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unicorn green is the new black

Bending Our Linear Models: The Rise of Unicorn Companies in Circular Fashion

The number of successful brands in the sustainable fashion industry worth more than $1 billion is becoming increasingly hard to ignore. It’s fair to say that the land of unicorn companies is getting greener and more circular. They might just be replacing the capitalist linear economy for good.  

But really, how effective are their business models? As with all billion-dollar brands, it is necessary to always critically lookout for their labour practices and accumulation of wealth. Essentially, are the billions serving the planet and its people or just a handful of CEOs? (PS: read all about how to tell sustainability from greenwashing over here.) It’s not easy to adopt circularity in a linear, capitalist world. Hugely different from the status quo, we know. Sustainability is a practice and process, one that’s incomplete without transparency. In this piece, we look closely at some unicorn brands stepping up to the challenge.

 

Rent The Runway | Designer-style clothing rental for work & weekends

Because trends are for renting, not buying! Co-founded by Jenn Hyman and Jenny Fleiss in 2009, Rent The Runway (RTR) reached a $1 billion unicorn-status valuation in 2019. Clothing rentals will continue to hold a place in the future of fashion—it’s more sustainable than fast fashion, often more economical. By renting your clothes vs. buying new, you help to contribute to a more sustainable future for fashion. After all, it’s the small (and stylish) steps that can help set us up for long-term success. Renting extends the life of garments, displaces the need for new production (of at least half a million garments through the next five years by Rent The Runway alone), diverts waste from landfills and lets you snag designer deals without the designer price tags!

Rent The Runway’s most-loved rental plan lets you rent 8 items per month for $144/month, which is just a fraction of the original retail price. And that also includes free shipping/returns, cleaning and rental coverage and more. Not to forget, a good rental always prioritises diversity in sizes and styles to make that dream closest accessible for all bodies: RTR has over 750 designers with sizes ranging from 00-22.

But it’s not all sunshine and rainbows. Several people have brought up RTR’s impact due to cleaning and transporting clothes, as well as their end of life in this business. Every item is still wrapped in a plastic dry-cleaning bag and not all plastic can be utilised for recycling. Rent the Runway also boasts of its large dry cleaners, and the company opened a second, 300,000-square-foot facility in 2019. The hidden environmental cost of delivery and packaging, taking the clothes back and forth between the warehouse and renter is not something that can be overlooked. Dry cleaning, too, is immensely harmful to the environment.

We must continue to demand better, especially so for unicorns that have the $$$ to better equip them for that transition to sustainability. The bottom line is the same: consume less, and support local rental services (with minimal delivery) wherever you can.

 

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StockX | Online stock market of things

Founded in 2016, StockX is an online resale platform for sneakers and apparel that reached $2.8 billion valuation in its latest funding round. Essentially, it’s a “stock market of things” where consumers can buy and sell products across several categories: sneakers, apparel, electronics, watches, handbags, collectables, accessories, streetwear (think hoodies and T-shirts from brands like Supreme), and more recently: NFTs. StockX stocks (pardon the pun) some of the best sustainable sneakers. From Nike to adidas to Reebok, you’ll find all the sustainable materials and innovative designs (including the hottest innovation: fabrics made from living, breathing algae). The platform boasts real-time pricing, that takes into account supply and demand, similar to how an investor trades stocks, with timestamped transactions to ensure all buyers and sellers can access the most up-to-date information on products.

Now onto their process and credentials: StockX has sought to counter the rampant counterfeiting that plagues these types of transactions by installing itself as the middleman. After a sale is made, the item is shipped to one of the company’s authentication centres, and an employee will physically inspect its authenticity. Once StockX has determined that an item isn’t a fake, it sends a payment to the seller and ships the item to the buyer. As compensation for its services, StockX takes a cut on every sale. It’s trusted precisely because of this transparent pricing and multi-step verification process.

 

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Vinted | Second-hand fashion marketplace

Looking to be more sustainable but don’t know where to start? Why not start in your wardrobe? Vinted is Europe’s largest consumer to consumer (C2C) online marketplace dedicated to second-hand fashion. A rare unicorn, and global community for buying and selling pre-loved clothes, Vinted is currently valued at $4.53 billion, with 45 million registered members globally across 14 countries. The second-hand marketplace works with three simple steps: list your item (with a description and price) for free, sell it, and then it’s payday. There are zero selling fees, so what you earn is yours to keep. As a buyer, you pay a Protection fee on each transaction which is 5% of the item plus $0.70 to add security to the transaction.

Aside from the environmental benefit of keeping clothes from reaching landfills, reselling is also financially beneficial: by selling unworn clothes, consumers free up space in their wardrobes and make some extra cash in return. As such, recently, a plethora of big-name brands have been jumping on the secondhand bandwagon. But is fast fashion resale truly operating in a way that reflects the values of a circular practice? Or are these markets simply a new avenue for profit? In other words: are they profiting off resale without scaling back production, that is, while retaining their core linear models of production?

Sigita Žvirblytė, Vinted’s Sustainability manager, shares in an interview, detailing why she joined Vinted: “I truly believe that Vinted has a strong potential to drive change in the fashion industry and to alter consumer habits to more sustainable ones. I’ve been on the same mission for the last five years. I still want to be a part of it, and ensure that when the circular models expand, the same mistakes by linear fashion companies aren’t repeated.”

 

Vestiaire Collective | Pre-loved luxury fashion marketplace

Second-hand has lost its stigma and it’s rapidly becoming popular. It’s cooler, cheaper and more sustainable, as long as it directly replaces a first-hand purchase: what’s not to love? Vestiaire Collective, currently at a $1.7 billion valuation, has an incredible selection of used high-end garments and accessories from big names at a fraction of the retail price, making designer fashion accessible and responsible. And we’ve had the absolute pleasure of working with Vestiare in previous iterations of our Conscious Festival. Unlike most companies and platforms associated with high fashion, this brand is keen to promote and encourage a circular fashion economy. More so, this is a brand that can be trusted: its own in-house quality control team checks each item for authenticity and compares it against the listed condition and description once it’s been sold.

While it’s known by now that resale is key in the fight against climate change, not all resale platforms are the same. Vestiare released its first-ever impact report on Earth Day last week to unveil new figures revealing not only the power of circularity but also how its business model fits within the resale market. For one, their research finds that shopping with Vestiaire Collective saves 90% of the environmental cost of a new item. Of course, authentic luxury fashion is well-placed for a second life. Vestiaire Collective democratises luxury fashion, opening it up to people who might not be able to afford it new.

 

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Rothy’s | Stylish staples made from recycled materials 

Rothy’s, a global lifestyle brand transforming sustainable materials into timeless shoes, handbags and accessories, is valued at $1 billion and newly joined the unicorn club this year. They’ve transformed millions of single-use plastic water bottles into their signature thread, which they use to craft all their products. Speaking of materials, they are making algae-based strobel boards (the green part of the shoe under the insole) to help keep algae from blooming rapidly due to global warming and causing ecological unbalance. How cool is that?! (Read up more about their sustainability practices here. There is so much to learn from brands leading the way.)

The truth is, circularity is messy. If closing the loop was easy, everyone would do it. And as we continue on our path to doing better, we have a lot to celebrate. Like how Rothy’s launched a pilot recycling program that successfully recycled over 20,000 pairs of shoes in 2021, zero waste, LED green building certification and reaching circular production: by 2023, not only will their products be crafted with the majority of twice-recycled and bio-based materials, but every single style they make will have an end-of-wear solution. We can’t emphasise how important the last one is.

Before buying each product, ask: what is its end of life? Is the product ultimately recyclable (mixed blend fabrics are usually hard to separate and recycle)? Does the brand provide take-back programmes where they genuinely recycle the products?

 

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Patagonia | Outdoor Clothing & Gear

Valued at $1 billion, this unicorn is making headlines for its radical outlook on business and degrowth in the outdoor clothing/gear industry:  Yvonne Chouinnard (Patagonia’s founder) shared, “Every company has its ideal size” (…). “We never wanted to be a big company. We want to be the best company, and it’s easier to try to be the best small company than the best big company.” Needless to say, being the best, that is, minimising harm is no easy feat. And Patagonia almost went bankrupt when transitioning to organic cotton. (Cotton is the world’s most popular natural fibre. But it is a nasty business, responsible for dangerously high water and chemical use.) In many ways, companies like Patagonia are uniquely positioned to lead efforts because of the years they have already spent working and researching how to reduce waste.

In 2013, Patagonia launched “worn wear”, an online marketplace for second-hand Patagonia clothing. And by 2020, they have already “sold” over 130,000 repurposed items. There is no better anthem than: “Drop it in the mail, not in the landfill!” More recently, they’ve started a donation program that allows buyers to donate to a group on Patagonia Action Works. They’re also taxing themselves 1% for the planet, and using that 1% to support environmental nonprofits. We hope that unicorn companies start to redistribute more of their earnings, for a more equitable ecosystem.

 

FEATURED IMAGE: via Isaque on Pexels | IMAGE DESCRIPTION: Image of a person holding a blade of a dried plant; they’re wearing a cream-coloured, long-sleeved knit outfit, with only the arm in focus. 
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