Artificial intelligence has captivated deep-pocketed investors throughout 2023, as they continue to bankroll startups hawking solutions based on the technology.
This year alone, one in every four dollars that went into the pocket of an American startup was related to AI, per Crunchbase data. And according to McKinsey data, AI startups garnered over five times as much funding in the first half of 2023 as they did over the same period in 2022.
As fashion, apparel and logistics companies continue to adopt AI and partner with third parties for specific use cases, a number of startups focusing on AI in these industries have received funding.
Eight of those deals are outlined below.
Company: OpenAI
Headquarters: San Francisco
Funds Raised: $10.3 billion
Round: Two Series E rounds
Investors: Microsoft, Flat Capital, Tiger Global Management, Sequoia Capital, a16z, Thrive Capital, K2 Global, Founders Fund
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More on the Funding: OpenAI is considered “the” AI startup by many. Its marquis products, ChatGPT and Dall-E, have given industry-agnostic leaders the chance to explore generative AI and its potential use cases for their businesses. OpenAI’s large language models (LLMs) also serve as the backbone for a number of other businesses’ generative AI systems. The Microsoft partner has garnered over $10 billion in funding this year alone, despite its leadership turnover in November.
Company: Urbanic
Headquarters: London
Funds Raised: $150 million
Round: Series C
Investors: Mirabaud Lifestyle Impact & Innovation Fund, D1 Capital Partners, JAM Fund
More on the Funding: Urbanic serves India‘s fast-fashion market demands, operating with a highly efficient supply chain not dissimilar to fast-fashion giant Shein.
Part of the company’s nimbleness comes from the use of artificial intelligence in designing and creating goods. The gargantuan raise will contribute to the further development of proprietary large language models, according to the company.
Urbanic does not currently sell its proprietary technology to other companies, unlike most other AI-focused startups that received funding in the fashion, apparel and logistics spaces in 2023. Per the release noting the funding announcement, the company seeks to further test the limits of AI-generated creative content in 2024.
Company: Loop
Headquarters: Chicago
Funds Raised: $35 million
Round: Series B
Investors: J.P. Morgan Growth Equity Partners, Index Ventures
More on the Funding: Loop uses AI to consolidate and analyze financial data associated with transportation and logistics. In doing so, the technology can share insights on various facets of the supply chain, including linking disparate documents to root causes of discrepancies. Using that data, Loop can improve cost visibility for logistics carriers; cut unnecessary spending patterns through automation, increasing working capital and optimize transportation budgets.
Its clients include major logistics companies like Great Dane and Loadsmart. The startup, which was founded by former Flexport and Uber engineers, counted Convoy as a customer prior to its abrupt shutdown in October.
Loop will use its new funds to expand its audit and payment capabilities beyond the trucking side of logistics into ocean freight and air freight.
Though Crunchbase data shows that the amount of funding supply chain startups have received globally in 2023 proved to be significantly less than years immediately prior, supply chain startups using AI to lead the way haven’t seen their funding dry up in quite the same manner.
Company: Leonardo AI
Headquarters: Sydney, Australia
Funds Raised: $31 million
Round: Undisclosed
Investors: Blackbird, Side Stage Ventures, Smash Capital, TIRTA Ventures, Gaorong Capital and Samsung Next
More on the Funding: Leonardo AI snatched up a hefty sum of cash for its generative art tool, which has several features to help users create images. Users can enter a prompt, just as with other generative art platforms like Dall-E or Midjourney, to generate an image.
However, users can also begin sketching an idea they have and see it turn into an AI-rendered image in real time. Clothing design is one potential use case for the technology as brands and designers begin to explore generative AI’s impact on the design process.
Unlike some of its competitors, the tool also allows users to adjust the “temperature” of the output — the higher the user cranks the temperature, the more creative the model can be with its output. Since last year, the company notes, its seven million users have created over 700 million images.
Company: Syrup Tech
Headquarters: New York City
Funds Raised: $17.5 million
Round: Series A
Investors: Accel Partners, Gradient Ventures, 1984 Ventures
More on the Funding: Syrup Tech uses AI to help brands with inventory optimization by providing insights on what a retailer should order to meet consumer demand.
Its proprietary technology aggregates historical and real-time data to help retailers determine where to allocate already purchased inventory and order the right sizes, colors and amount of new inventory. The company said its solution has resulted in less excess inventory for its partners, which helps drive sustainability efforts and increases the number of items sold to consumers at full price.
The Reformation partner plans to use the funds to enable new features for the broader planning ecosystem and hire about 40 additional employees in engineering, product and sales roles.
Company: Zelig
Headquarters: Los Angeles
Funds Raised: $15 million
Round: Series A
Investors: Hilco Global, Bezikian Zareh
More on the Funding: Zelig, which has not yet launched its marquis products, has created virtual try-on technology that will allow users to select a model that looks most like them to try on products on a brand’s site.
Per the company, the feature will later be expanded to allow users to take a photo of themselves to be used for virtual try-on; that capability bears resemblance to a recent partnership between Inditex‘s Bershka brand and startup 3DLook.
Per McKinsey data, 71 percent of consumers expect companies to deliver personalized experiences and interactions. Zelig could take that one step further in the future; the company’s founder said partner brands will eventually be able to use the personalized virtual try-on images to send one-to-one marketing emails with a photo of the consumer.
Company: Myth AI
Headquarters: London
Funds Raised: $1.3 million
Round: Seed
Investors: Birkan Kül, Emre Kozlu, and Faik Ulutas (angel investors)
What They Do: Myth AI uses generative AI to quickly and efficiently design patterns for brands in Europe. The founder noted in a release that the technology allows brands quicker, cheaper access to unique designs for their garments and addresses textile waste by reducing the number of fabric swatches created for prototypes.
McKinsey data shows that nearly one-fourth of perceived value from generative AI in 2024 could come from using the technology in the design and product development stages, and Myth already has more than a handful of clients in action. The startup counts fabric mills like Elyaf Textile, Gama Textile and Sun Textile among its current clients.
The founder noted that the funding would go toward further expansion into the UK and potential expansion into Asia and the United States, as well as increasing the number of marketing, sales and technology-focused employees on the team.
Company: Arvist
Headquarters: Chicago
Funds Raised: $1.1 million
Round: Pre-seed
Investors: Refashiond Ventures, Geek Ventures, Lofty Ventures, The Council Fund, Blue Impact Supply Chain Ventures, Techstars, New Leaf Ventures, ProChain Ventures, Chisos Capital, and EverPresent Ventures
More on the Funding: Arvist snatched up a solid pre-seed round in November for its AI-based solution for supply chain inefficiencies.
The technology can plug in to existing hardware and infrastructure inside warehouses to identify pain points, then optimize supply chain operations as distributors face labor shortages and disruptions.
The startup will use the money to add two additional team members to its mix and to increase the number of features the technology offers to clients. The founder said those features will include asset tracking for misplaced goods, quality checks on outbound inventory and insights into efficient loading of trucks.