India’s Zyode raises $18M to expand its tech-enabled fashion manufacturing to more countries

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Zyode is an Indian startup that offers its tech platform to global fashion brands to help them with their entire design-to-delivery process. It has raised $18 million in a new funding round to expand its presence to over 40 countries worldwide.

This Gurugram-based startup works with Indian factories to help them make fashion wear for global brands. It offers an ERP (enterprise resource planning) software, which it calls the “brain of manufacturing”, that tells factories what should be produced, how it should be made and when it should be made so that they can utilise their full potential.

Ankit Jaipuria, co-founder of Zeode, told TechCrunch that the capacity utilisation of over 80,000 small and medium factories in India is less than 33%. Through its ERP platform, the startup helps factories understand what components – such as fabric – they should use to make clothes for a particular brand. It also tells them in what pattern the fabric should be cut and stitched based on the requirement raised by the brand to get maximum utilisation.

In addition, the startup has developed a daily production reporting system to give factories a day-to-day work plan. This tackles the challenges that local factories and their workers face in a typical environment where factory owners manage operations through paper and pen or WhatsApp.

Jaipuria said, “We are giving the daily instructions, which earlier used to be given by a factory owner, and that is: how it has to be made, when it has to be made, what has to be made – all this goes through Zyod, and that is why I say Zyod acts as the brain of manufacturing, and factories act as the execution arms.”

Co-founded by Jaipuria and Ritesh Khandelwal in early 2023, Zyode currently serves over 550 customers across 18 countries, adding nearly 400 customers in the last two years. The startup initially helped D2C brands with faster launch times and low minimum order quantities. However, in the October quarter, it started onboarding enterprise customers and has since added major brands including Reliance Industries and Aditya Birla in India. Its early clients also include Japan’s Urban Research, Pennsylvania’s Anthropologie, UK’s Next and Boohoo, and Spain’s Van-Dos.

In January, Zyode launched its mobile app on iOS and Android platforms. It focuses on long-tail customers who want to buy different styles on the go. The app also helps enterprise clients view their orders. Zyode also plans to update the app with new communication methods, including approving orders and communicating with teams through a live chat window.

The $18 million investment is Zyode’s Series A round led by RTP Global and includes participation from existing investors Lightspeed and Alteria Capital and new investors Stride Ventures, Stride One, and Trifecta Capital. The funding will help the startup expand its presence in the Southern Hemisphere and enter markets such as Brazil and Australia. It is also looking to enter some underserved countries including Africa and the Scandinavian part of Europe.

“Once we have expanded well in both hemispheres, we will be able to produce all-weather products for our ongoing factories in India,” Jaipuria said.

Zyode has grown its catalog from 10 or 20 initially to 10,000 styles per month. The startup gives brands predictions about what clothing styles people will want to buy based on the data it collects.

With the fresh funding, Zyode wants to improve these predictions as well as automate the platform so that brands can feed in the style and image of the design they want to create so that its pattern can be generated. The startup also plans to integrate its software with traditional sewing machines to reduce human errors.

The Series A round also includes an undisclosed loan, which Jaipuria said is specifically for working capital requirements.

“Zyod leverages technology to refine every aspect of the production process, from its modular design approach to optimizing operations at the factory level,” Nishit Garg, partner in RTP Global’s Asia investment team, said in a prepared statement.

Zeode’s new funding comes two years after it raised $3.5 million in a seed round in April 2023. Jaipuria told TechCrunch that the startup’s valuation has grown “multiple times” since the last round, but he did not reveal any specific numbers. The co-founder pointed out that the startup also generates “several million dollars” in revenue annually.

“We are thrilled to double down on our partnership with Zeode,” said Rahul Taneja, Partner, Lightspeed India. “Their global network is growing rapidly and we are excited about this next phase of growth.”

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