After digesting Allbirds’ 138-page SEC (US Securities and Exchange Commission) filing on its pivot, some analysts noted that the company’s mystery new backer was only putting up US$5m of its US$50m in upfront funding. There was an option, but no obligation to stump up with the remainder.
US$5m is a modest sum to buy then lease AI hardware in a world where Meta is building a US$10 billion data centre in Texas that is still a tiddler next to the US$100b “Project Stargate” complex underway in the same state for a consortium including Oracle and OpenAI.
Those companies have the sorts of budgets that put them at the front of the queue for Nvidia’s much-in-demand GPUs (the super-powerful, super-expensive chips that power most AI training and processing).
Just days from dissolution
After years of losses selling sustainable shoes, Allbirds – co-founded by ex-All Whites captain Tim Brown – said on April 1 that it had sold its assets to American Exchange Group.
Shareholders would vote on dissolving the company on April 24, with a positive vote leading to a payout from the US$39m ($66m).
But on Wednesday (US time), a surprise development saw shareholders learn they would now be asked to vote on a radical turnaround plan next week.
Allbirds said it had reached an agreement to raise US$50m from an unnamed institutional investor and should receive the funds in the second quarter.
The money would be used to “pivot its business to AI compute infrastructure, with a long-term vision to become a fully integrated GPU-as-a-Service (GPUaaS) and AI-native cloud solutions provider”.
Green aims abandoned
An Allbirds SEC filing said NewBird AI would seek to buy and monetise GPUs. Nvidia dominates the tight market in GPU chips, which are at the heart of training and running AI software in giant data centres that cost billions to build.
As power and water-hogs, data centres are not on any environmentalist’s list of favourite things.
Accordingly, shareholders are also being asked to ditch its green credentials as it becomes NewBird AI.
“Because the anticipated Electronics Infrastructure Business would be less focused on the public benefit of environmental conservation, which is stated in the company’s Certificate of Incorporation, stockholders are being asked to approve the Charter Amendment Proposal (as defined herein) to remove references to the company being operated for the environmental conservation public benefit,” the SEC filing says.
Brown, who earlier resigned as co-chief executive but still serves as a director, has been asked for comment.
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.
