- Allbirds turns to AI
- The new company is called NewBird AI
- This will sell AI GPU space, but why did Allbirds choose this route, and what does it really mean?
I discovered Allbirds on TikTok. The social media platform can be a source of entertainment and information for some, but increasingly it’s where I find enticing brands for products that I end up loving. Shoe and clothing manufacturer Allbirds was one of them. It’s now NewBird AI, an AI infrastructure company, in a pivot that makes about as much sense as wrapping slices of bologna around your feet and calling them sandals.
As a loyal customer who once took his wife to New York’s only Allbirds store and convinced her to buy a pair of $100 slip-ons, I watched with dismay as the once high-flying viral shoe company narrowly avoided bankruptcy.
Until a week ago, I still received two or three Allbirds promotional text messages a month, and I would have happily purchased another of their lightweight, extremely comfortable and, yes, washable shoes.
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I don’t know exactly where things went wrong with Allbirds, but now I, and most of the rest of the world, know where it’s going.
On Wednesday morning, the company issued a press release reiterating that Allbirds’ assets had been sold to American Exchange Group, which, according to the release, “intends to continue to build on the legacy of Allbirds and provide compelling products to Allbirds’ customers.” This appears to mean that the AllBirds shoe brand will continue. But the rest of the statement is just word salad filled with business jargon.
Even though they sold the assets, there are remnants of the NASDAQ-listed company Allbirds. This company has apparently secured $50 million in funding “to pivot its business to AI compute infrastructure.”
And the long-term vision is to sell GPU AI space or cycles as a service, which it calls “GPU aaS.” Oh, and the new name is NewBird AI.
Look, I have no problem with this business concept. Demand for GPU access for AI model building and rapid processing is at an all-time high. Small businesses may want something like an AWS for AI to rent cycles for their small to medium sized businesses. Such a service allows small players to appear like the biggest to their customers. If they want an AI chatbot on their site, maybe they rent cycles from NewBird AI.
What I don’t understand is what this has to do with shoes. AllBirds sells stylish, well-made shoes and sneakers. It was a great online retailer, at least from this customer’s perspective. Look, I was so excited when I received my first pair that I did a TikTok unboxing.
You could say that everything in life is now connected to AI. There’s no reason why Allbirds…I mean, NewBird AI…can’t be connected either. I guess. What I really think, however, is that this is a cowardly attention game. The AllBirds business is mostly dead (maybe), but the brand has a profile. NewBird AI’s financiers clearly believe the name has enormous, albeit temporary, value.
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Oddly, so do investors. News of the pivot sent AllBirds shares soaring. In the morning it was less than two dollars. By the afternoon, the stock was trading at more than $20. I don’t know what that says about the overall intelligence of the average investor. Do they think the bizarre intersection of an ancient shoe brand and AI is a winning combination?
Like I said, the idea has some value, but no reason to associate it with the brand in any way. And what about Allbirds? I visited the site and launched the live chat, where I found a saleswoman named Sophie (who may have been AI).
I wrote: “What have I heard about your transition to AI? »
Sophia: “Hello! This is Sophie from Allbirds, thanks for reaching out! 😊 Could you tell us a little more about what you’ve heard about our ‘pivot to AI’? I’m here to help you with all your Allbirds-related questions.”
Me: “I’m told you’re renamed NewBird AI and will sell AI services. Do you also sell shoes?”
Sophia: “I’m here to help you with Allbirds shoes, orders or services. Is there anything specific I can help you with today?”
Since I knew Sophie wouldn’t get back to me about New Bird AI, I decided to find out if they were still planning to ship shoes next week.
Sophia: “Yes, Allbirds is still selling and shipping shoes, so you should be able to place an order next week.”
Actually, Sophie was cool that I waited even longer, like a month.
Sophia: “Yes, you should be fine. Allbirds is still selling and shipping shoes, so you can wait until next month if you want.”
This makes sense, as the former Allbirds sold its assets to American Exchange Group, which owns fashion brands like Aerosoles, Alexis Bendel and Ed Hardy. So maybe my once favorite shoe brand (a bit in Hey Dude now) could live on under its wide array of fashion and products.
As for NewBird AI, it appears the new company leveraged the old AllBirds brand just long enough to generate a lot of seed money from the stock market. NewBird AI is, ultimately, a non-unique company that ultimately has no connection to Allbirds’ legacy.
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