Last week I saw a piece of news so unbelievable I almost thought it was an April Fools joke. A shoe company, once the darling of Silicon Valley and celebrities alike, isn’t going to sell shoes anymore. They are going into AI instead.
The company is called Allbirds, founded by a New Zealander called Tim Brown. He played soccer for the All Whites, and in 2007 he read a magazine article about how New Zealand’s wool industry was disappearing. The country used to have 70 million sheep. By then it was down to 30. He couldn’t understand why nobody was making shoes out of all that wool.
A few years later he retired from soccer, went to business school, and built the company. From the start, Allbirds had a mission: to make shoes in a better way for the planet, using natural materials instead of the synthetic plastics the industry had been built on. The first shoe was a soft grey wool sneaker with no logos, made from New Zealand merino wool. The soles were made from sugarcane grown in Brazil instead of the petroleum-based plastic foam most shoes use. Later models had uppers made from eucalyptus tree fibre, and the laces were spun from recycled plastic bottles. It was unlike anything else on the market.
Time magazine called it the most comfortable shoe in the world. Within a couple of years it was what people in Silicon Valley wore. Barack Obama wore them. Leonardo DiCaprio, an environmentalist, invested in them. I had some patients who were wearing them too.
At their peak, Allbirds were worth four billion dollars, after listing on the stock exchange in 2021. But a mere four years later, they have been sold for $39 million, less than one percent of what they were worth. And now, they aren’t even selling shoes.
How does a company worth four billion fall this far this fast? How does a company built around one idea end up doing something completely different? I don’t know the answer to either question.
All I know is that it is one of the strangest things I have seen in a while, and I haven’t been able to stop thinking about it.
