Levi Strauss arrived in wild San Francisco in 1853.

The gold rush was on, but Strauss (1829-1902) had no guarantees that he would make his own fortune.

Strauss, who was still a couple of decades from launching his famous jeans, was relatively unknown. He was there to set up a West Coast branch for his brothers' New York dry-goods distribution business.

He wasn't penniless — and likely networked with a few fellow Jewish merchants.

Neither did he have any special advantages. Strauss was just another man from the East Coast who wanted to tap a hot economy.

"He had a lot of competition in San Francisco," Lynn Downey, a Strauss historian, told IBD. "He was not the only wholesale merchant. Everybody got on the bandwagon."

Still, Strauss was sharp with an untiring love of his work and the ability to see and seize opportunities. Risk wasn't a problem for Strauss.

Those characteristics would later help him create the popular jeans now synonymous with 20th century American culture.

"He prevailed. He survived," said Downey. "There are a lot of other names of dry-goods businesses in the San Francisco directory at the time that you haven't heard of anymore — because they're long gone."

Strauss' company imported clothing, umbrellas, bolts of fabric and even handkerchiefs. He sold them to small stores across the West that were supplying the miners of the gold rush. Later the stores would sell to the families that settled there.

Although no historical record exists of how he grew his business, Strauss became widely known and respected on the West Coast.

"He has been quoted as saying, 'My life is my business,' " Downey said.

With that success, the rugged jeans would soon have legs.

"Everybody knew Levi Strauss' name," Downey said. "The reach of his business was so fast. He already had a reputation for being an upright businessman."

In 1872, a tailor in Reno, Nev., Jacob Davis, contacted Strauss about an idea for a new kind of pants. He thought Strauss was the right choice of business partner.

Davis found an unusual way to make pants after a local asked him to make a long-lasting pair for her husband.

Davis put metal rivets at the corners of the pockets on denim pants, already the popular fabric for laborers' trousers. He also attached them at the base of the button fly. These were the stress points.

The pants held up longer than anything on the market. "Word went up and down the railroad lines: Someone has found out how to make pants that would last," said John Marschall, professor emeritus at the University of Nevada, Reno.

Yet Davis wasn't a sure thing, if his past was any indication.

"He had applied for several other patents, and they came to nothing," Marschall said.

Davis didn't even want to be a tailor, but had to take on the craft after his other efforts didn't pan out.

Despite those challenges, the pants were a hit. Downey said he had sold around 300 pairs by 1872.

Strauss saw something in the riveted pants.

"It made them a different kind of product, and Levi understood that," Downey said. "He had his finger on the pulse of business, and a finger on the pulse" of consumers.

At the time, piracy was common, and it's conceivable that Strauss could have simply stolen the idea. He had the means.

"I think he's a person of integrity; that's the only thing I can think of," Marschall said. "It was the right thing to do."

Strauss and Davis filed the patent and received their stamped paper in 1873. Yet the venture was shaky.

Strauss was a wholesaler of goods made by others, not by his own company. Shifting to actually manufacturing something was a big change in his business model.

"He made a risky decision to go into the manufacturing business, which is just something he didn't do," Downey said. So Strauss put Davis in charge of manufacturing the jeans.

Also, Strauss leveraged his immense wholesale business to push the pants. Salespeople just added the jeans to their product offerings.

"If it had Levi Strauss' name, people knew it would have a good product," Downey said.

Strauss made it work.

Cowboys, farmers, miners and railroad workers snapped up the jeans.

Other manufacturers wanted to cash in on the new product, so they challenged the pants in court.

Levi didn't back down. He hired lawyers to defend the patent.

The lawyers interviewed people in Sacramento, Calif., and all over Nevada — Reno, Virginia City and Carson City. Their testimony helped make Strauss' case, and a federal court said the patent would stand.

The firm soon saw the 501 — known as the XX — become a best-seller. Although the wholesale business would last well into the 20th century, Strauss knew what would be the cash cow: the jeans.

"I think he was just a smart guy," Downey said.

Strauss never married, so he spent much of his life at the office and shop floors. He would stay involved in day-to-day operations until late in the 19th century.

Despite those formal times, he never let his employees call him Mr. Strauss. He was simply Levi.

Strauss stood tall in San Francisco. He helped found Temple Emanu-El, the city's first synagogue. He also contributed to the Pacific Hebrew Orphan Asylum and Home and the Hebrew Board of Relief. In 1897, he funded 28 scholarships at the University of California, Berkeley.

But he wasn't always successful. In 1895, he helped fund a railroad from San Francisco to the San Joaquin Valley; it failed.

Strauss died in fall 1902, leaving an estate of $6 million, worth $145 million in today's dollars.

The company, which had more than $7 billion in annual sales in the 1990s, has struggled in the past decade, but could be back on course. In 2006, revenue was off less than 1% to $4.19 billion compared with 2005. Net income was up by more than 50% in 2006.

In the fourth quarter, sales rose 4% and net income more than doubled as operations improved.

Strauss would have liked to have seen the effort.

"He devoted his entire life to his business," Downey said.
BY BRIAN WOMACK