The NZ-founded company that once sold Silicon Valley its favourite sneaker is now trying to sell it computing power, writes Catherine McGregor in today’s excerpt from The Bulletin.
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From wool to silicon
A shoe company with no background in technology is pivoting to artificial intelligence. Allbirds – the NZ-born sneaker brand co-founded by former All White Tim Brown in 2015 – announced yesterday it would rebrand as NewBird AI and use US$50 million in new investment to buy graphics processing units (GPUs), the powerful chips at the heart of the AI boom. The plan is to lease that computing power out to companies struggling to access AI infrastructure, positioning the company as a “GPU-as-a-service provider”.
The announcement came just weeks after Allbirds sold its intellectual property and assets for a mere US$39 million – less than 1% of its peak US$4 billion valuation. As the New York Times’ Livia Albeck-Ripka reports, investors responded with immediate enthusiasm: Allbirds stock surged more than 700% on the news, from around US$3 a share to over US$21, establishing itself as the market’s new meme-stock du jour.
‘A hail Mary’
The pivot has triggered reactions ranging from bafflement to alarm. “At first it read like a really well-executed April Fools’ joke”, AI infrastructure expert Bill Kleyman told the NYT. “Every company wants to be an AI company…. The underlying business is struggling; AI presents itself as a compelling narrative reset, and off we go.” Investment firm William Blair dropped its coverage of Allbirds entirely, calling the plan “by any measure a Hail Mary” and flagging “deep uncertainty” around the GPU pivot. Bloomberg TV called it “the most 2026 move ever”. Business Insider ran a piece rounding up the best social media jokes about the news – none of which, sad to say, are actually funny.
Not everyone was so sceptical. New Zealand futurist Paul Spain told RNZ’s Corin Dann NewBird AI faced an uphill challenge, given the cost of accessing computing power from giants like Amazon, Microsoft and Google. But there were “good people at Allbirds”, Spain said, and while it wouldn’t be easy, they “might be able to make it work”.
A fall from grace
In February, The Spinoff’s Emma Gleason traced the arc of Allbirds’ spectacular rise and fall. From a 2014 Kickstarter campaign that reached its target in five days, Allbirds grew into a cultural phenomenon, worn by Barack Obama, Oprah Winfrey and, as recently as Waitangi Day this year, Chris Hipkins. At its IPO in 2021, Allbirds was valued at US$3.52 billion. But the company never turned a profit. After going public, it expanded aggressively into brick-and-mortar stores and television advertising, betting it could find a market beyond its Silicon Valley bubble. It couldn’t. Revenue peaked at US$297 million in 2022, then fell sharply. By 2024, its market cap had crashed to US$4.5 million – a fall of 97%.
Earlier this year the company closed all remaining full-priced US stores. As part of the AI rebrand, shareholders are being asked to approve the removal of all “references to the company being operated for the environmental conservation public benefit” from its founding documents – a poignant coda for a brand that until recently promised “sustainability in every step”.
The crypto pivot
Allbirds is not the first struggling company to try reinventing itself by going all-in on that year’s most hyped tech – nor the first with a New Zealand connection. As The Register’s Matt Rosoff recalls, in December 2017, American soft drinks company changed its name from Long Island Iced Tea Corp to Long Blockchain, despite having no background in technology or crypto. Its shares more than tripled, giving the tiny firm a market cap of over $90 million. The bubble burst, of course: the SEC delisted Long Blockchain in February 2021 and charged three people connected with the company with insider trading. One of those people? Former NZ rich-lister Eric Watson, who stands accused of passing to a friend non-public information about the impending business pivot, just before the company’s stock price skyrocketed.
Speaking to Keall, Herald NOW business host Garth Bray said he was “not suggesting anything dodgy” about Allbirds’ own tech pivot, “but it would be one heck of a comeback story”. The Financial Times (paywalled) summed up the business world’s dubiousness: “We’d suggest running away as quickly as possible, if anyone can suggest a suitable brand of footwear for the task.”
