Roger Federer became the latest celebrity to make a fortune out of backing a sports clothing firm as his trainer business On Holding AG soared in value by 47% to US$11bn in first dealings yesterday.
The tennis superstar invested a reported US$54mln into the eleven-year-old company two years ago, since when its value has gone through the roof as the athleisure market boomed during the Covid lockdown.
On’s selling point is tube-like sponges in the soles of shoes, which retail for around US$200, and apparently help you run faster.
The Swiss group also has a 100% recyclable brand of running shoes, called Cyclon, made from castor beans, but these are only available on a subscription basis and have to be returned for replacement once they wear out.
On was founded in 2010 by runners Olivier Bernhard, David Allemann and Caspar Coppetti and is also now with the company also working with twenty-times Grand Slam champion Federer on a tennis shoe – Roger Pro.
The shares were listed at US$24 with the company selling 31.1mln shares and raising around US$750mln in new money.
Ahead of trading today in the US, the shares were trading at US$35.
Trainers have become an incredibly buoyant market, with demand fuelled by government stimulus cheques that have seen youngsters flocking to athleisure stores actual and online to spend.
Britain’s JD Sports this week upped its full-year profit forecast by more than 80% due to demand largely from the US for shoes and casual wear.
According to Reuters, On’s sales have grown 60% a year since Federer got involved while revenue in North America, its biggest market, doubled from a year ago in the first six months of this year.
On is taking on some big beasts in Nike, Adidas with even the like of Warren Buffett getting involved through Brooks Running.
It might all end in tears, but people were saying the same thing about the trainer market in 2003 just at the time Federer win his fist Grand Slam title.