OpenSC landed a $4 million seed round to continue developing its digital supply chain technology, including blockchain.
The “impact tech” venture was founded by the Australian branch of the World Wide Fund for Wildlife (WWF-Australia) and Boston Consulting Group’s venture capital and incubation firm, BCG Digital Ventures.
OpenSC said it will use the funds to continue the development of a technology platform that will help businesses and brands create sustainable and ethical supply chains. It hopes to accomplish this goal by leveraging technologies like blockchain to comprehensively track commodities, including cotton, around the globe.
“We’re on a mission to help producers, retailers, and consumers choose products that are good for the planet and good for workers,” Markus Mutz, a director with BCG Digital Ventures and OpenSC’s incoming CEO, said in a statement. “We’ve reached a point where technology has evolved and can be harnessed to create a whole new level of transparency and re-build trust. At OpenSC, we believe this will revolutionize the way we humans consume and, therefore, the way that we humans produce.”
The firm announced the funding round following the completion of a proof-of-concept project in which OpenSC tracked the harvesting and sale of Patagonian Toothfish caught off the coast of Antartica. Working with Austral Fisheries, OpenSC’s platform provided detailed data from the day an individual fish was caught, to its fileting at an approved location, and finally to the restaurant at which it was served.
In July, OpenSC also announced a collaboration with Nestlé to trace milk products produced in New Zealand and palm oil sourced in the Americas—the first time a major food and beverage company has piloted a blockchain technology in this way, according to the startup.
With the new seed funding also comes the assistance and expertise of new investors and partners, like early-stage venture fund Working Capital. The firm, which is in turn supported by global human rights organization, Humanity United, specializes in promoting and protecting worker rights by helping to develop scalable supply chain management solutions, like the platform in development at OpenSC, through investment.
Working Capital will also be joined by Christian Wenger, the founder of Swiss “innovation hub” digitalswitzerland.
Thanks to this support, nine months following its launch at the World Economic Forum in Davos in January, OpenSC will have the runway to bring this technology and expertise to a broader range of commodities and to more supply chains.
“Working Capital is delighted to add OpenSC to our global portfolio of leading startups that we believe will drive positive change, promote responsible business practices, and improve the lives and well-being of millions of vulnerable workers who produce the goods we use and consume every day,” Ed Marcum, managing director of Working Capital added. “The complexity and opacity of global supply chains can allow forced labor and human exploitation to happen unseen by corporations, and tools like OpenSC can shine some much-needed light.”
It’s no secret that human activity is taking a toll on the environment but OpenSC claims the “vast majority” of that devastation is wreaked by the less than 500 companies controlling a small group of widely used commodities. In order to prevent “the worst environmental and social impacts” caused by these industries, OpenSC contends that certified responsible production must scale to 20 percent market share. To date, no key commodity group has reached this goal.
By providing new solutions to ensure that commodities are produced ethically and sustainably, OpenSC said it can help consumers and business make better-informed purchasing decisions.
“OpenSC gives companies and consumers a new level of visibility into supply chains,” Dermot O’Gorman, CEO of WWF-Australia said. “Enabled by data and insights, companies will be able to make responsible sourcing decisions that support producers who respect human rights and use environmentally sound practices. And consumers will be empowered with trustworthy, tamper-proof information about the individual products they are buying.”