Cult Status: Allbirds

30 May, 2020 / Case Studies

Cult Status: Allbirds

Cult Status: Allbirds

The Transamerica Pyramid rises from the pavements of San Francisco’s Financial District like an offering to the gods of capitalism, all thick concrete stilts and thousands of angled box windows that repeat hypnotically as they taper into the sky.

When the sun hits its late-morning position, the tip of the Pyramid’s pointed shadow falls directly onto Montgomery Street, known as ‘Wall Street of The West’ where bankers, management consultants, investors and coders all flitter in and out of doorways between meetings.

For most of the nineteenth century, Montgomery Street was the unlikely centre of revolutions in art, politics, literature, gay rights and creativity. And if you know where to look today beyond the cold stone facades you can still find some of that.

Head down one alleyway and you’ll see Villa Taverna, now a private club, where artists like Frida Kahlo and Henri Matisse used to hang out when they came to town. A few blocks away is where Mona’s 440 Club was located, the first lesbian bar in the United States, which opened just after the repeal of prohibition in 1936.21 In Hotaling Place, you can still see a wavy line set firmly into the ground that marks the original Bay shoreline before it was extended eight more blocks as the city outgrew the sea.

It’s near this laneway that a 28-year-old Mark Twain worked as a journalist in the 1860s; in the basement steam room of a building on Montgomery Street he met a fireman named Tom Sawyer who told him incredible stories that ignited his imagination.

It’s also on this same street, some 150 years later, that a former New Zealand professional soccer player named Tim Brown and former biotech engineer and renewables expert Joey Zwillinger signed a lease to house their new shoe company.

The historic building they settled on, once home to printing presses and artists’ studios, runs the full length from Montgomery to Hotaling Place, with two storeys of tall ceilings and winding staircases. It’s an imposing space oozing with history, and Tim and Joey built their financial modelling on subleasing some of the desks in the building after negotiating cheaper rent by agreeing to open a small shoe store facing the laneway, with offices behind.

Immediately after signing the lease, Tim and Joey went straight to their local bar. ‘We thought we’d made the worst decision,’ recalls Tim.

It had taken Tim and Joey years of false starts to get there. Tim had played his way up to the position of Vice Captain of New Zealand’s national soccer team and had grown increasingly disillusioned with the flashy corporate logos splashed all over the shoes and clothes they had to wear. Joey grew up in Southern California, dabbling in business and technology and experimenting with making things from resources that didn’t run out. Their wives were roommates at Dartmouth College and introduced them to each other.

And now, after two false starts with different brand names and products, they’d come together to launch a single shoe without any logos, made from New Zealand merino wool, sustainable materials and an ethical supply chain they had spent years perfecting. They named their company Allbirds after the name early settlers gave to New Zealand’s landscape, signed the lease, and went to the pub to fret over the decision.

They needn’t have worried.

By the end of their first year, Tim and Joey’s company had grown faster than Nike ever did. By the end of their second, they’d sold over a million pairs of shoes. By the end of their third year, their burgeoning footwear brand was reportedly valued at US$1.4 billion and named ‘the fastest growing shoe company in the world’22 by Inc. magazine.

Allbirds’ offices in the Financial District spread just as fast. They still occupy the same building that once printed Mark Twain’s writing, plus another larger building across the laneway, with sleek white furniture and meeting rooms named after New Zealand trees. Yet another building houses the Research and Development team, with plans to eventually connect them all, as best they can.

The original cramped storefront on Hotaling Place has been upgraded into a modern homage to the shoes, which have now multiplied from a single stripped-back style to dozens of variations, including a new shoe made entirely from eucalyptus trees.

As we walk around the store, Tim points out all the tiny details they’ve thought about, from the way the chairs tilt slightly forwards when you try on the shoes, to the modular ever-changing wall display, to how the recycled shoeboxes are incorporated into the design of the store instead of hidden out the back. ‘There’s nothing in itself particularly remarkable,’ says Tim, ‘but all those details add up to an experience and feeling of the brand that is really thoughtful… We’ve put the pieces together in a slightly different way.’

Every aspect of Allbirds has been questioned and reimagined, like the materials they use and how shoes are produced and eventually sold to customers. ‘We just asked simple questions,’ Tim says of their success. ‘We paid attention to a lot of details, and tried to understand whether there’s an opportunity to do things differently, and then had the courage to do that.’

At 39 years old, Tim Brown is one of the eldest millennials, a generation that’s been slurred, revered, dismissed and feted – and sometimes all of the above in same sentence. He’s leading a generation that’s asking tough questions and demanding more and that now has the ability to give it. Tim and Joey are quickly undoing the old rules that governed how business is meant to be done, and writing their own new ones as they go.

One of Tim and Joey’s missions is to drag the footwear industry into the modern age. ‘There is the expectation now that business must be a force for good,’ says Tim, ‘and it’s about more than just making money; it has to be. I think that’s a generational difference.’

Making the entire company as environmentally responsible as they can, from the material they use in their laces to a carbon fund that offsets 100 per cent of the carbon Allbirds produces as a company, is a motivating factor for Tim. ‘It doesn’t feel like a day goes by where there isn’t another UN or government report that says we’re on the path to really making a mess of this if we don’t act quickly,’ he says. ‘And is it going to be one shoe company that changes that? No. Is the fashion industry a problem? Yes. I definitely think that there’s a consumer sentiment that this is now an issue.’

That consumer sentiment, particularly from millennials and Generation Z, is abundantly clear. They are rewarding businesses like Allbirds for stepping up to the challenge of creating change in every aspect of how their products are made and sold. ‘The businesses that are preparing today are the ones that are going to win in the long run, I’m quite certain of that,’ says Tim.

Tim and Joey know exactly what impact they want to have, and ensure that every project challenges the traditional supply chain to make it better for the environment not just for his company, but for all who follow as well. ‘Now more than ever, there’s a groundswell of understanding that we need to do things quite differently,’ he says. ‘There’s a moment in time here… People will judge the way that we’ve behaved here in terms of solving this problem… I’ve got a son who was born three weeks ago who will be 31 in 2050 and it might all be too late.’

They recently completed a project to improve the soles in every pair of Allbirds shoes. Very few people have thought about why the soles that have been inserted into running shoes for decades are almost always made from a foam called EVA, or ethylene-vinyl acetate. It’s the moulded padding used to create the soft and bouncy base on shoes and thongs. It’s convenient and cheap, and it’s made from petroleum oil.

As Allbirds grew in size, they gained the type of power that meant they could pressure their suppliers to invest millions of dollars to test out alternatives to EVA. In 2018, their Brazilian factory, Braskem, announced they’d finally developed a new product made from sugarcane that worked just as well. The sugarcane’s treated using very little fertiliser, then refined into molasses at a sugar mill powered by renewable energy. The sugars in the molasses convert into ethanol using yeast, and are then given a few special additives to turn them into the world’s first carbon negative EVA polymer.

They named the new product SweetFoamTM, and it’s being phased into the soles of every Allbirds shoe. The technology is also open-source, meaning that any other apparel company in the world can also use it as a more sustainable alternative to petroleum oil.

Tim is proud that their scale meant Braskem could commit to investing in improving their technology. ‘If we were a 20-pair-a-year streetwear brand, they wouldn’t have invested millions of dollars to make that possible. They did it because we proposed that it was for the entire industry – and that we were going to be a showcase that it could be done, and were going to make it available to everyone.’ Over 100 companies are now in discussion about using it. The more companies that use it, the cheaper it becomes. ‘It’s that intersection of the right thing to do for both the business and for the purpose,’ says Tim.

The footwear industry is notoriously competitive, with secret formulas and privacy designed to keep innovation from spreading, but by setting the intention of the impact that they wanted to have – that is, to make business more environmentally sustainable – they were able to stay on track and succeed where others had failed. It’s this commitment to balancing the clear purpose of the company alongside growing profits that’s earned Allbirds a fervent community of advocates who are evangelists for their shoes. In just a few years, they’ve earned a serious amount of cult status that’s expanding as more people hear about their mission and wear their product.

There’s a quote often attributed to Mark Twain: ‘The two most important days in your life are the day you are born, and the day you find out why.’ As Tim Brown wanders the same winding laneways Twain did a century and a half earlier, he knows that he’s getting bit closer to answering the latter.

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