Rapid Response: On's 16-year overnight success: Zendaya, Federer, and outrunning competition

On built a $4 billion sports brand in 16 years with a garden hose, a Roger Federer dinner in Zurich, and a young designer who watched a Halloween YouTube video. Co-founder and co-CEO David Allemann joins Rapid Response to explain why the defining decade for On is still ahead, and why being the most premium brand matters more than being the biggest. He breaks down the leadership shake-up that brought him back into a CEO role, and what the first-of-its-kind LightSpray robotic process says about On’s innovation philosophy. Allemann also makes the case for why the "movement class" is replacing the leisure class as the defining consumer of our time. Visit the Rapid Response website here: https://www.rapidresponseshow.com/ See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:01Speaker 00

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• 1:42Speaker 01

  We took a conscious decision to embrace a lot of risk and say, hey, it sounds crazy. But crazy is good because the night is always the darkest before dawn. And you can imagine if you build over 16 years from zero to almost a $4 billion US brand, you have to have a very, very strong execution engine or it will fall apart in that journey. So it's really an opportunity to build a brand that doesn't have to be ultimately the absolute biggest, but is the most premium brand of the future.

• 2:18Bob Safian?

  That's David Alimon, co-founder and co-CEO of ON. ON is the bellwether for a new generation of athletic footwear and apparel companies that are posing a significant challenge to the likes of Nike and Adidas. David explains how ON is taking advantage of the increased visibility of sports in society, partnering with stars like Zendaya, Roger Federer, and others, and appealing to what he calls the movement class. Whether you've ever slipped on a pair of ON cloud shoes or not, David's insights will inspire you to keep moving personally and in your business. So let's get to it. I'm Bob Safian and this is Rapid Response.

• 3:08Bob Safian?

  I'm Bob Safian. I'm here with David Alimon, the co-founder and co-CEO of ON. David, great to sit down with you.

• 3:16Speaker 01

  Thank you very much for having me, Bob.

• 3:18Bob Safian?

  ON has been an amazing growth story. The lead player in sort of a new generation of athletic footwear and apparel companies. Is that how you see ON as like the next big global brand? I mean, you started with a unique soul design, which is also the way that Nike started with their waffle shoes. What is your plan?

• 3:42Speaker 01

  I think the plan is to be the most premium global sports brand, really based on innovation, but also on design. At the end, it's about making sure that people are excited about sports, that they love to go out. I was out running at the Hudson this morning. It was so inspiring because there's such a big group of runners out there. So I think when you move, whether that's running or something else, something happens to your mind as well. And that's really important for us via our mantra is dream on. And so that encapsulates it.

• 4:18Bob Safian?

  Sometimes I feel like when I go running here in New York, it's a race, even if there's not a race on, because there's so many people out running.

• 4:24Speaker 01

  It's New York pace, right? You have to overtake each other.

• 4:28Bob Safian?

  I mean, the legacy players in this space, they sort of didn't seem to see the competition rising that you're part of. I mean, Nike's struggling, Adidas seems to be finding its way a little bit. You know, they're sort of the strivers like New Balance and ASICS. And then there are other newer players like you, like Hoka, even apparel brands like Tracksmith or Bandit. When you look at that sort of competitive landscape, is there a specific spot that ON holds? How do you think about that, where you fit in that ecosystem?

• 5:05Speaker 01

  When we started in 2010, we saw an opportunity to really innovate with a radical new idea, which was cloud tech. It's not just having a foam mattress underneath your foot, but engineering, really engineering the run and changing the feel of running. So we came always from an innovation space. And I think that's the unique approach that we keep to this day. And I think it also coincides with a radical shift that sports used to be, probably when we started, still something that you do on the weekend. Now, sports and sports lifestyle has moved to the center of society.

• 5:47Speaker 01

  I think back in the days you had what I would call the leisure class. It's very much about consumption. It's about owning things. But that has changed, hasn't it, over the last 15 years? I think there's a new movement class coming along. Sports has moved to the very center of society. It's the last life moment. It's what brings people together. And it's a lot more about experience. It's about vitality. It's about longevity. Health is the new wealth. And I think whenever society changed, that has created a big opportunity for absolutely new brands that respond to that to become big.

• 6:27Bob Safian?

  In the field that you're in, like there are so many players. They get inspired by each other. They steal each other's ideas. Does it drive you crazy that sort of, you know, you have to keep, oh, now someone else is trying to track what we were doing?

• 6:41Speaker 01

  No, I think that's exciting because then you always have to push yourself to create the next. If you think about the whole luxury space, the luxury space, and the whole scarcity model, high price model, has over the last two years probably lost tens of millions of consumers who are looking for something that's more accessible. And that's a huge opportunity for premium products as well.

• 7:10Bob Safian?

  So it's a premium product, but not necessarily a luxury product?

• 7:14Speaker 01

  Yes, because luxury is defined by limiting access. So scarcity, making it very exclusive. ON is defined by innovation. So we want to bring innovation to everyone to give you a better experience. Of course, there's a certain price tag for innovation because we invest so much in creating the next. So that needs a premium brand that can invest innovation.

• 7:45Bob Safian?

  And so you're not a luxury brand at that end, but you're more a premium brand than, how I put it, than some of the legacy players?

• 7:55Speaker 01

  Yes. I mean, if you think about other areas of business, there was a moment, very much defined by New York, in New York, actually, when we learned that we can live in lofts and their kitchens moved to the very center of our homes. So home appliances became much more important. And you didn't kind of store your vacuum cleaner anymore in the closet back, but you hang it on your wall. That created an opportunity for a brand to create something that is at the intersection of innovation, a chat engine in your vacuum cleaner, but also a unique aesthetic. And so I think it's a great example of a brand that is based on innovation,

• 8:39Speaker 01

  but reaches millions of consumers.

• 8:42Bob Safian?

  You have these relationships with celebrities. You're plugged in with Zendaya, who's among this year's hottest stars. Roger Federer is a co-entrepreneur at the company. Like, how did those relationships start?

• 8:54Speaker 01

  A lot has been serendipity. So when Roger posted from Roland Garros on his Insta in an on shoe, we felt that's an invitation to a date. And so we went on that date and that's how the relationship formed. And then a little bit later, you probably remember that Zendaya had her challengers movie.

• 9:20Bob Safian?

  Yes.

• 9:21Speaker 01

  And it was, of course, about tennis. And one of the characters was pretty much formed after Roger with his on shoes. And she always had to tie up these on shoes because we had a special closing mechanism. And she, for her acting partner, was always lacing the shoes. So that's how she got to know on up close and personal. And so that that started to form this relationship. So it's been very organic.

• 9:48Bob Safian?

  With Roger, I understand you went to him and sort of pitched him, even though you didn't have money for him.

• 9:56Speaker 01

  You know, I mean, we felt he first pitched us by putting the on on his feet.

• 10:01Bob Safian?

  And he's Swiss, as you are.

• 10:03Speaker 01

  And Switzerland is a small place. And so we had some common friends. And so we went to a restaurant in the inner city of Zurich. He came in with his baseball cap deep in his face and we hit it off and we had a great evening. And he was challenging us. He said, hey, you've been such an amazing innovation player in running, really radically changing the feel of running. Could you change the feel of tennis as well and bring innovation to a tennis shoe as well? And that's what we did. And three months later, we had him at our renovation space, which we called the On Labs in Zurich.

• 10:37Bob Safian?

  Well, and it was a, it was a good move on his part, too, because instead of taking money, I understand he took equity. And that has worked out very well for him, given how the company has grown.

• 10:46Speaker 01

  I think it worked well. We were a seven-year-old company back then. We felt doing the classical model of just giving money to athletes, a classical endorsement model, that's not our way to do it. We always tried to innovate on everything, not just on outsalls, but also how you do the marketing model. And so we said, hey, instead of us giving you money, why don't you give us money? And that worked out for everyone very well.

• 11:13Bob Safian?

  Your personal background is not shoe design. This is something you sort of came to, well, I don't know whether it was serendipity for you, too.

• 11:22Speaker 01

  My background has always been in business, but especially in business when it comes to creativity, design, also digital. It was a certain serendipity because a friend of Casper, me, my co-founder, his friend Olivier was a professional triathlete. And at some point, Casper called me and said, hey, remember Olivier? He had an idea for a shoe. And we said, come on, that's, that's crazy. But then we said, hey, let's try that shoe. And that was on a rainy day in Zurich, somewhere up in the woods. And he came with a shoe that he had cut his garden hose at home and glued these garden hose pieces underneath a shaved off shoe, just to prove the principle.

• 12:06Speaker 01

  And we went on a run and it felt amazing. We felt, wow, that's really a different experience.

• 12:12Bob Safian?

  I spent a fair amount of time with the former CEO of Nike, Mark Parker, who started as a shoe designer. Obviously, you didn't start as a shoe designer. You know, it's more brand design, really, that you've been focused on. Is there something different about being a business leader when you're a designer? Do you look at the business in a different way?

• 12:35Speaker 01

  Some of the biggest brands have been created at the intersection of innovation and design. If you think about big leaps in the past. So for example, people started to travel at the end of the 19th century. So that was a huge societal shift. And then some brands who had done probably some saddles for horses, decided, hey, could we take our technology, leather, sometimes not even leather, and create luggage that is very, very sturdy, that doesn't allow for moisture of coming in? And could we bring that to a new class? I would call it the travel class.

• 13:19Speaker 01

  And that created some of the biggest brands that today exist as the leading luxury brands. And similar things happened later on. So for example, when digital devices grew up from being on either in the basement or then under your table and became portable, and they became part of your identity because they're portable and you're sitting in the coffee shop with them or you're holding them to your ear, then design became much more important. So it's always that feel, also for the consumer, between the actual feeling, the sensation, but then also the emotional feeling, how this looks like, what does it say about me?

• 14:00Speaker 01

  Do I get excited to lace the shoes up and go for a run at the Hudson? It should be a great feel, but it should also be a great emotional feel. And so I think that created some of the biggest brands.

• 14:13Bob Safian?

  David's reminder of brands that redefine themselves in the face of change. It's instructive in our AI world that new capability and emotional impact should ideally reinforce each other. So what role do On's physical stores play for David's brand? And what prompted him to shake up the company's leadership earlier this year and take over as co-CEO? We'll talk about that and more after the break. Stay with us.

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• 16:05Bob Safian?

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• 16:36Bob Safian?

  Before the break, On's David Alamon talked about the growing opportunity for new sports brands in today's marketplace. Now he addresses the company's recent leadership shakeup, the role of brick and mortar stores in the digital world, and a crazy new shoe inspired by a YouTube Halloween video. Plus, does sustainability in footwear and apparel really matter? Let's hop back in.

• 17:05Bob Safian?

  Not everything about On's rise has always gone exactly the way you would want it to. I mean, since going public five years ago, revenue has steadily gone up, you know, past $3 billion in 2025. But the stock price is down quite a bit from its peak. And back in May, you and your co-founder Casper stepped into the co-CEO role, sort of shaking up On's leadership. What prompted you to want to take a more hands-on control?

• 17:36Speaker 01

  When you look at On's leadership model, we've always operated on very much as a partnership. So it was several partners from the get-go. I mean, Olivier Casper and I started the company as a partnership of three. Later on, we were joined by other leaders. At some point, we were a partnership of five. And that was our secret weapon because it gave us an incredible bandwidth to go after very different missions. So some of our partners went very much about operating the engine of the business, the supply chain, making sure that the machine is humming. And it gave us the opportunity to always stay focused on building the next growth engine.

• 18:19Speaker 01

  So building the next shoe, building apparel, building retail, building a new sport like with Roger in tennis. That's very much what a founder-led organization should do, building the next. And so in that transition that we had recently, that didn't change. It shifted a little bit priorities. Operating the business and being very precise in the business has become a bigger share of our daily routine.

• 18:46Bob Safian?

  Does it frustrate you that with all the success you're having, like the stock price has not necessarily reflected that or the trajectory of that?

• 18:54Speaker 01

  I think it's just been a reality that there's been quite a bit of volatility in the market. And our way to navigate that is definitely not to resort to discounting, but to make sure that we bring the newest innovation into the sport.

• 19:09Bob Safian?

  You've mentioned the word innovation several times and I know that as businesses get bigger, it can often be harder to implement that innovation, that risk is harder for folks to take. I wondered whether that was part of the motivation of sort of, you know, as a founder, being in that co-CEO role to keep that moving along.

• 19:34Speaker 01

  It definitely helps. It's always been our role as founders to make sure that we're not just thinking about the moment, but that we're thinking about the next moment. Often, people are coming to me and saying, hey, that's, it's incredible how you just exploded. And I'm saying, yes, we've been a 16-year overnight success. And that's true, not just for the overall business, but it's often true then for the next thing that you add. That's been often four, five years in the making. I mean, for example, our retail business, our stores is now growing very fast, but I actually came here to New York to open the first store at Lafayette

• 20:15Speaker 01

  Street during COVID in 2021. So that's five years ago. And now you're seeing really expanding and the business growing up with more than 80 stores open.

• 20:26Bob Safian?

  I remember like the folks at Warby Parker, when they first opened stores, it was much more of a branding priority for them than it was an actual sales priority. And they realized, actually, this is great business. For you guys, did it start that way? Was it more like, oh, we're gonna, we're gonna brand ourselves like some other brands have these stores? Or did you always think like, oh, this is, you know, this is a financial lever too?

• 20:53Speaker 01

  For us, the primary reason to start stores has been two things. First of all, we wanted to plant the brand in the middle of society and our city centers still are very much in the middle of society. It probably wasn't so obvious in the

• 21:12Speaker 01

  middle of the pandemic.

• 21:13Bob Safian?

  But you got better rents then, I guess.

• 21:15Speaker 01

  Yes, absolutely true. And we continue to believe that after COVID, city centers are coming back. And so we invested very much then in, hey, this is our opportunity to go in. And the second reason has been, we were very clear that we want to become a brand that is, as we call it toe-to-toe. So we started to invest into apparel. And it's very hard to just do apparel in a shoe wall in one of our partner stores. So I think you have to give it the full expression.

• 21:49Bob Safian?

  Because you can control the environment much more.

• 21:51Speaker 01

  Yes, we can control the expression and especially for something like apparel, where you can't just put the shoe on a wall as a freestanding object, but where you have to give it space. That's a huge opportunity for retail as well.

• 22:04Bob Safian?

  And does that then drive the retail sales of the apparel even not in your stores?

• 22:12Speaker 01

  It does. So I mean, retail stores lift all boats. So it just gives additional energy to a community in the city. We also do a lot of runs out of the store. And in that journey, we found out it's a great business as well. So, but that was not the first thought. It's the outcome of doing all the right things, how you go into retail.

• 22:34Bob Safian?

  There is this race in athletic footwear to use more technology. I mean, Brooks created a special shoe to help Josh Kerr break the record for the mile run. How do you think about tech at ON? I saw a video of this light spray machine that you're using for a particular shoe, which, which is pretty cool.

• 22:54Speaker 01

  I think I have a

• 22:56Bob Safian?

  Here's the shoe.

• 22:57Speaker 01

  Yes. Often there are 200 pieces going into an upper of a shoe. So it's a very classical manufacturing method with 200 steps until you have a full shoe together. And we had a young designer who had seen a YouTube video of somebody with a hot glue gun spraying a Halloween net. And that was his inspiration. And he said, hey, if somebody can spray a Halloween net, could I use a hot glue gun to spray a shoe as well? And he did that. And we had a very scrappy first prototype of that. And he reminded us of that shoe where Olivier had put the garden hose

• 23:40Speaker 01

  pieces. And back then, we took a conscious decision to embrace a lot of risk and say, hey, it sounds crazy, but crazy is good because the night is always the darkest before dawn. And so we said, hey, let's put a few robotics engineers, material scientists, sports scientists around that designer. And so we had a smaller tech team of five people that then came up with light spray, which is a technology where you have a robotic arm and that robotic arm sprays a small filament in polygonic shapes directly on an outsole. So it's not stitched on, it just

• 24:22Speaker 01

  melts with the outsole. And it collapses this process of 200 steps into one. This is a shoe that is sprayed by a robotic arm in three minutes.

• 24:35Bob Safian?

  When an idea like this comes to you, I mean, you must get lots of proposals for crazy, new, I like, how do you decide what you're gonna invest in?

• 24:45Speaker 01

  We have a whole pipeline process. So probably have at any given point, 50, 100 ideas what we could do. And then we have review meetings where we're basically saying, hey, what is good to go and stage gates and decide what goes down the innovation funnel. That's our standard procedure.

• 25:06Bob Safian?

  You connected with this sort of focused customer base of runners. And as you try to expand, you have to reach a broader community beyond that sort of more elite community. How do you test like how far you can go with the brand and, and sort of what the base is willing to let you do while you, that allows you to still maintain your credibility with them? Because you don't want them to move off to the next new hot shoe brand.

• 25:36Speaker 01

  No, that is, that's absolutely true. And the athlete for us comes always, always first. We're operating with the ON Athletic Club, one of the largest athlete group in the industry with runners, sprinters. So we have a dedicated team. So that's our core. By the same token, our lens is not running, but it's movement. So we feel movement is more important than ever because it's not just about health and longevity and vitality, topics that are incredibly important, but it's also about what happens to your mind. We feel when you're going out, whether that's now running or training, or whether it's tennis, or whether it's any, or hiking, or any other

• 26:21Speaker 01

  form of movement, something happens to your mind. You come back probably with either a new idea, a bit more optimistic. And we started in running, but of course, we're expanding in all other sports of movement.

• 26:37Bob Safian?

  I did want to ask you about sustainability in your brand. The Swiss have a very strong reputation for sustainability. Here in the US, it's kind of become kind of a dormant conversation a little bit. I know you have, you have like your clean cloud shirts that are made from carbon emissions. I'm not sure how that works, but does being green matter today in the marketplace in how you sell? Or is it a separate consideration?

• 27:06Speaker 01

  It matters very much to us. I think Switzerland is a bit the pinnacle of an outdoor theme park.

• 27:15Speaker 01

  And so we do most of our sports in nature. It's something that we have to preserve. And so on every dimension, what we can do to reduce the footprint of ON towards the environment is, is super important. And take a light spray shoe. The shoe upper is because it's not 200 steps going into it, but one step is more than 75% lower CO2 footprint. Or you mentioned clean cloud. We're actually sucking bad clouds from the air, industry emissions, create the base ingredients for foam again to create clean cloud foam. So we do everything that innovation can do to lower the footprint.

• 28:00Bob Safian?

  So you've been on this 16-year overnight success journey. What's at stake for ON right now?

• 28:09Speaker 01

  The defining decade for ON is ahead of us. We've planted so many seeds that are growing up, which is exciting. Our apparel, it's growing more than 50% year over year. Our digital channels are growing very fast. We're expanding globally. So we're relevant for communities across the globe. We're still the fastest growing brand in, in our industry of the scaled, of the scaled sports brands. We're also the most premium in terms of margins, the most premium brand. So it's really an opportunity to build a brand that doesn't have to be ultimately the absolute biggest, but is the most premium brand of the future.

• 28:54Bob Safian?

  Well, David, I have to say, this has been a great conversation. Thanks so much for joining me and, and doing it.

• 29:00Speaker 01

  Thank you very much for having me.

• 29:04Bob Safian?

  I keep going back to that light spray shoe that David talked about. It was so light in my hand, kind of crazy. Now, maybe it won't revolutionize shoemaking, who knows? But David's emphasis on rethinking and creativity, that's the threat that any renegade business poses. And it's what even the biggest companies need to embrace, particularly right now. David isn't saying that he's going after the sports giants at Nike and Adidas, but of course, why would he? That just complicates investor expectations. Still, in his very Swiss way, you can hear his ambition. He may not be at the very front of the pack, but he can see the

• 29:45Bob Safian?

  leaders ahead and he knows the race is long. I'm Bob Safian. Thanks for listening.

• 30:01Speaker 00

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• 30:40Bob Safian?

  Hey listeners, Bob here. If you listen to Rapid Response on Masters of Scale, you may be missing half the show because every Friday we release a second Rapid Response exclusively in the Rapid Response feed. The guests and topics are just as compelling and timely, from Ford CEO to NASA's administrator to the lessons from the devil wears Prada. It takes about 10 seconds to find. Just search Rapid Response wherever you listen to podcasts and hit follow to make sure you never miss an episode. I hope to see you there.

• 31:17Speaker 03

  Humans will never be more intelligent than AI.

• 31:21Speaker 04

  There's going to be two types of companies. Those are great at AI and those that went out of business because they weren't.

• 31:26Speaker 05

  How do we build a future that is human-centered?

• 31:31Speaker 06

  I'm Rana Elkhayubi. And on my podcast, Pioneers of AI, we answer that question and so many more. As an AI scientist, entrepreneur, and investor, I know what it takes to build AI that works for everyone. Every week, I sit down with the pioneers shaping our future and we take you behind the scenes of the AI that's transforming our lives. Find Pioneers of AI wherever you tune in.

• 32:01Bob Safian?

  Rapid Response is a Wait What original. I'm Bob Safian. Our executive producer is Eve Trow. Our senior producer is Alex Morris and our associate producer is Masha Makutonina. Mixing and mastering by Aaron Bastinelli and Brian Pugh. Our theme music is by Ryan Holiday. For more, visit rapidresponseshow.com.