Italy's entrepreneur with sole
By Vincent Boland
Published: April 22 2009 03:00 | Last updated: April 22 2009 03:00
Mario Moretti Polegato wants you to want holes in the soles of your shoes.
In one of several laboratories he has built at the headquarters of his Geox footwear empire, a bionic leg, known as a walkmeter and wearing a running shoe, is simulating a human taking 100,000 steps, or about 200km. The repetitive movement is aimed at testing the shoe's durability. Other machines are testing shoes for cracking, waterproofness and "breathability".
The tests, overseen by a team of engineers, are part of the Italian entrepreneur's obsession with getting us all to walk around with holes in our shoes. He wants to create the perfect shoe that will not make the foot sweat.
"The era of smelly feet is over," he says, seated at his desk in his wood-and-marble office at Geox's base in Montebelluna, in Italy's industrial heartland around Treviso. Perforations in the soles not only allow the foot to breathe but also make walking more comfortable.
Founder and chairman of the company, his belief in his unusual shoes has made him a billionaire and something of a lifestyle guru. Although founded only in 1995, Geox is the world's second largest lifestyle/casual footwear brand, after Clarks. He spends much of his time travelling and speaking about innovation, entrepreneurship and the environment.
The corridors of the Geox labs are lined with photographs of Mr Polegato addressing students at universities from Cambridge to Venice. Recently, he had lunch with Prince Charles, of Britain's Royal Family. A visitor to Geox is handed a list of "celebrities choosing Geox for themselves or their children". Names include Angelina Jolie, Barack Obama and Pope Benedict XVI. Indeed, Mr Polegato himself is something of a celebrity in Italy. In a country of entrepreneurs, he is clearly proud of his achievement and sees himself in the same league as other, better-known Italian designer-entrepreneurs such as Giorgio Armani. He also has the character to match.
At 56, Mr Polegato cuts an imposing figure - tall, broad-shouldered and dressed in an immaculate pinstripe suit with a bright yellow tie and a pair of the classic black men's shoes he invented, the basic components of which are leather uppers and rubber soles. Black-and-white spectacles add an eccentric touch he seems to relish.
Yet he seems to take it personally that only one Italian in 10 - to say nothing of the rest of the world - is wearing a Geox shoe at this moment. Ninety per cent of the world's shoes have rubber soles, he says, and it seems to jar that this should be the case. "Almost all of humanity walks this way, and it's not right," he says.
His conviction that conventional rubber soles are terrible for your feet, whether for walking or running, struck Mr Polegato one day in the early 1990s - he does not recall the precise date. The epiphany came in the desert outside Reno, Nevada. He was out jogging during a lull in a wine fair he was attending on behalf of his family's wine business, in which he was heavily involved. The solution to his bruised and sweating feet, he concluded after trying his own experiment, was holes in the soles, which would allow the foot to breathe. "At first I was thinking only of my own feet, and only later, after I had returned to Italy, did I begin to think about it as a business idea," he says.
"I went looking for breathable soles in sports shops all around Italy, and I couldn't find them. I thought, is it possible that nobody has thought of this idea yet? And nobody had," he says.
In the Nevada desert Mr Polegato tore holes in the soles of his running shoes with his hands. Back in Montebelluna, he began to refine his idea. "It's very hard to walk around with holes in your shoes because they let in dirt and water," he says. "So the problem I had to overcome was to make a shoe with holes in the soles that was also waterproof."
He patented his idea and began researching it. He found some answers in research carried out by scientists in Japan. Then he constructed a prototype, which he took to sports shoe makers in Italy, Germany and the US, all of which expressed scepticism. "I couldn't understand why they couldn't understand my idea, so I decided to begin making the shoes myself," he says. With backing from the Cassa di Risparmio di Treviso, the local savings bank (now part of the UniCredit group), he got enough credit to set up a manufacturing operation, which became Geox.
The company designs and manufactures mid-price casual shoes with tiny holes in the soles that can be worn with a suit. The shoes are made waterproof by a special membrane that keeps water out and allows sweat to exit.
In 2008, Mr Polegato says, Geox sold 20m pairs of shoes. Italy ac-counts for 38 per cent of sales and other European countries for 47 per cent. The company has 940 stores and 3,600 employees, and had €893m ($1.2bn) in sales last year, and net income of €123m.
Geox has made Mr Polegato rich, but this is not a tale of rags to riches, since he comes from a wealthy family of winemakers. Geox is his first entrepreneurial venture, al-though the wine business founded by his grandfather was entrepreneurial in its day.
Nevertheless, the rapid success of Geox has added another layer of wealth to an already well-off part of Italy. The region around Treviso is home to Benetton, Diesel, Luxottica and other globally successful Italian brands - as well as a cluster of artisanal shoemakers. Geox was worth near-ly €4bn at the height of the stock market boom (it was listed in Milan on December 1, 2004), although the value has fallen to about €1.4bn today. Mr Pol-egato owns 71 per cent of the company.
He has entrusted day-to-day management to an executive team, which leaves him time to give talks about the experience of being an entrepreneur. "It's impossible to substitute an entrepreneur for a financier," he says. "A company is not just about money. It is necessary to connect all the people who work here, and only an entrepreneur can do that."
Warming to his theme, one of the lessons of the global crisis, he says, is "the need to change capitalism". Asked to define the company of the future, he pauses for a moment before highlighting four themes: "It must strive to change the world, it must innovate beyond the imagination of its clients, it must be globally integrated and it must demonstrate that it is not just generous but genuine," he says.
"Generous is when you look after your employees. By genuine I mean that a company shouldn't have anything to hide."
Desert dream: the afternoon jog that led to a Milan listing
The story of how Mario Moretti Polegato's run in the Nevada desert led to an epiphany about human footwear and a big international business has become one of the hoary myths of Italian entrepreneurship.
He was attending a wine fair in Reno - his family owns the Villa Sandi vineyard in Montebelluna, among others - and went jogging one afternoon. "Reno is a funny city," he says. "It's all cowboys and desert. You can get from the downtown to the desert in 15 minutes." During his run he had an overwhelming urge to cut holes in the soles of his shoes and so was inspired to experiment.
Several patents, innovations and a Milan listing later, he plans to expand Geox from shoes into clothing, involving the same waterproof breathability.
At the same time, the company is beginning to test a type of sports shoe that deals with the problem of perspiration.
"We don't want to compete directly with Nike or Adidas, but we are anticipating the future," Mr Polegato says. "We want to repeat the experience with sports shoes that we did with 'brown shoes' [non-trainers], but we're not in a hurry."
Copyright The Financial Times Limited 2009
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