Supply chain traceability and compliance platform TrusTrace has received a $24 million cash infusion that will foster its continued growth across the apparel and textile sector.
The group on Thursday announced the completion of its latest investment round led by Circularity Capital, which invests in businesses that promote a circular economy. Existing investment partners Industrifonden and Fairpoint Capital also participated.
The funding will serve to accelerate the platform’s global expansion into key markets and bolster product innovation and collaboration with industry stakeholders, TrusTrace CEO and co-founder Shameek Ghosh said. The group’s subscription revenue has grown fivefold since its previous funding round in 2021, with brands like Adidas, Brooks Running, Tapestry, Asics and other apparel, footwear and luxury players signing on to manage ESG risks and ensure compliance across their intricate value chains. Over the next 12 months, the firm aims to target more regional and mid-size brands.
Related Stories
“With the new fundraising round, TrusTrace aims to focus on three main categories: strengthening our product portfolio, international expansion, and dedicating more time to product research and development,” Ghosh told Sourcing Journal this week. “With ever changing supply chain laws and regulations, we will continue our global research into requirements and developing solutions that enables brands to not just be compliant with particular laws, but across laws and regions.”
In recent years, TrusTrace has been leaning more heavily on artificial intelligence (AI) to improve the speed and accuracy of its supply chain data digitization process—an effort it will continue moving forward. “In order to know, prove and improve the impact of a supply chain, brands need a detailed understanding of very complex, global operations, requiring evidence for millions or billions of data points,” Ghosh added. With the extra capital, the company can “move closer to our goals of traceability becoming an industry standard, where all brands have access” to that multitude of insights.
Several factors have contributed to the platform’s rapid acceleration in recent years. “For one, regulations have only continued to increase and become more stringent. Brands know that if they do not comply now, they will be unable to compete in a highly regulated industry,” the chief executive explained. Ongoing supply chain disruptions and reverberations from the Covid-19 era, along with the effects of climate change, “have shown brands that if they do not know what is going on in their supply chains, they will be unable to offer customers consistent service.”
Ghosh called the new funding “pivotal” in further enhancing TrusTrace’s industry reach. The firm plans to work on strengthening existing product models like its supply chain mapping, supplier management, “Real Time Trace” and “Swift Trace” solutions. The proprietary technology allows users to centralize traceability data using purchase order numbers, and record data transactions on the go.
Many of the company’s new customers are introduced through existing clients, and TrusTrace helps facilitate discussions between “leaders in the traceability space and brands that are embarking on their journey and look to learn from more experienced players,” Ghosh said. “We will also have more resources to drive partnerships and solutions integrations; solving more challenges for more brands globally.”
Today, TrusTrace has customers across the U.S., the E.U., the U.K. and Asia. “In certain product categories, we have over 60 percent of the global supplier base on our platform,” he added. “While we don’t have this vast global supplier network information across all categories yet, by continuing to offer various training sessions and constantly communicating with our supplier base, we’re continuing to grow across all categories.”
That growth will take shape with the help of new staff. The platform is “investing significantly” in cultivating a more localized presence across key regions, and expects to see headcount rise from 125 to 200 or 300 over the coming years.
“Our goal for the next five to ten years is for traceability to become standard practice, where detailed data is constantly shared on how products are made,” Ghosh said. “There’s a lot of talk of consumers being able to make the right choices, and that’s of course important, but traceability is so much more than that.”
“What strong regulatory pressure combined with traceability will ensure is that we consumers do not have to choose between products that are responsibly or irresponsibly made,” he added. “It will be impossible to put products with adverse social or environmental impacts on the market in the future.”
