How I Built A $7 Billion Shoe Company Called On | Founder Effect

Summary

Olivier Bernhard, a six-time Ironman champion, recounts his journey from a struggling athlete to co-founder of the innovative shoe company On. His passion for endurance sports led to a groundbreaking shoe design, developed with partners Casper Capetti and David Alman. Their focus on quick prototyping and experiential marketing paid off, particularly with the award-winning Cloud Racer. The involvement of tennis star Roger Federer as an investor and collaborator further propelled On's growth. With a successful IPO in 2021, On aims to redefine athletic footwear, emphasizing incremental progress and product excellence amidst fierce competition.

Takeaways

• 😀 Olivier Bernhard is a six-time Ironman champion who transitioned from professional athletics to entrepreneurship.
• 🏃‍♂️ He struggled financially early in his career, often relying on prize money to fund future races.
• 👟 After retiring in 2006, Olivier was inspired to create a better running shoe after testing a prototype with rubber hoses.
• 💡 In 2010, Olivier partnered with Casper Coppetti and David Allemann to launch On Running, combining their expertise in business and design.
• 🌍 On quickly expanded from an idea to selling shoes in 19 countries, showcasing the importance of agile development.
• 🏆 Their product, the Cloud Racer, gained recognition after winning a gold award at a major sports gear exhibition in 2013.
• 🤝 On's experiential marketing approach allowed retailers to test the shoes, leading to higher sales and brand credibility.
• 🎾 Roger Federer approached On to collaborate, highlighting the potential of partnerships over traditional sponsorships.
• 📈 During the pandemic, On saw a significant sales increase, tripling sales volume compared to 2019.
• 💰 On went public in September 2021, achieving a valuation of over $7 billion and emphasizing their goals for future growth.

Q & A

What was Olivier Bernhard's initial impression of the shoe design involving garden hoses?

Olivier liked the idea and feel but didn't like the look of the shoe with garden hoses attached, initially doubting its potential.

How did Roger Federer get involved with the running shoe company On?

Roger Federer reached out to On, expressing interest in becoming a partner rather than seeking a sponsorship, despite On being a small, young company.

What were some early challenges faced by On during its startup phase?

On faced cash flow challenges and needed to convince retailers to buy their shoes, which proved difficult initially.

What significant milestone did On achieve at the ISPO exhibition in 2013?

On's Cloud Racer won the Gold Award at ISPO, beating out over 300 competitors, which helped establish their brand in the market.

What strategy did On adopt to engage retailers effectively?

On shifted from presenting their technology to running with retailers, allowing them to experience the product firsthand, which led to better engagement and interest.

How did the COVID-19 pandemic affect On's sales?

Initially, sales dropped in March 2020, but by the end of the year, On's sales volume had tripled compared to 2019.

Why did On decide to go public in 2021?

Going public allowed On to compete at a higher level with established brands like Adidas and Nike and provided resources to pursue their growth ambitions.

What was Olivier's background before starting On?

Olivier was a professional triathlete, having won two World Championships and six Iron Man titles, but struggled financially early in his career.

What key lesson does Olivier emphasize about success in both sports and business?

Olivier advises not to focus too much on the top; instead, take things step by step and enjoy the journey, similar to competing in sports.

How did On's team structure contribute to their early success?

Olivier recognized his strengths and weaknesses and brought in partners with expertise in finance, marketing, and design, ensuring a well-rounded team for the startup.