a causeartist platform

6 Impact Investors Funding Sustainable Fashion Startups

The fashion industry emits more carbon than international flights and maritime shipping combined, and is the second largest polluter in the world after oil. The ethical and sustainable fashion movement has been building up for years now and is about to blast into the mainstream. The movement is lead by consumers.

The global ethical fashion market size reached a value of nearly $6.35 billion in 2019 and is expected to $8.25 billion in 2023 and is expected to then grow to $9.81 billion in 2025 and $15.17 billion in 2030.

Textile industry environmental statistics.

- The average consumer today buys 60% more clothes compared to the early 2000s, but keeps each garment for only half as long.

- A single T-shirt takes approximately 2,700 litres of water to produce, contributing to what’s considered as one of the top five global risks: water scarcity.

- Polyester production for textiles in 2015 alone contributed to the release of 706 billion kg worth of greenhouse gases; that’s the equivalent of the annual emission of 185 coal-fired power plants.

According to a recent report published by Quantis, more than 80% of fashion’s carbon footprint is generated during production, which means that mitigating the environmental impact of garment products requires brands to reevaluate their sourcing.

As consumers continue to care more about how clothes are made, who makes them, and how it impacts our environment, investors are now listening to consumers and to this market. Below are impact investors funding sustainable fashion startups to create more ethical manufacturing and production processes and more sustainable materials to build the fashion brands of the next generation.

Good Fashion Fund

The Good Fashion Fund (GFF) is the first investment fund focused solely on driving the implementation of innovative solutions in the fashion industry. Currently, apparel supply chains are plagued by negative environmental and social impacts. While sustainable solutions exist today, there is a lack of capital available to scale these technologies within the supply chain. The Fund was created to address this gap – connecting the most promising technologies to the industry, to collaboratively tackle its challenges.

The Good Fashion Fund invests in the adoption of high impact and disruptive technologies and circular innovations in the textile & apparel production industry in Asia (India, Bangladesh, Vietnam).

They help manufacturers and operators to implement these technologies, to significantly improve the positive impact of apparel manufacturing. This means the use of recyclable and safe materials, clean and less energy, closed-loop manufacturing and the creation of fair jobs and growth.

Heed Capital

Venture capital as a catalyzing force for impact and sustainability. Heed Capital backs purpose-driven founders across the globe who transform the world’s biggest challenges into the world’s biggest business opportunities. They support founders who innovate considering social and environmental impact being a foundation of the company, a part of its DNA, to deliver scalable social and environmental impact.

Closed Loop Partners

Closed Loop Partners is a New York-based investment firm comprised of venture capital, growth equity, private equity, project-based finance and an innovation center focused on building the circular economy.

They have created an ecosystem that connects entrepreneurs, industry experts, global consumer goods companies, retailers, financial institutions and municipalities. Their investments align capitalism with positive social and environmental impact by reducing waste and greenhouse gas emissions via materials innovation, advanced recycling technologies, supply chain optimization and landfill diversion.

Alante Capital

Alante Capital is a venture capital fund investing in innovative technologies that address climate change and enable a resilient, sustainable future for apparel production and retail.

The company believes that by cleaning up the production and consumption patterns of leading industries, we can make substantial headway towards decreasing the negative effects humans have on the environment. The founders decided to get started with an often-overlooked industry that touches everyone on the planet… the apparel industry.

Over the past decade, clothing prices have hit record lows while production continues to soar, resulting in an exponential increase in environmental and social costs. The challenges of managing opaque supply chains have allowed for forced labor, unsafe working conditions and toxic dumping to be outcomes of the clothes we wear. Companies are actively developing and integrating new solutions to make the lifecycle of apparel safer, cleaner, more efficient and more sustainable.

Style with Substance Ventures

Since early 2015, Style with Substance has been working to promote sustainability in the fashion industry and support those innovators and entrepreneurs that were creating positive impact.

By late 2016, the company realized that there was a gap with the investment, innovation and sustainable fashion industry in Canada. The companies founder, Stacey Fruitman became an Advisor with the MaRS Catalyst Fund to help source early stage companies.  As most of these companies too early for Funds, they decided to make pre-seed investment with the Style with Substance Ventures arm of the business.

They believe that it is crucial to create a supportive and collaborative eco-system where we see synergies across the various portfolio companies. The portfolio is diversified within the fashion innovation sector spanning across areas like material fabrication, new retail business models, and supply chain revitalization.  

Beyond Form

Beyond Form is a venture studio building impact-driven fashion technologies with ambitious founders & corporates. The company helps builds startups from the ground up in partnership with ambitious entrepreneurs and corporates.

Their methodology combines three important components together to create great fashion tech startups: Fashion Domain Expertise, Technology Prowess, Entrepreneurial Mindset The team works in close collaboration with founders. Together we validate ideas, build the MVP, test & iterate and launch onto the market.

Listen and Subscribe to the Investing in Impact Podcast
Subscribe on Apple Podcasts and Spotify

Latest articles