Did the “Meghan Markle effect” strike again?
Footwear brand Rothy’s announced last week that it has raised $35 million in funding from Goldman Sachs’ asset management unit to fuel its expansion—just two months after the Duchess of Sussex stepped out on her royal tour of Australia, Fiji, the Kingdom of Tonga and New Zealand in a pair of its ballet flats.
Certainly the so-called “Markle sparkle” didn’t hurt. The San Francisco-based firm saw sales of the black Point style the Duchess wore as much as quadruple, according to reports.
But the nascent company, which has fielded acclaim for its comfy-chic kicks derived from post-consumer recycled plastic bottles, was already on the ascent. Buoyed by a ubiquitous social-media presence and a fan base of eco-conscious millennials (like Markle herself), Rothy’s has seen its bottom line balloon 50 times since it emerged in 2016, it said. This year alone, Rothy’s sold more than 1 million pairs of shoes, raking in more than $140 million in revenue.
“We started Rothy’s to make shoes that would be loved for their style, practicality and comfort while pursuing our company’s mission of sustainability,” Stephen Hawthornthwaite, CEO and co-founder of Rothy’s, said in a statement. “We are thrilled to welcome Goldman Sachs Investment Partners as an investor. We look forward to the next phase of our journey in becoming a globally recognized brand.”
By turning plastic waste into flats, loafers, and sneakers for women and girls, the company has diverted more than 20 million plastic bottles from landfills to date, it said.
Rothy’s creates its uppers using a proprietary three-dimensional knitting technique, similar to Nike’s Flyknit, that creates no seams and 30 percent less waste than traditional shoe production. The insoles comprise recycled foam and injection-molded soles are made of carbon-free rubber. Even the glues are nontoxic and vegan-friendly.
The company owns 100 percent of its manufacturing processes, including a dedicated and growing facility in China that allows it to rapidly test new products quickly while “remaining responsive to consumer demand signals,” it said. Though it began as digitally native, direct-to-consumer brand, Rothy’s opened its first brick-and-mortar store on Fillmore Street, two miles away from San Francisco’s iconic Jackson Square, earlier this year.
“Rothy’s has achieved the rare combination of attributes we look for in a brand: a production process and product offering with differentiated [intellectual property], a passionately supportive and loyal customer base and rapid growth achieved through viral means,” said Ian Friedman, co-head of Goldman Sachs Investment Partners Venture Capital & Growth Equity team. “We believe that Rothy’s has the opportunity to eliminate consumers’ historical need to compromise on style, comfort or sustainability.”