- Needs To Exist
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- The Ghost Who Built Costco
The Ghost Who Built Costco
Needs To Exist
November 09, 2025
In partnership with
Sol Price is the most important founder nobody talks about.
Not “underrated on Twitter” levels of unknown.
I mean: built-an-entire-industry, mentored-killers, inspired-trillions-in-value… and still invisible in the Marvel Cinematic Universe of founder worship.
Sam Walton studied him.
Jim Sinegal worshipped him.
Trader Joe’s rhymed with him.
Bezos basically turned his religion into AWS margins.
If Ted Turner was chaos with a broadcast license, Sol Price was the opposite:
No drama. No 24/7 cameras. Just concrete floors, ruthless ethics, and spreadsheets that humiliated entire industries.
This is the guy behind FedMart → Price Club → Costco.
The architecture NTE Pro is obsessed with: founders who quietly bend reality by fixing unit economics and values at the same time.
Today’s It Exists: Sol Price.
The retail revolutionary who proved you can pay people well, treat customers like clients, and still absolutely clean house.
Lesson 1 – The Letter That Took 50 Years
Start at the end.
Jim Sinegal (Costco co-founder) gets a letter from Sol Price in his 70s.
“Dear Jim… you’ve been very generous about giving me some credit for influencing you… you would have been a great achiever under any circumstance.”
Jim walks out of his office and says:
“I’ve been waiting 50 f*cking years for this letter.”
This is a billionaire operator, with one of the cleanest businesses on earth, still chasing a one-line attaboy from his mentor.
Sol almost never gave compliments.
So when he did, grown men treated it like a championship ring.
👉 Takeaway: The strongest signal of a founder’s greatness isn’t their net worth. It’s how killers talk about them decades later.
Lesson 2 – Droopy Eye, Nuclear Drive
As a kid, Sol had a drooping eyelid. Kids roasted him. He got shy, angry, and competitive.
His response wasn’t therapy. It was:
Read more than everyone.
Think faster than everyone.
Prove them all wrong.
A teacher told his mom:
“He’ll either be a gangster or do a lot of good.”
Translation: perfect founder wiring.
He never lost that chip:
Underdog energy + slight misfit + needs to prove himself through building → that’s the engine powering FedMart and Price Club.
👉 Takeaway: You don’t have to heal every chip on your shoulder. Some of them are jet fuel. Just point them at something useful.
Lesson 3 – Raised by a Man “In Grave Danger of Getting Well”
Sol’s dad lived off a disability check for decades.
Didn’t work. Didn’t try. Played cards. Drifted.
Sol watched his family’s reputation tank and decided:
“Yeah, I’m never being that guy.”
Then war hits.
By day: young lawyer.
By night: aircraft factory.
Schedule: 8am–11:15pm. No whining. Loved it.
Later in life he lectures his grandkids on time:
24 hours a day. 168 a week. You’re not out of time, you’re out of priorities.
Sign on his desk: DO IT NOW.
👉 Takeaway: Some people inherit money. Others inherit an allergy to laziness. Guess which one builds empires.
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Lesson 4 – Eloping, Loneliness, and Picking the Right Co-Founder for Life
Helen’s parents thought Sol was a bad bet: divorced parents, weird dad, no status.
So Sol and Helen went and got married anyway.
She gave him the one thing his childhood never did: emotional bedrock.
He gave her 70 years of relentless effort without walking away when shit got hard.
Founders love to talk about “being lonely at the top.” Sol quietly hacked that with one decision in his twenties.
👉 Takeaway: Choose a partner who believes in your delusional version of the future. It’s the only anti-burnout feature that actually works.
Before FedMart and Price Club, Sol is a young lawyer watching weird little niches make stupid money:
Navy “locker clubs” renting lockers and selling goods to sailors who had to change clothes.
Fedco: a membership store only for federal employees. People drove 200 miles from San Diego to shop there.
Sol’s brain:
Focused segment + membership + real savings = volcanic demand.
He tries to partner with Fedco. They say no.
Like Sam Walton later, he gets lucky by being rejected.
So he builds FedMart.
👉 Takeaway: Most great companies start when someone notices “Wait, people are driving HOW FAR to save a few bucks?” and then bothers to do the obvious thing.
Lesson 6 – The Fiduciary Retailer (aka: How to Not Be a Leech)
Sol’s core heresy:
“We have a professional fiduciary duty to the customer.”
Not slogan. Operating system.
He:
Bought as low as possible.
Marked up minimally.
Treated membership fees as the profit engine.
Ranked stakeholders: customers → employees → shareholders.
Everyone else built margin on confusion.
Sol built margin on efficiency and trust.
That’s the DNA you feel every time Costco is weirdly cheap.
👉 Takeaway: Most businesses treat customers like a resource. Treat them like clients and you’ll still be printing when the hype cycles die.
Lesson 7 – Intelligent Loss of Sales: Why Costco Only Has One Ketchup
Retail religion: “More SKUs = more sales.”
Sol: “What if that’s dumb?”
He invents Intelligent Loss of Sales:
Carry fewer items.
Pick the best-value version.
Accept losing a few picky customers.
Use simplicity to nuke costs and prices.
Example: 3-in-1 oil.
Why stock 3 sizes? Stock the 8oz, price it right, let edge cases walk.
50,000 SKUs? Bloated, slow, and expensive.
3,000–4,500 SKUs? Fast, clean, cheap, and unbeatable.
This is literally the Costco / Trader Joe’s playbook decades early.
👉 Takeaway: “Everyone” offering everything is your opening to offer less and win.
Lesson 8 – Pay More, Expect More, Teach Always
Competitors: 50¢ an hour.
Sol: $1 an hour. In cheaper markets too.
Why?
Because people aren’t costs. They’re your alter egos.
His mantra:
“You train an animal. You teach a person.”
His job was to create thousands of mini-Sols:
People who:
Understand the model.
Care about the customer.
Can run the box without a manual.
Jim Sinegal: “I didn’t learn a lot from Sol. I learned everything.”
This is how Costco ends up with 20,000+ applicants for 200 jobs and fanatically well-run stores: inherited operating religion.
👉 Takeaway: Overpay + overtrust + overtell them why → under-manage for life.
Lesson 9 – Fighting Cartels, Fake Prices, and Dumb Laws
Sol’s to-do list over a few decades:
Refuse racist bathroom requirements in financing docs.
Launch discount pharmacies despite threats, rock-throwing, and exile from professional guilds.
Build private labels to bypass manufacturers who hated discounting.
Sue and lobby until “fair trade” minimum pricing rules died.
When the state said “you must fix prices,” Sol said “see you in court” and won.
While others role-played “respectable,” he quietly rewired the rules so customers stopped getting robbed.
👉 Takeaway: Industry norms are often legalized theft. Durable founders are willing to be the villain in the cartel’s group chat.
Lesson 10 – The Flaw: Teaching Everyone, Including Future Killers
Sol had one bug: he was too generous with the blueprint.
He:
Walked Sam Walton through his model. → Sam’s Club.
Encouraged Bernie Marcus post-firing. → Home Depot using warehouse logic.
Inspired half the category.
He also sold 64% of FedMart to Hugo Mann, an operator misaligned on values, and got blasted out of his own company.
Brilliant teacher. Brutal reminder: the market doesn’t grade on inspiration.
👉 Takeaway: Mentor up. Be careful mentoring sideways. And never sell control to someone you wouldn’t let babysit your dog.
Lesson 11 – Price Club: The Purest Version of the Idea
After getting bounced from FedMart, Sol reloads.
He takes:
Macro (European warehouse club),
Fedco (membership),
His own ethics & simplicity,
…and births Price Club:
No-frills warehouse.
Business customers only (prove you’re legit).
~3,000 items.
Rock-bottom markups.
Membership as the golden flywheel.
Thousands of small businesses pooling purchasing power into one concrete box of compounding leverage.
That’s the ancestor of everything you recognize as “Costco brain” today.
👉 Takeaway: Great founders don’t pivot to random new trends at 40. They double down on the one idea the world hasn’t fully understood yet.
Lesson 12 – Out-Executed by His Own Students (And Knowing It)
Price Club had a 7-year head start.
Then:
Costco shows up led by his apprentice, Jim.
Sam’s Club shows up led by his superfan, Sam Walton.
They grow faster. Open smarter. Operate tighter.
Sol’s team gets distracted by real estate side quests. Competitors stay locked on the core.
Then tragedy: Sol’s grandson (Robert’s son) gets sick and dies.
At the same time, Wall Street pressure spikes. Scaling pain mounts.
Sol and Robert look at each other and realize:
“We’re world-class at inventing this model. Jim is world-class at running it.”
So they merge with Costco.
Not as a surrender. As a values test:
Who will protect the philosophy best?
Answer: the kid who waited 50 years for his mentor’s letter.
👉 Takeaway: Elite founders know when their highest-leverage move is to hand the controls to the operator who believes what they believe and executes better.
If Sol Price Were Building Right Now
He wouldn’t be launching another cute DTC brand.
He’d be:
Running a Global Member Cooperative that:
Caps markups in public.
Publishes cost breakdowns.
Treats membership as a vote for a saner economy.
Using AI not for vibes, but to:
Obliterate middlemen.
Slash overhead.
Audit suppliers.
Route every saved penny to price, wages, or member dividends.
Turning private label into:
A weapon against bullshit brands.
A guarantee: “If you screw our members, we’ll out-compete you ourselves.”
Funding legal warfare to:
Ban dark patterns.
Nuke drip fees.
Make “fiduciary retailer” a regulated category.
He’d still be in a cheap office, with a DO IT NOW sign, making you look at your P&L and ask why your customers trust a warehouse more than they trust you.
👉 Takeaway: He’d be the quiet apex predator of “fair.”
The Spark
Sol Price’s real legacy isn’t just Costco’s hot dog, or membership economics, or warehouse clubs.
It’s the blueprint:
Misfit chip → relentless work.
Pick the right partner.
Treat customers like clients.
Use fewer SKUs, more conviction.
Overpay and overteach your people.
Attack dumb rules at the root.
Share enough to lift the world, protect enough to survive in it.
Hand the wheel to the operator who can drive your philosophy farther than you can.
This is exactly the pattern we hunt and stack inside NTE Pro:
The hidden architectures behind iconic companies,
so you can steal the system, not just the slogan.
Because It Exists isn’t about nostalgia.
It’s about arming the next Sol Price before they even realize they’re building the next trillion in a concrete box with great lighting, great wages, and no bullsh*t.
To learn more about the man who built Costco before Costco existed, listen to the Founders Podcast episode on Sol Price, it’s one of the best breakdowns ever made on integrity, innovation, and building a trillion-dollar idea without ever chasing fame.
And if you want to go deeper, read Sol Price: Retail Revolutionary & Social Innovator by Robert Price, a masterclass in how disciplined values, customer trust, and quiet genius can outlast every hype cycle.