Michael is pretty liberal with his salty language. So just a heads up.

[Guy Raz]

But unlike some founders I've spoken to.

[Michael Rubin]

Who prefer to remain stoic about their struggles, Michael is pretty generous when talking about his personal challenges, his anxieties, and.

[Guy Raz]

The sacrifices he's made over the years.

[Michael Rubin]

To build his businesses.

[Guy Raz]

And we'll hear about all of that a little later on. For now, what you need to know.

[Michael Rubin]

Is that Michael grew up in a.

[Guy Raz]

Philadelphia suburb in the 70s and 80s, and back then, he had trouble doing the things that came naturally to other kids, like reading.

[Nike]

People don't believe me when I say this. The last book that I read was the book called the Swoosh, the Unauthorized Story of Nike. I read it, I think, when I was in eighth or ninth grade. So it probably came out in 1986, 1987.

[Michael Rubin]

It's hard for you to concentrate on the page.

[Nike]

Yeah. I read a page and I have to. I read two lines, then I have to go back. I reread it. Yeah. And today, you know, again, since I haven't read a book since ninth grade, you know, my reading comes in very short, you know, like kind of pieces. If someone sends me an email that's, you know, three or four paragraphs, I'm 99% not reading it. Certainly 40 years ago was a lot less common than it is today.

[Michael Rubin]

Yeah.

[Nike]

To tell you about all the learning, the disabilities. But when you have a mother who's a psychiatrist.

[Michael Rubin]

Yes.

[Nike]

Father's a veterinarian, both grow up very education oriented, and you have a kid who's just not kind of doing well in school. You know, they worry and figure out, like, how do we help them? What do we do?

[Michael Rubin]

Did you get in trouble at school?

[Nike]

I was not a good student. I was not a good kid in school. I wasn't like a bad kid. It was more like I just didn't connect with school. So did I get in trouble? Yes, absolutely. Was I still well liked by everybody at school, including all the teachers and everything? Absolutely.

[Michael Rubin]

Yeah. So it sounds like you. You didn't feel like you were, or did you. Did you feel like, God, I'm failing my parents and do you remember feeling bad?

[Nike]

It's a great question, I don't think. You know, I grew up in a family where they told you what you couldn't do, and then that just provided motivation to me of what I could do. Yeah, I had great, two incredible parents. They just, you know, it was kind of like they told you all the things you couldn't do, all the things you couldn't accomplish. And to me, it's like, fuck that. Like, I can do anything I set my mind to. But as bad as a student as I was, and as much as I struggled in school, and even though it wasn't diagnosed at that point, real ADD issues, I think I was equally as bad as an athlete. Okay, so I wasn't just failing in school, I was failing in sports.

[Michael Rubin]

And that meant socially.

[Nike]

Yeah, what that meant was I was always last to be picked on a sports team. You're going to pick, you know, 10 people on each team. I'm 10. You know what that I believe. What that makes you do is you figure out, well, what are you good at? Where can you win? And to me, business and working was a place I always excelled. I loved doing it. It's a place where I could be number one. I could be the best that there was.

[Michael Rubin]

How did you figure that out? What was the moment the first time you thought, God, this is really fun.

[Guy Raz]

I'm good at this.

[Nike]

I think I was born with it.

[Michael Rubin]

But what, Tell me, because already at like age 8, you started selling. I mean, a lot of kids do lemonade stands. A lot of kids do, you know, car washing things. What was the thing that you started.

[Nike]

Doing 8 years old? When it would snow, I would go around door to door, sell the snow shoveling, and then hire six kids at five bucks an hour to shove all the driveways.

[Michael Rubin]

You would go door to door. You would say, hey, well, I'll shovel your thesis.

[Nike]

Hey, would you like. Would you like your driver shoveled? It's 20 bucks.

[Michael Rubin]

And then you'd go find the kids to do the work, pay them.

[Nike]

I had them pulling me around, and I was paying them five bucks an hour.

[Michael Rubin]

Do you remember how you even thought about doing that?

[Nike]

No. But I'll tell you one story that I do remember. When I was 12, I really learned how to tune skis. And a friend of mine said to me, like, hey, you love skiing and you love business. Why don't you start a ski tuning shop? And that's a great idea. And, you know, like an hour later, I had the Mike's Ski Tuning flyers made with the prices of, you know, you know, all the different things you could do for ski tuning.

[Michael Rubin]

So, all right, so age 12, you start a ski tuning shop. I guess you learned how to tune skis at like a ski camp you went to.

[Nike]

Yeah.

[Michael Rubin]

And so you're in Philadelphia or outside of Philadelphia, and you open, you open a ski tuning service. But I guess after your bar mitzvah, you made a little bit of cash and you were able to use that cash to actually open a storefront, like a location.

[Nike]

They had the ski swap every year, where all the ski retailers in the Philadelphia area would bring their excess inventory to a ski swap. And I worked that swap the whole weekend, you know, just trying to help out the other ski shop owners. And then I said to one of the guys, this guy Brett Bauman, who owned something called Bauman Ski Shop, I said, hey, you know, I live 45 minutes from you, so there's no competition. Why don't you lend me some of your excess equipment and I'll pay you for it as I sell it. And he did exactly that. And that year, at 13 years old, I did $25,000 in revenue.

[Michael Rubin]

Selling it from where?

[Nike]

From my basement or my parents house.

[Michael Rubin]

How did you get the word out? You would just tell people I'm selling skis?

[Nike]

Yeah, school flyers. You know, I actually, I remember. It's a great story. I don't think I've ever told this before. There was a ski shop called Ray Panella Ski Shop in the Plymouth Meeting Mall. I buy these flyers, I put on all the cars, thousands of cars in the parking lot. And I get home and my dad says, you know, hey, Michael, I need to speak to you. He says, I said, like, dad, what's up? He says, well, Ray Panello, who owns Ray Panello ski shops, called to say that you were trespassing and that he was gonna call the police and have you arrested for trespassing because you were putting flyers out in the mall's parking lot. He has a ski shop in the mall and he thought that you were unfairly competing. I said, well, what'd you tell him? He said, I told him my son was 13. If you need to worry about competing against a 13 year old, you got bigger problems.

[Michael Rubin]

Wow. So you basically take out a lease on a location on a brick and mortar store in your town. Was it Lafayette Hill Ridge and Butler Pikes?

[Nike]

Lafayette Hill, Pennsylvania.

[Michael Rubin]

Okay, so meant that your dad had to co sign that and you could.

[Guy Raz]

Take a lease out.

[Michael Rubin]

First of all, how did you operate that Business. I mean, you were a 14, 15 year old kid.

[Guy Raz]

Like you had to go to school during the. So how did that work?

[Michael Rubin]

Did you. How did you manage that business and also go to school?

[Nike]

Yeah, so that school thing definitely got in the way and I definitely focused on business. You know, I actually had a, they had a co op program in my school. You could get out at 11 o'clock if you had a co op program in 12th grade. Somehow I talked our school into allowing me to do that in 11th grade.

[Michael Rubin]

Getting credit for having like work experiences.

[Nike]

Yes. And so my landlord just had to. So I just had to pay them right on time that he gave me an A for my co op program. And that was like half of my curriculum.

[Michael Rubin]

Michael, how were you, first of all, at 15, were you like, were you fully grown or were you still growing? Like, were you short? Were you tall?

[Guy Raz]

Cause 15 is young, man.

[Michael Rubin]

How did you have, how are you able to get people to take you seriously?

[Nike]

Because I didn't have fear and I just went for it. And I think, you know, so many people have ideas and they talk about what they want to do, but they don't do it. I was just always more of a person. I'm gonna go out and fucking do it. And if it works out, great. And if it doesn't, you know, all good. And so. So, I mean, you could go back to 1986, 1988, you know, I remember after coming to ski in the summertime, I said, well, why don't I build a ski mountain in the middle of the summertime? And I went out and I bought £40,000 of ice cubes set up in a ski slope at 15 years old.

[Michael Rubin]

Where did you set that up?

[Nike]

Outside of my ski shop. So I had a ski shop in Konshotkin, Pennsylvania. Ridge and Butler Pikes.

[Michael Rubin]

And you set up an.

[Nike]

I remember, I came back and I remember waking my mom and dad up at like 2:00 in the morning. I'm like, I got the greatest idea on the planet. They're like, what? What? I'm like, sir, I'm gonna set up a ski mountain in the middle of the summertime. Like, go back to bed. What are you talking about? Sure enough, a month later I went out. It was like 2,500 bucks. I bought 40,000 pounds of ice cubes. Cubes. Brandywine Ice Company. I don't know how I remember this. I set these up and every news outlet covered that. This 50 year old entrepreneur had set up a ski mountain outside of a ski shop. And that was my mark.

[Michael Rubin]

It's just a pile of ice with.

[Nike]

Hay on both sides, hay on each side, hay at the bottom.

[Guy Raz]

How do you ski down there?

[Nike]

You just ski on ice?

[Michael Rubin]

You just ski on. I. Yeah.

[Nike]

Amazing.

[Guy Raz]

Wow.

[Michael Rubin]

So how was business? I mean, were you making money?

[Nike]

So the first year I had the ski shop, we did great. We did like $125,000 in business. I made about $25,000 profit. Second year, very good. I think we got up to about $500,000 in business and maybe made 100 grand. You know, again, I'm 15 years old. This is pretty spectacular, by the way. Think about this. This is also going back 37 years ago.

[Michael Rubin]

Yeah.

[Nike]

So half a million dollars in business, $100,000 in profit when you're 15. 37 years ago. Kind of insane. Well, the next year, we had a little bit of an issue. It didn't snow. If you're in the ski business, it doesn't snow. That's not like an ingredients for, like, really killing it. But I also made a mistake. I got a little bit cocky. Okay. And I was. I was now 15, turning 16. But I went out, I bought a Porsche. Then I went 50, 50 with a neighbor. I wasn't old enough to drive the Porsche yet, but I bought and kept it down the street from my parents. So now the season ends, and I have $200,000 of bills, $80,000 of inventory, and half of a push. And by February, all the ski vendors that had shipped me inventory, shipped me skis on open credit, wanted to get paid, but I didn't have the money to pay them. And I started getting sued. I'd say the spring of the year that I was 16, I probably got sued a hundred times. The sheriff became my friend. She'd come before I went to school, and she'd drop off each day's lawsuits to me. And I thought I was a complete failure. It was over. I'm never gonna be able to be successful in business.

[Guy Raz]

Wow.

[Nike]

You know, I prepared to go bankrupt. And so I hired a bankruptcy lawyer, and they said, hey, let's have a meeting with the creditors. All the people you owe money to. All these people came around, and one of the creditors is, hey, Mr. Rubin, how old are you today? I guess I just looked older than my age. And at this point, everyone assumes you were older. I said, I'm 16. And the room went dead silent. I didn't know you weren't allowed to incur debt legally until you were 18.

[Michael Rubin]

Yeah. I think you were eventually able to.

[Guy Raz]

Settle Your debts, partly because you made a deal with your parents, I guess, where they agreed to lend you some. Some of the money if you agreed to go to college. And you kept up your end of the deal. You started at Villanova.

[Michael Rubin]

But you barely.

[Guy Raz]

Lasted a semester, Right?

[Nike]

That's right. I'd say the reason I went to college was because I gave my mom and dad my word that I would go to college, and it was important. My mom's like, look, I'm a psychiatrist. I know what's best for you. You're not a normal kid. You need to be a normal kid, go to school, play sports, have friends. Why are you obsessed with this business thing? But I never got out of business. Like, you know, never shut the shops down. And then I basically became very big at buying and selling excess footwear, sporting goods, inventory, skis. Buying and selling excess inventory, you know, primarily footwear and closeouts. So by the time I got into college, the biggest memory. If you say, what do I remember about college? I remember cell phones at this point, so you're talking about 1990. Cell phones were gigantic. And I remember always sitting in the parking lot of Villanova on this giant cell phone, buying and selling things, always, like, knowing that I had to get to class, but having no interest in getting to class because I was making deals. And, you know, I can remember times where I was making hundreds of thousands of dollars in a trade, you know, in the parking lot of Villanova, you know, before I go to school. So that was very difficult. And finally after, you know, kind of part of semester, I'm just like, I'm done. This is it. College isn't for me.

[Michael Rubin]

When you started doing these things right, and succeeding and selling stuff, what is it that you feel that you had? I mean, was it because it wasn't like, you know, this. You know, this accounting ability or, you know, or, you know, this mathematical knowledge, but there was something that you had that clearly worked. What do you think it was?

[Nike]

Common sense, street smarts, work ethic. I would always work harder than. I would always outwork my competition and the ability to really build authentic and strong relationships. And, like, nothing insults me. You could say anything to me. You know, look, you can't. Being sensitive, you know, and by the way, you would. You know, a lot of people in my family would disagree with this.

[Michael Rubin]

They would say what?

[Nike]

They would say, like, you know, it's okay to be sensitive. I'd say, like, that's bullshit.

[Michael Rubin]

Yeah.

[Nike]

Now, for some people, and, you know, an interesting thing about managing people and leading People is what works for different people. You may go in a sports team to one person and you can beat the shit out of them and that makes them play better. You may take that same approach with somebody else and they're gonna be dejected in the corner of the locker room. I was the person you could beat on that would do better through the beatings and it didn't bother me. Other people, I think, get dejected by that.

[Michael Rubin]

I actually think in the hundreds of interviews I've done on this show with founders, I think a superpower of many founders is they don't get offended, that they also don't hold grudges, they're desensitized.

[Nike]

Yeah, I think that's accurate of a lot of good leaders and entrepreneurs and much easier for a founder than a for hire CEO. Now, grudges are different because there could be somebody I may not like, somebody who's done me dirty. I may have no problem working with them, but I'll always remember, yeah, okay.

[Michael Rubin]

But you'll still work with them if you know that there's a value, if.

[Nike]

It'S in the greater interest of the Greater Good. I'll 100% work with them. But I got a long memory for people who've done me wrong. And I think that makes me smarter, that makes me better, that makes sure I don't, you know, get screwed multiple times.

[Guy Raz]

Yeah.

[Michael Rubin]

All right, let's get back into the story here. Cause we're sort of in around 1990, so this is still pre Internet. And at this point you're sort of.

[Guy Raz]

You'Re buying sports equipment and clothes and sneakers and then reselling it.

[Michael Rubin]

So first of all, how did you.

[Guy Raz]

Even get connected with the people who had this stuff to sell?

[Nike]

So I remember doing my first big deal. My first big deal was I owned. When I was graduating high school, I had five ski shops at this point. I remember going into one of the ski shops and they were selling these Umbro sneakers for. They were like soccer cleats and they were like 65 bucks. They were on sale for 29.99. I said to the manager of the store, I said, oh, you know, these are not selling well. They said, no, we bought them as closeouts. I said, oh, how much did you buy them for? They say $11.50 a pair. I said, wow. So we're selling them for $29,900 at half off. We bought them for $11.50 a pair. Can you find out how many pair they have? So they called the person at Umber and they said they had 12,000 pair. So I just got on the phone with the person, right? Then I said, hey, you have 12,000 pair. How much can I buy them for? They're like, you know, you can buy them all for 850. I said, how about I give you four bucks? They said, how about six? I said, can we agree at five? I bought the 12,000 pair for $60,000 that day. Okay. That was the first time I got in the shoe business. Buying and selling shoe clothes.

[Michael Rubin]

And you were going to sell the shoes at the ski shops?

[Nike]

Nope. I went to the Yellow Pages because that's how we found people. Then I found this company called Boscov's Department Stores. I just cold called them and I get this meeting with this guy, Albert Boscovs, who owns Boscov's Department Stores. He said, michael, how much do you want for these? I said, 15 bucks a pair. He said, I'll take them all for 1150. I hadn't even got them in yet. And I made 650 a pair on 12,000 pair of shoes. So now I'm 18. It's like 70 or $80,000. But I haven't even paid for the shoes I bought yet. I got them resold to somebody else. So it was that instinct to hustle, that instinct to keep asking, to never have fear. That worked for me. You know, that was my first big bulk deal was buying all the shoes at five bucks a pair and selling them for $11.50 at Boscoff's department Store.

[Michael Rubin]

It must have been such a rush.

[Nike]

It was for me, who sucked in sports, who sucked in school to know, hey, on one day I could see these shoes in a ski shop that I owned, find out that they were closeout, and make 70 or $80,000, you know, overnight without ever touching the shoes. That was pretty spectacular.

[Michael Rubin]

And that's it.

[Guy Raz]

And that's the beginning.

[Michael Rubin]

Okay, so now you've got this shoe experience. But again, this is like pre Internet, right? It's all yellow pages and relationships and big block cell phones, right?

[Guy Raz]

How are you going to the next. How are you getting the next connection?

[Michael Rubin]

How are you finding the next place to buy bulk stuff?

[Nike]

It wasn't even big black cell phones all the time. It was still payphones. Okay. Cause I remember one other quick story. I'll tell you. That's a great story. And I bet you this guy's still alive. I remember being at something called the Super Show. It was a big show in the sporting goods business where all the big retailers Went to the show.

[Michael Rubin]

It was in New York, it was.

[Nike]

In Atlanta, called the Super Show. And I think it was Xavier McDaniel. He was a basketball player, Seattle Seahawks.

[Michael Rubin]

Supersonics.

[Nike]

Yeah. So he had a shoe called X Man shoes.

[Michael Rubin]

Yeah.

[Nike]

And they didn't sell very well. So I bought 300,000 pair. I would have been 18 or 19. Bought 300,000 pair for nine bucks a pair. So $2.7 million. Okay. I remember going to the payphone and I called this guy, Dennis Wasilewski, okay? He was the banker from Continental bank, my banker. I said, hey, from the pay phone, like, you know, call. I said, hey, Dennis, I got great news. I just made like a million and a half, $2 million. He's like, what are you talking about? He says, yeah, I just bought, you know, 300,000 pair of X Men shoes for nine bucks a pair. And I've got them, I'm going to, you know, get them all sold to models and TJ Maxx and Marshalls and Ross stores. And we get like 15 bucks a pair. So we're going to make like six bucks a pair on, you know, 300,000 pair. I'm gonna make like a million eight. He says, well, that's great. Why are you calling me? I'm like, well, how the fuck do you think I'm getting the money? You're a bank. I need the money.

[Michael Rubin]

He's like, to pay for the shoes?

[Nike]

Yeah, I gotta pay for the shoes. He's like, so you bought the shoes without me agreeing to lend you the money? I said, yeah, but you're gonna lend me the money because I'm gonna make this much money and pay you back and be a great customer of yours. And sure enough, Dennis lent me the money. This was a different day. This was like, this was when banking was done on like honor back in the day. He said, no problem. They lent me the money. I sold all the shoes and probably made a million eight.

[Guy Raz]

Wow.

[Nike]

18 years old, maybe 19.

[Michael Rubin]

But then you're talking about places like TJ Maxx, you're talking about other, other, other retailers, Marshalls. I mean, these are today, at least. They're huge retailers and I think they were pretty big in 1990. How did you even get into those places as a 18, 19 year old? Just calling and, and asking for a buyer. Like, how did you even get into those places?

[Nike]

Sometimes you'd know somebody that could introduce you. Sometimes you just cold call and get the person on the phone. Sometimes you meet them at a different trade show.

[Michael Rubin]

And that's what you did.

[Nike]

If. If. If you hesitate, if you don't take your shot, how. How do you get a chance to win?

[Michael Rubin]

Did. Did you grow up a. A crazy sports fan medium? Is Phil a Philly sports fan?

[Nike]

Yeah.

[Michael Rubin]

But it wasn't like you lived and died.

[Nike]

I did not.

[Michael Rubin]

Yeah, but it was business that you.

[Guy Raz]

Lived and died by.

[Nike]

Yes.

[Michael Rubin]

So your business, really, I mean, when you essentially realize college is not for you, you are in the business of buying overstocked goods, and you could do this, presumably in a pretty short period of time, you had the cash to back up these purchases, or were you. Was it this kind of arrangement where you would.

[Nike]

I had a bank.

[Michael Rubin]

Yeah.

[Nike]

I mean, by the time I was 21, I bet you I owed the bank $50 million.

[Michael Rubin]

Wow.

[Nike]

Because I had a business that was doing 120 million bucks buying and selling closeouts. I always had to finance the inventory and finance the accounts receivable. That's kind of crazy.

[Guy Raz]

Yeah.

[Michael Rubin]

And it was because you had this relationship. They knew you, and they had seen what you had done before.

[Nike]

Yeah. So there were times I would need to go in. I remember there was a guy above Dennis who was like. I think he was the CEO of Continental Bank. When I needed a lot of money, I go to see him to explain, like, hey, I've got this deal. I'm gonna buy this. I'm gonna sell this to y. Here are some of the purchase orders from some of the customers so I can show you what I'm doing. I need this. Okay, great deal. Let's go. And by the way, there are times when I got in trouble with the bank, when I got, you know, over leveraged too much debt. I go and see that same person and like, hey, I'm gonna come through. And, you know, we got you, Michael. And then, you know, I came through. So, you know, relationships are important in good times, but they don't really matter in bad times. Relationships are everything.

[Michael Rubin]

How are you staffing your growing business? By 1993, you're doing a million or more in revenue.

[Nike]

Yes. And the crazy thing is, I have an assistant today, so we have a group of incredible assistants. One of my assistants, Michelle Reardon, has been with me 33 years.

[Guy Raz]

Wow.

[Michael Rubin]

She started with you way that year.

[Nike]

She started with me in the Abington Ski shop called the Ski and Sport Emporium, and then came to my first office that I had, where KPR Sports was, by the way, named after my mom and dad, Ken and Paulette Rubin.

[Michael Rubin]

Yeah.

[NerdWallet]

All right.

[Michael Rubin]

So you got this office, and it's just growing very, very quickly. And I guess at a certain point from my research, I guess it was around 95, you buy a big share of a women's shoe brand called Raika. And I don't remember this brand, but what did they, I mean, was it athletic shoes, running shoes, fashion?

[Nike]

So I had an issue. My issue was I built this incredible business buying and selling closeouts nine figure business. Right over $100 million. I'm now at 21.

[Michael Rubin]

And was it profitable?

[Nike]

Very profitable. But I didn't like it cause I felt like I was living off of other people's mistakes. That's why I decided to get in the brand of footwear business.

[Michael Rubin]

And I do want to make your own stuff.

[Nike]

I want to make my own shoes and build my own brands. And you know, I ended up with three footwear companies that got me to about $180 million in revenue. Call it, call it like we maybe added another 60 or 80 million dollars revenue to the closeout business. And that's what the business was in 1998, by the way. We were a public company.

[Michael Rubin]

You were, you were running a publicly traded company. I think you were like 23.

[Nike]

I think I was the youngest person ever run a public company at that point, I think in the world.

[Michael Rubin]

And you had designers, it was everything.

[Nike]

On the, we had two divisions. The closeout business.

[Michael Rubin]

Yep.

[Nike]

And then we had the brand and footwear business.

[Michael Rubin]

And how did the brand and footwear business. I mean, the closeout business to me seems like a great business because you know, you're buying low, you're going to sell high, you've already got the people who have committed to it. But making and selling your own brand is a different beast.

[Nike]

Yeah, you know, it was a 23 year old competing against Nike and Reebok and Converse. That was an uphill battle. But I did what I wanted to do. And when I was building my own footwear brand, the number one thing I liked to do, I would just walk around, look at people's feet like it was crazy. I would literally go out for hours at a time, just look at what people were wearing so I could learn. By the way, I still walk around sometimes and just look at people's feet. Because that's the way I was programmed as a, as a, you know, early 20s kid in the footwear business.

[Michael Rubin]

How much was money a motivator for you?

[Guy Raz]

You were already making a lot of.

[Michael Rubin]

Money, 10, $15 million a year at such a young age. Were you looking at that and saying, okay, I'm gonna go. We're gonna get.

[Guy Raz]

We're gonna make more and more and more.

[Nike]

Some people will believe this, some people won't. I didn't give a fuck. Like it never ever I look at this and say, like, I want to be rich. It was never a motivator. It was that I was a bad student, I was a bad athlete. And I can play my game here and win. And I want to win. I want to keep putting up a lot of points each day and win against my competition. That's what I love, because that's how I got my satisfaction, is by winning.

[Guy Raz]

When we come back in just a.

[Michael Rubin]

Moment, how Michael moves into E commerce.

[Guy Raz]

And why one of his investors actually.

[Michael Rubin]

Tells him that he's not losing enough money. Stay with us. I'm Guy Raz and you're listening to.

[Guy Raz]

How I Built this.

[NerdWallet]

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[Guy Raz]

Whether you could use a little extra.

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[Michael Rubin]

Every year I think to myself about.

[Guy Raz]

The new goals I'm going to set for myself. But did you know that only eight personal of us will stick with the resolutions we make? Today's episode is sponsored by Acorns. Acorns is a simple tool that makes it easy to lock in years and years of healthy money habits in just five minutes. Head to acorns.combilt or download the Acorns app to start saving and investing for your future. Today, paid non client endorsement compensation provides incentive to positively promote Acorns Tier 5 compensation, provided investing involves risk. Acorns Advisors LLC and SEC registered investment advisor. View important [e-mail] I imagine getting a message from your favorite brand that feels like it was created just for you. Chances are they're using Attentive, the SMS and email marketing platform designed to help brands build and connect with their ideal audience. Attentive helps marketers create unique messages for every Subscriber, transforming the consumer shopping experience and maximizing marketing performance. But how does it work? Attentive's AI learns what subscribers actually want based on their real time interactions with your brand. That means it customizes the content, tone and timing of every message so they always resonate. Ready to take customers on a journey created just for them? Visit attentive.combilt to learn more. Hey, welcome back to How I Built this.

[Michael Rubin]

I'm Guy Raz. So it's around 1998, and Michael is.

[Guy Raz]

Running a successful business, buying and selling other people's brands and thinking of starting his own. And then one day, a market analyst calls him up to ask about the Internet.

[Nike]

And he says, hey, what are you doing about this Internet thing? I literally said to him, fuck the Internet. Fuck all these young kids. They're all nerds. They just lose a lot of money. I don't want to hear any of this. And I hang up on him, okay? He calls me back an hour later. He's like, michael, I really think you should think about this Internet thing. I'm like, what do you mean? I didn't even know. Like, I couldn't, at this point, I couldn't work email. It was just starting, you know, I was not a technology person, but I did what any entrepreneur would do. After he put it in my head, I went and I called the CEO of the Sports Authority and the CEO of Dick's Sporting Goods and the CEO of Sports Chalet. Hey, what are you doing about this Internet thing? And everyone said the same thing to me. They said, you know, we got a lot of pressure from our boards to figure out how to handle this, but if you have any great ideas, call me. And literally, I went away that holiday break of 1998, and I wrote the plan for GSI Commerce.

[Michael Rubin]

What was the plan that you wrote?

[Nike]

The plan was to go out and get all the sporting goods retailers to give me all their rights to run their Internet business. I'd buy one inventory and leverage it across all the sporting goods retailers because they all sold essentially very similar merchandise.

[Michael Rubin]

So you'd go to Dick's Sporting Goods and Sports Authority and whoever.

[Nike]

Yeah. And say, give me your Internet rights and I'll operate your E commerce business. And before I even started, I was able to get the Sports Authority, Sports Chalet, Thomas Sports and MC Sports to give me all the Internet rights. And then within the next year or two, I got Dick's Sporting Goods and several others. That was the original business, running the sporting goods e commerce business of the biggest Sporting goods retailers in the country.

[Michael Rubin]

Even though it was basically a fraction of a fraction of a percent of their business initially.

[Nike]

Right. But by the way, by 2001, when we were. So we did it from 99 when we launched till 2001. I think we did 100, 200 million dollars in online sales of sporting goods 22 years ago.

[Guy Raz]

And then the bubble bursts. The dot com bubble bursts in 2001.

[Michael Rubin]

What kind of impact did that have on the business? Because from what I've read, there were many years where it was operating at a loss.

[Nike]

Yeah, I loved those periods of time because to me, every period of controversy, every period of tough times, that's a big opportunity. So for me, what did I do in 2000? So, you know, when the bubble burst in 2001, what did I do? I bought competitors at much lower prices. I focused on really locking into how we ran our business. You know, our best years came from that first. That was my first kind of big implosion that happened around me. And, you know, our stock price went from $30 to $3 a share. We just focused on the business, and we built a much better business during that period of time.

[Michael Rubin]

So. All right, let's kind of drill down on this for a moment. I mean, you were a really young CEO for the first time when you were like, 23, which requires leadership abilities. And some people have them and some people develop them.

[Nike]

Yes.

[Michael Rubin]

What do you remember about just being a manager of people and just knowing how to organize and interact with people? Did it come easily to you or was it hard?

[Nike]

I think a lot of it was somewhat natural for me because I was fortunate that where I wasn't able to read speak so well, focus. I had some natural leadership skills, and I had a nice way about me, and so I think it generally worked well.

[Michael Rubin]

And what about operationally?

[Guy Raz]

Did you.

[Nike]

I was always a shitty operator.

[Michael Rubin]

So what did you do for that? How did you.

[Nike]

How did you found great people to support me? Yeah, like, I was never, like, I could never add value, and I still couldn't today. Like, hey, here's how to make our platform better, or here's how to. Like, I just. I wasn't. I wasn't strong in that area. So I'd say I was always, like, good at developing the idea, the vision, the strategy, and then leading to get the people around me. I was always less good at, like, hey, you know, how do we make the trains run on time? That wasn't what my strength was.

[Michael Rubin]

You know, it's amazing to me because when you look back on this period of time now, I think most people say, wow, that was a really smart way to think about how to run your business. Acquire other companies at lower prices, build up the portfolio. But you guys lost $150 million in a four year period. But still, from the way you remember that time, it wasn't. You felt like it was gonna be fine.

[Nike]

I remember having the founder of SoftBank, Masayoshi Son, tell me in 2000 that we weren't losing enough money.

[Michael Rubin]

Wow.

[Nike]

That we weren't being aggressive enough, that we weren't moving quickly enough.

[Michael Rubin]

Cause you had raised like 80 million.

[Nike]

From them and 80 the first time. But then we raised more and I mean we raised hundreds of millions of dollars in total. And so for us, when you look at the $150 million that you mentioned during those four year period of time, that's nothing relative to what we had peers that were losing. A billion dollars, billions of dollars. So I'd say we were probably the most entrepreneurial of that group of competitors.

[Michael Rubin]

All right, so I guess sort of through the early 2000s, you guys continue to expand.

[Guy Raz]

Right.

[Michael Rubin]

You do all these, these different partnerships and then you also acquire the e.

[Guy Raz]

Commerce rights for the major professional sports leagues. Right.

[Michael Rubin]

Which was massive. What did that mean?

[Nike]

Yeah, so we kind of ran the e commerce businesses for the NFL, right. The NBA, Major league Baseball and the NHL.

[Guy Raz]

You were doing all the back end.

[Michael Rubin]

You were doing the buying and the selling.

[Nike]

We were doing everything. We were kind of the licensee that ran that business. We were kind of the owner of the e commerce business. Of the four leagues that we paid them a row to, we licensed those rights from the leagues.

[Michael Rubin]

But you weren't making the products.

[Nike]

Not at that point we were not.

[Guy Raz]

Got it.

[Michael Rubin]

Okay, so now let's focus on one thing that we most know you for today.

[NerdWallet]

Right.

[Michael Rubin]

Which is Fanatics. And Fanatics was actually founded by two brothers.

[Guy Raz]

It was a brick and mortar store in Jacksonville, Florida.

[Nike]

Yeah.

[Michael Rubin]

And then it grew into an e commerce business, I think especially mainly for college sports. Initially, anyway, you, GSI Commerce, you wound up acquiring them for about $277 million, right?

[Nike]

Yeah. So our strength was in pro sports and fanatics strength was in college sports. And we thought it would be great to put the two businesses together.

[Michael Rubin]

The purchase goes through in 2011, but later that year, GSI sells to ebay. All of the brands, everything goes to eBay. $2.4 billion.

[Nike]

Yeah. Well, what happened was ebay came to us and said, look, we want to acquire GSI. Commerce, they had two businesses, the eBay Marketplace and PayPal. They said, we want to have a third business. This basically runs the e commerce operations for big retailers, big brands that will also allow us to get these brands into the ebay marketplace. And so really what they want to do is buy GSI to get in business with all the big brands and retailers that we worked with. But ebay, as everyone knows, doesn't own inventory. So they had no interest in owning the fanatics business, which was the only business that GSI owned that owned inventory. So they said, hey, Michael, we'd like to buy GSI overall, but we'd love, you know, you to buy this back if you wanted to. That would help facilitate the deal.

[Michael Rubin]

Yeah.

[Nike]

And so we bought back fanatics, including the licensed business that GSI had, for 330 million bucks.

[Michael Rubin]

You basically buy this back from ebay. And what was the vision that you had at that point? I mean, this is 2011. What did you think you were going to do with it?

[Nike]

So when I bought fanatics back, I said, I'm going to lock in on this business. It's the only thing I'm really going to do. And then we're going to be great at this.

[Michael Rubin]

And what did, what was it going to be? It was going to be.

[Nike]

Well, you got to realize when you think back to fanatics, when I bought it back from eBay in 2011, it was a completely undifferentiated retailer of licensed sports merchandise. And so it was a small business.

[Michael Rubin]

They were just getting and they weren't. It was not vertically integrated.

[Nike]

It was not.

[Michael Rubin]

They were just like outsourcing their designs.

[Nike]

That's right. They bought merchandise from many third party vendors. But there was a new era of 47, seven brands and Majestic, Mitchell and Ness, whoever it was, they bought from lots of other brands.

[Michael Rubin]

And you wanted to do something different.

[Nike]

Well, I think I recognized that sports had a ton of secular growth behind it. Like just, is sports going to grow? Yes. Is Phantom going to grow? Yes. At the same time, I had watched Amazon and Alibaba disrupt retail in such a meaningful way that I knew if we didn't really differentiate the business that it wouldn't exist long term. And so we had a vision for really working very closely with sports teams and sports leagues to come up with a business model that was better for them, that would let them build their direct to consumer business, build how they communicate directly with fans. You know, that was kind of the beginning of really growing the fanatics business.

[Michael Rubin]

Essentially, if I'm hearing you Correctly. What you're saying is if all we did was just sell licensed shirts or, you know, hats, and it was also available on Amazon, we're cooked. We can't compete.

[Nike]

Yeah. If we're selling merchandise that's readily available, you know, at other places, I don't think what makes it special. What we said is we wanted to do is we wanted to do something that would be special. We wanted to have a broader assortment of merchandise. I think we wanted to do is create a better model with the sports properties to where they benefited from the growth of the business. When we first started, really all of that licensed sports merchandise was sold through traditional brick and mortar retailers. What the leagues wanted to do is no differently than what any brand wants to do. No differently than what Apple would want to do is to build more of a direct to consumer business themselves. And we really, by working with the leagues, gave them the ability to drive a much bigger percentage of business through their own direct to consumer business. So put in perspective, when we started, it might have been 1 or 2% of business would go through the NFL or Major League Baseball or NBAs direct to consumer business. Today it's about a third would go through their own direct to consumer business.

[Michael Rubin]

How did you get the leagues to agree to work with you? I mean, to sort of buy into this idea in 2012 when there were already other brands out there, they were doing licensing deals with other.

[Nike]

Yeah, I think the leagues recognized that they make most of their money from media, from selling the media rights, and that they want to find other places to further monetize in this consumer products area where taking care of the fan is so important that they realize that if they could get a new model here, a better model, that they could, you know, take better care of the fans and make more money as a sports property.

[Michael Rubin]

So I guess from what I understand, one of the differentiating factors was also this ability to respond and react quickly, Right. To like, the stories in sports.

[Nike]

Well, think about what's going on right now in sports. You just had Ohtani that goes to the Dodgers and everyone's so excited. He gets to the Dodgers. Okay. Everyone wants his products. Then he does something nobody else had done. He hits 50 home runs and 50 sold bases. We make so many products around that in real time. And then, my God, they win the World Series. And so the ability for us to respond and handle that consumer demand will probably service just in North America just this month. Between now and the end of the year, I think we'll probably service a million different Dodger fans online, we've been able to capitalize on that in a way for fans.

[Michael Rubin]

Yeah.

[Nike]

That said, the thing that's scary when you hear the and I listen to myself talk. I'm like, the biggest thing I've been thinking during this whole conversation myself is, man, I've been doing this stuff for 40 plus years. I feel like we're just getting started. I'm going to leave here. I'm going to go spend the afternoon evening with the CEO of Fanax Commerce, which is our entire fangirl business. We're going to talk about all the things that we're not doing well and what are the things we need to do better. And even though the business grown from $250 million when I bought it back from ebay to this year, that division's like a $6.7 billion business. Okay. We're not thinking about what we're doing well. We're thinking about what we're not doing well. Where can we be better? What do we need to keep enhancing? What do we need to fix? And by the way, there's a lot we need to do. And that's what gets me so excited, is like, I've been at this for a long time, but I still feel like a startup.

[Guy Raz]

When we come back in just a.

[Michael Rubin]

Moment, Michael talks about the sacrifices he's.

[Guy Raz]

Made to always be in startup mode.

[Michael Rubin]

And how he's finally forcing himself to sleep. Stay with us.

[Guy Raz]

I'm Guy Raz, and you're listening to how I built this. You've heard the phrase a thousand times. Like a good neighbor, State Farm is there. But it's more than just a jingle. It's true. State Farm offers small business insurance for all kinds of small businesses, and they can help you choose the coverage that best fits your needs. Choosing State Farm to insure your small business not only simplifies managing your insurance needs by only working with a State Farm agent, but also gives you the support of a local sbo. But best of all, your policy and small business insurance can adjust. As your small business grows with a State Farm agent, you know someone is helping you achieve your goals. All you have to do is say, like a good neighbor, State Farm is there. What makes a leader? Well, a true leader leads by example. And a true leader takes risks, too. They plunge into life with determination. For those who approach life with a palpable passion, there's the Range Rover Sport. Sophisticated refinement meets visceral power in the Range Rover Sport. A new dimension of sporting luxury with its adaptive off Road cruise control. You can monitor ground conditions and acclimate to the present terrain. Plus adaptive dynamics reduces unwanted body movements to deliver smooth and composed handling. Build your Range Rover Sport@Land RoverUSA.com.

[Michael Rubin]

Hey.

[Guy Raz]

Welcome back to How I Built this.

[Michael Rubin]

I'm Guy Raz. So when we last left off, Michael was saying that even though he's been running fanatics for 15 years, he still.

[Guy Raz]

Feels like he's building a brand new company.

[Nike]

Yeah, I mean look, we have three businesses today. Our first business is the one you've been asking me questions about. The next commerce and that includes, you know, today we have, we run the e commerce businesses of the NFL, the NBA, Major League Baseball, NHL. We have about 900 individual team sites that we operate. We operate the flagship fanatics website which is the single biggest site that we operate. We own lids which has 1400 headwear stores. We operate the college bookstores for the apparel. We own Mitchell Nest, the apparel brand. You know, we make all of the Nike licensed sports merchandise and NFL college, Major league Baseball. So that's the business people think of us for. But when you really look at that business, even though it's grown from a $250 million business in 2010, the year before we bought it, this year we put it all together, it's about a $6.7 billion business.

[Guy Raz]

Wow.

[Nike]

Look, I think we've become a decent sized company. We haven't become beloved and I want to be beloved by sports fans and we need to be better to be beloved by sports fans. So there's so much to do there. I think in our newest business, Collectibles, where we own tops and we have the official trading card rights to many of the biggest sports properties in the world. That business, we bought it and then we just got into this with the sports betting business where everyone's betting against us. And I love that, I Love being underdog.

[Michael Rubin]

DraftKings has been the dominant player.

[Nike]

FanDuel and DraftKings are the dominant two companies. And for me people are like, oh, you're the leader in fangirl, you're the leader in trading.

[Michael Rubin]

Why are you getting into that?

[Nike]

You know you're the underdog here. Guess what? If you want to ask me what gets me most turned on, being the frickin underdog. Man, that is fun to have everyone betting against. You say you can't do this. Great. You know, the same way my mom told me I couldn't do something and my dad told me I couldn't do something. I was told as a little kid you can't do this. Let's see how it plays out.

[Michael Rubin]

Where do you, I mean, presumably sort of the sports betting market is a massive, massive growth opportunity. Right. When you say we're just getting started, I mean, is that sort of where your head goes, particularly to that part of the business?

[Nike]

No, my head goes to. We're just getting started in all of the businesses, even in our fanatics, Commerce. $6.7 billion in revenue this year.

[Michael Rubin]

Yeah.

[Nike]

So right now we are so focused, like we had. Look, this is no secret. We went through a, you know, tough experience earlier this year in our partnership with Major League Baseball and with Nike, where, you know, Nike redesigned the jersey that we'd been making for eight years. And, you know, there was a really negative reaction to it.

[Michael Rubin]

And with Major League Baseball for the uniforms.

[Nike]

It was the official Major League Baseball uniform.

[Michael Rubin]

And some of the players complained about it.

[Nike]

Players complained, fans complained relentlessly. They didn't like, say a little bit. They said a lot. They spoke loudly.

[Michael Rubin]

They could see through it and all this stuff.

[Nike]

Yeah. And for us, that was actually an incredible moment because we could sit there and say, hey, we've made lots of mistakes. This is one thing where, you know, we didn't lead it. You know, we kind of got, you know, stuck in the situation. Or you could say, you know what, how do we use this to make our company better? And we actually came up with a brand purpose. They said we were going to relentlessly enhance the fan experience in everything we do. And if we're not, we're not going to do it. We embraced the ass whipping. We said we need to be a lot better. You know what, Even if we're not designing the jersey, if we had people inside of Fnatics, it was saying, hey, people may not like the smaller letters, they may not like this, they may not like that. Well, you know what? We got to speak up louder. We got to be stronger. We can't, you know, you can't just go along for the ride. So, like, that's why I'm so excited about this business because I get to learn every day. I get big challenges. You know, it's a, you know, if you like action, this is the job for you.

[Michael Rubin]

So, all right, if you think about it just 12 years ago, right, where you essentially, about 12 years ago, where you really kind of fanatics really kind of has its rebirth and it becomes what we know about today. And that's not that long ago.

[Guy Raz]

Right.

[Michael Rubin]

And yet the business of sports and sports apparel has just exploded even more. And while so many other content and media businesses have had challenging times, and we're sort of starting to see this kind of over saturation with content. Sports just. It just. It's just moving in this, like, hockey stick direction.

[Nike]

Look, I think it's obvious to know that there's secular growth behind sports. I think we've helped to accelerate the growth of this category. But it doesn't mean you don't look at yourself and say, not what have we done well, but what are all the things we haven't done well, what are all the things that, you know, we didn't get right? Because that's the way we think. If you sit there and you're satisfied, you're dead.

[Michael Rubin]

Hmm.

[Guy Raz]

So you.

[Michael Rubin]

So, I mean, I hesitate to ask you this question because I think I know the answer, but, like, you don't see. You see yourself involved with this for the long haul. Like, you don't.

[Nike]

Forever.

[Michael Rubin]

Forever.

[Nike]

Forever. I'm never selling this.

[Michael Rubin]

You are gonna be at the helm of this thing till I die. Till you die.

[Nike]

Yep.

[Michael Rubin]

You know, one of the. I mean, you know this, that there are a lot of sacrifices that a person makes. And one of the things that I do on the show is emphasize that entrepreneurship is not a hustle culture. It's not a hustle culture show. It's not get rich quick scheme show. It takes a long time. It's a lot of work, and there are a lot of things you have to give up. Yeah, you've benefited tremendously from it, obviously, you know, have massive wealth, but there are also things that you've sacrificed. And again, I don't know if people are going to. They're not going to play a violin for you necessarily, but like, just being young, just being a young kid, hanging out and doing stuff, like, you were working, you didn't have a teenage college experience. You weren't in your 20s, hanging out.

[Guy Raz]

Hanging out with friends.

[Michael Rubin]

You were working.

[Nike]

Look, I agree that there's lots of sacrifices that I've made and will continue to make, but they don't feel like sacrifices to me because I'm doing what I love. I mean, if you ask Tom Brady, did he make sacrifices to win seven Super Bowls, I don't think he's taking anything back because he won seven Super Bowls. And by the way, the only thing he's mad about is that he lost to the Giants twice and didn't win more. So that's my mentality.

[Michael Rubin]

What about as a parent, did you have to presumably had to sacrifice time with your kids?

[Nike]

I have. And I do. But when I try to be there is for the things that really matter. And, no, I'm not like, you know, look, I have, you know, two young kids now as well. And, you know, I think, you know, when Camille and I had, you know, when we had Romy and then Gemma are the two young ones, you know, she knew that, like, I'd be there when it mattered, but I like that I'm gonna. Like, she knew that. I work 17 hours of most days, so, you know, this morning when I woke up and the kids were up at, you know, 5:00 in the morning, I went down and played with the kids for 10 minutes, and I went to work at 5am in the morning. And, you know, tonight they'll be in bed when I get home, but tomorrow morning I'll go see him for 10 minutes. And, you know, but I'm there when it matters. And I'd say with my older daughter.

[Michael Rubin]

Who'S now 18, who's now from your first marriage.

[Nike]

Yeah. Yeah. And. And we have. Our relationship is spectacular. If I go and get my phone right now, she will have called or.

[Michael Rubin]

Yeah.

[Nike]

You know, it's like we just. We make it work. You kind of figure out what you got to do, and you kind of make it all work. And, you know, it's, you know, nothing simple and. But look, look, are there much better parents than me? Absolutely. And yes. You know, does Camille want to kill me sometimes because I'm just not mentally available? Sure. But, like, I'm doing what's best for me, and I love doing what I'm doing.

[Michael Rubin]

Given that your mom was a psychiatrist, I imagine that she encouraged you to talk about things on your mind. Have you ever benefited from therapy?

[Nike]

I have gone to therapy off and on, over the. Over my entire life. You know, as a kid, hey, you're broke. And so, I mean, I was probably sent to a therapist from the age 10 or 12 up.

[Michael Rubin]

Did you hate it when you were a kid?

[Nike]

Hated it. Didn't dislike it. I hated it. But I'd say I've never really been a great patient of a therapist, but what I am really good at is talking through my issues with people that I'm really close to.

[Michael Rubin]

Do you ever remember feeling anxiety or depression?

[Nike]

Not depression, but anxiety? Yes. Anxiety about what I need to get done, Pressures that could be on me. Yes. Never depression.

[Michael Rubin]

Anxiety that would, like, cause sleepless nights.

[Nike]

Well, I have one of the worst. I mean, so look, there's something in my. In my. Like a tube in my chest. Chest, yeah. Where it keeps enlarged every year. It's enlarging. Over the past five years, has enlarged about 4, about 40 bips. And they said if it goes another 50 bps, you have to get open heart surgery. And they said the only way to fix it is sleep. Okay. And I used to think I was so tough to sleep as little as I could be. My sleep, if you. Look, if you average the last 20 years is probably four and a half hours a night. And now I got this whoop on my wrist. I'm trying to figure out how to sleep. Seven hours a day, by the way, is really, really hard because I wake up every one to two hours throughout the night with a dry mouth thinking about work.

[Michael Rubin]

Do you grab your phone?

[Nike]

Always. And I know I shouldn't, but I can't. It's.

[Michael Rubin]

I can't be in the room.

[Nike]

Yeah. Well, thank you, Mr. Obvious. So have I had sleepless nights? More than you'd ever know. Have I stayed up thinking about what do I need to do? How do I compete better? How do I do better for our fans all the time?

[Michael Rubin]

You know, you mentioned that the last book you read was when you were in ninth grade. And I think that's in part because it's just hard. It's hard for a lot of people to just focus on a page. And so some people can listen to books, some people just.

[Nike]

I don't listen to them either. Talk about something really weird about my brain. Okay. This is gonna sound crazy. I don't know the Alphabet. I get stuck around mnp, and I've never. And I've kind of decided that I'm not gonna relearn it because I kind of like that I could not be able to do the Alphabet legitimately. So, you know, I kind of accept my brain as, like, my brain's. It's weird, but, like, it. You know, I'm pretty good at certain things and pretty shitty at other things. I just focus on what I'm good at. Yeah.

[Michael Rubin]

So, all right. How much of all this do you attribute to just the grind?

[Guy Raz]

And how much do you think has.

[Michael Rubin]

To do with getting lucky?

[Nike]

Well, anyone who says that you don't need luck to be successful in business is full of shit or doesn't understand. You definitely need some luck to go with you. Luck and time are a very important ingredient. That said, I attribute 100% of it to the grind, not 99%. I am a top grinder. I'll outwork. I'll out hustle anybody. It's fun for me. Like, I don't look at it as grinding. I look at it as like if you asked any athlete in the world if they could have their career go on forever in perpetuity at the top of their game, who wouldn't wish for that? And I can do that in business, I think. And so, like, why would I ever give that up?

[Michael Rubin]

That's Michael Rubin of Fanatics, by the.

[Guy Raz]

Way, in case you missed it.

[Michael Rubin]

Back in September, Major League Baseball announced that it was getting rid of those.

[Guy Raz]

Embarrassing see through uniforms and returning to the old ones.

[Michael Rubin]

And one more thing. Michael recently announced that he's no longer going to throw his annual White Party, the big bash at his Hamptons estate.

[Guy Raz]

Where celebrities would dress up in white and pose for paparazzi.

[Michael Rubin]

Michael felt like, given the notoriety around.

[Guy Raz]

Another famous White party, the one that.

[Michael Rubin]

Used to be thrown by Diddy, that the whole concept has kind of been tarnished. So he's decided to focus more on.

[Guy Raz]

Charitable events in the coming years.

[Michael Rubin]

Hey, thanks so much for listening to.

[Guy Raz]

The show this week. Please make sure to click the Follow button on your podcast app so you never miss a new episode of the show. And if you're interested in insights, ideas and lessons from some of the world's.

[Michael Rubin]

Greatest entrepreneurs, please sign up for my [e-mail] or on substack.

[Guy Raz]

This episode was produced by Devin Schwartz with music composed by Ramtin Arablouei. It was edited by Neva Grant with research help from Chris Masini. Our engineers were Robert Rodriguez and Gilly Moon, and our production staff also includes Alex Chung, JC Howard, Carla Estevez, Sam Paulson, Kathryn Cipher, Kerry Thompson, John Isabella, and Elaine Coates.

[Michael Rubin]

I'm Guy Raz and you've been listening.

[Guy Raz]

To How I Built this. If you like How I Built this, you can listen early and ad free right now by joining Wondery plus in the Wondery app or on Apple Podcasts. Prime members can listen ad free on Amazon Music. Before you go, tell us about yourself by filling out a short [e-mail] survey it takes a lot to grow your business. You've got to attract audiences, score leads, manage all the channels. It's a lot of long days and late nights, but with Breeze HubSpot's new AI tools, it's never been easier to be a marketer and crush your goals fast. Which means pretty soon your company will have a lot to celebrate, like 110% more leads in just 12 months. Visit HubSpot.com marketers to learn more.