Lebanese Social Enterprise FabricAID closes $1.6M SEED
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Lebanese social enterprise and second-hand clothing reseller FabricAID has successfully raised $1.6M in its latest funding round. The SEED round led by Wamda and alfanar extended from 2020 until the end of 2021 and included equity investment from venture capital, venture philanthropy impact investment, and angel investors; alongside, development grants and competition awards.
Founded in 2017, FabricAID is a Lebanese social enterprise set forth to fill a gap between unstainable and excessive fast fashion and the clothing of vulnerable communities. As the largest second-hand clothing collector in the MENA region, FabricAID is working to establish and scale a socially and environmentally conscious value chain for the apparel industry by optimizing the collection, sorting, upcycling, and resale of second-hand clothes. It does this through a series of socially conscious and sustainable brands targeting diverse socio-economic groups, including the extremely vulnerable.
7% of all VC capital deployed in MENA between 2016 and Q3 2021 was funneled through impact investment as recorded in our debut 2021 MENA VC Impact Investment Report brought together with Wa’ed. This funding round further promotes investors’ appetite for businesses that “do well, and do good”, i.e are profitable and yet have a great impact on their sheltering communities and environments. As natural industries of interest, EdTech and HealthTech sectors in MENA closed 40% of the 403 impact investment deals in the past 5 years, yet major rounds by UAE-based Yellow Door Energy and Egypt-based KarmSolar put the Energy sector as the highest capital aggregator in impact investing. As Lebanese communities struggle with a fluctuating economy riddled with hyperinflation and economic strife, it is impact investments like this one that not only provides responses to the crises but more importantly builds the business momentum of the entrepreneurial sector as an alternative player in the economy.
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Clothing has become one of the most consumed goods in our world with consumption rates 400% higher today than they were just two decades ago. More than half of discarded clothing ends up in landfills where it piles up and eventually ends up being incinerated. In parallel, over 77 million people across the Arab world cannot afford to buy new clothing. To this effect, through strategic collection and upcycling of second-hand clothes, FabricAID was able to scale its social enterprise for the past 4 years. FabricAID has raised a total of 2.1 million USD since its inception and has multiplied sales in 2021 by a factor of five, resulting in over 70,000 beneficiary consumers served to date. To effectively serve growing needs and demand, FabricAID now employees nearly one hundred full-time employees.
The startup plans on utilizing its newly acquired funds to further strengthen FabricAID’s positioning in Lebanon, expand its operations in Jordan, and launch in Egypt fulfilling its vision of providing clothing for everyone in need in a dignified, sustainable, and environmentally conscious manner. General Manager Omar Itani concluded with high hopes for the team “This is a stepping stone, not only for us at FabricAID, but for all social enterprises. Yes, we can be profitable, and have a substantial impact at the same time. Yes, we can attract venture capital and serve our community at the same time, yes, it is possible!"
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