Smartex, a Portuguese startup founded in 2018, is using artificial intelligence to eliminate textile waste before it happens, capturing the attention of major investors including Amazon (NASDAQ:AMZN), H&M Group, and Tony Fadell, inventor of the iPod and Nest thermostat, CNBC reports.
Co-founder Gilberto Loureiro began working in textile factories as a teenager and quickly noticed how slow, manual inspection processes allowed production flaws to continue for hours, leading to massive amounts of discarded material, according to CNBC. After earning a master's degree in physics, Loureiro launched Smartex with the goal of digitizing defect detection using real-time vision systems and AI.
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Real-Time "Golden Stops" that Rescue Millions of Garments
According to Smartex, it integrates cameras and computer vision software into textile machines to detect flaws the instant they appear. When an error is found, the system pauses production immediately, triggering what Smartex calls a "Golden Stop."
According to the company, over 110,000 Golden Stops have saved more than 1 million kilograms of fabric since the system launched. That number translates to roughly 5.8 million garments saved from the landfill.
Beyond sustainability, Smartex says that the system improves factory yields by 0.37% per kilogram of fabric, a meaningful margin boost in an industry that operates on thin profitability, CNBC reports.
"If this is the largest industry that is still untouched by the internet and is one of the largest pollutants in the world, and nobody is working on this in terms of technology, then there is a massive gap here," Loureiro told CNBC.
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High-Profile Backers Signal Confidence in Climate Tech
Smartex's solution has drawn the support of major industry figures. In 2022, the company announced it raised $24.7 million in a funding round led by Lightspeed Venture Partners and Fadell's Build Collective. That same round, H&M Group made a strategic investment, becoming one of the first global retailers to endorse the startup.
Amazon also joined through its AWS Compute for Climate Fellowship, which CNBC says provides advanced cloud resources to early-stage climate startups. Smartex uses Amazon Web Services tools to train its AI models, which must adapt to a wide range of fabric textures and colors.
"Climate tech startups, they have so much [research and development] that they need to do … maybe even more than … standard tech companies, they have to invent new science or new technology, as well as new business models," Lisbeth Kaufman, head of climate tech business development, startups and venture capital at AWS, told CNBC.
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Smartex Expands Global Reach with Luxury Fashion Giants as Clients
Smartex's AI-powered quality control platform has already been adopted by some of the most forward-thinking names in knitted fabric production. According to the company, current customers include Tintex Textiles, Familitex, Toraman Tekstil, and Ekoten, among others.
Other Smartex backers include DCVC, SOSV's HAX, Spider Capital, Momenta Ventures, Bombyx Growth Fund, Faber, EX Capital, and Fashion for Good. Through its collaboration with Fashion for Good, Smartex says it has launched multiple pilot projects alongside major industry players including Kering Group, parent to Gucci and Balenciaga, PVH (NYSE:PVH), and Pangaia.
The startup has expanded across Europe, Central Asia, South America, and Africa, with further Asian market entry on the horizon. According to Smartex, the European Commission has also formally recognized Smartex as foundational to the development of Industry 4.0 in textile manufacturing.
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