Ganni, Patagonia and Reformation Join Pilot Project to Decarbonize Fashion

Editorial TeamEditorial Team
March 2nd, 2023

California startup Rubi Labs has secured another $8.7 million in funding for its lyocell yarn made from converted CO2, with brands such as Ganni, Reformation, and Patagonia, having agreed to produce prototypes in hopes of driving the commercialization of the product.

California-based startup Rubi Labs has received $8.7 million in seed funding, bringing it one step closer to its vision of carbon-negative viscose. This latest round of funding - led by Talis Capital, Patagonia's Tin Shed Ventures, and H&M Group - brings total funding to $13.5 million.

The funding will drive the next phase of commercialization: Testing how well the material fits into existing supply chains, creating prototype products from start to finish, and selling them through limited capsule collections before scaling.

In addition to strategic partners H&M and Patagonia, this next phase will include simultaneous pilots with Ganni, Reformation, and Urbn-owned rental platform Nuuly. This will take about six months in total and is already underway with most of the brands selected to test the concept at different price points.



The Rise of Sustainable Materials Amongst Brands

Rubi Labs uses biochemical processes to convert carbon dioxide from manufacturing plant waste streams into cellulose, which it uses to make lyocell yarn for textiles, reducing the need for other waste materials or deforestation. On the cellulosic materials side, competitors like Circulose® owner Renewcell and Natural Fiber Welding are swapping conventional pulp materials for recycled clothing.

Brands that are supporting new materials from the pilot stage onward may take a financial risk if it doesn't work. According to Kathleen Talbot, chief sustainability officer and VP of operations at Reformation, the brand hopes that the payoff is worthwhile, which currently sources viscose rayon as 20% of its materials.

As the decarbonization goal fits with Reformation’s sustainability strategy, the brand decided it was a good fit in terms of its material sourcing, as it doesn’t source synthetics.

According to Rubi Labs Co-founder Neeka Mashouf, who founded the company with her twin sister Leila Mashouf, the biggest challenge will be integrating the material into existing supply chains and testing the concept from start to finish, Mashouf added. Most brands don't own their supply chains, and many of them don't have visibility into the entire chain. Rubi Labs hopes to bring in manufacturing partners to minimize those risks and make it as cost-effective as possible.

At a later date, rental platform Nuuly will also get on board to test the durability of the material. The garments to be tested will be made by parent company Urbn's production team, which is already in talks with the startup.



Inditex's Competitors Join Forces to Decarbonize Fashion

This isn't one of the only major investments in decarbonizing the industry. H&M also launched investment fund last year with other apparel brands for solutions to halve pollutant emissions by 2030. H&M, one of Inditex's biggest global competitors, joined other apparel brands to launch a fund aimed at decarbonizing the fashion industry.

The Apparel Impact Institute (Aii), an organization focused on climate research in the textile sector, has launched the Fashion Climate Fund, an investment vehicle with $250 million in assets. The Swedish group H&M, the Canadian firm Lululemon, and the Schmidt Family Foundation, the foundation headed by former Google CEO Eric Schmidt, are the main funders.

The fund was created to invest in solutions to halve emissions of polluting gases in the textile sector by the end of the decade. The focus is on the supply chain, the most polluting part of the industry. The fund aims to contribute to the elimination of up to 150 million tons of carbon dioxide (CO2).

To achieve this, it’ll combine a mixed investment approach, including philanthropy, debt issues and equities. As Aii explained in a statement, it plans to unlock up to US$2 billion from different sources of capital. Of this amount, apparel manufacturers, philanthropic investors and various retail brands have provided the initial capital, while the remaining 1.7 billion-plus will be raised through bonds and share purchases.

It’ll have a varied focus in this area. On the one hand, it is looking for renewable energy technology projects to replace coal, or to develop new methods of processing materials that do not depend on this fossil fuel.