May 16, 2022 · 1h 10m · acquired
Arena Show Part II: Brooks Running (with CEO Jim Weber) · Acquired
Jim Weber · 41m spoken Ben Gilbert · 13m spoken David Rosenthal · 6m spoken Christina Cacioppo · 1m spoken
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Recorded live at the Seattle Arena Show, Acquired hosts Ben Gilbert and David Rosenthal interview Brooks Running CEO Jim Weber to unpack how the century-old brand transformed from near-insolvency into a billion-dollar standalone Berkshire Hathaway subsidiary through extreme product focus, counter-positioning, and operational discipline.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Ben and David hold 31.1% of the talking time here. How this is scored →
Ben and David as informed peer 3.1 Guest teaching 3.8 Guest disagreement 0.4 Ben and David pushing back 0.0
speaking balance: gold is Ben and David, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 1:04:56 Jim jokes about bringing up cancer
Jim playfully calls out the hosts for shifting the upbeat arena energy to cancer ('Let's close it on a light note with some cancer!').
Hardest push from Ben and David ▶ 21:00 Ben reframes Big 5 revenue lossBen stops Jim to clarify and emphasize the massive risk of intentionally walking away from over a sixth of the company's total revenue.
Biggest teaching moment ▶ 51:20 Using Strava and field counters to restart supply chainJim educates the hosts on how monitoring Strava activity and sending field staff to parks gave Brooks the confidence to turn supply chains on 6-12 weeks before rivals.
Ben and David hold their own ▶ 24:20 David breaks down counterpositioning strategyDavid shows deep strategic fluency by dissecting Nike's brand heritage of 'victory' versus Brooks' counterpositioned stance on self-investment.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Ben and David as informed peer | Guest teaching | Guest disagreement | Ben and David pushing back | Why |
|---|---|---|---|---|---|---|
| Pre-Show Banter and Acquired Theme Song | 0 | 0 | 0 | 0 | Intro banter, shoe jokes between Ben and David, and the show theme song. No guest participation or substantive debate. | |
| Sponsor Spotlight: Vanta with CEO Christina Cacioppo | 2 | 3 | 1 | 0 | Short sponsor Q&A with Vanta CEO Christina Cacioppo discussing company culture and product vs. GTM philosophies. Very collaborative and friendly. | |
| Live Stage Intro: The Brooks Turnaround Story | 0 | 0 | 0 | 0 | Host monologue framing the Brooks Running turnaround story before introducing Jim Weber onto the stage. | |
| Welcoming Jim Weber and Running With Purpose | 2 | 2 | 0 | 0 | Jim walks out on stage, receives Acquired swag, and introduces the premise of his book 'Running With Purpose'. Highly celebratory tone. | |
| Jim Weber's Background and Brooks' Strategic Pivot | 4 | 5 | 1 | 0 | Jim walks through his background at Coleman and Sim Sports before explaining Brooks' strategic pivot to eliminate low-end footwear and focus strictly on performance running. | |
| Whitney Recapitalization and Self-Funding Economics | 5 | 6 | 0 | 0 | Hosts cite specific financial details like the $7M Whitney recapitalization, while Jim details the self-funding asset-light model that delivers over 50% return on tangible assets. | |
| Consumable Unit Economics and Race Day Shoe Counts | 4 | 6 | 0 | 0 | Jim schools the hosts on consumable unit economics, explaining that frequent runners burn through 2.6 pairs of shoes a year and citing marathon shoe counts. | |
| Channel Rationalization and Counter-Positioning Strategy | 6 | 5 | 1 | 0 | David and Ben ask about channel conflict and counter-positioning against Nike. Jim explains abandoning Big 5 and positioning Brooks around the everyday personal pursuit of running rather than the podium. | |
| Inclusive Brand Culture and Biomechanical Innovation | 4 | 5 | 0 | 0 | Ben reflects on Brooks' approachable brand culture, and Jim elaborates on biomechanical customization, Title IX's impact on female runners, and product R&D focus. | |
| Sponsor Spotlight: Cyber Insurance with Vouch | 0 | 0 | 0 | 0 | Sponsor spotlight monologue from David explaining Vouch cyber insurance. | |
| Turnaround Execution and Product Lead Times | 4 | 5 | 1 | 0 | Jim recounts turning down retailer makeup business, aligning team incentives around realistic cash flow targets, and shoe production lead times akin to automotive tooling. | |
| Navigating Russell Athletic and Fruit of the Loom Mergers | 5 | 5 | 1 | 0 | Ben and David track corporate M&A history as Jim recounts negotiating autonomy under Russell Athletic and Fruit of the Loom, resisting moves to Bowling Green. | |
| Warren Buffett and the Berkshire Hathaway Spin-Out | 4 | 6 | 0 | 0 | Jim shares the story of meeting Warren Buffett in Omaha and Buffett's 7 a.m. voicemail deciding to spin Brooks out as a direct Berkshire Hathaway subsidiary. | |
| The 2012 Olympic Trials Guerrilla Marketing Stunt | 3 | 4 | 1 | 0 | Jim entertainingly recounts flying a 'Run Happy' plane over Nike's home turf at the 2012 Olympic Trials in Eugene, leading to him being kicked out of the stadium. | |
| Navigating COVID-19 and Surpassing $1 Billion Revenue | 5 | 6 | 0 | 0 | Jim explains how real-time Strava data and park runner counts allowed Brooks to restart its supply chain months ahead of competitors during COVID-19, reaching $1.13B revenue. | |
| Brooks' Moat and Future Digital Strategy | 4 | 6 | 1 | 0 | Jim assesses Brooks' moats (retail partnerships, fit/ride consistency) and digital strategy, observing how competitors wasted hundreds of millions buying unprofitable fitness apps. | |
| Sponsor Spotlight: SoftBank Latin America Fund | 0 | 0 | 0 | 0 | Mid-roll host ad read for SoftBank Latin America Fund and Banco Inter. | |
| Overcoming Cancer and Reflections on Leadership | 3 | 5 | 1 | 0 | Jim playfully ribs the hosts about ending on cancer before delivering a deeply moving reflection on beating esophageal cancer, purpose, and living without fear. |
Statements from this episode (36)
Gilbert: Brooks Faced $30M Debt and Near-Payroll Failure in 2002
“So when the CEO, Jim Weber, took the helm in 2002, the company was losing five million dollars a year, it was thirty million dollars in debt, it was a week away from missing payroll, and the board was like having weekly meetings to figure out how to make Payro…”
Gilbert: Warren Buffett Made Brooks a Direct Berkshire Hathaway Report
“So, along the way, Brooks was acquired by Berkshire Hathaway, and Warren Buffett personally elevated Brooks and Jim to make the company a direct report to him.”
Weber: Brooks Running directs all marketing spend exclusively to runners
“If you're not a runner,
We haven't marketed to you.
I mean, we are so focused.
Every nickel has gone to people that are putting one foot in front of another”
Jim Weber: Global Running Market Is a $30 Billion Category
“The market in running, it's the biggest category in all of sporting goods. It's the biggest category in athletic footwear. It always has been. It's about a thirty billion dollar category globally. Apparel and footwear.”
Weber: Footwear's Multi-Sport Sprawl Began With Factory Utilization Pressures
“And what no one understood that I found out later is that the mindset in our industry literally came from owning a factory. When you had a shoe factory, you had to keep it busy all year long and keep the people employed. So you went from baseball cleats to wre…”
Jim Weber: Industry Thought Brooks Would Fail by Focusing Solely on Running
“And so, but when we made the decision to burn the boats on everything, but performance running, the industry had never seen that before. And most people thought we were crazy that we wouldn't survive.”
Weber: Companies with Issues Get Sold, While Opportunities Attract Investors
“The pitch I made to our team, and it's what I believed, is that companies with issues get sold. Companies with the opportunity attract investors.”
Weber: Brooks Running Has Not Needed Outside Capital Since 2001
“We haven't needed a dollar of capital since 2001.”
Weber: Brooks Averaged Over 50% Return on Tangible Net Assets
“Our return on tangible net assets has been over Over 50% for the last 15 years.”
Weber: Frequent runners go through 2.6 pairs of shoes annually
“A frequent runner will put 20 to 30 miles a week. They'll go through 2.6 pairs of shoes a year.”
Weber: Brooks Was #1 in Houston Half Marathon, #2 Behind Nike Overall
“So Houston Marathon, 8006 thousand marathoners, 12,000 halves. Number one shoe in the half, Brooks. Number two shoe in the full. There's a little brand down in Portland, Oregon. They were number one. But we are on their heels.”
Brooks CEO: Ghost and Adrenaline are top two US performance running shoes
“We have two of the best selling shoes now in the United States, the Ghost and the Adrenaline. They're the two top shoes in the performance running category.”
Brooks CEO: Big 5 made up $10M of Brooks' $60M revenue
“We were doing ten million of sixty million of revenue with them at 30 dollar shoes. My first meeting with them is we love Brooks. We see a great future for you.”
Weber: Real Footwear Revenue Is in Daily Trainers, Not Racing Shoes
“I think we were the first one to identify that the real business was in trainers. It wasn't in racing shoes. It wasn't in spikes. It wasn't in marathon racing shoes. The business is in the trainers.”
Weber: College Runners Often Race in Major Brands, But Train in Brooks
“A lot of the college athletes that race in the big brands, Train in Brooks. Every day.”
Brooks CEO: Running business is everyday wellness, not elite competition
“The sport is the soul of running, right? Track and field, cross country, road racing, the Olympics, now trail and ultra, but the business is people that are investing in themselves, fitness and health and wellness.”
Weber: Women have driven running growth since the mid-1990s
“I mean, we doubled the business, and women have driven this sport since the mid nineties.”
Weber: Beginner Runners Need Premium Footwear More Than Elite Athletes
“But what's interesting at our sport, the person that really needs the best footwear and the best Run bra and all of that are the people that are just beginning. Because the injury potential for those people is really high.”
Weber: Brooks generated $10M in cash during his first nine months
“And we generated ten million of cash that first nine months. That's how much we shrunk the balance sheet with focus.”
Weber: Footwear Manufacturing Complexity Resembles Cars More Than Apparel
“It's not the car business, but it's more like the car business than the t-shirt business. There's every, there's tooling on everything. 12 sizes men's, 12 sizes women's, widths, colors. It's scaling these things in the fact there's a lot of tooling.”
Weber: Bringing one shoe style to market costs $500K to $1M
“Takes a half a million to a million bucks to bring one style to market.”
Weber: Brooks Running tripled its business between 2009 and 2014
“Oh, eight, oh, nine, just as that was going on, you know, obviously great recession. We tripled the business. From 2009 to 20 14.”
Jim Weber: Fruit of the Loom bought Russell for ~$1 billion
“Fruit was, you know, sort of consolidating all their stuff, and they had bought Russell for about a billion dollars with internal capital, and they were about to go and restructure that.”
Weber: Nike signed a 27-year marketing agreement with USATF
“Nike, ah, signs a 27 year marketing agreement with the governing body of our sport, USA Track and Field.”
Weber: Track Officials Ejected Brooks Execs From 2012 Olympic Trials
“They kicked me out, our head of marketing, and our head of sports marketing.”
Weber: 90% of Brooks Running products were sold via retail before COVID-19
“90% of our products went through a retailer.”
Weber: Brooks digital sales rose to 80%, driving record May 2020 revenue
“Digital went from 30% of all of our products going through a website of somebody's, ours or another partner's, it went to 80% by the end of April, and in May, we sold more in May 2020, almost all through digital than we did in May 19.”
Weber: Brooks turned its supply chain back on 6-12 weeks before competitors
“We turned our supply chain on at least six to 12 weeks before anybody else did.”
Weber: Brooks is number one brand at REI and Dick's Sporting Goods
“Obviously, you know, some of the better sporting goods players and outdoor from REI to Dick's Sporting Goods. We're their number one brand.”
Weber: Buffett Blocked Running App Acquisitions Due to Lack of EBITDA
“So I wanted to buy every one of those and Warren wanted me to do the multiple on EBITDA and there was no EBITDA. So let's just say it's hard to do acquisitions.”
Weber: Brooks reached number one US running shoe position with 21.5% share
“We became the number one running shoe brand in the United States in the last 12 months, last month. 21 and a half percent share in performance running.”
Weber: Brooks targets 60M unique customers and $4B revenue in 10 years
“So we see an opportunity for sixty million customers, Sixty million uniques up from maybe fifteen million today, four bagger, and four billion in revenue.”