Joey Zwillinger on Allbirds’ Market Decline and Turnaround Plan

Allbirds co-founder and CEO Joey Zwillinger joins Harry Stebbings to discuss the shoe company’s origins and the steep fall in its public-market value. This interview was published in November 2023; the prices, financial figures and plans discussed refer to that period.

Zwillinger says co-founder Tim Brown, a former New Zealand national soccer team captain with a design background, wanted a casual shoe without prominent athletic logos. Brown tested the idea on Kickstarter in 2014; their wives were close friends, and Zwillinger became an early customer.

Before Allbirds, Zwillinger worked at the biotechnology company Solazyme on chemicals derived from microalgae. He says brands were interested in alternatives to petroleum-based materials but often prioritized price and margins. He and Brown combined material expertise with design and consumer intuition when launching Allbirds in 2016.

Stebbings asks why a company that went public at a roughly $3.75 billion valuation was then worth around $127 million. These are figures stated in the interview; the video title and description cite different market-cap snapshots. Zwillinger attributes the decline to both external conditions and decisions within the company, taking responsibility for the latter.

The business had invested for rapid growth before the pandemic. Zwillinger says subsequent changes in consumer preferences made decisions harder and Allbirds was not positioned for everything that followed. He believes the brand remains strong, but acknowledges the business needs to catch up with that promise.

He describes revenue as close to $300 million and aided US brand awareness as below 15% at the time. Those are his company’s figures and definitions from the interview, not current results or independently verified estimates. He sees awareness as a major growth opportunity.

Zwillinger predicts a return to understated premium styles could benefit Allbirds. Stebbings questions whether moving into athletic running shoes confused the brand. Zwillinger agrees that perceptions cannot be changed overnight and says the company is refocusing on a crossover between casual life and activity, with comfort and versatile style.

He says successes and stumbles often come back to people: a growing company needs both entrepreneurial ambition and deep functional expertise. He urges leaders to treat their prior experience as a reference book rather than an inflexible playbook, since Allbirds’ distribution and positioning differ from other footwear businesses.

He does not regret going public, saying the company gained cash and the ability to control its course. He believes the share price reflects investors writing the company off and expects the market to respond if the business delivers sustained financial improvement. That is his assessment and a forward-looking claim.

Zwillinger calls Allbirds a product company operating in a category where style matters, rather than simply a technology or fashion company. He says its data infrastructure helps it listen to consumers and feed their feedback into product development, a competitive claim made by the CEO.

Public ownership means the company’s decisions and quarterly reports are visible in a way they were not when private. Zwillinger sees useful discipline in that cadence, but also potential tension with long-term building. He says the company tries to structure governance and capital around a longer horizon.

The fall from a $15 IPO price to around $1 a share was humbling, Zwillinger says, and he takes responsibility to shareholders seriously. Rising rates were an external factor, he adds, but not an excuse. His expectation that investors could eventually recover or gain depends on future performance and is not guaranteed.

He rejects treating direct-to-consumer as the whole business model: Allbirds is a brand, he says, and direct sales are one distribution channel. The company initially used its own stores and online experience to build a relationship with customers and planned to expand into wholesale.

Zwillinger says research into naturally derived or bio-based materials helps distinguish its products. These are the company’s product and environmental positioning claims; the conversation does not provide a comparative lifecycle assessment. He argues that consumers continue to value innovation.

Stebbings asks whether Allbirds markets product innovation as effectively as competitors do. Zwillinger emphasizes the feel and appearance of its materials. He also says competitors with athletic positioning and wide wholesale distribution were better positioned when running demand surged during the pandemic.

Allbirds was almost entirely a casual-lifestyle shoe business in 2019, he says, and launched the light-active Dasher in 2020. He believes it did not need to dominate the running surge, and predicts different styles will shape the following five years. That is his forecast, not a demonstrated market outcome.

The company had planned to add wholesale after online sales and stores, but paused the expansion around 2020. Zwillinger believes broader distribution could have increased awareness when customers were seeking familiar brands. He now favors reaching consumers profitably wherever they prefer to shop.

On fundraising, he says the company raised when it had a plan for the money and believed it could reach milestones. He acknowledges he might change details of particular raises but says the larger goal was to build a lasting brand. His confidence that the business is on track reflects the founder’s perspective.

Asked whether early investors were pushed to sell, Zwillinger says he has never told anyone to sell and does not recognize the account. On acquisition interest, he says other footwear and apparel companies approached Allbirds, but nothing reached the stage of a signed offer.

He and Brown are not ideologically opposed to a sale or private ownership if a partner or change of structure best serves the brand, he says. The board should consider options if a large gap persists between its view of business value and public enterprise value. This is a statement of possible options, not an announced transaction.

On personal liquidity, Zwillinger says he sold nothing at the IPO and very little afterward. He and his wife focused on financial security rather than material luxury, while he says additional wealth could still be used constructively. His account concerns his own sales, not all shareholders’ transactions.

The difficult period has taught him to maintain discipline in good times and bad, and to build a leadership team with resilience and commitment. He says Allbirds had not previously been tested to the same extent when conditions were poor.

For the first time in company history, he says, sales declined during the year as the business pulled back investment. The first financial priority was reducing excess inventory while refreshing products and returning to the core active-lifestyle positioning.

Allbirds stopped opening new stores, slowed wholesale expansion and reduced marketing spending by a high-teens percentage year over year, according to Zwillinger. He describes the sales decline as part of a transitional plan and hopes cleaner inventory and product launches will support a recovery; the outcome was not established.

He expects a stronger business to attract investors while recognizing that others will remain skeptical. Asked when Allbirds will be profitable, he cites the company’s target of positive cash flow and adjusted EBITDA in 2025. Those are specific measures and a future target, not a statement that net income was already positive.

Retail is hard, he says, especially when leases are signed long before opening and shopping patterns change. Remote and hybrid work altered the flow of people through urban centers. He says the return to prior patterns took longer than expected, and some changes may be permanent.

For product creation and design, he values working together in person and says people closest to product, design and marketing were coming in four days a week. He presents this as Allbirds’ approach to creative work, not proof that remote work is unsuitable for every company.

Zwillinger says balance is not quite the right word for a decade of intense work. His wife Liz helps him think through business problems, and he tries to be present with his children and put down his phone when he comes home. The previous two years also brought more anxiety and stress than before.

He has leaned more on colleagues and made room for regular conversations about what worries them. Some anxiety, he says, can point to a real business problem that needs attention. Exercise and hobbies remain part of how he manages stress.

Zwillinger predicts that consumers will spend less than expected over the following six months and says the company is planning more conservatively. This was his 2023 view of the near-term economy, not a confirmed result. He says he is preparing for weakness rather than feeling anxious about it.

On shoe loyalty, he says consumers buy for multiple uses and can both remain loyal to favorites and be open to innovation. He cites an estimate of eight pairs per American per year, but supplies no source in the interview. Allbirds, he says, tries to retain customers through communication and feedback.

He sees potential for apparel and other natural-material products but argues that footwear alone is a large opportunity. He believes a small set of strong shoes could eventually support a billion dollars in sales or more; that is an ambition and projection, not current revenue.

Zwillinger describes a gap between consumers’ stated environmental values and what they purchase. He predicts brands that combine desirable products with sustainability will benefit if that gap narrows. As Allbirds’ co-founder he has a commercial interest in that proposition, and the cited survey pattern is not substantiated in the interview.

Asked which other company he would lead, he chooses Tesla for its combination of product performance, design and environmental positioning. That reflects his view of the company rather than a quantified environmental comparison. He also names Nelson Mandela as a person he would like to meet and Traeger as a favorite brand.

Looking to 2033, Zwillinger hopes Allbirds can become a large, lasting brand whose financial and environmental objectives reinforce each other. His claims about the impact of buying its shoes and his confidence in the long-term vision are the CEO’s aspirations and company-linked views, not proof of environmental benefit or future results.