Deal values Kiwi Tim Brown's woollen sneaker firm at $2b

Allbirds, the trendy woollen sneaker-maker co-founded by New Zealander Tim Brown, has raised US$50m ($72.5m) at post-money valuation of US$1.4 billion ($2.03b).

The Series C funding round was lead by T Rowe Price Investment Management, along with Fidelity Management & Research Company and return backer Tiger Global.

It brings total investment to US$75m. Existing investors include actor Leonardo DiCaprio.

Allbirds offered no financials or sales stats this morning, though Brown told the Herald his company has been profitable since 2016.

He says some of the money will be spent on research and development of sustainable materials. The company currently has stores in San Francisco and New York, and sells to other markets online. Some of the funds will be used to open a new store in London and further retail expansion.

The ex-All White Brown co-founded his venture in 2014 with a Kickstarter campaign for shoes made from Merino wool with a vegetable oil-based polyurethane insole - at the time called Woollen Runners.

Brown had spent two years devising the shoes with San Francisco-based biotech engineer and renewable materials specialist Joey Zwillinger.

Tim Brown (right) chats to Northburn Station manager and Merino grower Bevan McKnight. Photo / Vaughan Brookfield

The pair hit their Kickstarter crowdfunding target - a modest US$120,000 - within five days.

Soon after, Allbirds raised more than US$2.7 million in a Series A investment round led by New York-based venture capital fund Lerer Hippeau Ventures, with high-profile investors including Ben Lerer, co-founder of digital media company Thrillist, and David Gilboa, co-founder of online eyewear company Warby Parker.

By 2017, with 50 staff on board and sales about to hit the one-million pairs of shoes mark, a Series B round attracted US$24m, with new investors including Maveron - a fund developed by Howard Schultz, the founder and chief executive of Starbucks.

Today, Brown and Zwillinger run Allbirds from San Francisco, the majority of investors are American and most of its footwear is made in Italy - but the company continues to use Merino wool from New Zealand.

The company is now diversifying.

In August, it Allbirds released the Sugar Zeffers - a pair of $60 jandals made using sugar cane and recycled polyester.

The company also has a new line of shoes made from eucalyptus pulp. And last month, in partnership with Air New Zealand, it released an eye mask made from merino wool and castor bean oil-based foam.