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Responsibly, a Danish startup founded just this year, has bagged $2 million in pre-seed investment to launch its data platform for responsible sourcing. Slated to launch later this year, the company’s platform will feature “scorecards” for more than 10,000 listed suppliers with information on their environmental, social and human rights records.
Responsibly has closed its pre-seed funding round with €1.68 million (US$2 million), led by Berlin-based early-stage investors Flash Ventures. Other investors joining the round include Pirate Impact, the VC founded by brothers Fabian and Ferry Heilemann of online discounts platform DailyDeal fame, as well as Michael Wax, the founder of SoftBank-backed logistics startup Forto. Benedikt Franke, founder, and CEO of climate tech firm Planetly also participated in the round.
The Copenhagen-based startup says the funds will fuel the launch of its data-driven platform, which helps retailers and businesses source responsibly from ethical suppliers. Slated to launch before the end of 2021, the platform will feature a scorecard for each of its suppliers, listing information such as whether the company is involved in human rights violations, or water pollution and deforestation.
According to Responsibly, which was co-founded by Jacob Vous Petersen and Thomas Buch Andersson in February, the platform will aggregate data from more than 10,000 suppliers. At the moment, the firm is racing to fine-tune its product and is testing the software with select clients before the beta launch.
“The funding enables us to expand our top-end engineering team and build the engines and intelligence that can read, interpret, and translate information across sources into intuitive scorecards, so we can pilot the product with our very exciting pilot customers,” said co-founder and CEO Buch Andersson.
‘Making it as easy as possible for purchasers’
For the co-founders, the concept is to make it as convenient as possible for corporate buyers to source responsibly at scale. Right now, transparent, harmonised data that is easy to access and understand isn’t available because of gaps in tech infrastructure. Responsibly hopes to close this gap with its algorithm-based software, then simplify the information through a scorecard.
Suppliers are given a choice whether to make their own scorecards with all the information on ethical, environmental and social standards, or to use a pre-outlined version that has been developed in collaboration with a nonprofit.
“If we can make it as easy for purchasers to evaluate how their suppliers compare on a planetary agenda, as it is to compare them on price, then we think we can unlock the huge force for change that’s sitting in the world’s procurement departments,” said Buch Andersson.
Investors eye marketplace solutions
Amid surging consumer demand for better sustainability practices from businesses, investors are now not only backing the startups developing cleaner, ethical alternative products, but solutions that actually make it easier for businesses to ensure a responsible supply chain.
Another recently launched startup, SourceGreenPackaging, just rolled out its sustainable packaging sourcing B2B marketplace after closing an oversubscribed pre-seed funding round. The company, based in Hong Kong, offers an online portal for global food companies, retail brands and e-commerce businesses to source plastic-free certified packaging materials safely and conveniently.
Other startups that offer responsible sourcing services include Munich-based Integrity Next, which provides cloud-based monitoring of supply chains, and EcoVadis, a Paris-based ratings platform that assesses CSR and sustainable procurement.
Commenting on the decision to back Responsibly, Flash Ventures’ founding partner Johann Nordhus Westarp described the upcoming launch of the software as “perfect timing”.
“Companies will fundamentally change the way they procure in the next couple of years. Price- or value-driven procurement will give way to impact-driven procurement. Companies are acting somewhat blindly today, treading-water to solve the problem of the day,” continued Nordhus Westarp. “Responsibly helps them finally get visibility into their procurement footprints and make forward-thinking decisions for all the right reasons.”
Lead image courtesy of Unsplash.