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Funding

Textiles dyeing climate tech startup Xefco raises $10.5 million Seed extension

- April 30, 2024 2 MIN READ
The tanneries of Fez, Morocco
Not Geelong, but Morocco Photo: AdobeStock
Sydney startup Xefco will ramp up its Victorian presence after raising $10.5 million in a Seed extension.

The round was CSIRO-backed VC fund Main Sequence Ventures, with support from Virescent Ventures for the government-backed Clean Energy Finance Corporation, which chipped in $2.5 million, plus existing shareholders Investible and Voyagers Climate-Tech Fund in Xefco’s Seed investment round.

But it’s $2.5 million in funding from Breakthrough Victoria, the state government’s $2 billion investment fund that will see the startup turn its attention to south of the NSW border.

Founded in 2018, Xefco specialises in innovative coating technologies for the textile industry. It collaborated with Deakin University during the pandemic in a pivot to produce what were called “Covid-killing face masks”.

The startup last years established a research and development and pilot manufacturing plant at Deakin University in Geelong at its expanded $20 million ManuFutures hub, which is designed to accelerate innovations in manufacturing.

Deakin University – Waurn Ponds Campus. Associate Professor Alessandra Sutti and Xefco CEO Tom Hussey

Returning to its roots, the business specialises in using plasma to create a highly efficient, water-free solution for textile dyeing and finishing, with the potential to eliminate up to 20% of the world’s water pollution and 3% of the world’s carbon emissions.

It takes around 75 litres of water to dye a pair of jeans.

The company scored $4 million in 2023 through the Trailblazer Universities Program to scale and commercialise its tech, called Ausora.

Its XReflex technology, which reduces consumption of insulation materials, is being used by some of the world’s leading apparel and fashion brands including The North Face.

Deakin University signed a partnership agreement Xefco in September last year as part of its Recycling and Clean Energy Commercialisation Hub (REACH).

Xefco CEO and cofounder Tom Hussey said dyeing and finishing drive the biggest impacts in the textile supply chain.

“Whereas, compared to conventional wet dyeing and finishing, our process eliminates the use of water and cuts energy, chemical consumption and cost,” he said.

“Our technology has the potential to stop millions of tonnes of waste entering our waterways and CO2 from entering our planet.”

Breakthrough Victoria’s investment will see Xefco add to its headcount as its scales its technology and manufacturing capability in the state.

The plasma coating technology bonds to the surface of a fabric to allow its dyeing and finishing to be completed in one process without using water.

The technology also requires 86% less energy than traditional methods, cutting carbon emissions.

The US$2 trillion textile market produces approximately 600 billion metres of fabric annually and is considered one of the most polluting industries in the world

Xefco’s operations also eliminate the use of toxic chemicals from textile supply chains, making the industry safer for workers and their communities.

Breakthrough Victoria CEO Grant Dooley said they believe Xefco has the potential to move major global fashion brands towards more eco-friendly and efficient manufacturing processes that are better for workers and the environment.

“With research and development based in Geelong and upwards of 10 regional Victorian manufacturers already collaborating with Xefco on design and manufacturing, BV believes this investment can help establish Victoria as a leader in advanced textile manufacturing systems,” he said.

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