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Eyeing Retail Expansion, Allbirds Takes Flight With $50M Funding

The startup that sold over 1 million shoes in its first two years of existence has attracted a third round of investment to help bring “the world’s most comfortable shoe” to a store near you.

Allbirds, which funded its first prototype wool sneaker through a Kickstarter campaign, has received an additional $50 million in capital to fuel its seemingly inevitable expansion. The Series C round was led by T. Rowe Price and Fidelity investments.

In total, Allbirds has raised $75 million from traditional investors and celebrities alike, including Leonardo DiCaprio and Andre Iguodala of the Golden State Warriors.

Allbirds is a certified B Corporation, a new type of corporate entity legally required to balance purpose and profit with regard to the impact on workers, customers, suppliers and the environment.

“We do business differently,” the company says on its website. “The environment is a stakeholder here, and how we treat it is just as important as the bottom line.”

Sustainability has been at the forefront of the organization’s priorities since its inception, along with a commitment to ethical sourcing. Its merino wool is sourced from ZQ Merino, the world’s first accredited wool supplier that promises no mulesing occurs during production.

Allbirds co-founder and co-CEO Joey Zwillinger said he believes the company’s success and its environmental efforts go hand-in-hand.

“Climate change is the problem of our generation and the private sector has a responsibility to combat it,” Zwillinger said. “We founded Allbirds as a Public Benefit Corporation, officially writing environmental protection into our charter. This injection of capital will help us bring our sustainable products to more people around the globe, demonstrating that comfort, design and sustainability don’t have to live exclusive of each other.”

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One of the ways Allbirds manages to stay on the cutting edge of sustainability is its dedication to developing better materials for its shoes. Last year it created shoes using fabric engineered from eucalyptus fiber to provide a lighter alternative to the fleece-like Wool Runners. Allbirds also launched a limited-run of sandals made with its SweetFoam soles, constructed using a “sugarcane-based, carbon-negative EVA compound,” which the company said has been made freely available to other organizations.

“There’s an opportunity for us to take a leadership role in an industry that has paid lip service to the idea of sustainability. We are incredibly fortunate to be able to take advantage of this moment and challenge footwear norms, creating products that are not only better for our customers, but also better for the planet,” said Tim Brown, Allbirds’ other co-founder and co-CEO.

But, the first order of business is its upcoming retail expansion—which starts this week in the United Kingdom, where Allbirds opens the doors to a shop in London’s Convent Garden neighborhood and exposes the greater U.K. to its shipping service.

Up until this week, the company has operated only two retail locations, one each in San Francisco and New York, with direct-to-consumer sales in the United States, New Zealand, Australia and Canada.

Allbirds also announced plans to open more U.S. stores and begin an expansion to unspecified Asian markets for both retail and e-commerce in 2019, an undertaking the company described as an “ambitious expansion strategy that will bring better products to more closets around the globe.”