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Stephanie Benedetto

Queen of Raw: Turn Pollution Into Profit

Marketplace to buy and sell unused textiles, keeping them out of landfills and turning pollution into profit

 

THE APPLICATION

Your bio:

Corporate attorney turned fashion tech and sustainability entrepreneur, Stephanie is the Co-Founder of Queen of Raw, a marketplace to buy and sell unused textiles, keeping them out of landfills and turning pollution into profit. Prior to starting Queen of Raw, Stephanie worked as a lawyer in the fashion, start-up, and technology industries and co-founded a sustainable textile manufacturing facility.

An advocate for women in business and sustainability, her companies have been featured in NPR, Good Morning America, NYTimes, WWD, ELLE, Cheddar, WCBS, United Nations, Fortune, Entrepreneur, Ellen MacArthur Foundation, and Fast Company.

Stephanie is a NASA/NIKE/IKEA/DELL Innovator, a Grand Prize WeWork Creator Awards Winner presented by Ashton Kutcher, a Cartier Women’s Initiative Finalist, an MIT – Solve Global Challenge Winner, and a thredUP Circular Fashion Fund Recipient.

She is a Member of Pledge 1% and Founding Member of Wildlife Friendly Enterprise Network, along with Aveda, Kering, and Stella McCartney.

Project name:

Queen of Raw: Turn Pollution Into Profit

One-line project summary:

Marketplace to buy and sell unused textiles, keeping them out of landfills and turning pollution into profit

Present your project.

Fabric production is one of the world’s worst polluters, and it wastes water at an alarming rate. Yet $120 billion worth of unused fabric sits in warehouses around the world—or gets burned up, or thrown into landfills, contaminating drinking water. This is a loss not just for the environment, but also for businesses whose profitability suffers from overproducing and over-purchasing those surplus fabrics.

Queen of Raw’s online platform matches buyers and sellers of unused fabric, offering a direct process powered by blockchain and machine learning. Factories, brands, and retailers post their unused fabric for resale on the platform, giving purchasers quick, easy access to new materials at lower price points.

Sellers also subscribe to a monthly service that maps, measures, and traces their supply chains, minimizing their waste streams going forward. Queen of Raw has helped 175,000 users save millions of dollars—and more than a billion gallons of water.

 

Submit a video.

What specific problem are you solving?

Every year $120 billion dollars worth of unused textiles just sits in warehouses collecting dust or is burned or sent to landfill.  For some of our enterprise customers, this fabric waste represents up to 15% of their bottom line.

Why does this waste occur?  Mills make an average 3% to 5% extra fabric per order to compensate for errors in the production process.  Factories create the most waste when cutting finished goods out of the mills’ fabrics.  And brands ordering far in advance cancel or change orders, resulting in fabric liability that costs money to be stored, burned, or landfilled.  H&M alone burned $4.3 billion of unused materials in 2018.

This waste is occurring now more than ever and it is polluting our drinking water, especially in developing countries.  One tee shirt takes 700 gallons of water to produce.  If we continue at the current pace of textile production, by 2025, two-thirds of the entire world’s population will face shortages of freshwater and be exposed to hazardous chemicals from textile production.

What is your project?

Queen of Raw is a global marketplace for mills, factories, and brands to buy and sell unused textiles, keeping them out of landfills and turning pollution into profit.  It enables textile buyers to easily purchase unused textiles at steep discounts located where they need it and when they need it, while textile sellers benefit from the end-to-end automated process and excess revenue.

In our community, buyers become sellers and sellers become buyers.

Who does your project serve, and in what ways is the project impacting their lives?

We are in a period of massive disruption, requiring us to digitally innovate our way out of crisis.  For supply chains to be resilient and agile, this means reducing our customers’ costs while sustainably securing the materials needed across their supply lines in real time.  Unused textiles can still fill orders on demand and away from areas impacted by disruption, while supporting commitments to sustainability.

We have already saved over 1 billion gallons of water.  That’s enough clean water for 1.43 million people to drink around the world for 3 years.

Which dimension of The Elevate Prize does your project most closely address?

Elevating issues and their projects by building awareness and driving action to solve the most difficult problems of our world

Explain how your project relates to The Elevate Prize and your selected dimension.

The global textile industry market value is expected to reach $1.23 trillion by 2025. Less than 1 percent of material used to produce clothing is recycled into new clothing, representing a loss of more than $100 billion worth of materials each year. With textile production set to account for 26 percent of all global carbon emissions by 2050, any trend toward a circular economy could be beneficial. Buying one used item reduces its carbon footprint by 82 percent.

How did you come up with your project?

I know about the problem of textile waste because my family has been in the textiles business for over 100 years.

In 1896, my great-grandfather came over on a ship from Austria and landed at Ellis Island.  After settling into the Lower East Side, he had to make a living for his family as an immigrant chasing the American Dream.  So he started working with his hands.  He would find materials and supplies nearby (old fabrics other immigrants had brought with them on the ships but weren’t using).  He’d create beautiful fashion garments with minimal waste and minimal toxins because his bottom dollar depended on it.  And he sold finished goods to local customers.  And it was a very successful, profitable business.

Of course today’s supply chains are much more complicated.  Hundreds of steps involving millions of people across the globe and metric tons of water, chemicals, crops, and oil are used in the process.  My vision with Queen of Raw is to use technology to get back to what my great-grandfather did.  He didn’t talk about it in terms of sustainability, but it absolutely made sense for people, for planet, and for profit!

 

Why are you passionate about your project?

Women need to become key decision makers in their organizations to bring about change.  Many women leave work for a variety of reasons, including having children.  I launched my business at the same time as I had my first child.  This has only made me stronger.  I am doing what I am doing to make a difference in the world not just for myself anymore, but for my children and my children’s children.  I want them to have clean water to drink, clothes that aren’t toxic to wear, and a planet to live on.  Because of this mission, I find the strength to meet any challenge.

Why are you well-positioned to deliver this project?

Stephanie Benedetto – Chief Executive Officer

Graduated from University of Pennsylvania with honors with a Bachelor of Arts in Philosophy, Politics, and Economics. Earned her Juris Doctor from Emory University School of Law. Worked as a lawyer in fashion and technology and co-founded a textile manufacturing facility. An advocate for women in business and sustainability, her companies have been featured in NPR, Good Morning America, NYTimes, Vogue, WWD, ELLE, Cheddar, Parade, WCBS, United Nations, Fortune, Entrepreneur, WIRED, Ellen MacArthur Foundation, and Fast Company. Stephanie is a NASA/NIKE/IKEA/DELL LAUNCH.org Innovator, a Grand Prize WeWork Creator Awards Winner presented by Ashton Kutcher, a Cartier Women’s Initiative Finalist, an MIT – Solve Global Challenge Winner, and a thredUP Circular Fashion Fund Recipient. She is a Founding Member of Wildlife Friendly Enterprise Network, along with Aveda, Kering, and Stella McCartney.

Phil Derasmo – Chief Technology Officer

Technology expert with 15+ years in the industry leading technology projects for startups and large companies, including high security applications on Wall Street. Was the co-founder and CTO of a social shopping site and the Director of Engineering at Mantl. Derasmo also worked for eight years as Vice President of and Manager in the Applications Development Division at Citi. An architect and engineer with CISSP certification, he mentors at the Richard Branson Centre for Entrepreneurship.

Provide an example of your ability to overcome adversity.

As we’ve been growing, to support enterprise customers, like H&M, we realized we had a challenge.  They have up to hundreds of thousands of SKUs of unused fabric.  To onboard that amount of inventory manually to our marketplace would take months.  Not to mention the amount of resources needed to keep that inventory information accurate and up to date.

Thanks to our incredible team, we built the solution.  In partnership with SAP, we can now integrate directly into a business’ inventory management system.  Taking the on-boarding process from months to minutes!  As soon as something is flagged as a liability, we can automatically pull it into Queen of Raw’s marketplace.  And as items are bought and sold through our platform, we can sync those changes back to the customer’s inventory management system in real time.

Describe a past experience that demonstrates your leadership ability.

To win the WeWork Creator Awards, I was given 60 seconds to pitch Ashton Kutcher live on stage.

Here’s the result: https://www.youtube.com/watch?v=ZLTs-I3cxrU

How long have you been working on your project?

6

Where are you headquartered?

New York, NY, USA

What type of organization is your project?

For-profit, including B-Corp or similar models

If you selected Other, please explain here.

N/A

Describe what makes your project innovative.

The quicker we match a buyer with a seller, the quicker we can keep this waste out of landfill.  We implement artificial intelligence like product recommendations, chatbots, and custom search results to enhance the matchmaking process in our marketplace.  And we verify data records and workflow using blockchain.

When a brand buys a monthly subscription, it will get a customized supply chain management system that’s designed to expose excess yardage and waste (water, chemicals, dollars) as they occur in real time.

“Let’s say I am the farmer,” Benedetto offers. “I get an alert on my phone and enter ‘I just took 500 pounds of raw cotton to X mill to get spun into thread.’ I upload a certification that it’s 100 percent organic, click, and save.” The mill operator does the same when he receives the cotton, and up through the chain.

The idea is that the brand can see why its waste is happening — for example, a mill throwing out material because of a designer making changes too late. Queen of Raw’s data can then help the company become more efficient going forward — and be rewarded financially for taking action. As soon as the brand gets an alert of surplus fabric, even finished clothes, it can sell the excess immediately on Queen of Raw, without racking up storage fees. Everyone wins.

What is your theory of change?

Queen of Raw’s vision is a world without waste.  Our mission is to help businesses minimize waste in their supply chains, supporting their bottom line and the environment, while changing the way businesses think about waste.  By 2025, we can save over 4 billion gallons of water (SDG 6), keep over 2 million tons of textiles out of landfills (SDG 12), and improve our customers’ bottom line by 15% (SDG 17).

We educate our community through our platform and through our non-for-profit, Wildlife Friendly Enterprise Network (SDG 8).  We also engage policymakers and are a drafter and signatory to the New York Circular City Initiative proposing to change the laws and make New York City circular in the coming years (SDG 17).  We help businesses offset that legal liability.

Select the key characteristics of the community you are impacting.

  • Women & Girls
  • Rural
  • Urban
  • Low-Income
  • Middle-Income

Which of the UN Sustainable Development Goals does your project address?

  • 6. Clean Water and Sanitation
  • 8. Decent Work and Economic Growth
  • 11. Sustainable Cities and Communities
  • 12. Responsible Consumption and Production
  • 13. Climate Action
  • 17. Partnerships for the Goals

In which countries do you currently operate?

  • Canada
  • China
  • France
  • Germany
  • Italy
  • Portugal
  • Spain
  • Taiwan, China
  • Turkey
  • United Kingdom
  • United States
  • Vietnam

In which countries will you be operating within the next year?

  • Bangladesh
  • Canada
  • China
  • France
  • Germany
  • India
  • Italy
  • Kenya
  • Portugal
  • Spain
  • Taiwan, China
  • Turkey
  • United Kingdom
  • United States
  • Vietnam

How many people does your project currently serve? How many will it serve in one year? In five years?

The $800 billion global apparel industry, with its ever-faster fashion, has become famous for its squander. It slurps up water like no tomorrow — literally, because at this rate, it will cause extreme scarcity in countries like China and throughout Asia by 2030. And every year, fashion manufacturing produces 92 million tons of solid waste, most of which goes to landfills or up in smoke.

And it’s not just clothes. Up and down the industry’s supply chain, there’s excess material coming out at the seams. “I saw a massive problem: factories, mills, retailers, brands sitting on hundreds of billions to literally a trillion dollars’ worth of unused raw material,” Benedetto says.

*Saved over 1 billion gallons of water (that’s enough clean water for 1.43 million people to drink around the world)

*Kept over 500 tons of textiles out of landfill

*Improved our customers’ bottom lines by over 15 percent

What are your goals within the next year and within the next five years?

Queen of Raw takes all the waste that goes on in the industry and turns it into profit.

Beyond fashion, fabric has a role to play in almost every industry. Whether you’re sitting on it as a pillow at a restaurant, gripping it in the form of a leather steering wheel, or drying your hands with a bathroom towel, we are surrounded by textiles. Queen of Raw hopes to be just as ubiquitous. For the sake of the planet, we hope so too.

“We know that the best economies are circular,” Benedetto says. “They find underutilized resources and put them back into the chain of supply and demand. This is the future. For people. For planet. For profit. That’s Queen of Raw.”

1. Enterprise dashboard with supply chain data and analytics: Provides insights and strategies to minimize waste; Water Saved (SDG 6); Save over 4 billion gallons of water by 2025

2. Research with policymakers to change the laws and make cities circular: Encourages reducing waste to avoid legal liability; Textiles Renewed (i.e. tonnage bought/saved from landfill) (SDG 12); Keep over 2 million tons of textiles out of landfill by 2025

3. Global marketplace to buy/sell textile waste: Lowers the cost of textiles and reduces textile liabilities on the books; ROI (i.e. boost to bottom line) (SDG 17); Improve our customers’ bottom line by over 15 percent

What barriers currently exist for you to accomplish your goals in the next year and in the next five years?

Our goal is to provide our customers with frictionless participation in our marketplace.

For enterprise businesses, the process of manually identifying and on-boarding inventory took months.

How do you plan to overcome these barriers?

So we built the tools our enterprise community requested to automate the process of on-boarding inventory and vendors.  And signed a partnership with SAP.

This took the on-boarding process from months to minutes.

The tools we built are powerful.

Enterprise businesses can collect real time actionable data and create transparency around inventory’s journey from farm to finished good to end of life.

What organizations do you currently partner with, if any? How are you working with them?

Our strategic partnerships include:

-Launch.org (NASA, NIKE, IKEA, DELL)

-WeWork

-Techstars

-thredUP

-Wildlife Friendly Enterprise Network

-Cartier Women’s Initiative

-MIT SOLVE

-United Nations

-SAP

What is your business model?

Key to our business model is the supply side of our marketplace.  That is why we focused on automating the on-boarding process.  Once supply is digitized, we can monitor, track, and trace it in new ways; monetizing today’s waste as well as minimizing future waste.  This is why we have seen less than a 1% churn (and that is only because those businesses went under).

What is your path to financial sustainability?

As a SaaS enabled marketplace, we benefit from multiple revenue streams.  This includes a commission per marketplace sale (“traditional revenue”), as well as integration fees, subscription fees, and customization fees for our enterprise software and tools (“subscription revenue”).  Payment is made at the time services are rendered, with a discount for a 12 month pilot of the software.

Since our launch, we tested as low as 6% and as high as 50% for a marketplace commission.  25% seems to be what the market can bear.  We are regularly tracking the pricing and trends we see in the secondary markets for waste.

Over time, we project that the value of subscription revenue will be greater than traditional marketplace revenue as businesses get more efficient with their supply chains through our software.

If you have raised funds for your project or are generating revenue, please provide details.

Through the actions taken in our marketplace, we have saved over one billion gallons of water and kept over 500 tons of textiles out of landfills.  While saving our enterprise customers, including H&M, Marc Jacobs, Louis Vuitton, and Kering, millions of dollars in the process.  We’ve grown our marketplace to over 175,000 users, giving our community access to materials that they never had before.

We expect to on-board 4-6 enterprise customers to our software over the next 12 months.  We currently have 28 enterprise customers we are negotiating with.

To acquire these accounts, we leverage our existing network and business development representatives.  We also use paid channels like Google, Facebook, and Instagram, the monthly expenditures for which are a percentage of revenue (currently between 4% and 5%).

If you seek to raise funds for your project, please provide details.

We closed our seed round on April 30, 2020.  This priced round was led by female investors focused on women and impact who also bring strategic partnerships in the textiles industry.

Funds will be used to support our enterprise customers as well as for marketing and customer acquisition, team expansion, and supporting our technology infrastructure.

What are your estimated expenses for 2020?

In our business model, we hold no inventory and have no equipment.  Our buyers pay in full in advance prior to shipping for the goods and our sellers pay for the enterprise software as services are rendered.

Why are you applying for The Elevate Prize?

First, I am excited to connect with The Elevate Prize’s mentors.  I would like to learn from the experiences of the people who have been where I am now.  Suggestions around business plan improvements, customer acquisition tactics, and best practices for business-to-business marketplace and software solutions would be welcomed.

Second, I am looking to share The Elevate Prize’s powerful network, particularly with respect to business professionals that I can learn from and companies that I can connect with to create long-lasting relationships.  This would include forging new relationships (while strengthening existing ones) with those in the supply chain, fashion, technology, and sustainability industries.  The more educational programs I can participate in, the better.

Third, I am looking for trusted and experienced advisors who will offer constructive insights and resources to assist me in scaling my company.  I would like to work with The Elevate Prize’s advisors on the next stage of growth for my company, specifically by examining financing and other partnership opportunities available in the market, as well as formalizing my board of advisors.

In which of the following areas do you most need partners or support?

  • Funding and revenue model
  • Talent recruitment
  • Mentorship and/or coaching
  • Board members or advisors
  • Marketing, media, and exposure

Please explain in more detail here.

Our board of advisors includes representatives from Ascena Retail Group (Ann Taylor and Loft), sustainability at Cisco, and Waste Management.  We are looking to grow our board of advisors, including with an expert in e-commerce.

Management is supported by technology contractors as needed on a project-basis, as well as business development and sales representatives located in strategic regions of the world and compensated by commission (between 2% and 10%).  Key future hires will include a director of engineering and a head of customer success.

What organizations would you like to partner with, and how would you like to partner with them?

To scale our business, we intend to leverage strategic partnerships with the providers of inventory management systems so integration can happen quickly and easily.  We have signed a partnership with SAP who provides us with technology and sales support in exchange for a 15% commission.  We focused on SAP because SAP customers include 18 of the top 20 global apparel and footwear retailers.  Future distribution partners include Oracle, Info, and Microsoft.

We are hyper focused right now on solving supply chain’s waste problem for retail and apparel.  But there are strong cross-industry use cases where this business model and technology could be used–from automotive and aviation to consumer goods to food and beverage.  We would like to partner with organizations in these verticals to start to identify powerful applications of what we are doing, helping us grow and scale and change the world for even more people globally.