Everlane—once an icon of ethical fashion—is reportedly being sold for $100 million to Shein, arguably the least ethical fashion brand on the market.
Everlane had been on shaky financial ground for years, and majority owner L Catterton began shopping it around in March. But few expected it to sell to a Chinese retailer credibly accused of forced labor and labeled by Yale researchers as “the biggest polluter in fast fashion.”
It’s the latest blow to a wave of ethical consumer brands that sprung up in the 2010s to court millennials. Last month, Allbirds—the sustainable sneaker startup—sold off its footwear assets, abandoned its environmental mission, and pivoted to artificial intelligence. Two years ago, Beautycounter—built on ridding harmful ingredients from personal care products—shuttered without warning after its troubled acquisition by the Carlyle Group. (Founder Gregg Renfrew bought back the brand and has since relaunched as Counter.)
These brands were born during the Obama years, when millennials were brimming with hope and convinced that progress was coming. Climate change felt like a problem that business, government, and consumers could solve together. Workers’ rights, transparent supply chains, and cleaner materials appeared to be going mainstream. Now the reckoning has arrived in the middle of a second Trump administration that’s actively dismantling climate policy and DEI initiatives. For millennials, the death of these brands feels like a collapse of a belief system.
These companies failed for many reasons. They stopped innovating, buckled under investor pressure, and landed with private equity firms looking to cut their losses. But for millennials who grew up with them, it’s deflating to watch an era of idealistic brands end in such humiliation. The bigger worry is that it could discourage the next generation of founders and investors from seeing business as a force for good.
The Mission Was Real
Everlane is selling out, to use the words of Puck, which first broke this news. It’s tempting now to look back and wonder whether the company ever stood for something. As a reporter who covered Everlane in its early days, I don’t believe its focus on ethics was just marketing. Sure, founder Michael Preysman was a brilliant marketer. But he used his skills to draw attention to fashion’s environmental footprint and the lives of garment workers.
In 2019, I visited Everlane’s San Francisco headquarters to report on its ambitious goal of eradicating virgin plastic from its supply chain. The company practiced what it preached. Preysman proudly walked me through the office kitchen, stocked with food in minimal packaging. Kim Smith, then head of sustainability, explained how hard they worked to move garments through the supply chain without sealing each one in its own plastic bag to keep it clean. The Everlane team regularly visited factories and found ways to improve the quality of workers’ lives by buying motorcycle helmets and planting community gardens.
I had similar experiences with Allbirds, which was founded just a few blocks away from Everlane in 2015. In 2018, at a long table made of reclaimed wood that the founders had sanded themselves, I heard about their push to replace the plastic foam in sneakers with a polymer derived from sugarcane rather than fossil fuels—thereby slashing the shoes’ carbon footprint in the process. That same year, I traveled to Capitol Hill with a group of 100 Beautycounter saleswomen as they lobbied lawmakers to better regulate personal care products.
These companies poured money into materials research, higher wages for workers, and regulations that would make their own operations harder. They also spurred broader industry change. Thanks, in part, to Everlane, recycled plastic is now widely used in apparel manufacturing. Sneaker giants followed Allbirds’ lead, incorporating more eco-friendly materials into their shoes. Beauty brands began changing their formulas to remove known toxins.
But their influence on the marketplace also means that these brands faced new competition from other brands making similar products. It was hard to keep up the pace of innovation so that consumers would stay interested.
The Reckoning For Mission-Driven Brands
Millennials who came of age during the Obama years believed startups could change the world for the better. If they just focused on the right innovations, they could make products that were less polluting and less toxic—and pay workers a living wage. Customers, meanwhile, would be attracted to their mission-driven ethos.
That now seems quaint. Everlane, which designed basics meant to be worn for years, now belongs to Shein, which has upwards of 600,000 products on its website at any given moment to appeal to every micro-trend. Allbirds has abandoned its environmental mission entirely; it just raised $50 million to lease compute power to AI developers. Beautycounter no longer exists, though its founder, Gregg Renfrew, is making another go of it with Counter.
I’ve written at length about why so many direct-to-consumer brands imploded. A big part of the story is that these startups emerged at a time when venture capitalists were happy to pump cash into consumer brands to fuel their growth, often at the expense of profitability. Eventually, the investors came looking for a return, forcing decisions that broke the companies.
Allbirds went public, landing an initial market capitalization of $2.16 billion. It bled losses for years before selling its intellectual property to American Exchange Group for $39 million and pivoting to different business altogether. Beautycounter and Everlane took the private equity route. We’re now seeing how that ended.
It’s hard not to read the timing as symbolic. The brands that promised a more ethical capitalism came of age during a time when progressives were in power. They’re meeting their end during a time when the environmental regulations are being rolled back and DEI has become a slur. The political climate that nurtured these brands is gone, and the one that replaced it is openly hostile to what they stood for.
It would be easy to conclude that ethical brands are doomed. They aren’t. Patagonia and Eileen Fisher have built long-lasting businesses by growing at a sane pace for decades. Boll & Branch, deeply committed to workers’ rights, has found success by leaning into product quality and is growing quickly among older, higher-income consumers. And plenty of smaller brands—American Giant, Cleobella, Christy Dawn, Hanna Andersson—remain quietly committed to sustainability and workers’ rights.
For those of us who continue to believe that business can drive positive change in the world, the hope is that the next crop of entrepreneurs learns the right lesson: ethics and environmentalism have to be built into a profitable business model. The founders of Everlane, Allbirds, and Beautycounter couldn’t have imagined their companies ending this way. But the innovations they pioneered are still out there, influencing the industry.
