Richard Thalheimer, Founder of Sharper Image, Talks for the First Time About His Ouster

But the younger Thalheimer was best at sales. He had begun to sell encyclopedias in high school, and when he got to college, he added embroidered T-shirts and yogurt machines to his repertoire. That he made a mark as the nation's preeminent gadget retailer didn't surprise his sister. "My mother had a hard time keeping him in toys when he was little," she recalls. "He went through them quickly and was always looking for something new."

His penchant for toys, albeit more expensive ones, has scarcely ebbed. For years he kept a collection of rare motorcycles on display at Sharper Image headquarters. On a trip to the Florida home of Arthur Jones, the founder of the Nautilus exercise equipment empire, Thalheimer was so impressed by Jones' aircraft and private landing strip that he took up flying (his latest plane is a burgundy, gray, and white Cessna 182) and has logged 1,500 hours. Until bending to shareholder pressure to get rid of it, he kept a corporate jet at his disposal while at the company.

While serving him well, his relentless quest for the new and the cool has also taken a toll. "Richard has so much energy and is so focused on his work that his mind is never at rest," says ex-wife Elyse Eng, who sits on the board of the California Pacific Medical Center Foundation and is prominent in Nob Hill social circles. A former modern dancer, she met Thalheimer after he saw her perform with a small dance ensemble in the Mission in the late '70s. The two have remained friendly since their 13-year marriage ended in the mid-'90s.

Eng recalls vegetating with a book during beach vacations to Hawaii and elsewhere while Thalheimer was "constantly thinking of stuff and calling his creative director back and forth." Even on bicycling getaways to rural France, in the days before cellphones, she says that whenever they entered a city he would be "looking in store windows, always looking for products."

"He's a very complicated person; very difficult to get to know," she says.

Former subordinates, some of whom asked not to be quoted, say he could also be difficult to work for. A self-described neatness freak, Thalheimer for years enforced a strict dress code that dictated the style and color of clothes headquarters staffers could wear (blue or gray); decreed that only ceramic coffee cups be used (to curb spills); and outlawed all but gray legal pads and pencils (to match the décor). "He chewed me out more than once for propping my feet on the [office] furniture, although eventually he lightened up on that some," one former underling says.

Thalheimer's impromptu store inspections — in which he was famous for giving the white-glove test to Plexiglas display cases — became the stuff of company legend. "Whenever he landed in a city with more than one store, the people at the first store he visited called ahead to the others to let them know he was in town," one former manager says. "That was the pact."

Despite his creative genius at sniffing out new products and knowing how to market them, Thalheimer fared less well when it came to nuts-and-bolts organizational details. Under his tutelage, the company experienced a variety of chronic problems over the years, observers say, including inventory shortfalls and product development delays. His critics, including some Wall Street analysts, say that he was prone to governing by whim.

Asked about such things, Thalheimer is candid. "There was a time, especially in the earlier years, when I had a reputation for being somewhat demanding," he concedes. "But we all grow. And I believe people will tell you that over time I mellowed."

The gold standard of The Sharper Image's diverse product offerings was, and remains, the Ionic Breeze. The air purifier was not only a top seller, it was also the prize progeny of Sharper Image Design, a highly successful and secretive product design lab that Thalheimer introduced in 1991 to churn out high-margin items the company could produce itself.

Occupying nondescript quarters in a Novato office park without so much as a sign to announce its existence, the design group became a kind of Xerox Park for gadgetry. The lab started with a couple of inventors-for-hire whose first project was to develop a motorized tie rack (60,000 units of which were sold in a few months). By the mid-'90s it had two dozen engineers churning out scores of patents. Those who worked there say Thalheimer provided hands-on inspiration during frequent visits in which he and the inventors typically sat around a huge table and brainstormed over burritos.

"The place was so secret that there were people at company headquarters who didn't even know where it was," says inventor Chuck Taylor. He registered dozens of patents (with The Sharper Image as the assignee) during 15 years at the lab, before retiring to Florida to spend time on his sailboat, aptly named Ironic Breeze. "Besides Richard, there were only a handful of company executives who came."