Kevin Plank, the Man Under the Armour

Mj 618_348_the man under the armor

It’s a warm evening in May, the night before the Preakness Stakes, and hundreds of people are packed into a vast white party tent at a horse farm 17 miles northwest of Baltimore. Some are getting drunk at the tent’s multiple whiskey bars. Others stand on a veranda that overlooks the green hills of this part of Maryland, holding plates of barbecue and wiping brisket sauce from their lips.

Kevin Plank does this every year – throws this party, invites everyone he knows. Tomorrow he’ll take a bunch of these people to the race, try to hook them on horses, show them another side of a city they thought they knew from the corruption and drug-dealing on ‘The Wire,’ but tonight he’s just trying to make sure everyone’s having a good time. Plank, age 41, with alert, shining eyes and the bland good looks of a dad in a mail-order catalog, is the founder and CEO of Under Armour, the $2 billion athletic apparel and footwear company that employs 1,300 in an old Procter & Gamble detergent factory on the Baltimore waterfront. He greets a string of Baltimore politicians, NBC News contributor Harry Smith, former NFL linebacker LaVar Arrington, and former gymnastics coach Bela Karolyi, who’s decked out in a cowboy hat. He greets his buddies from his Catholic high school and the University of Maryland, where he walked onto the football team. (“I’ll go over to my college friends,” Plank tells me later. “They’re like, ‘Come on, come on, let’s do a shot.’ I can’t do a shot; the governor’s over there.”) After a time, he ducks into the manor house, which he’s decorated with framed pictures of the famous horses that used to train here, including Native Dancer, who won the Belmont Stakes and the Preakness Stakes in 1953 and damn near won the Kentucky Derby, as well.

Plank bought the farm in 2007, partly out of irritation. He kept hearing that the Preakness, which has been held in Baltimore since 1873, might be moving out of Maryland. Yet nobody in Baltimore seemed to care. This baffled him. He thought, What are Baltimore’s great brands? The Orioles. The Ravens. Crab cakes. Johns Hopkins. And the Preakness. “People are, like, ‘Horse racing’s going away,'” says Plank. “It’s a 134-year-old tradition, and you’re ready to let it walk?” So he snapped up Sagamore Farm, the 530-acre ranch that for generations had been owned by the Vanderbilt family, who’d let it go to seed. Plank hired one of his high school pals, Tom Mullikin, to restore the farm to its former glory and breed horses that could one day contend for the Preakness, even the Triple Crown. Sagamore now employs 26 people full-time. One of Plank’s horses, Tiger Walk, finished eighth in the 2012 Preakness. “I like fixing broken things,” Plank says.

In the tent, I meet a former steeplechase jockey named Sean Clancy. “He’s different from the typical young, self-made man who’s tried to bull his way to the top,” Clancy says of Plank. “A lot of guys would just go to a sale, or buy million-dollar horses that have already proven themselves on the racetrack, and not go to the lengths that Kevin went to, buying that farm, sinking money into it, restoring it. He still has kind of an old soul about it.”

Out on the hillside, two hot-air balloons go up and down on tethers, giving rides to the guests. A fire pit crackles, and the humid night fills with happy, drunken chatter, the hills blurring in the dusk. The air smells of beef and perfume. “I love seeing people,” Plank tells me later. “I love blowin’ their minds. I love that Gatsby-type party.” But the party isn’t excess for the sake of excess. It has a purpose: to keep a horse race in Baltimore – to do his share in saving the Preakness – while continuing to grow the company that has given Kevin Plank the resources to fix broken things.

A few weeks later, I pull into Under Armour headquarters on a gray-skied morning after a heavy rain. The first thing I see is a group of employees working out: six women and four men, all young and fit and good-looking, doing push-ups on mats in a concrete courtyard. Every company is a church of itself, but Under Armour more than most; here, the active lifestyle is king, and employees are encouraged to live the brand. In the company cafeteria, the Humble & Hungry, named after Plank’s standard email sign-off, the food is color-coded according to healthiness – “Go” foods, “Slow” foods, and “Whoa” foods (“Stop! Think twice about these foods. Consume on your day off!”). The average age of employees is 31. “It is a little bit of a mini Melrose Place,” Plank tells me, “in a good, healthy way.”

Plank’s office has white-brick walls and windows that look out onto Baltimore Harbor. He pokes his head out the window and wonders aloud if the city is going to send one of its trash-skimming boats around to clean up debris from the harbor, which it often does when it rains. Today he’s wearing a white polo, jeans, and Under Armour sneakers. His belt buckle is in the shape of the Under Armour logo: a squat, horizontally stretched U looming above an A, like a lifter at the gym spotting his bro. An oversize map of the world dominates the wall behind his desk, and opposite the windows, a ceiling-high whiteboard is scribbled with inspirational sayings: “Storm the beaches and improvise!”; “I am the opposite of a moderate man.” Plank takes a seat and tells me he recently delivered a graduation speech at a Baltimore high school, Paul Laurence Dunbar, to which the company has given tens of thousands in charitable donations. “The biggest message to anybody out there?” he says. “Imagine this: This Maryland football player can build a billion-dollar company. You know, why can’t you? What’s your excuse?

“I mean, if you look at the White House,” Plank continues, “you gotta have gone to Harvard or Yale” to be president. “But for the rest of us, it’s nice to know that you can go to a state school and still have a chance.” His eyes flash. “Obama went to Harvard. Clinton went to Yale. Bush went to Yale. Where does the rest of the world come from? There’s something to it,” he says of his state school experience, “coming through that big system, that big funnel, that big machine, having not only survived but thrived in a lot of senses.”

Plank grew up in Kensington, Maryland, his father a real estate developer, his mother the town’s longtime mayor. He was the youngest of five brothers. “It’s the dog that’s born at the end of the litter that’s gotta fight for everything,” says Kip Fulks, a collegiate lacrosse player who was Plank’s first business partner and is now Under Armour’s COO. One of Plank’s Little League football teammates, Mark Mason, recalls that young Plank was “crazy.” Says Mason, “The first time I ever met him, at age 10, I was actually intimidated by him. We had these trees you had to run through. He went through yelling the whole entire time.”

As a sophomore in high school, Plank got kicked out of a private Jesuit prep school for poor grades. He transferred to Catholic school, where the kids had to wear uniforms, perform drills, and submit to inspections. “A pretty good wake-up call,” Plank says. “I realized what an amazing opportunity I had. I was coming from a good neighborhood, good parents, good older brothers. I didn’t really have an excuse.” After graduating, he spent a year at another military school, playing football and trying to get noticed by Division I schools. None seemed interested. So he went to the University of Maryland, unrecruited, and walked onto the team. Eventually he became special-teams captain, flinging himself at the other team’s blockers, absorbing abuse. “He would run into a brick wall,” says Mason, who played with Plank at Maryland. “And if the coach told him to hit a brick wall and get through it, he’d find a way to get through it.”

Plank also found a way to make money. Every February, around Valentine’s Day, he sold roses. Some of the guys on the football team delivered flowers for him, and so did his girlfriend at the time, Desiree Jacqueline Guerzon, who later became his wife.

What happened next has basically become part of American business lore, a Horatio Alger story that’s been incorporated by Plank into the company’s very branding. Sick of sweating through his cotton shirts during practices, Plank bought some synthetic fabric used in women’s lingerie and had a tailor make a series of prototype shirts that would fit tight against the skin and wick away sweat. Compression shirts, he called them. The first shirt sucked. The second one sucked a little less. The seventh iteration was kind of nice. Not that it was some amazing technical achievement. Plank didn’t have a patent on synthetic fibers or anything like that. But the shirt was just different enough from what was out there to give him a fingerhold on a mountain built by giants like Nike, Reebok, and Adidas. You reached into your dresser full of 20 or 30 cotton shirts and here was something slick and sleek and synthetic.

With the help of Fulks, Plank started trying to get athletes to wear his stuff. For the most part, the pros he approached weren’t interested, so he attacked at the collegiate level instead, where kids were open to trying new things. While Nike was driving truckfuls of cash into the homes of superstars, Plank was sweet-talking equipment managers in college locker rooms.

It was touch and go for a while in the late Nineties. Plank drove a ’94 Bronco with 250,000 miles and a cracked windshield. One day he went to the bank, checked his account, and saw that he had only $1,500 left. He’d written more than $5,000 in checks and couldn’t cover them. So he cleared out all his cash except for $100 and drove to Atlantic City to try to make some money playing blackjack. He was up $5,000 at one point, then decided to go for $10,000 – and lost it all.

“It’s over,” he thought. “You blew it.” He started to cry. On the way back to Maryland, he realized he couldn’t pay for the toll.

The next day, Plank stopped by his mother’s house to get something to eat. He used to keep a P.O. box there. He opened it, and inside was a check for $4,200 from Georgia Tech. “That was the last time I doubted the company,” Plank says. “Wipe the tears away, stand up, be a man, run your business, find a way,” he says sternly. “I wouldn’t call it a cry, by the way. I’d call it a whimper.”

The company grew quickly. In 1998, Plank moved Under Armour to a warehouse on Sharp Street in Baltimore. Soon afterward, another company in the athletic-apparel business invited Plank and Fulks to their office to talk about a possible partnership. During the discussion, one of the guys from the other company said, “Maybe we should just buy you guys.” According to Fulks, “Kevin looked at the guy and said, ‘No problem. Five billion and I’m yours.’ And the guy laughed. And Kevin looked at him seriously and said, ‘No, you raise the money and I’ll sell it.'” Fulks adds, “Those people are no longer around.”

Plank had another chance to sell the company several years later, when he started talking to Wall Street about taking Under Armour public. By now, youth and college teams and even some pros were wearing his clothes. The company’s sales had grown exponentially – from $5 million to $300 million in five years – as the company expanded into women’s wear and children’s clothing and had begun operating abroad. But more important, Under Armour had crossed that bright metaphysical border from “product” to “brand.” A product is just a thing you sell. But a brand is an idea. A brand is a chance to mint money: Under Armour backpacks, Under Armour flip-flops, Under Armour bottled water.

In 2005, on the day before the initial public offering, Plank got a cash offer for the company, according to Rob Sweeney, head of retail investment banking at Goldman Sachs, who led the IPO. The offer was around $750 million and gave Plank a chance to walk away, at age 33, with $500 million. He turned it down.

On its first day of trading, Under Armour’s stock rose 94 percent. The IPO made his family rich: his wife; his brother Scott, who owned 5 percent of the company’s shares until 2010 but later sold some of them and retired. Since the IPO, Under Armour has grown an average of 31 percent every year, enough to make Plank a billionaire.

“I think he wants to be bigger than Nike,” says Sweeney. “I think he wants to be a $75 billion company.”

The Under Armour Innovation Center is behind two security doors in a building on the company’s campus, across a set of freight-train tracks from the building that houses Plank’s office. Kevin Haley, the company’s head of innovation, an athletically built guy with close-cropped blond hair, walks me down a hallway past sewing machines and 3-D printers used for rapid prototyping, including one he calls the Big Daddy. About 30 people work in the innovation department, focusing exclusively on the most forward-looking and longest-gestating projects. Under Armour also throws the place open to outside inventors from time to time; the company sponsors a business competition every year at the University of Maryland, Cupid’s Cup, named after Plank’s collegiate rose-delivery business, designed to spotlight up-and-coming entrepreneurs. Plank says he wanted Under Armour to be a welcoming place to anyone with an interesting idea; if some 23-year-old kid comes knocking on the door, “there’s not some bureaucrat who’s sitting there going, ‘Oh, no, no, no; let me tell you how the process works.’ They’re going, ‘Hey, man, that’s pretty cool.’ And they’ll know, ‘Come to Under Armour and we’ll give you a fair shake.'”

Plank told me a story about how this process can work: A few years ago, he found himself in the New York Rangers locker room after a game, and he noticed the players wearing a type of compression short he’d never seen before. “I’m like, ‘Why aren’t these guys wearing our shorts? What’s that product?’ It’s the Coreshort. It’s this guy named Greg, a physiologist. Who wears it? Everybody. Everybody on the Rangers? No, everybody in the NHL. Like, all right. We can knock him off. We can buy it. Or we can license it.” And that’s what they’ve done: Under Armour now sells hundreds of thousands of Coreshorts at twice what Greg was selling them for. “We should be the platform,” Plank said. “I want everybody in the world to think of cool ideas. If you can do it yourself, great. But if you’re concerned, or if you want validation? Come to Under Armour.”

Haley and I arrive at a wall where several shirts are hanging. They have circular holes in the center where computer sensors would go to monitor heart rate and other performance data. “These are our early Frankenstein prototypes for our 39 project,” Haley says. Five years in the making, it launched in March under the name Armour39. Named after the original compression shirt – prototype No. 39 – Armour39 is an interesting window into where the company is heading. The day when our computers and our clothing fuse together seamlessly is not that far off; Under Armour dramatizes this in a commercial playing in the lobby featuring “Future Girl,” a woman who pushes a button and changes the color of her clothes. It’s an open question whether the technology companies or the clothing companies will define what this fusion looks like and thereby control the market. With all the disclosures lately about how tech companies like Google and Facebook are handing over customer data to the National Security Agency, are customers likely to trust them to manufacture things they actually put next to their skin? “Am I supposed to give that [market] away to the computer guys?” Plank says. “Who does the customer trust more? Who’s going to be leading that charge? Will it be Facebook? I don’t know. I know we’ll be there in some way, shape, or form.”

Haley brings me to a small workout area draped in black fabric. This is where they’ve been testing Armour39, as well as what he calls a “revolutionary” new bra and a new kind of shoe that’s going to “revolutionize the footwear industry.”

Under Armour has been trying to break into footwear for seven years now, without a lot of success. It still controls just a tiny slice of the U.S. footwear pie – 2 percent. The desire to make shoes was always there, says Fulks; they’d never be as big as Nike if they didn’t make shoes. “Just wait until we make shoes,” they used to say to each other. “It’s gonna blow up.” Adds Fulks, “Obviously a little naive.” Cross-trainers, basketball shoes, running shoes – nothing has seemed to stick. Plank says it’s taken the company that long to figure out the complicated logistics of making shoes in factories overseas: “Sometimes you’re just going to make mistakes for seven years.” But they were also trying to take market share from an overwhelmingly dominant competitor: Nike owns 40 percent of the U.S. athletic footwear market and 90 percent of the basketball-shoe business.

Nike has loomed large for Plank since the very beginning; he used to send Nike CEO Phil Knight a Christmas card every year, writing, “You will hear about us one day.” Plank doesn’t talk much about Nike anymore. He calls them “the guys from out West,” as in, “The guys from out West are valued at $50 billion. Are they nine times more valuable [than us]? I don’t know about that.” (Nike’s market cap is $50 billion; Under Armour’s is $6 billion.) Plank makes sure to tell me he thinks Knight is a good man, and respects him. “He’s also nearly 40 years older than me. So it gives me at least 40 years.”

The cards have changed a bit over the years. Under Armour isn’t just a start-up staffed by Plank’s bros anymore, although the bros are still around; he’s been able to lure top talent from Nike, Reebok, and other major fashion brands. After seven years of struggle, Plank finally believes they’re ready to take on footwear – this time with a new kind of running shoe called the SpeedForm.

I’m introduced to Dave Dombrow, senior creative director for footwear, a young former Nike employee with a shaved head, a plaid Under Armour shirt, and a soothingly inspirational style of speaking. He shows me the SpeedForm. The shoe’s distinguishing feature is a completely seamless heel, which gives it an ultraclose fit. Dombrow hands me a pair; they’re incredibly light and look like slippers. Under Armour likes to show off this shoe because, for one thing, it seems distinctively Armour-ish in a way that its other shoes didn’t; with its bra-cup-like heel, the SpeedForm is basically a compression sock for your foot. But the shoe also gives Plank a chance to talk about Baltimore. A typical shoe requires 100 to 200 sets of hands to make, which means chasing cheap labor all around the globe. The SpeedForm requires only 40 or 50 sets of hands, because it’s made in a bra factory, not a shoe factory, using manufacturing methods not usually used for shoes – like “ultrasonic” welding, a way of fusing material together without stitches. “We think we can get it down to 20, 30 sets of hands,” Plank says. If so, it may be cost-effective to manufacture in America instead of China.

“The public markets do not value jobs the way they once did,” Plank says, leaning back in his chair. “In the early 1970s, GM was the most valuable company in the world. Sixty billion dollars. They had jobs for a million Americans. You take the four horsemen of Silicon Valley? Amazon, Google, Apple, and Facebook? That’s 150,000 jobs. And collectively posting a trillion-dollar market cap…. So where are the jobs here? Does everybody work at McDonald’s?”

Suddenly, Plank starts reeling off growth percentages; that’s how guys like him keep score. Under Armour grew by 24 percent in 2010, 38 percent in 2011, and 25 percent in 2012. “I’m not guaranteeing it, but if we grow at least 23 percent for the next seven years, we’re a $10 billion company. So that’s five times from where we are today. What if we could just find a way to bring 25,000 jobs back to Baltimore city? Can you imagine what that would mean? Actually find a model that can invigorate the city of Baltimore again?”

This is where you start to involuntarily nod along with the guy. Plank isn’t Wall Street; he’s not a social media company. He’s not hawking credit-default swaps or some dipshit app. He’s a guy making shoes and shirts, actual physical products, things that come from factories and create jobs. At the same time, he’s so passionate about what innovation can do that it’s easy to forget what it can’t do. For instance, innovation probably can’t do anything to protect the shy sack of mayonnaise that is the human brain if the human it belongs to is hitting another human with a force of 15 to 20 Gs, which is the force that a lineman generates on every play, and which is about equal to a car hitting a brick wall at 30 miles per hour.

Earlier this year, Under Armour joined the Head Health Initiative, a $60 million partnership with the NFL and General Electric to reduce brain injuries in the league. The effort isn’t very far along, but there are reasons to be skeptical that it’s an earnest attempt to solve a problem and not just a public relations move to deflect criticism and liability. (At the time the initiative was announced, more than 4,000 former players were getting ready to sue the NFL over head trauma; the suit has since been filed.) When I call a couple of medical experts who study chronic traumatic encephalopathy, the degenerative brain disease that doctors have found in the brains of dozens of deceased NFL players, they tell me that it’s likely that no technology in the foreseeable future will be able to blunt the massive forces inherent in the game of football.

Plank doesn’t supply the NFL’s uniforms. Nike does. The contract is worth an estimated $1.1 billion. The initiative stands to strengthen Plank’s relationship with the league. It “represents another way in,” Forbes has written, “and a chance to be a hero.”

When I relay the medical experts’ skepticism to Plank, he darkens. “I love the sport. And I hate seeing it under attack. I think it’s important that we put the strongest resources that we have to defend it.” He says maybe there’s some angle we haven’t thought of, some technology from an Army helmet or a shoe or a boat. America is a smart, resourceful country, he says. If we can put a man on the moon…

Two days later, I head back into Baltimore to watch Under Armour shoot a commercial for its new “I Will” campaign. The site is a lush, green football field amid an industrial neighborhood. Beyond one of the uprights are two dilapidated brick buildings full of broken windows. A large film crew is setting up on the grass, and 30 kids from local schools are standing around, awaiting orders, decked out in navy shirts, white pants, and Under Armour “Highlight” cleats in shades of yellow, pink, aqua, and silver.

Ray Lewis is here, too, watching from the sidelines, stoic and silent, arms crossed over a cream-colored shirt. Lewis signed with Under Armour in 2007, not long after the company opened its first retail store. Plank would never admit this, but Ray Lewis, in a way, was another broken thing; his reputation had never really recovered from being charged with two counts of murder in 2000, even though those charges were eventually dropped as part of a plea deal. Plank helped rehabilitate his image. “I think he trusts me, you know?” Plank will later tell me. “And I hope it’s because we’re real. I hope it’s because I’ve earned that trust. And, frankly, I trust him, too. It’s powerful, when you look at what Ray has accomplished, what he has done in life, what he’s been through. All those things give him perspective, which is deeper than someone who just sells insurance for a living. That’s a real man.”

I walk over to Lewis and ask him why he and Plank click so well. “I think it’s because we have the same sort of personality,” Lewis says. “We’re both driven people, you know? We’re both kind of what they call alpha. Alpha people. People who are leaders. So when we get together, the conversations are intense. It’s just like, ‘I got what you want, you know what you want.’ And it’s like, ‘Let’s do this.'” He claps his hands.

After a time, one of the crew members brings Lewis to the center of the field and tells the players that Lewis has something to say. The players cluster around him. Lewis begins speaking off-the-cuff; his remarks may be cut into the final ad.

“I ain’t got time to play. Life is about moments. Life is about remembering that one thing that changed my life. What is that one moment. What is that one race.”

The kids stare at him, transfixed.

“It’s got to come from your heart, your mind, your soul, your spirit. You gotta be willing to die for it.”

After nine minutes and 10 seconds, Lewis trails off, looks up. People start to clap. He jokes and laughs with a few of the kids, walks off the field to a clutch of autograph seekers, climbs into a car, and drives away.

Kevin Plank arrives at the field a bit later, wearing black jeans and a black hoodie and complaining good-naturedly about a “jacked up” calf from running. He falls into conversation with the director, Eliot Rausch, a young, lean guy with tattoos, a shaved head, and Under Armour shoes with red laces. “That is so cool back there,” Plank says, pointing to an alley behind the field that runs between the dilapidated buildings. “Is there any way to have [the camera] project right out through the alley?” Rausch replies in a diplomatic tone that it’s an interesting idea.

Plank takes out his phone, makes a call. He lets me overhear it. He tells the person on the other end he’s going over to Ray Lewis’s later to watch the Miami Heat game. Got that? Plank and Ray Lewis hang.

Plank asks me what I thought of an event the day before, Investor Day, in which Under Armour brought stock analysts to headquarters to give them a pitch about the company’s future. At one point during Plank’s presentation, he brought Tom Brady up to the stage as a surprise guest. Now Plank starts to tell me about running into an analyst in the bathroom after his speech. “His first reaction to me was, ‘I really thought we were going to see Bryce Harper today.'” Harper, the 20-year-old outfielder with the Washington Nationals and 2012 Rookie of the Year, is signed up with Under Armour. “And I’m kinda goin’, ‘That’s Tom Brady,'” Plank continues. “Bryce is great, but he doesn’t have three Super Bowl championships, two MVPs, and a supermodel wife.” Plank laughs. “It was funny. That’s sort of the definition of Wall Street. ‘Whaddya got. Whaddya got.’ You know, we’re a lean-forward company. That’s the expectation they have of us.” Which is fine, he says. He refers to something he told the analysts yesterday: Under Armour will double its sales in just three years, from $2 billion to $4 billion. “That’s a bold statement,” he says. “To plug a number out there? Not a lot of companies can do that.”

Just then, a helicopter comes rumbling above the football field. “You know you’re in Baltimore when you hear the helicopters come in,” Plank says. He leans back and throws his hands to the sky in a sort of isn’t-this-town-crazy gesture, as if the copter is a police copter. Then he points at me and smiles. “That’s a news helicopter, for the record.” It strikes me as a deeply Plank moment. Here’s this broken landscape. But not too broken. Just broken enough to require his intervention, which is to say, not broken enough to slow him down.

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