Allbirds, the footwear brand known for its wool sneakers, is hiring an employee to manage regulatory and other financial filings, a move that is typically a precursor to an initial public offering.
The position will involve leading “the charge on our SEC filings,” including quarterly and annual reports, according to a job posting published on Allbirds’ website, as well as other documents issued by public companies. The role also calls for “IPO experience including knowledge of the S-1 filing process,” referring to a lengthy document detailing business operations, future risks and other information companies must file ahead of a public offering.
Former professional soccer player Tim Brown and entrepreneur Joey Zwillinger launched Allbirds in 2016 with a $95 sneaker made from merino wool that quickly developed a devoted following in Silicon Valley. The footwear brand was one of the standouts in the first class of direct to consumer brands, a group that includes Warby Parker, Everlane and other start-ups that promised high-quality goods at low prices by selling through their own websites rather than wholesalers.
If Allbirds proceeds with an IPO, it would be among the first of these DTC brands to go public, rather than sell to a larger rival or continue to tap venture capital firms for funding. Allbirds has raised over $200 million and the company confirmed it has a valuation of $1.7 billion.
The company declined to comment on the job posting or any potential IPO plans. In a statement, it said it “has always been focused on building a great company, and ... doing what is best for our stakeholders (planet, people, investors) at the right time and in a way that helps the business grow in a sustainable fashion.”
An IPO would be in line with Allbirds’ founders’ ambitions to take on footwear giants like Nike and Adidas. The company sees its focus on sustainability — using wool, eucalyptus pulp and other natural materials to construct its shoes, for instance — as a key edge. Even Allbirds’ shoelaces are made from recycled plastic bottles.
The brand has expanded rapidly, opening 22 stores in the US, Europe, China, Japan and New Zealand. It’s also launched new footwear styles and an apparel line. The company declined to give recent sales figures but told BoF its e-commerce sales in China last year were double what they were in 2019. In October, Zwillinger said the company has “been profitable for most of our existence.”
In the run-up to an IPO, Allbirds would be required to disclose additional details about its business, as well as potential risks to its growth plans. Investors will likely have questions about its ability to compete in a crowded footwear market; its most popular styles have been imitated by larger rivals from Steve Madden to Amazon. Acquiring new customers via social media and search advertising is also becoming more expensive for digital-native brands.
Those concerns have kept other DTC brands from tapping public markets. Many, including the menswear brand Bonobos and Greats, have sold to better-established retailers. Casper, the mattress start-up, saw its share price tumble following a February 2020 IPO. Warby Parker, widely seen as one of the DTC era’s biggest successes and long the subject of IPO rumours, has yet to go public. Allbirds raised $100 million in funding in September amidst the pandemic, and Bloomberg reported it is using some of the money to expand its fleet of stores in the hopes it can convince investors of growth potential ahead of an IPO.
Investors are concerned about companies that spend heavily to grow and lose lots of money on the way. As one put it to BoF in 2019, “all this unicorn status, it’s just inflated. It’s paper money and it’s not real.”
Allbirds’ roots in sustainability might also create some challenges. The company is a certified B Corp., and so it legally must weigh out business decisions against its impact on the environment. Investors have recently piled into sustainable bonds and other assets with a green angle, but whether that interest will persist over the long term remains to be seen.
Still, Allbirds has outlasted early predictions its minimalist sneakers would prove to be a short-lived fad. It’s also attracted attention from some of footwear’s giants: last year, Adidas and Allbirds announced a collaboration on a sneaker with an ultra-low carbon footprint.