By Thomas Heath
Washington Post Staff Writer
Sunday, January 24, 2010; W10
It is late afternoon on a Friday in September, and Kevin Plank is standing on the edge of the Auburn University football team's practice field, surrounded by top executives from Under Armour, the sports clothing and footwear company he invented.
While the players drill in near silence for the next day's game against Mississippi State, all their mental and physical energy bent toward winning, Plank watches them intently. The Under Armour chairman is in his element when he is close to football, the game he worships and the profession that defines his business.
Dressed in brown slacks and a white Under Armour shirt, Plank feverishly pounds away on his cellphone, sending text messages and photos from the practice field back to headquarters in Baltimore. He has spotted a big problem with the Auburn team's practice shorts: The UA logo is at the top by the hip, obscured by the oversized shirts the players wear untucked.
"You can NOT see any logo -- I would move it to the bottom in the future!" he types. Then: "Let's get out to see this stuff!"
Such intensity is how the 37-year-old Plank built a worldwide business with 2,700 employees and revenue approaching $1 billion. It is why he constantly flies around the world to sporting events. It's why he develops new products, finds sports celebrities to promote them and seeks a bigger audience to buy them -- from Europe to China. It's also why he pays universities such as Auburn to feature his products, the schools serving as both laboratory and showcase for Under Armour.
Plank works endlessly to give Under Armour an edge, and his deals to outfit university sports teams are a crucial part of his battle to win customers from the established big guys. Think Adidas, Reebok and Nike -- especially Nike, which outfits more than 100 colleges, compared with Under Armour's 50 or so.
"You need to put your hands around the throat of your business, and you need to run it," he told a group of Auburn students earlier that day. "There's no other way."
Plank knows he needs to create wealth for shareholders, himself included, and keep Wall Street confident that Under Armour has a future as a successful stand-alone business. If he doesn't, it could become a takeover target, pressuring Plank to sell his controlling share to a bigger rival or even a private equity firm.
"The time between $500 million and $1 billion is a weird time, a dead zone," Plank says. He refers to eyewear-maker Oakley and sports apparel firm Nautica -- both were gobbled up by bigger companies, although both brands still exist. "It's the Bermuda Triangle of apparel companies. Companies get caught. ..."
He's determined that's not going to happen to Under Armour.
As his black SUV tools through the Auburn campus, he orders the driver to pull up to Jordan-Hare Stadium, the 87,451-seat home to the Auburn Tigers and the moneymaking machine that pays for Auburn's sports program. Football is serious business here.
The car continues across the sprawling campus, and Plank starts counting out loud.
The number keeps rising. Plank is counting the students he sees wearing Nike shorts. It is driving him nuts.
"That's about 30 in the last half-hour," he says.
The cellphone reemerges, and he begins banging out another e-mail.
Plank grew up in Kensington, where his mother was the mayor and his father was a developer. He was the youngest of five brothers, a self-starter who showed up at neighborhood doors with a shovel or rake in the hope of making a few bucks.
"You kind of have that bug," he says.
He was born with the entrepreneurial gene, not the academic one. Being thrown out of Georgetown Preparatory School in his sophomore year for academic reasons, he says, was one of his first breaks. He was recruited to play football by St. John's College High School in Northwest Washington, where he fell in with players such as Chris Harrison and Jay Williams, who later preached the Under Armour gospel in NFL locker rooms.
"One door closed, and another opened," Plank says.
Plank credits St. John's -- which has a military cadet corps that is a feeder to U.S. service academies -- as a formative experience. It gave him something to prove, made him show up for drill and inspection every morning, and forced him into the real world at an early age. The "do it yourself" outsider approach would help foster the rebel coolness that he would play on when marketing UA as an alternative to Nike.
After St. John's, he spent a year at Fork Union Military Academy, another football factory, many of whose graduates became Under Armour ambassadors in college and the pros.
From grammar school through the University of Maryland, Plank always hustled. He parked cars, sold T-shirts and bracelets at Grateful Dead concerts, pumped beer at the Kemper Open golf tournament and made thousands of dollars running a campus flower delivery business at U-Md.
"He had a Visa swipe set up in our apartment and gave each of us instructions on how to take flower orders 24-7," recalls college roommate Russell Weaver. "Then he recruited 10, 15 or 20 guys on the team and on campus to ... sell roses. Players would stand on the corner of Route 1 or on Georgia Avenue selling flowers. Who else could do that?"
Plank also dreamed of opening a chain of crab cake restaurants. Instead, he pursued an idea for a novel shirt that he thought would make him and his friends better football players.
A slow walk-on who played on the field goal, punting and kicking teams for Maryland, Plank decided that traditional cotton T-shirts soaked up too much sweat and weighed him down. He started hunting for material that would wick the sweat from his body to make him lighter and faster.
When he found what he thought would work at a local Minnesota Fabrics store, he carried the microfiber cloth to a tailor, held up a T-shirt and the material, and asked, "Can you make one of these from this?"
Seven prototypes and $450 later, he had what he wanted: a tight-fitting compression shirt that wicked away sweat so a football player didn't need to change shirts every quarter. With $17,000 from his campus flower business, he started his company, ordering 500 shirts. It was 1995, and Plank was 23.
Plank wanted to name the company Heart, but that was too common. Then he thought of Body Armour. Finally, Plank's oldest brother, Bill, mistakenly asked how Under Armour was coming along. "I thought, That's it," Plank says.
Knocking down Mountain Dews and running on little sleep, Plank handed shirts to high school and college teammates and asked them to spread them around. He mailed samples of the shirts to football player friends around the country.
He passed out prototypes to only the best athletes at Maryland, trying to create an aura of "authenticity" around his shirt. He got a list of all the equipment managers in the Atlantic Coast Conference and sent them his prototypes. "I was always telling people I was doing great, even if I wasn't," Plank says. "It's being bigger than you are. I couldn't tell people I burned through $17,000 in cash and had maxed out $40,000 on my credit cards. But I had one of those moments when I thought: Did I do the right thing? Did I go after the right opportunity? And then that day I remember coming home and checking the mail, and in the mail was a check from Georgia Tech, the first school that'd we'd sold, for $3,800, which had me right back in it."
Then there were close calls. Such as the time he drove overnight from Baltimore to North Carolina to buy material to fill a client's order. Or the time he told the Arizona State football coach "of course we make cold-weather shirts. No problem." And then he invented one and shipped a couple of hundred of them, at a financial loss, with hours to spare before the game.
Plank drove his Ford Bronco all over the East Coast, trolling for fabric in New York's garment district, running up to a Bronx manufacturer who turned the material into shirts. He was helped by a buddy from the University of Maryland, Kip Fulks, now 37, who oversees the design of Under Armour's Olympic uniforms.
Plank's wife, D.J., then his college sweetheart, recalls those early days, when she would help fill orders. "His first four-page brochure, he had 'Call 24 hours a day, 7 days a week,' " says D.J., now 38. "So someone would call from the West Coast at 4 in the morning. I ... would take orders when I was half asleep. The next day, I would ... find [the orders] written on the back of a magazine or wonder, Where is it?"
From a rowhouse in Georgetown owned by his grandmother, Plank marketed his shirts to Generation X by draping them on top athletes and making them the go-to garment for the young crowd. Word about the gear started trickling out. The Atlanta Falcons called for some shirts. So did the New York Giants.
The merchandise was picked up by sports apparel catalogues such as Eastbay. Revenue began to grow, from $17,000 in 1996 to $100,000 in 1997 and then to $1.3 million in 1999. Players on school and professional teams with contracts with Nike or other rivals began demanding Under Armour clothing. Under Armour framed the checks -- from the University of Wisconsin or the Washington Redskins or the Falcons -- and hung them in the office.
A big turning point came in late 1999, when Under Armour placed a $25,000 half-page advertisement in ESPN magazine showing a sweaty, rippled Rasheed Simmons, a photogenic former teammate of Plank's at Maryland who became the first face of Under Armour. Plank said it spurred $1 million in direct sales the next year, "one of those pivotal moments that made the company," Plank says.
Athletes and teams were starting to buy. Now was the time to go after the general public, to make the brand cool enough to compete with the giants.
Steve Battista, 35, stands on the sideline as South Carolina prepares to take on heavily favored University of Florida, college football's version of the New York Yankees. The November 2009 game, in front of 79,297 fans at the Gamecocks' Williams-Brice Stadium and televised nationally on CBS, was important. South Carolina is an Under Armour school. Florida wears the Nike swoosh.
"This is why you do the deal, to be on the field with the No. 1 team in the country," says Battista, Under Armour senior vice president of brand.
The Under Armour family roots for its teams, and leading the cheering is Plank, pacing the sideline a few feet away.
The purpose of the gathering is to play a college football game, but the back story is a marketing showdown, UA vs. archrival Nike. The more UA teams win, the farther they advance, the more television exposure they get, the bigger bang Plank gets for his sponsorship dollar.
The Gamecocks are wearing Under Armour's black camouflage jerseys with slogans such as "Courage," "Integrity," and "Service " printed on the back instead of players' names to honor veterans who were injured in the Iraq and Afghanistan conflicts. The exposure is a big deal for Plank and his company, who clearly think they have staged a marketing coup while contributing to a good cause: raising money for wounded veterans by selling products at the game, on campus and online.
"Ever seen anything like this?" he asks a reporter. "Whaddya think? This is big-time college football."
The Under Armour logo is plastered all around. It's on every South Carolina player, including their cleats. It's on South Carolina coach Steve Spurrier and his assistants. It's on the giant video screen. It's on fans, photographers, security officers and even the students serving Gatorade to the team.
Under Armour pays well over $1 million a year -- over several years -- for the right to outfit South Carolina's football team. Nike does the same for the University of Florida and many other schools.
The idea of taking market share from Nike, as well as the other "big guys," is still a street fight. But even with some flubs, several analysts agree that the lucrative U.S. sports apparel/footwear market is inexorably becoming a duel between Nike and Under Armour.
"I don't know anyone who has stayed in Nike's cross hairs and lived to tell about it, and Nike has had UA in its cross hairs for the past four to five years," says John Horan, who publishes Sporting Goods Intelligence, an industry newsletter.
As the giant video screen at one end of the field blasts Under Armour's signature "We Must Protect This House" advertisement over the speakers, Plank looks up from his BlackBerry.
Battista, who started nearly a decade ago as employee No. 19, stands a few feet behind his boss and recounts how they turned Under Armour from a cash-starved brand into a legitimate Nike rival.
"We had skintight shorts and a shirt that made you look like a superhero," Battista says. "You take a best athlete wearing a second-skin garment that looks like he just stepped out of a comic book, and that trickles down to the kid playing Pop Warner football."
Plank's timing was perfect. Under Armour's young, rebellious generation wanted to set itself apart from its fathers and mothers, who grew up with Nike and Reebok. To keep the brand authentic, Under Armour started by selling its products only at independent sporting goods stores and chains such as Dick's and Modell's, where discriminating athletes shopped. Mom and Dad could buy their workout gear at Target and Sears while picking up chaise longues or picture frames.
"Kevin sold a shirt to kids who played football and baseball and were very conservative," says Mike Jacobsen, editor of Team Insight, a New York-based sports industry trade magazine. "But by wearing Under Armour, the kids could be rebellious within the traditional team sports."
Back on the field, the game starts, and Florida scores a quick touchdown. A rout may be underway, but South Carolina drives 84 yards in 14 plays to tie the score at 7 all. Florida leads 17-14 at halftime, a moral victory so far for South Carolina. The Under Armour contingent is clearly pleased.
The South Carolina sun has set, and the halftime show, a choreographed extravaganza, finishes with a ear-shattering flyover by a formation of F-15 fighter jets.
When the Gamecocks emerge for the second half, one of the coaches, a former roommate of Plank's from Maryland, veers to the sideline, and he and Plank exchange hugs and pose for photos. As the third quarter rolls forward, the Under Armour staff takes heart that its team is playing Florida tough.
Battista recalls his 2000 job interview with Plank on the night before Thanksgiving. It was in a Baltimore warehouse, under a bridge, where Plank had moved the company in order to stay true to what he saw as the company's blue-collar values. He also wanted to be close to the Baltimore Orioles and Baltimore Ravens -- both stadiums were located across the parking lot.
"I came back to my apartment that night and told my wife this is a guy who knows how to make a buck," says Battista, a 26-year-old aspiring novelist at the time. "More importantly, he knows how to win."
Battista becomes focused on the South Carolina-Florida game. It's dark now, and South Carolina, down 17-14, is mounting an impressive drive. The entire South Carolina sideline is silent and psyched. But when Florida intercepts a South Carolina pass and scores a minute later, the Under Armour team sags. Then it heads for the SUV and the airport.
Nike, at least on the field, has won the day.
As much as Plank tries to set himself apart from Nike, he also has pulled a lesson or two from his foe's playbook, such as signing star athletes. Downhill skier Lindsey Vonn will wear Under Armour at the Winter Olympics in February, and Milwaukee Bucks rookie star Brandon Jennings is wearing the company's basketball shoe this season.
But Plank has also had a few missteps. Last year, Under Armour pursued a relationship with Lance Stephenson, a highly regarded basketball player being recruited by the University of Maryland, where Plank is a generous donor and member of the board of trustees. The appearance of Plank -- a representative of the school -- attempting to forge a relationship that could one day benefit a recruit raised eyebrows in NCAA recruiting circles. (Stephenson went to the University of Cincinnati, an Adidas school.) Plank also acknowledged that a 2002 strategy of taking the men's line and changing its size and color for women -- dubbed "shrink it and pink it" -- was clumsy. He killed the product line before it hit the stores. Even though the effort cost only a few million dollars, it represented a significant chunk of Under Armour's $50 million revenue at the time. It also disappointed some retailers, who had to wait another year for a women's line.
Plank must now work on firing up his nascent footwear business, which generates less than 12 percent of current revenue, and go head to head with Nike, Adidas, New Balance and other players in the $31 billion international branded athletic footwear market. The stakes are huge; Nike has an estimated 35 percent of the market, followed by Adidas at 22 percent and Puma with just under 7 percent. If UA can grab 3 percent of the world's athletic footwear market, com-panywide revenue would double.
"He has to start picking fights with the big boys on their turf," says Horan of Sporting Goods Intelligence.
Under Armour has made mistakes in pursuit of that 3 percent -- a rushed football cleat in 2006, a dud in the highly competitive running shoe market in 2009 -- but analysts say that now the company is getting it right. It has hired a slew of executives, including veterans from past shoe and apparel wars. Apparel sales for women, men and youth grew by double digits in the second quarter of 2009.
The key to overtaking Nike is through innovation, and many industry experts predict that Under Armour can get there.
"If you asked me who could be equal to Nike in the future, the only company I can think about is Under Armour," says Sonny Vaccaro, who helped Nike build its empire by putting its basketball shoes on celebrities such as Michael Jordan.
Plank still owns 25 percent of Under Armour shares, which makes him worth at least $350 million. He also controls 77 percent of the company's voting shares, which means he probably doesn't have to sell the company unless he wants to.
Asked if he has received any offers to sell, Plank says only that "it's no secret there is a great deal of interest in this company." But he says later that he isn't going anywhere. He wants to keep building the brand.
"Why sell [the company] to some weenie and watch them take it apart? Then we have to ask someone, 'Can we leave now?' No way."
Kevin Plank settles into a lush, tan-leather armchair of the Challenger 604 corporate jet hurtling back to Baltimore from Columbia, S.C. He is sipping Maker's Mark and Diet Coke between bites of pepperoni pizza. The jet's sound system is playing "Folsom Prison Blues" by Johnny Cash. The group on the jet is tired and disappointed after South Carolina's defeat. But the Under Armour team is pleased with the publicity garnered from the uniforms honoring veterans.
"We won everything we controlled today," says Walker Jones, Under Armour's director of sports marketing.
Plank, D.J. and their two children, ages 6 and 3, live in Lutherville, Md. Though Plank breeds racehorses on his 540-acre Sagamore Farm in Baltimore County, which was once owned by the Vanderbilt family and is where champion thoroughbred Native Dancer trained, he loves the nonstop life of the globetrotting mogul. He unloads his upcoming schedule from memory.
"I'm going to a football game today. Tomorrow, I have a company sales meeting. Tuesday, I fly to China on commercial. I come back Saturday night to Newark, where my jet picks me up. Then I'm back for the Ravens-Colts game, and we're hosting" the family of NFL quarterbacks Eli and Peyton Manning.
"If you don't love doing this," he says, motioning toward his lieutenants, "you don't belong in this industry. It's like Vince Lombardi said, 'Act like you've been there.' "
With his jet approaching Baltimore, Plank leans forward and points to a photo of the new uniform and helmet Under Armour developed for the U.S. men's and women's bobsled Olympic teams. Plank helped supervise the new suits, which are modeled after the clothing of motorcycle daredevil Evel Knievel. He was involved in every detail, right down to the color of the backdrop on the advertisement. (Plank insisted on red and black, over green and tan.)
Many signs are pointing upward for Under Armour. Although its college programs did not finish among the top 10 schools in the 2009 football season, the company is expanding its university presence, including a recent six-year, multimillion-dollar endorsement deal with Boston College. The company also hopes to make a splash at next month's Winter Olympics. Along with Lindsey Vonn and the bobsled teams, its stable of athletes runs from U.S. snowboarder Lindsey Jacobellis to Swedish, U.S. and Canadian hockey players, to Canadian skiers and to the U.S. men's and women's freestyle ski teams.
But the business world is fraught with as many uncertainties as competitive sports. The retail culture can be fickle, a product might not measure up, another upstart could jump in the game. But Plank's passionate drive keeps him ever vigilant.
"We still have plenty of opportunities to screw things up."
Thomas Heath writes the Post's Value Added column. He can be reached at firstname.lastname@example.org.