The vision driving Web3 start-up Spatial Labs is vast in its implications for fashion, but also deeply personal for its Gen Z founder, Iddris Sandu. The 25-year-old tech entrepreneur raised $10 million in seed funding from high-profile investors for a blockchain technology business with global ambitions.
“It’s definitely difficult being a founder of color to raise an eight-figure seed round,” Sandu explained to WWD in an exclusive interview. “We see the numbers possibly within a series A or others, but not for a seed by a start-up focusing on tech innovation — and not just being limited to [things] like, ‘Hey, you’re in the beauty space, and you know how to make good stuff for people of color.’”
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Spatial Labs, aka SLabs, describes itself as a hardware and software infrastructure company for Web3. The fashion industry may know it best for its LNQ platform, which embeds microchips into products like clothing and shoes. With a bop of an NFC-equipped phone, people can tie into blockchain applications for authentication, loyalty programs, unlocking digital twins and more.
“We’re so used to hearing [about] a skin care line or ally, and they are creating a better product for people of color or whatever,” said Sandu, who was born in Ghana and raised in Los Angeles. “For a company to say we’re not targeting people of color with our products, but the whole entire world — introducing something that anybody can use to improve the overall efficiency of their brands or platforms, how they want to monetize their data — it’s very, very rare that we kind of see those things happening.”
“The disparity is apparent whenever there’s a bear market,” he added.
“Everyone says, ‘Oh my God, it’s so difficult to find funding.’ And for that, I say, ‘Now you know what it’s like to be a Black founder every single day.’”
But not this day. Spatial Labs’ multimillion-dollar seed, announced Thursday, touts an impressive roster of investors led by Blockchain Capital, which backed renowned crypto goods marketplace OpenSea; Jay-Z’s Marcy Venture Partners; Yucaipa Capital and Soho House group’s Ron Burkle; Scooter Braun; Anthony Tolliver, former NBA player and principal at Wealthlete Private Equity, and Seattle Seahawks linebacker Bobby Wagner, who’s also a partner at VC Studio Fuse Venture Partners.
The latest round marks the return of Blockchain Capital and Jay-Z’s Marcy Venture Partners, and those earlier investments helped take the company now to a total raise of more than $14 million.
For them, as well as potential partners, there’s certainly appeal in the business itself. Last year, the company’s first shoe drop in May 2022 with sustainable footwear brand Ales Grey completely sold out. It also released its own tech-enabled products as a proof of concept, and they have proven popular. Its LNQ marketplace, which launched in October, shows various garments that have sold out. Behind the scenes, numerous confidential conversations are happening with top-tier fashion houses to embed their own branded items with the LNQ tech, as well as major department stores in the U.K. to carry the merchandise. A second drop for Ales Grey is also in the works.
Although the funding will drive expansion across research and development, partnerships and leadership — including executives that hail from the fashion biz — SLabs is not a fashion-specific business, Sandu explained. He sees it as a robust ecosystem of hardware and software for consumer goods of all types. As for the tech, that vision is expanding as well. The company is developing some sort of project to “revolutionize” augmented reality, though when pressed for details. Sandu didn’t elaborate, saying that the business is focused on “physical and digital entry points.”
In the meantime, it continues development and pursuing partnerships for the LNQ tech. Those microchips are available in as few as 50 units, so even individuals, budding indie brands and other small operators are welcome to apply.
Another major appeal for investors may be Sandu himself. Venture capitals often say they back the founder as much, or even more than, the business itself. Perhaps his Gen Z cred puts his finger on the pulse of current culture and consumer demand, and his time interning with Google, Facebook and Uber as a wee 13-year-old illustrates his tech savvy, ambition and drive.
All of these things can be crucial. But so is the ability to break down walls, buck the status quo and carve a path that, he hopes, others can follow.
“A lot of Black founders are only funded when they’re bold enough to say, ‘Hey, there’s this issue that I realized in my community, and I’ve created a solution to it,’” he continued. “But in terms of world-changing ideas, things that can affect overall economies of scale, the whole entire world, there’s a much higher risk, right?
“That’s the unique space in play here, to be able to encourage and show the next generation of young leaders and innovators that irrespective of what you look like, irrespective of where you come from, the ideas, the vision that you have is one of the most valuable things.”