When a pitch landed in my inbox announcing “Allbirds puts an end to unsustainable leather”, I knew it had to be the first feature published by Techstyler. Not because it’s true (it isn’t yet) but because it sums up fashion’s bold and binary sustainability claims, which are often unsubstantiated. Not at Techstyler. So what is the Allbirds solution, and how does it stack up?
The Plant Pacer shoe by Allbirds, made of Mirum ‘plant leather’ from Natural Fiber Welding (NFW), launched on 13th September 2022, staking a claim as a first-of-a-kind 100% plant-only ‘leather-equivalent’ shoe.
The announcement signals an essential step for ‘alternative leather’ commercialisation. Incumbent animal and vegan ‘leathers’ (which almost always contain plastic) are associated with damaging environmental impacts. Mirum is 100% plant-based, contains no plastic and doesn’t require tanning (a process that in most cases uses toxic heavy metals).
NFW created Mirum using applied engineering and chemistry that reorganises the structure of plant molecules to make them perform in specific ways: in this case, like leather. They did this with the help of Allbirds, who developed and tested shoes made using Mirum, feeding back the results for NFW to refine the material properties for footwear applications. The optimised Mirum is available to any brand making footwear, not only Allbirds.
The critical difference between Mirum and other plant-based, mycelium and next-gen leathers is that NFW’s technology reorganises plant building blocks (called cellulose) through a series of controlled, predictable and non-toxic chemical and engineering steps. In contrast, ‘leathers’ made from controlled growth, fermentation or gene-editing techniques can be more challenging to develop and produce reliably at scale, especially within the cost parameters required for commercial adoption. Regarding plant and vegan ‘leathers’, they typically contain petrochemical-derived polymers to aid performance and longevity – a limitation that NFW has engineered its way around to avoid such additives.
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“The idea for Mirum was formed in 2019”, said NFW’s CEO Luke Haverhals during a video call. He confessed that the first 20 or so iterations began in a 20-dollar pancake griddle from a local hardware store before a lab breakthrough justified the transition to a donated piece of machinery for more controlled development. NFW’s CTO, Aaron Amstutz, drove Mirum’s development, cramming it in around his work on Clarus: their first material to go to market.
One of the tricky things about the materials science game, says Haverhals, is that in the beginning, you’re asking people to fund ideas that might not work. In 2015, with single-digit thousands, they got off the ground, filing patents and setting up an office. In 2016, Steve Zika, who represented a family investment office at the time, but is now NFW’s president, raised $100,000 “so we could just try to create something,” says Haverhals. With promising progress, NFW raised $23M in a 2019 Series A funding round, including $2M from Allbirds.
How much did it cost to develop Mirum? What role did the $2M from Allbirds play?
“From pitching [Mirum] to [achieving] traction with a few brands [cost] hundreds of thousands to single digit millions,” said Haverhals (excluding the cost of refining the material to a production-ready stage). So the relationship between NFW and Allbirds isn’t primarily financial – their $2M investment is a fraction of what was required to get Mirum to where it is now. In fact, Haverhals explained that focusing on the $2M investment is to miss the point.
“Allbirds were validators for NFW,” the CEO explained. “When you’re a company like [us], it’s hard to get investors from the coast to come to Peoria, Illinois”, he says. “The money is in Silicon Valley and Boston, so the East Coast biotech and Silicon Valley VC pipelines drive the capital. NFW with its PhD chemists and without a [big] name? That’s not sexy”.
After Allbirds invested in NFW, they used the brand’s position to publicly declare Mirum’s potential and their intention to support it. Then, Haverhals says, they “rolled up their sleeves and said: we will test Mirum and beat you up when the shoes don’t work right”. Allbirds designed and made the shoe using Mirum backed with Tencel (a closed-loop man-made cellulosic textile) and then tested it, giving NFW feedback to improve the material’s properties and performance.
The critical point here is that NFW was able to develop a new, product-specific version of Mirum based on the material’s end-use. No doubt this is of keen interest to other NFW investors, including BMW i Ventures, whose parent company BMW Group produces many leather-clad steering wheels and car seats.
When asked about the foundations of the partnership, NFW’s CEO puts this down to “honest conversations about what [NFW] had to do to make [Mirum] worthy of an Allbirds shoe”. All the while, NFW knew that “Allbirds was committed and would stick it out”. So the $2M investment isn’t the point, especially considering what would come in Series B.
The Allbirds team, including co-founder Joey Zwillinger and Materials Engineer Claudia Richardson (who previously worked with Tin Shed Ventures, Patagonia’s Venture Capital Fund), were both instrumental in informing potential investors about NFW’s progress. They also declared their intention to launch a Mirum shoe to market in 2021. Subsequently, NFW raised $85M in Series B funding, allowing them to scale production to meet the volumes required for the Mirum Plant Pacer to go to market.
According to Allbirds…
But what about the Allbirds perspective? Whilst NFW tries to reduce the environmental impacts of materials that serve many industries (including automotive, homewares, fashion and footwear), what are Allbirds trying to achieve? Why work with NFW?
During a video interview, Jad Finck, Allbirds’ VP of Innovation and Sustainability, explained the reasoning behind the partnership and why Allbirds is launching a new product category whilst in the throes of trying to reduce absolute emissions in line with their science-based targets.
“We anticipate growing and want to be a big profitable company: a model for the world,” explained Finck. Allbirds is at the beginning of that journey. At five years old, it launched on the Nasdaq last year with an IPO valued at $4BN, despite being pre-profit. There have been calls for product diversification and wholesale1 expansion to chase profitability, and the Plant Pacer might answer the first of those. It opens up a new product category, appealing to a broader audience that is more lifestyle-oriented and for whom the ‘iconic fuzzy’2 shoe styles don’t appeal.
Alongside chasing profits, Allbirds is chipping away at the environmental impacts of their products, beating many of their competitors with lower impact materials and renewable energy-powered manufacturing. But to date, their shoes have been made of wool, cotton and other plant-based textiles – not leather.
“People love leather: the way it looks and feels,” admits Finck. “They’re buying it anyway, so why not give them a better replacement”, he says. His rationale stands to reason, except that Allbirds has committed to a 95% emissions reduction, per product, by 2030; meaning their average emissions per pair of shoes must decrease from 6.7 kg CO₂e3 to less than 1 kg by 2030 (for all existing and new shoe styles). So why add a new product line now? Furthermore, Allbirds’ latest sustainability report reveals that in 2020, adding new products increased emissions: “our average Basics carbon footprint increased slightly in 2020 as we expanded our offering to include underwear products.”4
Finck explains the brand’s decision to launch the Plant Pacer by sharing the levers Allbirds can pull to reduce impacts. He says there is still unplundered territory as they “look for carbon sinks in their LCAs and identify low hanging fruit”. Shifting production to sites powered by renewable energy could fall into this category. Other levers include regenerative farming, where proof of optimised carbon sequestration (beyond what nature provides with traditional farming methods) is accounted for in emissions reductions attributable to each product. However, given the magnitude of the emissions reduction task, a big, unspoken lever must be waiting in the wings. Otherwise, it’s unclear how Allbirds could achieve the sub-1kg emissions target.
The Mirum Plant Pacer’s emissions ‘pricetag’ starts at 8.24kg per pair: a smaller footprint than some existing styles but higher than others – and far higher than their landmark Adizero X Allbirds running shoe, at just 2.94kg. So on this basis, does the Plant Pacer need to exist (and what’s the secret emissions reduction lever?)
Finck agrees with the question regarding justifying the Plant Pacer’s launch and admits Allbirds are constantly asking themselves, “does this product need to exist? Is it better than what’s out there?” And concerning leather shoes, the Plant Pacer looks to be a “yes”. Unfortunately, without directly comparable LCA data, I cannot place firm figures on the impact of Mirum versus animal or other plant-based ‘leathers’. However, Natural Fiber Welding has conducted an ongoing life cycle assessment, summarised on their impact assessment page5, complete with limitations and exclusions. Its findings indicate Mirum has a lower carbon footprint than bovine and synthetic ‘pleather’ alternatives. Other environmental impact metrics are also addressed.
So the Plant Pacer (which also comes in a canvas version) might win an environmental impact battle against incumbent leather shoes. Still, Allbirds has its internal struggle to reduce absolute emissions by almost half within eight years. So what’s the secret lever?
Finck can’t divulge more than what’s already public regarding their renewables, regenerative and materials development initiatives. However, as a decarbonisation innovator and investor, he surely has an eye for cutting-edge technologies and materials. [He’s also an inventor with an intellectual property and patent portfolio specialising in low-carbon technologies.]
While closing out this piece, a recent news story was gaining traction: Yvon Chouinard has transferred the ownership of Patagonia to a charitable organisation that will funnel its profits into solving the climate crisis.
The purpose-driven similarities between Patagonia and Allbirds seem obvious, and Patagonia has undoubtedly influenced every brand that has launched as a ‘sustainability first’ company in recent years. But 50 years ago, Patagonia began with a product that existed because it was better than what was already out there. Allbirds did the same, but just six years ago, amidst tangible climate change. As a result, Allbirds is a product of its time and has a technical toolkit way beyond what was available to Patagonia. And to that end, Finck described Allbirds, which he joined six months after it launched, as “a material innovation company and a lifestyle brand” borne out of the belief that the world needs “better solutions”.
The lingering question is, when does ‘better’ switch from being relative to absolute? For example, the Mirum Plant Pacer may be ‘better’ than a leather shoe, but its impact will increase Allbird’s overall emissions if the shoe is successful and consumers buy it, which is the point – and the problem.
All eyes must then be on the next decarbonisation lever the brand intends to pull to have hope of achieving its absolute emissions reduction target of 42% by 2030. And then there’s also the question of doing that profitably, with investors pushing for growth and expansion – a pressure Yvon Chouinard managed to keep at bay by maintaining private control of Patagonia until giving it away to help fight climate change.
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