Biography of Bette Nesmith Graham, Inventor of Liquid Paper

Bette Graham used a kitchen blender to create correcting fluid.

Liquid paper
Glowimages / Getty Images

Bette Nesmith Graham (March 23, 1924–May 12, 1980) was the inventor and businesswoman who made a fortune from her invention "Liquid Paper," a product which along with its competitors such as Wite-Out, allowed secretaries to quickly correct typing mistakes.

Fast Facts: Bette Nesmith Graham

  • Known For: Invention of the correcting fluid known as Liquid Paper.
  • Born: March 23, 1924, Dallas Texas
  • Parents: Christine Duval and Jesse McMurray
  • Died: May 12, 1980
  • Education: Left San Antonio's Alamo Heights School at 17
  • Spouse(s): Warren Nesmith (married 1941, divorced 1946); Robert Graham (m. 1962, div. 1975)
  • Children: Michael Nesmith (born December 30, 1942)

Early Life

Bette Claire McMurray was born on March 23, 1924 in Dallas, Texas, the daughter of Christine Duval and Jesse McMurray. Her mother owned a knitting store and taught Bette how to paint; her father worked at an auto parts store. Bette attended the Alamo Heights School in San Antonio, Texas, until she was 17 when she left school to marry her childhood sweetheart and soldier Warren Nesmith. Nesmith went off to World War II and while he was away, she had their only son, Michael Nesmith (later of The Monkees fame). They divorced in 1946.

Divorced, and with a small child to support, Bette took several odd jobs, eventually learning shorthand and typing. She found employment in 1951 as an executive secretary for the Texas Bank & Trust in Dallas. A technological advancement in typewriters from fabric to carbon ribbons and a more sensitive key pad made errors more common and more difficult to correct: Erasers that had worked before now smeared the carbon across the paper. Graham sought a better way to correct typing errors, and she remembered that artists painted over their mistakes on canvas, so why couldn't typists simply paint over their mistakes?

The Invention of Liquid Paper

Bette Nesmith put some tempera water-based paint, colored to match the stationery she used, into a bottle and took her watercolor brush to the office. She used this to surreptitiously correct her typing mistakes, which her boss never noticed. Soon another secretary saw the new invention and asked for some of the correcting fluid. Graham found a green bottle at home, wrote "Mistake Out" on a label, and gave it to her friend. Soon all the secretaries in the building were asking for some, too.

The Mistake Out Company

She continued to refine her recipe in her kitchen laboratory, which was based on a formula for tempura paint she found at the local library, with assistance from a paint company employee and a chemistry teacher at a local school. In 1956, Bette Nesmith started the Mistake Out Company: her son Michael and his friends filled bottles for her customers. Nevertheless, she made little money despite working nights and weekends to fill orders.

Bette Nesmith left her typing job at the bank in 1958 when Mistake Out finally began to succeed: her product was featured in office supply magazines, she had a meeting with IBM, and General Electric placed an order for 500 bottles. Although some stories say she was fired from the bank for signing her name with the "Mistake Out Company," her own Gihon Foundation biography reports she simply started working part time then left as the company succeeded. She became a full-time small business owner, applied for a patent and changed the name to the Liquid Paper Company.

Liquid Paper's Success

She now had time to devote to selling Liquid Paper, and business boomed. At each step along the way, she expanded the business, moving her production out of her kitchen into her backyard, then into a four-room house. In 1962, she married Robert Graham, a frozen-food salesman who then took an increasingly active role in the organization. By 1967, Liquid Paper had grown into a million dollar business. In 1968, she moved into her own plant and corporate headquarters in Dallas with automated operations 19 employees. That year Bette Nesmith Graham sold one million bottles.

In 1975, Liquid Paper moved into a 35,000-sq. ft., international headquarters building in Dallas. The plant had equipment that could produce 500 bottles a minute. That same year, she divorced Robert Graham. In 1976, the Liquid Paper Corporation turned out 25 million bottles. Its net earnings were $1.5 million. The company spent $1 million a year on advertising alone. Bette, now a wealthy woman, established two charitable foundations, the Gihon Foundation in 1976, to collect paintings and other artworks by women, and the Bette Clair McMurray Foundation to support women in need, in 1978.

But when she stepped down as chairperson, her ex-husband Robert Graham took over and she found herself on the losing end of a power struggle. She was barred from making corporate decisions, lost access to the premises, and the company changed her formula so she would lose royalties.

Death and Legacy

Despite increasing health issues, Bette Graham managed to wrest back control of the company and in 1979, Liquid Paper was sold to Gillette for $4.75 million and Bette's royalty rights were restored.

Bette Nesmith Graham believed money to be a tool, not a solution to a problem. Her two foundations supported several ways to help women find new ways to earn a living. especially unwed mothers; shelter and counseling for battered women; and college scholarship for mature women. Graham died on May 12, 1980, six months after selling her corporation for $47.5 million.

At the time of her death, Bette Graham was planning a building to house the foundations, and the art collection including works by Georgia O'Keeffe, Mary Cassatt, and Helen Frankenthaler and many other lesser-known artists. She described herself as a "feminist who wants freedom for myself and everybody else."

Sources