Shein’s reported Everlane acquisition signals pivot from sustainability to scale

Reports indicate that Chinese ultra-fast fashion giant Shein plans to acquire San Francisco-based sustainable brand Everlane for US$100m. The deal, reported by fashion reporter Lauren Sherman, has not been officially confirmed by either party. Everlane, known for its model of radical transparency, has faced significant financial headwinds, including layoffs in 2020 and 2023, and the confirmation in April of the closure of its San Francisco office.

Shein was reportedly the only party willing to meet the valuation asked by Everlane’s majority owner, private equity firm L Catterton. Backed by LVMH, L Catterton previously owned Australian retailer RM Williams before it was purchased by billionaire Andrew Forrest in 2020. Shein’s capacity to fund the acquisition is underscored by its recent performance, with sales topping £2bn in the UK and $1.5bn in Australia last year.

The potential acquisition raises concerns regarding the dilution of Everlane’s ethos. The brand was built on disclosing true costs for materials, labour, and transportation, notably partnering with the Saitex denim factory in Vietnam. In contrast, Shein is known for releasing up to 10,000 styles a day and has faced scrutiny over murky supply chains, secrecy, and alleged links to forced Uyghur labour.

Concurrently, sustainable footwear company Allbirds has rebranded as NewBird, shifting its strategic focus from eco-friendly materials to artificial intelligence. The move, described by former Australian Vogue sustainability editor Clare Press as a pivot to boost stock value, resulted in a 600% surge in the company’s share price. This follows a period where the publicly listed company, previously driven by Silicon Valley hype and B Corp certification, was leaking money.

These developments occur against a backdrop of declining consumer interest in sustainable fashion and funding challenges for sector advocacy groups. Organisations such as Remake, Fashion Revolution, and the Centre for Sustainable Fashion have shrunk or restructured due to funding shortages. Former Everlane founder Michael Preysman has since moved on to run a magnesium-powered hydration startup, illustrating the broader retreat from sustainability as a primary commercial driver.