The CEO of Allbirds’ new AI biz has a plan, but no employees

Allbirds has made a significant pivot towards artificial intelligence, transitioning from its roots as a direct-to-consumer shoe brand to a new venture dubbed Smartbird. This change comes on the heels of the company's $43 million sale of its footwear division and an impressive $100 million capital raise from the stock market. Nadia Carlsten, a former executive at AWS and the newly appointed CEO of Smartbird, is at the helm of this transformation. With a PhD in engineering and experience leading the European compute company DCAI, Carlsten is now tasked with building a team from the ground up. "We’re going to be recruiting a brand new team for the AI business, and we’re going to be getting an office," Carlsten mentioned in an interview from Amsterdam. The objective of Smartbird is to establish itself as a provider of AI infrastructure, catering to the growing need for computing power necessary to train and operate deep learning models. Unlike competitors in the cloud space, Smartbird plans to focus on clients that require direct control over their servers due to various business or regulatory reasons, valuing data sovereignty over the scalability offered by public cloud services. While the market for such specialized AI infrastructure remains young, Carlsten has previously collaborated with sectors such as pharmaceuticals and energy, which have unique data sovereignty needs. She envisions Smartbird not as a competitor to major cloud providers but rather as an alternative solution for companies pursuing internal AI projects. Despite the presence of established players like Hewlett Packard and Equinix, Carlsten believes Smartbird’s agility and control over infrastructure could resonate with prospective clients. She aims to deploy computing clusters for multiple customers by year-end, emphasizing that her focus is on smaller-scale operations rather than large GPU deployments. Market demand for AI infrastructure is surging, influencing the stock market and prompting innovations like orbital data centers. Carlsten asserts that Allbirds' shift to Smartbird was strategic, aimed at carving out a niche in the market. Her compensation reflects the stakes involved, with a salary of $700,000 and stock options valued at approximately $9 million. In this transition, Allbirds has also relinquished its status as a public benefit corporation, which had previously underscored its commitment to sustainability. This change raises questions about the permanence of such commitments in the face of evolving business models. As Carlsten embarks on this journey, she remains focused on ensuring that Smartbird delivers tangible value in the AI sector, stating, "What matters is, is there actual weight behind the chasing?"