Tim Brown, who co-founded Allbirds, will be sharing his business advice with others after joining Icehouse Ventures as a venture partner. Photo / Dean Purcell
Allbirds co-founder and ex-All Whites captain Tim Brown has joined the crew at Icehouse Ventures, an Auckland-based venture capital firm that puts money into start-ups.
Chief executive Robbie Paul likens the move to two other high-profile entrepreneurs, Rocket Lab founder Peter Beck and LanzaTech’s Sean Simpson, who are giving back to the start-up sector. Both are affiliated with another local firm, Outset Ventures, in which Icehouse owns a 41% stake.
Brown came on board part-time three weeks ago as a “venture partner”, which will mean he advises start-ups that Icehouse has invested in (as opposed to a limited partner, who also puts some of their money in). There’s scope for talent scouting, but the San Francisco-based Brown’s main role will be mentoring firms who want to break into the US market and raise funds in North America.
Allbirds has, famously, tripped over its own shoelaces recently, with mounting losses, falling revenue, store closures and even a delisting threat from the Nasdaq after its shares fell below US$1 (where they still languish). Brown and co-founder Joey Zwillinger have stepped down from their co-CEO roles, with a team of executives with more traditional footwear and retail roles steering a restructure, which Brown believes will be successful.
“It’s not what happens to you, but how you deal with it,” Brown says. ”Hopefully, I can share some of the problems and how to avoid them. I’ve made plenty of mistakes and I share those liberally.” (Those who follow Brown’s LinkedIn account know he faces Allbirds issues head-on in candid posts.)
Paul strikes a similar note on Allbirds’ up-and-down run.
“The least useful adviser is someone who had a fairy-tale run,” the Icehouse CEO says.
Paul adds that, regardless, Allbirds’ life beyond its November 2021 Nasdaq listing “is not that relevant to most of our companies”.
He was attracted to Brown’s pre-IPO success, which by any measure was ripping. The Wellington Phoenix midfielder started Allbirds from a Cuba St flat and turned it into a $4 billion company at its height. Along the way, Allbirds raised money from a slew of American VCs, plus celebs such Leonardo DiCaprio, across a trio of Series A rounds in 2016 (raising US$2.7 million, US$2.2m and US$7.5m), a 2017 US$17.5m Series B round, a US$50m Series C round in 2018, a US$75m Series D and a US$100m Series E raise in 2020 as sales built to millions of pairs of shoes.
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Brown says there’s something of a gap between seed and Series A early-stage funding, which Kiwi VC firms tend to specialise in, and the big American (and European and Asian) outfits who can chip in far more for later rounds. He has connections that can help. Icehouse wants to make more follow-through investments, too.
As someone who’s now lived in the US for more than a decade, Brown says he can help with everything from day-to-day meat-and-potatoes logistical issues to less tangible cultural issues.
He’ll be offering advice to all-comers on how to scale up their business for the US market and the different strategies required for different territories. “You can’t just say ‘America’, it’s like saying ‘cars’. States are very different, and different strategies are required for each.”
Brown will also be helping people to scale up the way they think.
“Imagining success from the beginning can sometimes be a little bit difficult. That’s not just a New Zealand problem, but we have a natural tendency to understate and have humility. Yet, sometimes, planning for success and understanding just the scale of a market like America is important to weave into the story from the very beginning. And that is sometimes a little antithetical to our cultural make-up.”
From his San Francisco base, Brown will offer 1:1 advice for Icehouse firms looking to break into the US. He will visit New Zealand two to three times a year for in-person development sessions, including Icehouse’s annual “No Barriers” founder retreat.
The entrepreneur has already been an active adviser to one of Icehouse’s fastest-growing portfolio businesses, Tracksuit.
Co-founder and co-CEO Connor Archibold says Brown’s expertise and experience have already been a major asset to the marketing tech business.
Brown also sees strong US potential for two other Icehouse firms. One is Watchful, which makes software for monitoring security teams. “Josh [Watchful CEO Josh Parsons] is a former policeman with an incredible founding,” the Allbirds director tells the Herald. The other is the market research start-up Ideally.
Brown’s appointment comes after Icehouse raised $10m in November last year (outside of close to $100m raised for its latest growth fund) for expanding its investment team and support operations for its portfolio companies.
The firm is also taking on an additional analyst, a senior legal counsel (who is relocating from a British-based venture fund), and another principal – a role for which it had more than 100 applicants, Paul says.
Brown is only the second venture partner to join Icehouse Ventures, following Tom Furlong, the former managing director of Granite Ventures, a Silicon Valley VC firm with more than $1b in funds under management, who’s billed as one of the most experienced VCs to relocate to New Zealand.
While it’s been a tough 18 months for the sector overall, Paul says: “We’ve invested $65m this year to date, more than we invested all of last year.”
The Herald’s Media Insider column recently asked Brown to reflect on the past seven years and think of perhaps five of the biggest things he’s learned about himself or the business. He responded:
1. Patience. “We tend to massively overestimate what we can get done in the short-term and underestimate what can be done in the long-term. If you have the courage to commit to something over the long run and there’s a bunch of parameters that need to be in place for that to happen, then you can do more than you think.” He likens it to a footballer practising penalty kicks day after day, gradually improving, until they are an expert.
2. Don’t confuse hard work with high performance. “Everyone’s working hard – you need to be doing the right work.” He raises the theory of whether someone operating at 80% capacity has a better chance of longer-term high performance. “You need to create space for reflection and for rest and for quite frankly capacity to drive things forward. What I found as an organisation is we just got busier, busier and busier.” It was ill-conceived to think that working 100% the whole time was a prerequisite for success. “I am stepping back to make sure we’re doing and working on exactly the right things.”
3. Focus. “You’re defined as much by what you say no to, just as much as what you say yes to. Defining ways to give really confident, humble and polite noes to things is something you learn. The great businesses, the great brands get more focused over time, and clearer on who they are.”
4. Breaking things up into three-year chapters. “Breaking the journey up into chunks and making sure you’re asking yourself, ‘Are you in exactly the right spot?’ is important. Generally, in life, we hold the pen a lot more than we maybe think.”
5. Telling your story. “The talking points are super important. The bit that always surprises me is that people want to learn about the Cuba St apartment far more than they want to learn about ringing the bell at the Stock Exchange in New York. I’m constantly reminded of the power of stories in driving change and connecting people to high performance and success.”
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
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