Material Exchange said it has raised 25 million euros ($27.18 million) in Series A funding to power the growth of its product suite.
Material Exchange is a B2B SaaS-enabled marketplace for the apparel and footwear industry that is digitizing the material sourcing process to replace the complex, fragmented relationships that exist between brands and suppliers. The goal is to drive sustainability and efficiency across the $2 trillion fashion supply chain. The company plans to step up recruitment to hire “world-class talent” across a range of specialties to help meet this goal.
“With this round, we’re able to accelerate our mission of leading the global revolution to sustainable, transparent apparel and footwear material sourcing by aggregating fragmented data into one digital solution,” said Darren Glenister, Material Exchange’s CEO and founder. “We believe the shift will ultimately have the greatest impact for brands and suppliers as well as end-consumers.”
The round was led by Molten Ventures along with the continued support of previous seed investors that includes Partech, Inventure, Norrsken, Lyra and Day One Capital. Material Exchange noted that when the global pandemic hit in 2020, it was approached by global denim trade show Kingpins to develop a digital denim marketplace in place of the physical show. The success of this partnership spurred the company to more aggressively focus on building and scaling the marketplace.
It also led to Material Exchange’s acquisition of the Olah textile agency, which operates the Kingpins Show, in October 2021. With the recent launch of its mobile app, Material Exchange is helping to further bridge the gap between digital and physical on and off the trade show floor.
The latest member of the Material Exchange team, Lucienne, is an AI tool that automatically creates an infinite number of prints and patterns. This tool helps replace the inefficient and wasteful sampling process, allowing brands to become more sustainable as they assess their supplier choices based on economic and environmental factors, as well as launches Material Exchange into the future of designing physical and digital materials for the real and virtual Metaverse.
“With Material Exchange, we see a significant and largely untapped opportunity in digitizing the highly complex and offline fashion supply chain,” Nicola McClafferty, partner at Molten Ventures, said. “The need for transparency and sustainability, as well as ongoing supply chain disruptions, are proving to be powerful forces for accelerating the structural trend of digitization of sourcing workflows for both brands and suppliers in the apparel industry.”
McClafferty said the company has been impressed not only by the early successes with leading brands and suppliers, but also by the team’s approach to building and owning this category.
“Such an understanding of the intricacies and complexities of the fashion supply chain can only come from a team of industry veterans, and having gotten to know Darren and the team, we have developed real conviction that this is an opportunity, approach, and team to back,” he added.
Material Exchange consists of a marketplace where buyers can discover materials and corresponding material data, visuals and sustainability data and certification input from suppliers. Suppliers subscribe to the platform and can upload, manage and showcase their materials and share all relevant material data in predefined data models.
Natural Fiber Welding Sees $85 Million Cash Infusion
Meanwhile, Peoria, Illinois-based material innovation firm Natural Fiber Welding (NFW) has amassed $85 million in Series B funding to pump up production of its high-performance, bio-based, circular material innovations.
Led by New York’s Evolution VC Partners with participation from Australia’s Tattarang, Lewis and Clark AgriFood, Collaborative Fund, AiiM Partners, Engine No.1, Raga Partners, Tidal Impact, Scrum Ventures and Gaingels, the round also included returning investors like BMW i Ventures, Ralph Lauren Corp., Advantage Capital and Central Illinois Angels.
The seven-year-old material sciences innovator has worked with global brands across the footwear, apparel, accessories and automotive spaces, providing solutions made from natural or recycled inputs with a low carbon footprint. NFW’s most prominent material platforms include Clarus, a group of performance textiles, and Mirum, a petroleum-free alternative to traditional leather. The company plans to use the capital to expand these programs to meet growing international demand, it said, as well as broadening the range to include molded composite materials that take the place of plastics.
“We envision a world that doesn’t rely on plastic, where abundant natural materials enable people and the planet to thrive together,” Luke Haverhals, NFW founder and CEO, said this week. “We’re here to leave the world better than we found it and we look forward to working with our brand partners to build a comprehensively circular coalition for the planet.”
Employed across lines by brands like Alexander McQueen, Pangaia, Bellroy, H&M and Camper, Mirum is a highly-customizable material that can be used across categories, mimicking everything from leather to carbon fiber, the group said. The high-performance, plant-based and fully circular material can be ground up and returned to the earth at its end of life stage, or used to make all-new material. Inherently durable, NFW said that Mirum takes a matter of months to biodegrade in landfill or compost conditions.
Its complement, Clarus, is a fabric made from natural virgin fibers or recycled inputs. Designed not to shed microplastics—a common issue with both virgin and recycled polyesters—NFW said that Clarus was created to close “critical gaps” in the textile industry’s efforts to develop a circular economy. The production process employs a closed-loop green chemistry rather than mechanical processing, which shreds fabrics and shortens fibers, impacting the integrity of new yarns.
Earlier this year, Ralph Lauren launched its RLX Clarus Polo Shirt at the 2022 Australian Open tennis tournament, while sandal brand Chaco recently released a line that replaces its traditional synthetic vamp straps with recycled cotton by Clarus. NFW earned Conservation X Labs’ Microfiber Innovation Challenge in recent weeks for its efforts to combat microfiber pollution through its products.
“The world has become allergic to plastics, which have permeated every aspect of our lives, and we need to reverse this trend,” said Gregg Smith, founder of Evolution VC Partners. Smith’s firm was compelled to invest by NFW’s all-natural innovations, which he believes have the potential to disrupt the existing materials market. “The next generation of consumers will pressure every industry—from automotive to apparel and furniture—to eliminate petrochemical usage, and NFW’s advanced materials solve those problems.”