Flush with cash, bamboo-based toilet paper company Cloud Paper makes it rain – TechCrunch

Startups

With toilet paper and kitchen rolls in its product portfolio for now, and more to come, Cloud Paper is a sustainable, bamboo-based alternative to toilet paper, made from any toilet paper. The company raised a $5 million round from an impressive cadre of investors to expand its product line and pursue more commercial applications for its products; commercial sized toilet paper and paper for contactless dispensers, for example. The company plays celebrity bingo with its investors, drawing checks from an array of star-studded investors.

“Cloud Paper is on a mission to transform the paper products industry to transition to tree-free products,” said Ashton Kutcher of Soundwaves. “We want to be part of that mission and further strengthen our position in this space as Cloud Paper expands into retail and pursues an aggressive B2B strategy, in addition to expanding their DTC offering.”

The $5 million round includes investments from Bezos Expeditions (Jeff Bezos’ personal investment firm), TIME Ventures, Presight Capital, Soundwaves and Marc Benioff’s Jeff Wilke.

The company’s two founders followed each other from company to company, starting with Uber and then Convoy, before quitting and starting a cleantech company that wipes the slate – and our bottoms – clean.

“My co-founder and I met at Uber in the early days when Uber first rolled out Uber X and ride-sharing around the world. We were there at an incredibly unique time and saw hypergrowth taking place. Then we worked together at Convoy — it’s kind of like Uber for trucking and supply chain — and we spent six or seven years at these pretty fast-growing startups,” explains Ryan Fritsch, CEO and co-founder of Cloud Paper. We sat down and said: “I think now is the time to take advantage of this experience we have built up. What are we going to do? We knew we wanted to go big in sustainability. The research led us into the impact of the paper and pulp industry Fast forward – we started the company in the spring of 2019. We did a $3 million seed round led by Greycroft.

Cloud Paper founder and CEO, Ryan Fritsch. (Image: Cloud paper)

From there, the company set its goals higher; Having sold more than 3 million rolls of toilet paper to date, with just 8 employees, the company is making a much bigger splash.

“This year we are going to take a big step in B2B. That’s where we started, but during COVID we moved to direct-to-consumer. Certain sectors – especially in the hospitality industry and travel – are starting to reopen. The commercial products that those entities want are very different from what you see on our website now,” says Fritsch. “There are all kinds of variations on kitchen paper and toilet paper. For example, an arena doesn’t want a 350-sheet roll. They want that high-capacity 3,000-sheet jumbo roll. We are working on expanding our catalog – that is our focus for the coming year.”

The numbers also make a lot of sense for the company; Cloud Paper delivered 930% more rolls since the Seed Round and grew its direct-to-consumer customer base by 230%. Business customers, the company reports, are up 400%. The brand also saw a sales increase of more than 800% during this period.

That is a lot of rolls of paper, which saved 10,000 trees, the company suspects. It gets its bamboo for the paper from China, where it can be difficult to trace the supply chain all the way back to the bamboo plants themselves; How does Cloud Paper know it will actually be sustainably grown, renewable bamboo? The founder has a clear answer.

“We depend on trusted third parties. This can validate the supply chain, especially the sustainability of the supply chain. Last year we were one of the first – if not the first – 100% Bamboo brand to be FSC certified. If you look at our direct competitors, you see the same three or four names. We are the first to check the FSC box for sustainability of the harvest and cultivation of the bamboo,” explains Fritsch. “There is also an annual report from the Natural Resources Defense Council (NRDC) called ‘the question of tissue’. Last year was the first year they featured some of the newer bamboo based brands. We got the highest marks from them last year. We also continue to look at additional third-party audit organizations to ensure we have the transparency we need. We recently received USDA biobased certification and we are looking at others as well.”

The company claims its tree-free bamboo paper towels and toilet paper saved more than 10,000 trees last year alone. This increase will allow Cloud Paper to make significant investments in its supply chain, product development and recruitment.

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