Sustainability-Focused Startup Material Exchange Notches Series A

Material Exchange — a Swedish Software-as-a-Service (SaaS) company helping H&M and Ugg source more sustainable materials — raised €25 million ($27 million) in a Series A funding round.

The startup, which connects fabric suppliers with buyers, has raised more than $35 million since 2017. The fresh infusion of capital will go towards helping it reach new markets, the company said in a press release Tuesday (April 12).

“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. We believe the shift will ultimately have the greatest impact for brands and suppliers, as well as consumers,” founder and CEO Darren Glenister said, adding that artificial intelligence is the future.

Material Exchange’s B2B SaaS-enabled marketplace for the apparel and footwear industry is digitizing the material sourcing process and replacing the complex, fragmented relationships that exist between brands and suppliers. The overall goal is to drive sustainability and efficiency across the $2 trillion fashion supply chain, per the release.

This new investment will also help power the growth of Material Exchange’s product suite, which includes a marketplace for connecting brands with a curated network of suppliers.

“I see an incredible amount of waste in this industry, with many samples sent and materials created based on speculation rather than needs and data,” Glenister told Vogue. “I wanted an investor who saw the big picture and could help us make the industry more transparent and sustainable.”

Related: Novi Connect Notches $40M to Drive Sustainability

Material Exchange was founded by Glenister in August 2018 and aims to reimagine how professionals interact with materials. The company’s operations are grounded in sustainability principles and every decision made is done with environmental, social and governance (ESG) values in mind.

Material Exchange is also planning to earmark a portion of its funding to expand its sustainability credentials and acquire other companies to help accelerate its growth.