How Birkenstock Went From The World’s Ugliest Shoe To A Billion-Dollar Sensation

By Melissa Twigg
Daily Telegraph UK
Dark grey Birkenstocks are donned on the street at Copenhagen Fashion Week 2021. Photo / Getty Images

As the footwear brand is preparing for New York Stock Exchange flotation where the listing could be as high as $10 billion, we look at the family behind it.

A film-maker with an eye for fashion intrigue would do well to make the House of Birkenstock. Thankfully, there would be

Birkenstock — which achieved the impossible over the past decade and migrated from being the podiatrist’s shoe of choice to a front-row catwalk favourite — is in the news because of the upcoming IPO at the New York Stock Exchange, where the listing could be as high as $10 billion. The iconic footwear brand, which has been entirely family-owned for nearly all of its history, plans to sell shares for between $44 and $49 apiece on October 11 — not that the Birkenstock brothers need any more money.

The family has been making shoes for hundreds of years. In 1774, Johann Adam Birkenstock was listed as a “subject and cobbler”, but it wasn’t until the 1890s that Konrad Birkenstock — who already owned two shoe shops in Frankfurt — began manufacturing and selling his revolutionary contoured insoles. His son Carl opened factories around Germany and, by the 1960s, his grandson Karl had made the Madrid prototype, trademarked the shape and taken it to America. A mega-brand was born.

Unlike most other fashion dynasties, the Birkenstocks side-stepped family in-fighting for the entire 20th century by taking an English aristocrat’s approach to inheritance and leaving full control of the company to one son per generation.

“It’s a clever move,” says fashion commentator Mario Ortelli. “You get a singular vision, and usually when a business is family-run for a long time, you have more consistency of brand positioning — investment ideas are taken with a longer term view rather than just for short-term gain. You see it with Hermes, and you see it with Birkenstock — both fashion companies that now have very strong brand identities.”

Then, in 2002, Karl – who had overseen enormous growth in company revenues during his tenure — broke with tradition when he retired and left control to his sons, Stephan, Christian and Alex. The brothers — who had grown up in one of Germany’s richest families — were made equal partners, and for any filmmaker, this is where the story would likely begin.

The three men were all in their 30s at this point, and rumour has it that they also had three very different visions for the brand — and that the squabbling began almost immediately as to who would take on the various subsidiaries created by their father and who would be responsible for creative direction going forward. After decades under the helm of a single controlling chairman with a clear plan, Birkenstock was suddenly rudderless.

This roadblock wasn’t helped by Christian’s acrimonious divorce a year later, and before the ink was even dry, his ex-wife Susanne had thrown another spanner in the works by setting up a sandal collection of her own.

Susanne Birkenstock started a rival sandal business, Beautystep, of glamorous sandals — leading to a thorny legal case. Photo / Getty Images
Susanne Birkenstock started a rival sandal business, Beautystep, of glamorous sandals — leading to a thorny legal case. Photo / Getty Images

Susanne and Christian met as teenagers at the local pool in Bad Honnef, an idyllic town just south of Bonn where the brothers grew up. The pair were married by the time they were 18 and Susanne, with her designer wardrobe, long legs and habit of wearing Birkenstocks to glamorous events, was credited with modernising the brand.

However, any credit she had with the family was lost when she plastered her married name across the marketing for her shoe company, Beautystep. The brothers threatened her with legal action, accused her of plagiarism and said she was exploiting them.

This caused a sensation in Germany, not least because patriarch Karl was still alive and apparently fuming — partly because in the divorce, Susanne had been given the couple’s Rhine-facing art nouveau villa in Bad Honnef that was right next door to his own. A summit between both sides over Christmas 2003 failed to resolve the dispute and so the Birkenstocks went to court.

“She’s simply trying to exploit the good name that Birkenstock has built up across the world in 17 different countries,’’ said a spokesman for the company’s legal team. “It’s not on. There are lots of people in Germany called Birkenstock. But they can’t all go around bringing sandals to the market.”

An ugly battle followed, with a judge eventually ruling that Susanne could sell her shoes so long as she didn’t prominently display her own last name.

Heidi Klum poses at the launch of her range of self-designed Birkenstock sandals in 2003. Photo / Getty Images
Heidi Klum poses at the launch of her range of self-designed Birkenstock sandals in 2003. Photo / Getty Images

Beautystep no longer exists, but the brothers still never found a way to smoothly manage their own company together. After his divorce, Christian bought and renovated an 11th century turreted castle in Linz that looks like something out of a Brothers Grimm tale. This took up much of his time, as did the running of his vast property in Spain where he allegedly spent much of the year.

Meanwhile, Alex was often in the US, where he owned a triplex penthouse in Miami Beach worth $25 million and a penthouse Art Deco apartment in Manhattan, which he later put on the market for $12 million.

The most low-key of the siblings was Stephen, the eldest who was rarely in the news and who, in 2013, decided to sell his share of the company to his two brothers. Forbes magazine suggested he probably pocketed several hundred million euros in the deal, so it’s hard to feel too sorry for him. Equally, given the value of the 2021 sale, he would have likely made a lot more money if he’d held on for another decade.

At this point, Alex and Christian decided to bring in an outside CEO for the first time in Birkenstock’s history. Oliver Reichert arrived on the scene almost by accident: Christian met him when his art dealer brought him along to deliver some paintings, and afterwards the three men had a beer. Reichert had spent the previous decade at a German television channel and knew nothing about Birkenstock (other than a memory of wearing them at the age of 13, when they were the only shoes that would fit his size 12 feet) but he was hungry for a new challenge.

It was a savvy choice, as the Viking-like blond made the company successful beyond anyone’s wildest dreams.

The brand had, up until this point, been resolutely, self-consciously, defiantly unfashionable. But Reichert came in and asked why. “The normal reaction of the old Birkenstock company [to being in fashion] was always ‘oh we’re a bit annoyed about all this c--p coming’. It was focused on its business and helping people get good health for their feet. It’s really very narrow-minded,” he said, in an interview with the Telegraph in 2019.

NZ-raised model Jordan Daniels wears Birkenstocks while off-duty at Milan Fashion Week spring/summer in 2021. Photo / Getty Images
NZ-raised model Jordan Daniels wears Birkenstocks while off-duty at Milan Fashion Week spring/summer in 2021. Photo / Getty Images

Instead, building on a Phoebe Philo for Céline show that reinterpreted the Birkenstock Arizona, Reichert brought in high-fashion collaborations with major names like Valentino and Rick Owens. The podiatrist’s favourite was suddenly more desirable than a pair of Manolo Blahniks.

“Social media also played a massive part,” says fashion historian Hannah Rochell. “The Boston clog, for example, is very much a Marmite style, but seeing these very young, very cool people wearing them on Instagram changed how they were perceived. Then lockdown happened and comfort became key and the shoe was brought to an entirely new demographic.”

Now, Birkenstock’s popularity is all-encompassing and there is almost no other branded fashion item that is worn by 80 and 18-year-olds alike. Even culture agrees: in 2002, Carrie Bradshaw declared Birkenstocks were ‘lesbian shoes’ in Sex and the City, while in this year’s Barbie, Margot Robbie steps out of her pink heels and into her flat Arizona sandals to signal her move to ‘real’ womanhood.

The flat sandal is a wry symbol for 'reality' in Greta Gerwig's Barbie. Photo / Warner Bros
The flat sandal is a wry symbol for 'reality' in Greta Gerwig's Barbie. Photo / Warner Bros

The two remaining brothers were, of course, laughing all the way to the bank. In February 2021, they agreed to sell a majority share to L Catterton, Bernard Arnault’s investment company, in a $4.7 billion deal. Now, with next week’s IPO they are set to make even more money.

And while they have remained remarkably under the radar for the last few years, there must be at least one film producer hoping they splash the enormous amount of money they’re about to receive in the most over-the-top way possible.

This article originally appeared in The Daily Telegraph.

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