On the afternoon of 11 August 2026, Roger Federer stopped being a billionaire. He had only recently become one. Federer’s wealth was never really built on tennis prize money, which totalled something like $130 million across twenty-four years, but on endorsements and on one particular investment: a stake of roughly 2.5% in a Swiss running shoe company called On, which he had joined as a co-owner in 2019 after wearing the shoes and then, in the manner of a man with time on his hands, cold-approaching the founders. That stake did what the shoes did, which is to say it went up a great deal. In 2025 Forbes put him across the billion-dollar line. Then On reported its second quarter, the stock fell 20.3% in a single session, and about $52 million of Federer’s paper wealth went with it. Forbes marked him back down to roughly $952 million. I mention this not because anyone should feel sorry for Roger Federer, who is fine, but because it is the most legible way I know to convey the scale of what happened that day. It was the worst single trading day in On’s history since its 2021 IPO. And here is the part that made me want to write this piece: it happened on a quarter in which gross margin hit an all-time company record of 65.4%, adjusted EBITDA margin expanded, net income went from a loss to CHF 105 million, and management raised its profitability guidance for the year. The stock is now $27.41, at Friday 11 September’s close. It set a fresh 52-week low of $26.60 on 10 September, three days ago. It is down roughly 43% in 2026 and 57% from the closing all-time high of $63.62 set on 30 January 2025. I do not own On. My conclusion, my position and one specific reason for the timing of all this are at the end. Not advice, just my homework. Do your own. A garden hose, cut into pieces On was founded in Zurich in 2010 by three Swiss men, one of whom had a specific and unusual problem. Olivier Bernhard was a professional endurance athlete, a multiple duathlon world champion and an Ironman winner, and by the end of his career his body had opinions about running surfaces. He wanted a shoe that landed soft and took off firm, which is close to a contradiction in materials engineering: cushioning absorbs energy on impact, and the energy you absorb on the way down is energy you do not get back on the way up. The prototype, and this detail is real and is now part of the company’s origin liturgy, was a garden hose cut into segments and glued to the sole of an existing running shoe. Hollow tubes that collapse under a heel strike and then lock up when the foot rolls forward. That became CloudTec, the row of hollow pods on the bottom of every On shoe, which is also the single most recognisable piece of industrial design in running footwear. You can identify an On from across a street, which turns out to matter enormously. Bernhard brought in David Allemann and Caspar Coppetti, who had marketing and strategy backgrounds rather than athletic ones, and the three of them built the thing out in a way that looks, in retrospect, almost suspiciously disciplined. They went specialty-running-store first, which is the channel where credibility is granted rather than bought. They priced at the top. They did not discount. They expanded from running into training, then tennis, then apparel, then lifestyle, in that order, which is the order that preserves the performance credential rather than spending it. They listed on the New York Stock Exchange on 15 September 2021. Read full deep dive here https://cycledesk.substack.com/p/on-holding-onon-the-difference-between?r=7unzzg&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true
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