In 2012, Tim Brown retired from professional football, after what was a pretty good career
that included the 2010 South African World Cup as the vice captain of New Zealand. But during his
career, he never felt satisfied with his trainers despite being sponsored by Adidas & Nike along the
way. He felt they were always too flashy with too many brand names. So he decided to make his own.
He always felt curious about Merino Wool and often asked himself why the material hadn’t been used
in the footwear industry. Well that all changed when Brown won a $200,000 development grant from
the New Zealand Wool Industry Research Group and with some help from agricultural scientists, Brown
developed a patented wool shoe material which was tough enough to withstand the stress that
a shoe goes through whilst being comfortable and not itchy. Merino wool , which is used by premium
brands, forms the shoe’s upper with a SweetFoam for the sole which makes for a resilient shoe.
In 2014, Brown launched the Wool Runner shoes on Kickstarter to raise some much needed funding,
targeting $30,000 with the worlds first woollen running shoes
designed to be worn sockless. and raised $119k in 5 days
selling over 1000 pairs having to stop the campaign as they’d ran out of materials.
Teaming up with Joey Zwillinger, an engineer and renewables expert,
the pair launched Allbirds in 2016 as co-founders and co-CEOs, Allbirds being a nod to the homeland
as it refers to New Zealand’s first settlers who found hardly any mammals when they arrived on the
island of ‘All Birds’. The trainers are made to be soft and comfortable with a minimalist look.
That look proved popular with Allbirds selling their 1 millionth pair just 2 years after launch.
now allBirds have had a bit of luck along the way, like when Time Magazine suggested
they were the worlds comfiest shoes on launch day. but The simplicity not just in the shoe,
but in the limited product range meant that they could focus on perfecting one or two simple shoes.
With simple pricing at around $95-$120 per pair, the business model was fairly simple.
The distribution strategy followed this simplicity, with Allbirds operating B2C,
selling directly to consumers and controlling manufacturing
and distribution. They opened up a couple of brick and mortar stores in New York,
San Francisco and London and began to build relationships with their fans.
Some of those fans were well known, DiCaprio wears them and invests in the company, Larry Page,
Ben Horowitz, Oprah, McConaughey, Paltrow, they’re all wearing them.
Allbirds USP is that they’re environmentally friendly and ethically sourced.
Made from Merino Wool and SweetFoam (Made from Sugarcane, it’s the world first carbon negative
EVA polymer. The natural materials make for light, breathable, machine washable shoes. The
long term goal of Allbirds is to emit no carbon by measuring everything, using recycled and
natural products and offsetting the difference. Simplicity sells and when you can put your shoes
in the washing machine then it revolutionises fashion and the way people think about footwear.
It stretches beyond Wool Runners, as they also began making slip on wool loungers in 2018
as well as Smallbirds, kid sized shoes. They also do a pair of Sweetfoam flip flops and they now
make a non wool shoe called Tree Runners and Tree Dashers, made from Eucalyptus trees. They chose
Eucalyptus because of its cooling qualities. But Allbirds are well aware that people don’t just
buy their products because they’re sustainable, it’s also because they’re great. Their products
now stretch beyond footwear, offering clothes as well as high top versions of their trainers.
Before 2021, Allbirds was a private company so it’s financials were opaque.
However, in August 2021, they filed for IPO which has revealed their financial position.
Their 2020 revenue of $219mn is impressive considering the company’s age but net losses
reached $25mn so there’s still work to be done to reach profitability. It’s
IPO valuation is yet to be revealed with estimates around the $2bn mark
following investment of $50mn from T Rowe Price in 2018 which valued them at $1.4bn at the time.
Investors therefore are interested in AllBirds, but Silicon Valley are obsessed,
and it’s no surprise when they’re interested in an innovative product that does things differently.
The rise of athleisure has also seen an increased demand for quality comfortable
clothing and footwear. It’s now cool to wear running shoes to run
errands and lounge around. Neil Blumenthal, the Warby Parker co-founder and co-CEO believes that
with the internet, people can find out every piece of information and if you’re inauthentic,
you’re easily found out. But if there’s one brand that defines authenticity,
i think it’s allbirds. Simplicity is a big player in the success of the business but at
the end of the day, it’s finally cool to care. And that’s how it happened. Thanks for watching.