India's Zyod is raising $18 million to expand its tech-enabled fashion manufacturing to more countries

Zjod is an Indian startup offering its technology platform to global fashion brands to help them with their entire design-to-delivery process. It has raised $18 million in a new round of funding to expand its footprint to more than 40 countries around the world.

The Gurugram-based startup partners with Indian factories to help them produce fashion apparel for global brands. It provides enterprise resource planning (ERP) software, sometimes called the “brain of manufacturing,” that tells factories what to produce, how to make it, and when to make it, so they can fully utilize their capacity .

More than 80,000 small and medium-sized factories in India have occupancy rates below 33%, Zyod co-founder Ankit Jaipuria told JS. Through its ERP platform, the startup helps factories understand which components – such as fabric – to use to produce clothing for a specific brand. It also explains the pattern in which the fabric should be cut and stitched, based on the brand's requirements for maximum use.

Furthermore, the startup has developed a daily production reporting system to provide factories with a daily action plan. This overcomes the challenges that local factories and their employees face in a typical environment where factory owners manage their operations with paper and pen or via WhatsApp.

“We give that daily instruction, which was previously given by a factory owner, and that is: how to make it, when to make it, what to make – all of this goes through Zyod, and that's why I say Zyod acts as the brains of production, and that the factories act as executive weapons,” Jaipuria said.

Co-founded by Jaipuria and Ritesh Khandelwal in early 2023, Zyod currently serves more than 550 customers in more than 18 countries, adding approximately 400 customers in the past two years. The startup initially helped D2C brands with faster launch time and low minimum order quantities. However, in the October quarter, the company started onboarding enterprise customers and has since added major brands including Reliance Industries and Aditya Birla in India. It also counts Japan's Urban Research, Pennsylvania's Anthropologie, Britain's NEXT and Boohoo, and Spain's VAN-DOS among its first customers.

In January, Zyod launched its mobile app on iOS and Android platforms. It targets longtail customers who want to buy different styles on the go. The app also helps business customers see their orders. Additionally, Zyod plans to update the app with new communication methods, including approving orders and communicating with teams through live chat windows.

The $18 million investment is Zyod'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 money will help the startup grow its presence in the Southern Hemisphere and penetrate markets such as Brazil and Australia. It also looks like it will enter some underutilized countries, including Africa and the Scandinavian part of Europe.

“Once we have properly expanded into both hemispheres, we will be able to deliver consistent, all-season products for our factories in India,” Jaipuria said.

Zyod has expanded its catalog from an initial 10 or 20 to 10,000 styles per month. The startup offers brands predictions about which clothing styles people might want to buy, based on the data it collects.

With the new funding, Zyod aims to improve these predictions and automate the platform so that brands can feed into the style and image of the design they want to produce to extract the pattern. The startup also plans to integrate its software with traditional sewing machines to reduce human errors.

The Series A round also includes undisclosed debt, which Jaipuria says is specifically for working capital needs.

“Zyod uses technology to refine every facet of the manufacturing process, from a modular design approach to optimizing operations at the plant level,” said Nishit Garg, partner in RTP Global's Asia investment team, in a prepared statement.

Zyod's new funding comes after it raised $3.5 million in a seed round in April 2023. Jaipuria told JS that the startup's valuation has grown “many fold” since the last round without sharing a specific number. The startup also makes “several millions of dollars” in revenue annually, its co-founder said.

“We are pleased to double our partnership with Zyod,” said Rahul Taneja, partner at Lightspeed India. “Their global network is expanding rapidly and we are excited about this next phase of growth.”

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