Bette Nesmith Graham fluid as "Mistake Out" in 1956. The name was later changed to Liquid Paper when she began her own company. Mistake Out started the 1960s operating at a small loss, with Nesmith's home doubling as company headquarters. As the product became an indispensable tool of the secretarial trade, Nesmith relocated production and shipping from her kitchen to a 10 feet-by-26 feet portable metal structure in her backyard, where packaging, shipping, and production were centered. Bette Nesmith married Robert Graham in 1962; he joined her in running the company. They divorced in 1975. She sold Liquid Paper to the Gillette Corporation
Michael Nesmith third son Jason was born in August 1968 to Nurit Wilde, whom he met while working on "The Monkees". Phyllis's third child and Nesmith's fourth, daughter Jessica, was born in September 1970. In around 1972, Nesmith started the record label Countryside Records with Jac Holzman, the founder of Elektra Records. Also in 1972, Nesmith and Phyllis were divorced and he moved to Carmel-by-the-Sea, California. In 1974, Nesmith started Pacific Arts Records and released what he called "a book with a soundtrack", titled "The Prison", as the company's first release. In 1976, he married Kathryn Bild. In 1988, following the ending