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

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

The Gurugram-based startup works with Indian factories to help them manufacture fashion wear for global brands. It offers ERP (enterprise resource planning) software, which it calls the “brain of manufacturing,” that tells factories what needs to be produced, how it should be made and when it should be made to let them fully utilize their capacity.

More than 80,000 small and medium factories in India have a capacity utilization of less than 33%, Zyod co-founder Ankit Jaipuria told TechCrunch. Through its ERP platform, the startup helps factories understand what components — like fabric — they need to use to produce clothes for a specific brand. It also explains the pattern in which the fabric should be cut and stitched based on the requirement raised by the brand to get maximum utilization.

Further, the startup has developed a daily production reporting system to give a day-to-day action plan to factories. This overcomes the challenges that local factories and their labor face in a typical environment where factory owners manage operations through paper and pen or via WhatsApp.

“We are giving that day-to-day instruction, which earlier was given by a factory owner, and that’s: how it has to be made, when it has to be made, what has to be made — all of this runs through Zyod, and that’s why I say Zyod acts as a brain of manufacturing, and the factories act as executing arms,” Jaipuria said.

Co-founded in early 2023 by Jaipuria and Ritesh Khandelwal, Zyod currently serves more than 550 customers in over 18 countries, adding about 400 customers in the last two years. The startup initially helped D2C brands with faster launch time and low minimum order quantity. However, in the October quarter, it 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, Anthropologie of Pennsylvania, U.K.’s NEXT and Boohoo, and VAN-DOS of Spain among its early clients.

In January, Zyod launched its mobile app across iOS and Android platforms. It focuses on long-tail customers that want to purchase different styles on the go. The app also helps enterprise clients see their orders. Zyod additionally 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 including 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 to enter a few under-tapped countries, including Africa and the Scandinavian part of Europe.

“Once we have expanded very well into both hemispheres, we can have all-season products consistent for our factories running in India,” Jaipuria said.

Zyod has expanded its catalog to 10,000 styles a month from 10 or 20 initially. The startup offers brands predictions for what clothing styles people may want to buy, based on data it collects.

With the fresh funding, Zyod wants to enhance these predictions as well as automate the platform to let brands feed in the style and image of the design they want to produce to get its pattern out. The startup also plans to integrate its software with traditional stitching machines to reduce human errors.

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

“Zyod leverages tech to refine every facet of the production process, right from a modular design approach to optimizing operations at the factory level,” said Nishit Garg, partner on 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 TechCrunch that the startup’s valuation has grown “multi-fold” since the last round without sharing a specific number. The startup also makes “multi-million dollars” of annualized revenue, the co-founder stated.

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