Allbirds and Panera Eye the Public Markets

Rose Hansen

Silicon Valley’s favorite shoe brand is headed to Wall Street. Allbirds is interviewing banks over the next few weeks to help it make a market debut, DealBook hears. The direct-to-consumer company was last valued at around $1.7 billion.

“It’s the materials.” Allbirds was founded by the New Zealand soccer star Tim Brown and Joey Zwillinger, a renewables expert. Its mantra is to “create better things in a better way,” and the company advertises that the merino wool in its shoes uses 60 percent less energy than typical synthetic materials. “One of the worst offenders of the environment from a consumer product standpoint is shoes,” Zwillinger told The Times in 2017. “It’s not the making; it’s the materials.” The brand’s flashy-but-logo-free shoes are popular among techies, celebrities (Leonardo DiCaprio is an investor) and Barack Obama. The company has raised more than $200 million since 2016.

The I.P.O. would jump into a hot market. Consumer brands that were founded with a heavy (if not exclusive) internet presence, including Honest Company and Warby Parker, are taking advantage of a pandemic-driven boom in online shopping to see if investor enthusiasm for tech I.P.O.s extends to them as well. Many of those companies, including Allbirds, have since opened some retail stores, which has proved an easier transition than the legacy retailers trying to build digital operations after making their names in the offline world.

Business for good? Allbirds is a certified B Corp, a certification earned by focusing on social good as well as profit. (Zwillinger joined a DealBook Debrief call last year to talk about the purpose of business.) Wall Street hasn’t always taken kindly to such companies: Etsy had to drop the status after taking a beating from the public markets following its I.P.O. Allbirds, though, said the $100 million funding round it announced last September was “indication of investors’ continued enthusiasm for its stakeholder-centric business model.”

  • “Allbirds has always been focused on building a great company, and as a B Corp and Public Benefit Corporation, doing what is best for our stakeholders (planet, people, investors) at the right time and in a way that helps the business grow in a sustainable fashion,” the company said in a statement.

President Biden prepares for his first joint address to Congress. In a locked-down Capitol, before a far smaller audience than usual, he is expected to argue for his expansive infrastructure bill and unveil a sweeping plan for nearly universal children’s education programs. Polls suggest that Americans support Biden’s big spending proposals. Follow the lead-up to the speech in our live briefing.

Vaccinated Americans can go maskless outside. The C.D.C. revised its social-distancing guidelines, allowing people who have received their shots to forgo masks outdoors except in crowded venues like stadiums. Meanwhile, Pfizer’s C.E.O., Albert Bourla, said the drug maker might roll out an oral treatment for Covid-19 by year end.

Deutsche Bank dodges a bullet. The German bank reported $1.1 billion in quarterly profit, its best performance in seven years, as its traders outperformed rivals on Wall Street. Just as notably, the bank said that unlike many of its competitors, it had suffered no losses from exposure to Archegos.

The cloud powers tech giants’ stellar earnings. Alphabet, Google’s parent company, said profit had more than doubled in the first quarter as online advertising and cloud services remained strong during the pandemic. Microsoft said its first-quarter earnings had jumped 44 percent, thanks to cloud and Office 365 workplace software. All eyes are now on Apple and Facebook, which report earnings after markets close today.

JPMorgan Chase will open its U.S. offices to all employees next month. The bank told its American workers that they can return on May 17, subject to a 50 percent occupancy cap, with a formal return to the office for all in July. Separately, HSBC plans to cut its office space 20 percent this year as it adopts more flexible working arrangements.

JAB, the sprawling conglomerate that owns Keurig, Krispy Kreme, Snapple and many other brands, completed an $800 million refinancing deal this month for its restaurant chain Panera Bread, DealBook is first to report. The deal could pave the way for JAB to bring the company back to the public markets after taking the chain private in 2017. As always with these things, no plans are final. JAB and Panera declined to comment.

A public listing could take place with or without an I.P.O. JAB has taken its investments public in a variety of ways, often while retaining a large stake. In 2018, it merged Green Mountain, which was private at the time, with Dr Pepper Snapple Group, and last year it took the coffee chain JDE Peets public through a traditional I.P.O. SPACs are sitting on more than $100 billion in cash as they look for companies to buy and take public.

The restaurant industry shifted online during the pandemic. The best-performing chains have been those that were already focused on takeout and delivery before lockdown orders like Dunkin Brands. Panera’s online ordering business was part of its appeal to JAB back in 2017. During the pandemic, the chain added tech-enabled curbside delivery and started selling groceries. About 85 percent of Panera customers now get carryout or delivery, compared with 40 percent before the pandemic, the company’s chief executive, Niren Chaudhary, told The Associated Press.

  • The chain, which Chaudhary says is profitable, now generates about $2 billion in e-commerce sales, more than half its total revenue. Postpandemic, it plans to redesign its restaurants to be smaller and more efficient for pickup orders.

— Matt Guse, the owner of the industrial company MRS Machining, on the unexpected resurgence in manufacturing and a dearth in factory workers to keep up with demand.

A Senate subcommittee hearing on the environment yesterday mulled legislation to support green investment, one aspect of the White House’s push to make fighting climate change a part of all of its policies. Inevitably, this exposed deep political divides, clouding the prospects for this and related initiatives important to the “climate administration.”

The National Climate Bank Act would provide $100 billion for a nonprofit investment accelerator to attract private capital and create jobs while cutting emissions, said the committee chair Edward Markey, Democrat of Massachusetts. (He first introduced the idea in 2009.) President Biden’s infrastructure plan recommends such an accelerator, and more than 200 groups recently urged Congress to incorporate the act into an infrastructure bill.

We don’t agree on anything, but I love him,” quipped the Oklahoma Republican Jim Inhofe before critiquing Markey’s plan at the hearing. The bank would create “a slush fund for green billionaires” like Elon Musk to collect government subsidies while taxpayers foot the bill for “charging stations of residents of coastal states,” Inhofe said. “We don’t need to pick winners and losers,” said Cynthia Lummis, Republican of Wyoming. Instead of eliminating fossil fuels, encouraging innovations like Wyoming’s carbon-capture experiments could also reduce emissions, she said.

“This is an approach that has been embraced by Republicans and Democrats alike in states across the nation,” Senator Chris Van Hollen, Democrat of Maryland, told DealBook after the hearing. He refuted claims that the fund would lack oversight and lead to higher energy prices. Reed Hundt of the Coalition for Green Capital, a nonprofit that helps create green banks, testified that there are projects underway in 37 states, and “we’re not talking about billionaires who want to go to Mars.”

For marijuana sector investors, things have never been better. States are reaping revenue from legalization and resistance at the federal level seems futile. “The shift in the political climate in D.C. has created tailwinds for the industry,” Matt Hawkins of the cannabis investment group Entourage Effect Capital told DealBook.

Uncle Sam isn’t totally sold. The House last week passed the Safe Banking Act (again), which would bar federal regulators from penalizing banks working with legal cannabis businesses. But although the Senate Banking Committee chair, Sherrod Brown of Ohio, said he would look at it “seriously,” he also said he was “not ready to move.” That means the Senate won’t vote on it soon, if at all.

More time might be good for industry insiders, Hawkins said. Full federal legalization would bring Wall Street investors and tobacco and alcohol giants looking to cash in, he said, and cannabis companies could use the time to scale up. From his perspective, the next important step is passing legislation that safeguards states’ marijuana laws.

  • An act first introduced in 2018 by the Democratic Senators Elizabeth Warren and Cory Booker would protect states, territories and tribal nations implementing marijuana laws from federal interference. The act hasn’t “yet” been reintroduced during this Congress, said an aide for Warren, without saying when that may happen.

Legalization is paying off for some states. In Illinois, tax revenue on sales of marijuana recently surpassed levies collected on alcohol. According to estimates from the independent policy nonprofit the Tax Foundation, the scope for tax revenue on recreational marijuana sales runs to the tens of millions of dollars per year for many states, if not more.


  • The S.E.C. is reportedly weighing new guidance for financial projections used to promote SPAC deals, further curtailing the frenzy for blank-check funds. (Reuters)

  • Crown Prince Mohammed bin Salman of Saudi Arabia said Aramco might sell a 1 percent stake to another “leading global energy company.” (CNBC)

  • A booming stock market and a surge in I.P.O.s have stuffed California’s coffers with tax revenue. (NYT)

Politics and policy

  • A top senator asked the Justice Department for information on whether Credit Suisse had helped wealthy Americans evade taxes even after settling a federal investigation. (NYT)

  • The hottest commodity in Washington right now: lobbyists fluent in “reconciliation,” the legislative procedure that may be used to pass the multitrillion-dollar infrastructure plan. (Politico)

  • Publishers are under pressure, including from employees, over book deals signed with Trump administration officials. (NYT)


  • How a list of “funny” customer names led to an internal reckoning at Basecamp, the company that recently banned talking politics at work. (Platformer)

  • Right-wing extremists, many barred from Facebook and YouTube, are flocking to Amazon’s Twitch service. (NYT)

  • Could Robinhood’s latest trademark application be a clue for its forthcoming I.P.O.? (Protocol)

Best of the rest

  • Samsung’s founding family will pay $11 billion in inheritance taxes, one of the biggest single bills in history, after the death of its patriarch last fall. (FT)

  • The Museum of Modern Art chose Marie-Josée Kravis, the philanthropist and wife of Henry Kravis, to replace Leon Black as its chair. (NYT)

  • Why Barcelona and Real Madrid are still holding out hope for the European Super League. (Bloomberg)

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