Allbirds, an eco-friendly shoe company that won over Silicon Valley, was sold a fraction of the $4 billion it was once worth.
The shoe brand said this week that it is selling all of its assets to American Exchange Group, a brand management company, for $39 million. The company, which makes shoes from wool and eucalyptus, attracted young Bay Area consumers and celebrities for its sustainable practices, but has since struggled to find its footing.
Allbirds peaked at a $4 billion valuation when it went public in 2021, but sales plummeted not long after. The company made $33 million in revenue in the third quarter of 2025, a little more than half of the $63 million it made for the same period in 2021.
The deal is still awaiting approval from shareholders and is expected to close in the second quarter of 2026.
The company canceled an earnings call it had scheduled for Tuesday, and its shares dropped by more than 10% Wednesday.
The company has evolved over the past decade into a brand known for innovation and comfort, Joe Vernachio, the company’s chief executive, said in a statement.
“This next chapter with AXNY builds on the foundational work already completed and sets up the brand to thrive in the years ahead,” Vernachio said.
The brand’s pricey wool shoes were initially embraced by celebrities like Leonardio DiCaprio, who invested in the company in 2018. However, the company failed to retain consumers for its other products, including flip-flops with sugarcane-based soles and wool leggings.
Allbirds was started nearly two decades ago in New Zealand by former professional football player Tim Brown. The company went public at a time when venture capitalists were funneling money into direct-to-consumer brands, which both make and sell goods through their own websites and stores.
The company eventually abandoned that approach, selling the product through retailers, but sales still tapered out. It had a net loss of just over $101 million in 2022.
Net proceeds from the sale are expected to be distributed to stockholders in the third quarter of 2026, the company said.
This story originally appeared in Los Angeles Times.
