Startup reusable packaging for $3.1 million to compete with single-use packaging – TechCrunch


Quick Pop Quiz: Is it better to recycle your cardboard boxes or use a sturdier packaging bag that can be used over and over until it meets its creator again? Returnity’s gamble is the latter, and the company just raised $3.1 million from Brand Foundry Ventures to continue the work the company has done with Estée Lauder, New Balance, Rent the Runway, Walmart and others — and to continue its further expand activities.

“And it’s been quite a long journey. We originally started as a reusable shopping bag company, with coincidentally James Reinhardt (the co-founder and CEO of ThredUp) as a customer, who bought reusable shopping bags. His challenge for us was whether we could make a reasonable shipping bag. That’s where it all started,” recalls Mike Newman, CEO of Returnity. “Since then we have been on this trip. We had this reusable grocery bag that we came up with, and we thought it was really cool, but it wasn’t going anywhere because we had to learn that packaging is really about systems — not product. If you don’t have a system to support reusable packaging, they just become press releases. They don’t scale; they don’t last. A big part of our journey as a company – and I think for the reusable concept in general – has been that if we don’t build scalable, sustainable options for reuse, we’re never really going to make a dent in the packaging. †

The company is taking on a huge challenge: More than 20 billion packages are delivered to the US each year (100 billion worldwide, a trend to double over the next five years), resulting in a huge amount of wasted material. Reusable packaging makes sense, especially in industries where there is a natural shipping-and-return model; For example, the fashion rental industry, regular grocery delivery and other companies with regular delivery or collection models. Now, if you recall, for a while there was a massive reduction in rental activity — people weren’t renting high-end fashion clothes to sit isolated in their living room, and Returnity was brutally waking up in 2020.

“We were ready for massive growth in 2020. And then 80% of our sales disappeared overnight, due to the pandemic shutdown. We really had to figure out how to be more relevant than inherently circular companies. If we hadn’t, we wouldn’t be where we are today,” Newman says. “That was a very painful part of our journey, but necessary because it forced us to face some of these fundamental questions about how we work for brands.”

The company has a hefty stack of pilot programs and case studies it celebrates as well — including some with some seriously tenacious customers. For Walmart, the company provides reusable bags optimized for home delivery services and manages packaging cleaning and replenishment. For New Balance, it leads the implementation of reusable shipping packaging for the New Balance Team Sports initiative, creating an efficient and environmentally friendly system to ship samples to and from partners. This reusable packaging replaces 10,000 shipments of single-use cardboard boxes, and the company claims it reduces emissions by up to 63%. It partnered with Aveda to create its Returnable Shipper program specifically for Aveda’s 1-liter bottles. For Happy Returns, the company is changing the way goods are moved between stores and warehouses with its “Return Bar” network. This means shoppers can exchange and return e-commerce items without printing, packaging or personal contact.

Returnity creates reusable packaging solutions that prevent huge amounts of cardboard and plastic from entering the recycling loop. Image Credits: Refund

The investment will help Returnity “double overnight,” adding bandwidth for account development, improving the back-end, and improving product and marketing in ways the company hasn’t done before. can see. By standardizing the onboarding process, the company is poised for serious growth.

“We hve three groups of customers. We have some customers who have been with us for years, such as Happy Returns and Rent the Runway, who just use it often and love it. We have a second group, like Walmart or Estée Lauder, where we’ve just completed the pilot programs and we’re ready for the next wave of growth. And finally, there’s a long list of early-stage brands that we’ll be able to announce in the coming months that we’re only just beginning that journey,” says Newman. “With this round, we can really build that pipeline and accelerate the work we’re doing for companies that want reuse as an important part of their future, but haven’t got started yet.”

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