"I think sandals have been underappreciated and underutilized ever since Greek and Roman times." 

Mark Thatcher should know. He is the owner and founder of Teva, a company that has become one of the best known names in the sandal business. Recently, Mark recalled for Flagstaff Tea Party how he rose from a Philadelphia ghetto to become one of Flagstaff's entrepreneurial legends. 

Growing up near Philadelphia, Mark developed a love of the outdoors. When he first came to Flagstaff in 1975, at age 20, he intended to get a degree in forestry. "All I knew was that I loved science and I loved the outdoors," recalled Mark. He hoped that he would end up working in one of the national parks. But after visiting a few national parks, Mark changed his mind. To him it seemed that park rangers were "policemen in the woods," which was not at all what he wanted to be.

Mark changed his major to geology. During the summers, when he was not attending classes at NAU, he worked as a boatman, helping to lead motorized trips through the Grand Canyon for a commercial tour company. He was having the time of his life. Little did he know then that the summers he spent learning the course of the river would ultimately change the course of his life. 

When he graduated, in 1980, he quickly landed a job with CITGO, the oil and gas company. He was able to get the job easily because he had befriended some of the company's top brass during a river trip.

"I was always a bit of a radical during the 60s and never really envisioned myself working for an oil company but I was willing to find out more, especially since I knew these people and they were down home people." 

His career in oil exploration, helping to search for and map out oil deposits lasted only three years.

"Although I loved looking for oil, I loved the science … I had a real passion for it but the politics and living in Houston … almost took away my passion and made me a basket case in terms of emotions."

In addition to being frustrated by office politics, Mark had to deal with a supervisor whom he described as "capriciously malicious."

In1983, Mark and many other CITGO employees were laid off in the wake of a merger. Mark and other employees were given a generous severance package that included office use and secretarial assistance while they looked for new jobs. But Mark was not sure he wanted just another job.

"I basically came to the conclusion that I was either going to have to become an entrepreneur or a bum. And by bum I mean anything from a homeless person almost up to a boatman. … What do bums and entrepreneurs have in common? They control their own time and they don't work for some jerk. …"

While Mark half-heartedly looked for work in the depressed oil industry, he began to think seriously about going into business for himself. 

"I posed the question, what product or service do I have an insight on? What pent up demand is there that I can get a grasp on intuitively that's in a vein that I know and like? Darnit, I'd like to get reconnected with the river somehow. And I thought well, footwear, footwear, footwear."

Mark vividly recalled how all of the Grand Canyon boatmen had worn simple thongs or flip-flops on the river. Paying passengers invariably took a keen interest in the simple footwear of the boatmen.

"It happened every trip. Somebody would notice me wearing thongs and make comments about it. Then later on in the trip, after day three or four, you could feel their jealousy. They were … in a hiking shoe or athletic shoe and their feet would stay wet. Their feet would get pruned and start to get fungus and gravel would get caught in the shoe. They'd constantly be taking them off. And they're going in and out of the water all day. Their feet would never really dry so their feet were pretty miserable … and here your feet were, smiling and happy."

But Mark also recalled that thong type footwear was not well suited for running because of the flip-flop effect and the tendency of a thong to fall off a runner's foot. 

"I loved moving fast in the Grand Canyon, running up certain side canyons. I experimented. I used to believe running barefoot would be the best way to go. I used to run up Havasu barefoot. I got big old gashes in my feet. …" 

Mark and other boatmen sometimes sewed a short length of elastic to each side of their thongs, looping the elastic around their ankle. They hoped the elastic would reduce the flip-flop effect and minimize the risk of losing their thongs in the water's strong currents. But the elastic strap created a new problem.

"The fact is … it would just jam you into the toe-piece. And it didn't really eliminate the flip flop - it just made it easier to retain the sandal."

As Mark thought about the strengths and weaknesses of the thongs he had worn during his river-running days, he began to wonder if he could come up with a simple, effective and comfortable way to keep the sole of a thong snug against a wearer's heel. As he was thinking about this, a new kind of material began appearing in watchbands. The material was Velcro. With a little help from the mother of his college sweetheart, who happened to own a sewing machine, Mark began attaching velro straps to thongs in various configurations until he found a configuration that seemed to hold the heel in place. Thus the first Teva sandal was born, though it had no name back in 1983.

"It's basically just a thong in front, two belt-loop things coming up from the side-heal area, and a Velcro closure around the ankle. So simple. All I did was take a thong and add a watchband strap and attach it."

With one crude prototype in hand, Mark knew he had neither the financial resources nor the expertise to start manufacturing his own sandals. He knew he would need to pitch his new product to a licensee -- a company that manufactures and distributes products. He knew his best bet was to take his idea to one of the companies that manufactured and distributed thongs. He made an appointment to meet with a representative of a company in Long Beach, Calif. During the same trip he would interview for a job in oil exploration, just in case his modified flip-flops were a flop.

When Mark went to Long Beach, he was nervous about showing his idea to anyone because it was not yet patented. For his own protection, Mark drafted a crude "confidential nondisclosure agreement." This document basically said that Mark's idea could not be used without his permission and that Mark was not going to give his permission unless arrangements were made to fairly compensate him. A representative of the company he was meeting with would have to sign the agreement before Mark would unveil his innovative sandal. In the agreement, Mark made it a point to mention the patent application number he had been assigned.

In Long Beach, Mark went to lunch with a representative of the family-owned company - the family's grown son.

"We went to Coco's … and I showed him my handwritten nondisclosure agreement - carbon papers so we each had a copy - he signed it. I was surprised he signed it so easily. … but I think it was the patent application number in there. He figured, 'well, it's going to be patented anyway so I can sign this thing.' … And then I showed him my idea and they were interested."

Before long, the company had produced some prototype sandals in its small Long Beach workshop.

"Once we got some samples, they gave me some prices. I added a unit of price above that to get what I thought would be a good wholesale price and I'd make the difference. That was my residual or royalty."

Soon, Mark was on the road. In the back of his pickup were 200 pairs of sandals and a stack of fliers. Suddenly, he was a shoe salesman, selling not only his own sandals, but also other models offered by the Long Beach company. The year was 1984. He visited sporting goods stores all over the Southwest, hoping to get his sandals on the shelves. He also traveled to the Northwest, Wyoming, and northern California. He sold some sandals but not as many as he had hoped he would. As expected, his sandals sold best in stores that catered to river runners. Some of the first stores to buy the new sandals were Aspen Sports and Expeditions in Flagstaff. 

He recalled trying to adapt his usual sales pitch to appeal to the older proprietor of a hiking store in Phoenix that specialized in desert hiking gear.

"I said, 'this is a desert hiking sandal.' And he looked at me and he kind of screwed up his eyes and he let me go through my little two-minute spiel and he goes, 'Are you crazy?' He goes, 'What's to protect your feet from rocks and cactus.' And I looked at him and said, 'Your eyes! I didn't say they were night time desert hiking sandals!'"

But even boatmen sometimes did not understand Mark's sandals. He had incorrectly assumed that boatmen everywhere were wearing thongs.

"It turned out that was just a Grand Canyon unique thing. … I'd say to (boatmen), 'Look … if you don't like the back-strap, I'm selling it to you for wholesale. It's still a cheap thong. You can cut the back-strap and still have a less expensive thong.' I sold a lot of pairs to boatmen directly that way and enough of the boatmen didn't cut their straps off such that they were seen wearing them by the passengers. … By the next year those store proprietors that might have said no to me the first time were being asked for the product because the boatmen were seen wearing them."

As interest in Mark's sandals began to grow, Mark put a small classified ad in the back of Outside magazine and asked two of his friends in Flagstaff if they would sell his sandals by mail. His friends, Steve and Mary Gashaw, agreed to help out in their spare time. 

Meanwhile, Mark continued to roam the country with boxes of sandals in the bed of his truck.

"I was just living on the road and living off my severance and trying to build this business … living very frugally - sleeping on the gluing table at the factory … sleeping in the back of my truck."

By the second production run, Mark had given his sandals a name, "Teva." The word means "nature" in Hebrew. Mark's mother is Jewish, but that's not the real reason Mark settled on a Hebrew word. The origin of the word Teva stems from Mark's visits to Israel as a teenager. 

"I was a high school dropout in Philadelphia. We had started a free high school, made some plans and we were legally out of school underage but we never got accreditation. … I'd already moved out of home and lived on $30 a week child-support from my dad in a black ghetto."

When it became clear that the board of education was not going to give accreditation to the free school, Mark asked his mother if she would send him to Israel for 11th grade. His experiences in U.S. public schools had not been good. But the year he had spent in England with his mother had been one of his best years as far as school was concerned. He hoped a year in Israel might help to get him back on track. It did. He finished school in the U.S. and then returned to Israel in 1973 during the Yom Kippur war.

"They asked for American volunteers to bring in the crops."

It was during Mark's second visit to Israel that he met Gil Dror. Dror would prove to be an important role model in Mark's life and became a close friend. Dror worked with an organization that Mark describes as similar to the Nature Conservancy. The name of the organization is loosely translated as, "Office of Guards of Nature." It is from this organization's name that the word "Teva" sprang to mind.

Though Mark had sold fewer than 200 sandals when he picked the name "Teva," orders were starting to come in at an encouraging rate. But no sooner had the sandals begun to show promise than Mark's relationship with the Long Beach company began to sour. 

"The few orders I got, the company did not deliver and maybe half the stores canceled their orders because they planned on receiving their order either spring or early summer. … They were a very sleepy ma and pa type operation. They were slow."

Things came to a head at a trade show that Mark attended with representatives of the company Mark had borrowed a pair of pliers from the company's workshop to use at the show. But he had not bothered to get permission to do so. Soon after this, Mark's agreement with this family-owned company fell apart. The father in the family told Mark, "Mark, we haven't got an agreement. You can hit the road."

Looking back, Mark realizes he should not have put so much faith in an agreement that was almost entirely verbal. 

"And I went out going, 'Oh my God, my idea's going to make somebody a million dollars but it ain't gonna be me. I better see what I can do about that.'"

Mark immediately started looking for a new manufacturing partner.

"I call that period looking for a white knight to save me. … I went to Patagonia. I went to North Face. I went to Sierra West. I petitioned the highest guys in those companies that would talk to me, told them my ideas. They listened. Some of them were quite polite and quite interested. None of them signed up. They were all less than impressed with my credentials in terms of going to source. Like the guy from Patagonia, (he said,) 'Do you know anything about getting this stuff manufactured in Asia?' I said, 'No, I don't know anything about that.'…

… I'd been reluctant to talk to a company by the name of Deckers but I finally did. Been reluctant because of certain hearsay. All of the sandal companies had some negative hearsay about them because I was talking to their competitors. … I finally called up Doug Otto who is the owner of Deckers and I said, 'I've got an idea. … Maybe you should come on out here so I can take you on a little river trip and show you how my idea is best utilized and what the market is about.' And he accepted my invitation."

Thus began a 15-year partnership with Deckers Outdoor Corp. of California that continues to this day. This time Mark was careful to get a licensing agreement in writing. The licensing agreement detailed how the licensee (Deckers) would oversee the manufacture, marketing and distribution of Teva sandals. In addition, the agreement gave the licensor (Mark) the ability to monitor quality and approve new footwear designs that bore the Teva label. The agreement also specified the percentage of proceeds from footwear sales that would be paid to Mark as a royalty. The agreement has been renegotiated every few years.

With Decker's help, Teva has become an increasingly recognized brand name. Mark now hold's several patents for innovative footwear designs. In 1987, Mark patented his "universal" sandal design, a design that eliminated the problem of toe-chaffing that sometimes afflicted sandal wearers engaged in vigorous sport activities. The new design removed the post from between the toes and instead held the toes in place using a strap over the top of the foot. This innovation, combined with "infinitely adjustable straps," created an immensely popular sandal design that has been much imitated.

According to a Decker's annual report made public at the end of 1998, "To date, Mr. Mark has successfully enforced his patent and trademark rights in all 20 concluded lawsuits brought against … third parties." The problem of counterfeiters using Teva designs without authorization has dogged Mark from the beginning. After his relationship with the Long Beach company ended, it soon became apparent that the company was going to continue marketing sandals based on Mark's design using the Teva name. It would take Mark nearly two years of legal wrangling to establish in court that he held the exclusive rights to the name and design of Teva sandals. 

Today Teva sandals are sold all over the world. They are especially popular in the U.S. and Europe. Mark estimates Teva footwear generated $80 million in gross revenue for Decker's in 2000. Though Mark declined to state precisely his personal earnings or the earnings of his company, Teva, he indicated that a licensor typically receives a royalty of between 2 and 10 percent of gross revenue.

While Deckers has been busy getting Teva footwear into retail stores all over the world, the tiny mail-order business that Mark set up with the help of two friends has evolved into Teva's consumer sales division. Operating out of offices in an unassuming wooden A-frame building on Beaver Street, Teva's consumer sales division handles catalog and Web-based sales of Teva footwear. According to John Kalinich, manager of licensing and consumer sales, the consumer sales division accounts for a mere 1.5 percent of Teva sales. Nonetheless, for the consumer sales division, business is booming thanks to the Internet. Since 1996, orders placed through the consumer sales division have jumped nearly 10-fold, amounting to just over $2 million in sales in 2000. 

Teva's consumer sales division currently employs 15 to 20 people, depending on the season. Most of the employees are students who work part time answering the phones. Teva's consumer sales division also includes two people who work at a warehouse in east Flagstaff. According to Kalinich wages are typical for Flagstaff, with part-timers earning between $6.50 and $8 an hour. Available benefits include health insurance, a 401(k) plan, paid vacation and sick leave. All employees also receive two free pairs of sandals per year.

Today Teva sells not only sport sandals, but also innovative running shoes, hiking shoes, and snow boots, as well as a variety of special shoes for kayaking and other water sports. Last year 2.5 million pairs of Teva footwear were sold worldwide.

Whatever thoughts Mark Mark may have once had of becoming a "bum" would seem to have been long forgotten. Today he not only has a roof over his head, he owns three homes in Mountain Dell, just south of Flagstaff, and a fourth in California. But though Mark is one of Flagstaff's more affluent residents, there is nothing ostentatious about him. 

Mountain Dell, with its unpaved roads and ramshackle homes, is hardly an exclusive neighborhood. Mark's primary residence, though certainly a nice home, is a surprisingly modest affair on a quarter-acre lot. Mark lives with his wife, Rachel. Mark's other two homes in Mountain Dell, located next door to his primary residence, are occupied by his his father and his wife's mother. One of the homes is also shared by a caretaker and the caretaker's family.  

"We've got kind of a little community here," said Mark.

The success of Teva has touched Mark's family in other ways as well. Mark's sister Leslie has been involved in directing Teva's local philanthropic efforts while his father, Tom, has had a hand in Teva's mail-order business.  

Rachel too has had a hand in the business, acting as the company's environmental coordinator. In a written statement prepared for this story, Rachel mentioned some of the ways that Teva is working to protect the environment. 

Through its financial support, Teva has worked to assist such local groups as the Nature Conservancy, the Grand Canyon Trust, and the Arizona Ethnobotanical Research Association. Teva also supports several other environmental organizations around the country that are working to restore rivers, forests and rangeland. Some of these groups are spotlighted in Teva's catalogs. 

"Although we do not control what our licensee, Deckers does, we do have an active working relationship with them, which allows us to influence their practices," wrote Rachel. "Last year I hired an environmental consultant, Mike Brown, to help me pitch the idea to Deckers for a corporate environmental crusade. He had previously been instrumental in Patagonia's efforts. With his help we were able to convince Deckers of the importance of weaving environmentalism into all they do. They have embraced the idea and are taking baby-steps (as Mike recommended) in this direction, starting with the greening of their corporate offices."

In addition to its support of various environmental efforts, Teva has also supported a number of other worthy causes such as Northland Family Help Center, Literacy Volunteers of Coconino County, and Northland Hospice, among others. 

Though Teva supports many charitable organizations, Mark would like to do more. 

"My philanthropic endeavors have been not as studied and not as expansive as I hope they will become," said Mark. 

Looking back, Mark marvels at his own unlikely rags-to-riches story.

"I'd really like to take any occasion to encourage folks to follow their dream. … Sometimes the most singular and simple ideas are the most powerful. … People maybe don't need the MBA. They just need the idea and the will to follow, to take it where it leads them as they pursue it."

To read about the manufacturing of Teva sandals in China, click here.