Allbirds, Once a $4 Billion Darling, Sells for $39 Million

The sustainable sneaker brand struggled with declining sales and losses before being acquired by American Exchange Group.

Mar. 31, 2026 at 4:38am

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Allbirds, the once-buzzy sustainable footwear company founded in 2015, has agreed to be acquired by American Exchange Group for $39 million. This comes after years of declining sales and mounting losses for the brand, which was once valued at $4 billion during its IPO in 2021. The company has been forced to close most of its retail stores and shift to a more wholesale-focused model as it failed to maintain its initial popularity.

Why it matters

Allbirds' downfall highlights the challenges facing direct-to-consumer brands as they struggle to maintain growth and profitability. The company's inability to expand beyond its core Wool Runner product and appeal to a wider customer base ultimately led to its demise, serving as a cautionary tale for other startups aiming to disrupt traditional retail.

The details

Allbirds was founded in 2015 by Tim Brown and Joey Zwillinger as a sustainable footwear company. The brand gained popularity in Silicon Valley and beyond for its comfortable wool sneakers. However, as the company expanded, it faced increasing competition and struggled to maintain its novelty factor. Allbirds launched new product lines, including the Dasher running shoe and the Tree Flyer, but these failed to resonate with consumers. The company also attempted to move into wholesale partnerships, but this shift did not offset declining direct-to-consumer sales. In March 2023, Allbirds reported a $101 million annual loss, leading to a leadership shakeup and a strategic reorganization. Despite these efforts, the company continued to struggle, and in March 2026, it announced it would be acquired by American Exchange Group for $39 million.

  • Allbirds was founded in 2015.
  • The company went public in November 2021.
  • In March 2023, Allbirds reported a $101 million annual loss.
  • In May 2023, Allbirds laid off 21 employees globally.
  • In March 2026, Allbirds announced it would be acquired by American Exchange Group for $39 million.

The players

Tim Brown

Cofounder of Allbirds who stepped into the role of chief innovation officer in May 2023.

Joey Zwillinger

Cofounder of Allbirds who became the sole CEO in May 2023 after Brown's role change.

American Exchange Group

A New York-based fashion and consumer goods company that is acquiring Allbirds for $39 million.

Joe Vernachio

Promoted from COO to CEO of Allbirds in 2023, with Zwillinger stepping down to serve as a special advisor.

Ashley Comeaux

Allbirds' vice president of product design, who previously spent over 10 years at Nike.

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What they’re saying

“As we've tried to expand and grow the brand, we created products that haven't quite met the mark.”

— Tim Brown, Cofounder of Allbirds

“We laid out a road map for our strategic transformation back in March, and now two quarters into our work, we have gained traction and are solidly on track to drive toward profitability expectations.”

— Joey Zwillinger, Cofounder of Allbirds

What’s next

The distribution of the net proceeds from the sale to Allbirds stockholders will be made in the third quarter of 2026 after the acquisition by American Exchange Group is completed.

The takeaway

Allbirds' downfall serves as a cautionary tale for direct-to-consumer brands that struggle to maintain growth and profitability. The company's inability to diversify beyond its core Wool Runner product and appeal to a wider customer base ultimately led to its demise, highlighting the challenges facing startups aiming to disrupt traditional retail.