At Kerrisdale Capital, we invest in all sorts of industries. One of the fields I’ve written about, in the course of my work with Kerrisdale Capital, is the shoe industry. Today, I’m going to dive into the history of that industry. This is one of the most ancient, and most fascinating industries known to humankind.
Archaeologists say that the earliest known examples of shoes date back over 40,000 years. Protective foot coverings have been recovered from Ice Age sites, suggesting that human beings were making, and wearing, shoes at least as far back as the year 40,000 BCE. While historians and archaeologists don’t know much about what these primitive shoes looked like, it’s a safe bet that they were intended to keep our Ice Age ancestors warm and protected from the elements.
By 4000 BCE, the ancient Egyptians were on record as constructing shoes out of leather. The remnants of leather shoes have also been excavated in Armenia and are thought to date back to 3627 BCE. Of course, it wasn’t very long until shoes started to become more elaborate. King Tut, apparently, was buried with leather sandals that had elaborate golden designs of hawks and other animals!
By the Middle Ages, shoes were turning into a status symbol. Suddenly, shoes weren’t just something useful for keeping your feet warm. The demand grew for stylish shoes, and even high heeled shoes. By the 12th and 13th centuries, wealthy Europeans were showing off in pointy toed shoes. According to the fashion of the times, the longer the toe on your shoe, the higher status you had!
By the 16th century, the European nobility was falling in love with high heeled shoes. They were introduced to the French public by Catherine of Medici. Louis XVI, the notoriously short French king, was a huge fan of garish high heeled shoes, which he used to boost his own height!
At Kerrisdale Capital, we conduct research into all sorts of industries. Shoe making dates back thousands of years, but it wasn’t until a few hundred years ago that it truly became industrialized.
In the 19th century, an African American inventor called Jan Ernst Matzeliger invented a machine to automatically make shoes. Not long after Matzeliger’s breakthrough, the first high heeled shoe factory opened in the United States. Clearly, this revolutionized shoe making. Suddenly, Americans didn’t have to import expensive shoes from Europe – instead, they could make them right at home.
In the early 20th century, shoe makers started selling shoes with rubber heels. These new, light-weight shoes were called “sneakers” because they were so quiet and light – nobody could hear your footsteps as you approached. It wasn’t long before sneakers with canvas uppers were all the rage in America and around the world.
At the same time, the 20th century was a time when stiletto shoes – named after a dagger by the same name – were introduced to the market. Stilettos and other high heeled shoes could command a very high price, making the shoe market incredibly valuable.
Sahm Adrangi is the founder of Kerrisdale Capital, a hedge fund that is well known for short-selling and for publishing research. Adrangi first became well-known after he shorted and exposed a number of fraudulent Chinese companies. Eventually, several of those fraudulent companies were subject to enforcement actions by the Securities and Exchange Commission.