Allbirds Acquired for $39 Million
Sustainable footwear company Allbirds is being acquired for $39 million, a fraction of the nearly $390 million it raised during its 2021 initial public offering. The deal, announced Wednesday by private equity firm NextStep Ventures, marks a significant downturn for the once-high-profile startup that debuted on the New York Stock Exchange with a $2.2 billion valuation.
Key Details
The acquisition includes Allbirds’ remaining operations, intellectual property, and brand assets, with the transaction expected to close in the third quarter of 2026. NextStep Ventures, a Boston-based firm specializing in consumer goods turnarounds, will assume control from Allbirds’ current shareholders, including early investors like Tiger Global Management.
Allbirds went public on November 3, 2021, selling 19.6 million shares at $15 each, which generated approximately $294 million in gross proceeds—close to 10 times the current sale price. The company’s stock, traded under the ticker BIRD, peaked at over $27 per share shortly after the IPO but has since plummeted to under $1, reflecting broader challenges in the direct-to-consumer apparel sector.
Under the terms of the deal, NextStep will inject an additional $20 million in working capital to stabilize operations. Allbirds, founded in 2014 by former All Blacks rugby players Tim Brown and Joey Zwillinger, reported $254 million in revenue for 2023 but posted a net loss of $106 million amid rising costs and softening demand for its wool-based sneakers.
Background and Context
Allbirds gained prominence in the late 2010s for its eco-friendly shoes made from merino wool and eucalyptus fibers, attracting endorsements from celebrities like Leonardo DiCaprio and a cult following among environmentally conscious consumers. The 2021 IPO was hailed as a success for sustainable fashion, with the company emphasizing carbon-neutral production and biodegradable materials.
However, post-IPO performance faltered due to supply chain disruptions from the COVID-19 pandemic, increased competition from brands like Hoka and On Running, and inflationary pressures that eroded profit margins. By 2025, Allbirds had closed multiple stores and laid off 20% of its workforce, prompting speculation about its future viability as a public entity.
This sale represents a delisting from the NYSE, ending Allbirds’ brief tenure as a publicly traded company. The $39 million price tag equates to a valuation of roughly 15% of its IPO debut, underscoring the volatility of consumer startups in a post-pandemic economy.
Expert Perspectives
“Allbirds’ trajectory highlights the risks of hype-driven IPOs in the sustainable goods space,” said Sarah Kline, a retail analyst at Forrester Research. “While the brand’s innovation was groundbreaking, execution challenges and market saturation have caught up. This acquisition could provide a reset, but rebuilding trust with investors will be key.”
Tim Brown, Allbirds’ co-founder and former CEO, stated in a company release: “We’re grateful for the journey and excited for NextStep to carry the mission forward. Sustainability remains at our core, and this partnership ensures our story continues.”
NextStep Ventures’ managing partner, Elena Vasquez, added: “Allbirds has untapped potential in a growing eco-market. Our plan focuses on streamlining operations and expanding into new channels like wholesale partnerships.”
Implications and Outlook
The deal signals broader pressures on direct-to-consumer brands that rushed to go public during the 2021 bull market. Investors who poured billions into similar companies, such as Warby Parker and Casper, have seen mixed results, with many facing delisting or buyouts at depressed valuations.
For the sustainable fashion industry, Allbirds’ sale raises questions about scalability. Despite global demand for green products—projected to reach $12 trillion by 2030, per McKinsey—profitability remains elusive for many pioneers.
Looking ahead, NextStep aims to reposition Allbirds with a focus on international expansion and product diversification, potentially including non-footwear items. Analysts predict the brand could return to profitability within two years if cost controls succeed, though regaining its pre-IPO buzz will require strategic marketing.
This transaction, while a low point, may offer Allbirds a path to longevity in an increasingly competitive landscape.
