The manufacturing decision that made Rothy's worth $475M

Most founders design a product and then go find a factory that can make it.

Rothy's did the opposite and that inversion is the reason Goldman Sachs invested and why a 49.9% stake sold for $475 million.

How Rothy's Knitting Process Changed Footwear

In 2012, two founders with zero footwear experience looked at the shoe industry and saw a manufacturing problem, not a product gap. Traditional footwear cuts pieces from flat material and assembles them by hand. The offcuts — the scrap — are just the cost of doing business. A leather upper might yield 60–70% usable material from the hide.

Rothy's asked: what if you designed the waste out before you designed the product in?

The answer was programmable knitting machines. Each shoe upper is knitted to its final shape in a single continuous pass. No cutting step. No offcuts. And because the pattern is software, changing a size is a code change, not a tooling change.

They spent four years and $2 million getting it right before selling a single pair.

The full breakdown — including why Nike never sued them and what this means for how you build your manufacturing system — is on the blog.

→ Read: How Rothy's Knitting Manufacturing Process Changed Footwear Forever

250 Years of American Supply Chain

July 4th is Saturday. To mark it, we're running a 5-part series this week on how supply chain and commerce have changed since 1776.

Sourcing without Alibaba. Launches without press releases. Delivery windows measured in seasons, not hours.

It's a little dry, a little funny, and grounded in things that are genuinely true. Follow us on LinkedIn to catch all five.

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If you're working through a sourcing challenge right now, whether that's finding a factory, rethinking your manufacturing system, or figuring out what your process should look like before you scale, we're here.