Coloreel, the digital dyeing and textile thread on-demand provider, said it received a 70 million Swedish krona (or about $8 million) funding round from existing and new investors “to support the company’s market expansion and growth and to initiate expansion into new application areas such as sewing.”
The company also said as businesses open up more fully following the COVID-19 outbreak, activity in the textile and embroidery market is up.
Joakim Staberg, founder and majority owner of the company, said with this private placement, “we bring in a number of exciting and strong investors alongside the existing major shareholders, Robur Ny Teknik, SEB Stiftelsen, Svea Ekonomi and Ilija Batljan, who also participated in this placement. In parallel to this, we now receive more and more new expressions of interest from additional investors, which feels very exciting.”
Mattias Nordin, chief executive officer of Coloreel, said the company is “noticing a sharp increase in activity as more and more markets open up. Larger orders such as the one recently announced from Tryckhuset AB is great proof that we are on the right track in our ambition to modernize the use of embroidery in the textile industry.”
Last month, Coloreel said Swedish embroidery manufacturer Tryckhuset AB is investing in new technology from the company to meet higher demand for products. Tryckhuset bought eight Coloreel units.
Terms of the deal were not disclosed. Anders Andreasson, CEO and chairman of Tryckhuset, said Coloreel’s technology “contributes to our efficiency and supports our continued expansion. In the past, we have sometimes had large scrap in our thread stock. Now we only need one thread spool that colors digitally during production, which creates contrasts, gradients, shadows and a depth that has not been possible before with traditional embroidery technology.”
Andreasson said the results resemble a digital print, “but it is embroidery and we do not have to compromise on the choice of color. If we receive an express delivery, we do not need to send a truck to pick up thread in the right color, we already have everything in place.”
In the statement about the funding round today, Coloreel said its technology for digital dyeing of textile thread on-demand “gives embroidery manufacturers and fashion designers a number of significant competitive advantages. The technology maximizes the users’ creative potential while minimizing the environmental impact. Higher embroidery quality, no thread waste, no wastewater, creative color changes and above all a complete freedom in the use of colors.”
The company also said market demand for its technology is high — from smaller niche brands to large apparel companies. But Coloreel is being selective, and said it “has chosen to initially enter into close collaborations with some of the world’s most famous brands and leading embroidery manufacturers.”
“The embroidery market is large and includes about 8 million installed embroidery heads worldwide,” Coloreel said. “Each of these embroidery heads can be equipped with Coloreel’s technology. Despite the ongoing pandemic, Coloreel, with the help of existing distributors, has delivered its groundbreaking technology to 11 countries in Europe, the United States and Asia, albeit in limited volumes.”
Coloreel noted it also started a business “with the world’s largest distributor of embroidery machines, U.S.-based Hirsch Solutions, which has already installed the technology with several reputable end customers in the U.S.”