This is the first in a two-part report. You can find the second article here, and listen to more insights on the GreenBiz 350 podcast.
AMSTERDAM — It’s mid-August, and tourists have returned to the city center. They stroll along narrow cobbled streets, ducking into shops selling the latest fashions, including a growing number of clothes made by homegrown sustainable brands.
These young fashion labels are the most visible players in Amsterdam’s efforts to create a model for local, circular textile production, but there’s a whole lot more happening in parts of the city most visitors don’t see, such as the industrial area that lies just across the river in the city’s Noord (north) section.
I catch a ferry behind the central train station and cross the water under a heavy grey sky. It has been unseasonably cool and rainy, and as if on cue, it starts to drizzle as I ride my rented bike down a road lined not with canals, but with warehouses and construction sites. Near the road’s end, I find the squat structure that houses The Renewal Workshop and am greeted by Jeff Denby, one of the startup’s co-founders.
Denby relocated to Amsterdam from the company’s home base of Cascade Locks, Oregon in 2019, to set up and expand its operations here. Inside the warehouse, the staff is busy inspecting, cleaning, tagging and repairing clothes — slightly damaged or even pristine items returned by online shoppers, and used clothing sent back through “take back” programs. Most of what comes in will later be resold by the brands that made them, partners such as Tommy Hilfiger and The North Face, or on The Renewal Workshop’s own website. The unsalvageable stuff goes to various partners for recycling.
The startup’s decision to make Amsterdam its European base, Denby tells me, came down to these main factors: an investment by two Dutch impact funds; a large number of fashion brand headquarters and distribution centers; the use of English as a primary business language; and a thriving circular fashion ecosystem that includes nonprofits such as Circle Economy and Fashion for Good, the latter of which connects sustainable fashion entrepreneurs with brands, mentors and investors through its global accelerator and scaling programs.
“When we were thinking about where in Europe it would make sense for us to land, and this was almost three years ago now, there was already a lot of conversation around circularity here,” Denby says. “And we wanted to be somewhere that was like a hub, where these conversations were happening.”
Home to denim makers such as MUD Jeans and Kuyichi, and apparel labels such as loop.a life, Studio JUX and ORTHODOX, Amsterdam isn’t just a circular fashion hub in the unofficial private sector sense, the city has ambitions of its own, the overarching one being to establish itself as a circular economy leader. Over the last few years, the city has developed circular strategies for food, the built environment and consumer goods, with a particular emphasis on clothing and textiles. (Although not as widely recognized as Paris and Milan for fashion, Amsterdam is a global denim capital, with the highest number of jeans companies per square kilometer in the world.)
In 2018, the city council adopted a proposal to become a frontrunner in the circular fashion sector, which has since translated into the following 2025 goals: 25 percent recycled or sustainable material in all new garments sold, and recycling of 30 percent of the region’s post-consumer textile materials. Those percentages increase to 50 percent for 2030.
To meet these goals will require a remarkably quick transition away from the garment industry’s fast fashion model — which produces 20 percent of the world’s industrial water pollution and results in a garbage truck’s worth of clothes landing in a landfill or incinerator every second — to a system where new clothes are designed and produced using recycled or renewable materials, and the life of existing pieces is extended via various business models, such as rental platforms, secondhand shops, repair services, and takeback and resale platforms.
Rolling out the red carpet
It will also take a ton of collaboration and cooperation among various players, including local government agencies and businesses that work on the ground, international brands that sell their products to Dutch consumers, and startups that create the circular solutions, not to mention investors.
“The government really pushes innovation, really encourages young entrepreneurs,” Borre Akkersdijk, co-founder of ByBorre, tells me when we meet at the startup’s studio and production plant. ByBorre has created a digital platform that allows designers and brands to use sustainable and recycled materials to design their products, samples of which it can then produce onsite.
“You can think very big here and start small, which is logical because we are small,” he says.
Marike Geertsma is one of the local government representatives working to make circular fashion and textile innovation happen. Geertsma leads the fashion sector team at amsterdam inbusiness, the foreign investment agency for the Amsterdam area, which helps foreign companies establish and grow their operations.
Along with other city offices, such as StartupAmsterdam, an agency dedicated to improving the local business climate for startups, scale-ups and innovative SMEs, amsterdam inbusiness is charged with attracting and supporting foreign companies that can help turn the city’s vision for the future into a reality on the ground as quickly as possible.
“We’re trying to connect local and international startups and corporates to make sure this ecosystem is being developed faster, better and more sustainably,” Geertsma told me over a recent call. “And to ensure that we can claim to be the most innovative hub for sustainable fashion in Europe.”
Geertsma and her team have spent the last 18 months or so mapping out the region’s existing network of circular fashion organizations and businesses and determining where holes exist that need to be filled.
Even a small country like the Netherlands, and the city of Amsterdam, can have a global impact on sustainability and responsibility.
To that end, “We are very welcoming to international companies who can contribute to the sustainable development of our economy,” Geertsma said. “If companies approach us, and we see that they could contribute, especially if they provide a missing link or an addition, then definitely we would roll out the red carpet.”
Of course, foreign businesses looking to set up shop in Amsterdam do have to meet certain general requirements, such as contributing to the local economy and creating jobs. And startups should have a viable business model with a track record of investment and operations in their own countries.
Wanted: Investors with a little patience
The Renewal Workshop is a good example that ticks all the boxes: a growing operation in Oregon; a specific repair and resale business model that didn’t previously exist; job creation (it employs 20 people in Amsterdam); and a track record of securing investment.
Three European impact investors — Dutch funds Social Impact Ventures and SHIFT Invest, and Switzerland’s Quadia — led the financing of the company’s Netherlands expansion. Denby and co-founder Nicole Bassett were connected to the funds through Fashion for Good, after participating in the organization’s scaling program.
Along with navigating the country’s regulatory and legal systems, and general bureaucracy, securing private financing is one of the biggest challenges for the increasing number of impact startups in the Netherlands, several entrepreneurs told me. The national government’s Netherlands Enterprise Agency (RVO) does offer financial support in the form of subsidies and grants, along with a variety of other services. However, the pool of private venture funding for the sustainable fashion sector, particularly patient capital, hasn’t yet risen to the level needed, although both the city and Fashion for Good are making progress in building the sector’s roster of investors.
“The one weak leg of the stool is funding, particularly venture [capital] funding for young companies. It isn’t as developed as the rest of the ecosystem,” Greg Stillman, who manages European business development from Amsterdam for Natural Fiber Welding, told me over a call in August. “There are a few entities popping up, but it’s nowhere near what the startups need to grow and fuel their ventures. I do think it will be addressed; it’s just coming on much slower.”
Based in Peoria, Illinois, Natural Fiber Welding has developed a sustainable chemical treatment method that boosts the quality of recycled cotton fibers and yarns so they can be used to produce new garments. The company also makes a plant-based leather-like material.
Stillman moved to the Netherlands after he fell in love and married a Dutch woman. He got a job helping to run the global accelerator program at Fashion for Good, where he connected with the folks at Natural Fiber Welding when the company participated in the scaling program in 2018.
“I basically convinced them to hire me,” he said. “The idea was, to be taken seriously in the European market you need a presence.”
Proving the model
Amsterdam is not alone in its circular initiatives. The European Union has made circularity a main pillar of its climate policy and plans to invest billions of euros in research, innovation and digitalization aimed at transitioning to a fully circular economy by 2050. This transition is beginning, with EU directives such as the obligatory separate collection of textile waste by 2025.
As a member state, the Netherlands shares the EU’s overarching objectives, although its own circular economy plan pushes the envelope further, with goals such as cutting the use of primary natural resources in half as soon as 2030. Indeed, a 2020 report from Circle Economy found that the Netherlands is the most circular country in the world.
The demand for a more sustainable model from both European consumers and governments has forced international fashion brands to the table, people I spoke to in Amsterdam said. Although how willingly and rapidly they will change remains to be seen, their minds and ears seemed to have opened.
Kanak Hirani is a native of Bangalore, who moved to Amsterdam in 2006 and now runs her own ethical clothing brand — Julahas (weavers in English) — which features capes, wraps and belts handwoven by artisans in rural India, 70 percent of them women. When I meet her in her studio, she explains that before the COVID pandemic she participated in an industry disruptor program for sustainable fashion entrepreneurs, funded by the EU and U.N. Women.
The one weak leg of the stool is funding, particularly venture [capital] funding for young companies. It isn’t as developed as the rest of the ecosystem.
“They actually put us in a room with sustainability representatives from H&M, and they came to us saying, ‘We have a lot of inventory, and we’re really turning to you because you are brands that were born sustainable. How would you tell us to address this inventory issue?’” Hirani says. “It was a very interesting session talking about how they could explore reselling models, how they could explore rental models. … And they were actually listening.”
Back at The Renewal Workshop, under the glare of the warehouse lights, a staff member called Hengameh (who asked that we use only her first name) is sewing up the ripped hem of a beautiful gold-colored coat. Other than this one defect, the coat is in perfect condition.
“You can imagine that inside this giant machine that’s cranking out and selling clothing, this coat ended up in a waste pile because it had a broken hem at the bottom,” Denby says. “And now Hengameh has saved it.”
It’s a rare, tiny win compared to the 2 million metric tons of textiles Europeans throw away each year. But it’s also a glimpse into Amsterdam’s vision of the future, one that people I spoke to say they want to share with the rest of the world.
“Even a small country like the Netherlands, and the city of Amsterdam, can have a global impact on sustainability and responsibility,” Akkersdijk says. “We can set an example of how it can be done. So the idea is to prove the model and then scale it.”