Today, Allbirds rings on the Nasdaq bell and has chosen a suitable ticker: BIRD.
Allbirds began as a simple, comfortable, and natural wool shoe. But today, it is more than an apparel company. Allbirds has evolved into a materials innovation company that disrupts how clothes are made. Open sourcing materials allows others to benefit from the company's innovations, making it a leader in sustainability.
Every year, the fashion industry alone releases 2.1 billion tonnes worth of carbon dioxide into our atmosphere. This is twice as much pollution as every American car currently in operation. Plastic is the majority of what we wear today. Plastic is made from oil, which comes primarily from fossil fuels.
This must change. It will.
Allbirds is much more than just clothing customers. It's about empowering people to make their children happy and allowing them to feel good about themselves.
Allbirds isn't the only one with this vision. Teslas job goes beyond getting a driver to and from work; Impossible Meats job involves more than just feeding hungry customers. All these businesses have the job of ensuring that our planet survives and thrives over the next decades. They also offer consumers the opportunity to take part in proactively improving their lifestyles.
Most likely to be the leaders of the next generation are sustainable companies
Although everyone agrees that sustainability is important, it will take generations to implement and perfect sustainable practices. This consensus view underestimates and underestimates the difficulty of catching up in a race that has already begun. This is an enormous opportunity for founders to create a purpose-native business that has a positive impact on the community and will benefit employees as well as investors.
Sustainability is not just for consumer goods. It applies to all businesses. You can find news about the funding of sustainable technology in the small towns (every large venture capital fund has at least one alternative meat business in their portfolio) and the ESG responsibility for large corporations on any given day.
The Economist reports that investors invested more than $500 billion in energy transition in 2021, which is shorthand for decarbonizing all aspects of energy, transport, industry, and agriculture. This was twice the amount they did in 2010. It is estimated that $30 trillion of investment will be required to decarbonize the world. This presents investors with an opportunity to invest in companies involved in the race for net-zero carbon emission. The biggest investor tailwind is climate change.
It is believed that Tesla's current valuations are 16x EV/NTM revenues compared to other car makers that trade between 7x-10x profits or Beyond Meat that trades at around 10x for forward revenue.
If you want to invest in these businesses, it is important to believe the shift is not only to sustainable. The long-term winners will be those who can put sustainable practices at the core of every decision.
Start a company right now if you want to make a difference in the future. The best chance of being the next generation winners is for sustainable-first businesses.
Allbirds will be the next Nike or compound at 25% over decades. While I don't know the answer, I do know that they are more likely than any other early-stage competitor. Let's pray that the world doesn't eat itself before it has a chance to chew some CO2.
TDM Growth Partners invest in Allbirds.
