Supply chain and product traceability SaaS platform TrusTrace has raised $6 Mn in Series A funding. The round was led by Industrifonden and Fairpoint Capital, with participation from BackingMinds and Fashion for Good.
Founded in 2016 by Shameek Ghosh and Saravanan Parisutham, the Coimbatore and Stockholm based startup leverages AI and blockchain technology to help brands across fashion, food and retail to understand and take responsibility for the social and environmental impact of their supply chain.
The startup currently boasts a portfolio of more than 8,000 suppliers in India, China, Bangladesh and other regions and shares data with 40+ well-known fashion brands like Decathlon, Fjällräven, Filippa K, Coop, and Zalando.
The fresh infusion of capital will be used to accelerate global expansion and expand product development by strengthening its team.
“TrusTrace enables product-level traceability and supply chain transparency to drive better, more sustainably-conscious and socially-responsible sourcing decisions,” said the CEO of TrusTrace Shameek Ghosh.
With the ‘staggering’ rise in extreme weather events across the world caused by climate change, the spotlight is falling on massive corporations who irresponsibly source their products.
Apparel and footwear production accounts for 8.1% of global greenhouse gas emissions. The relatively new trend of ‘fast-fashion’ within the industry has raised further concerns.
Fast fashion is a highly profitable and exploitative business model based on quickly replicating and mass manufacturing high-fashion trends. These garments are often manufactured at low costs in developing countries.
India, Bangladesh and China are some of the biggest manufacturers of garments in the world and these countries face everything from poisoned rivers to microplastics in the ocean and rampant energy wastage due to this new phenomenon.
The environmental cost is just one aspect of the damage caused by unethical practices in the fashion industry. Popular brands like Nike and Adidas have faced flak for producing garments, footwear and accessories in ‘sweatshop’ conditions.
A sweatshop is a factory where manual workers are hired with very-low wages and work under very poor conditions to produce low-cost goods that can be sold with a high margin.
In the past, massive corporations could brush these issues under the rug with carefully planned media coverage. But as consumers get more environmentally and socially conscious, they expect brands to source products responsibly.
Whether its Nestlé sourcing Palm Oil in Indonesia, or Apple using Tantalum from the Democratic Republic of Congo in manufacturing electronics, companies can no longer afford to ignore the impact their supply chains have on society and the environment.