The following is from Wikipedia:
When Gracie was 16 years old, he found the opportunity to teach a Jiu-Jitsu class, and this experience led him to develop Brazilian Jiu-Jitsu. The Director of the Bank of Brazil, Dr. Mario arrived for class as scheduled. The instructor Carlos was running late and was not present. Helio offered to begin the class with the man. When the tardy Carlos arrived offering his apologies, the student assured him it was no problem, and actually requested that he be allowed to continue learning with Helio instead. Carlos agreed to this and Helio began as an instructor.
Helio realized however, even though he knew the techniques theoretically, in actuality, the moves were much harder to execute. Due to his smaller size, he realized many of the jiu-jitsu moves required brute strength that his physical nature did not allow. He began adapting the moves for his particular physical attributes, and through trial and error learned to maximize leverage, thus minimizing the force that needed to be exerted to execute the move. From these experiments, Gracie Jiu-Jitsu, formally Brazilian Jiu-Jitsu, was created. Using these new techniques, smaller and weaker opponents gained the capability to defend themselves and even defeat much larger opponents