One of the more interesting retail spaces in the U.S. -- and increasingly, across the globe -- is the sneaker space.
For years, three or four major players dominated the footwear space. Largely, they were Nike (NKE) -), Adidas (ADDDF) -), Under Armour (UAA) -), and New Balance.
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Of course, there were (and continue to be) arguments and exceptions about the quality, market share, and cool factor about each of these brands. The sneaker sphere is, at best, incredibly fierce. At worst, it's a fickle beast that few companies ever manage to stay consistently relevant in.
Under Armour continues to lose ground as customers complain about footwear quality and appeal. Adidas is struggling to make up lost ground following its abandonment of its partnership with embattled rapper Kanye West (and took an over $500 million dollar haircut because of it). New Balance has had something of a resurgence in recent years following successful partnerships with everyone from English footballer Raheem Sterling to NBA star Kawhi Leonard.
The exception to this rule, of course, is Nike. Nike essentially started the streetwear craze when it signed Michael Jordan to its roster, releasing the first Air Jordan shoe to the public in 1985. And so began the modern sneaker craze. Signing an athlete of Jordan's stature -- at the rise of his career -- and creating something of an aspirational shoe that signified status, belonging, and performance hadn't really been done before.
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Nike had identified a market; the sneaker maker set a goal to sell $3 million worth of shoes in the first year. Following the release of Jordans, it exceeded that to $126 million. They remain some of the best-selling shoes of all time.
The Sneaker Market Is Fiercely Competitive
Identifying or creating markets before they're obvious is one of the hardest things to do in business but especially in fashion. Trends are fleeting and consumer taste shifts like the wind. But several fledgling shoe companies have made the attempt in recent years, namely Allbirds (BIRD) -), Hoka, and NOBULL.
Allbirds was founded in 2016, saw a meteoric rise during the pandemic and went public in late 2021. For several short years, Allbirds threaded the needle between comfort, sustainability and coolness. This is no easy feat. But thanks to a loyal fanbase in Silicon Valley and an appeal to consumers' conscience (Allbirds claims its wool sneakers are better for the environment and sustainable to make, and donates old shoes so it may process them responsibly).
But wool wears faster than synthetic materials, and customers have complained about quality issues. And its growing brick-and-mortal presence -- the company emphasized a direct-to-consumer model from inception -- has proven to be a drag on the bottom line. As comfortable as they may be, you can only own so many wool sneakers. Try as it might to release new products that replicate the success of its original Tree and Wool runners, consumers just aren't buying it. Its stock is down nearly 70% year-over-year and insiders claim the company has lost its identity.
NOBULL, on the other hand, knows exactly what its identity is, and has largely refused to stray. Started in 2015 by two former Reebok executives, the shoe remains popular among the gym crowd. It never really sought to take from Nike's demo, which caters to a more fashion-forward combination of streetwear and sports shoes. As its name implies, NOBULL is more utilitarian; the shoes are lighter, intended for weight lifting, training, and medical professionals. Most of its affiliates are CrossFit athletes, though in 2023 it was the Presenting Sponsor at the NFL Combine following an investment by the league. Also notable: most of NOBULL's sales are online.
Still, NOBULL has retained a sort of no-nonsense approach to training and it resonates with a certain subset of athletes and service members.
"Team NOBULL is a community of athletes, employees, ambassadors, first responders, teachers, military service members, medical professionals, and hardworking people from every field and skill level who know training is everything when you’re going for goals," its website reads.
NOBULL Gets a Nod from a Heavy Hitter
Though it remains privately owned, NOBULL's success is hard to ignore. So it comes as no surprise that a billionaire performance beverage founder is getting in on the action while it's still good.
Mike Repole, founder of popular sports drink Glaceau (which makes VitaminWater) and BodyArmor, acquired a majority stake in the company in July.
NOBULL was valued at $500 million in 2021, though it's safe to say it's worth quite a bit more following the success of its partnerships through CrossFit, the NFL and PGA Tour.
“I fell in love with just the name, the brilliance of NOBULL and what it stands for. It is no excuses, no BS, just get it done,” Repole said.
Repole hasn't revealed how much his majority stake is worth, though he did mention it's his biggest investment ever. The stake is via his private equity firm Impact Capital. He also mentioned an IPO may be in the future for NOBULL.
"If we want to build this big multibillion platform … taking this public I think is going to be the best way to go about it," he said.
Glaceau sold to Coca-Cola (KO) -) in 2007 for $4.1 billion and BodyArmor sold to the same company in 2021 for $5.6 billion.
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