The textile revolution starts here.

Every year, 92 million tons of textile waste are discarded. Less than 1% is recycled into new clothes.
Why? Because the system is broken: linear, wasteful, invisible.
Cyclothe, has built a circular, scalable, and traceable system that turns textile waste into valuable resources. And today, they’re inviting us to be part of it.

Company Overview

Cyclothe is an innovative cleantech startup based in Stockholm, redefining textile waste management through an approach that merges cutting-edge technology and circular economy principles. By combining artificial intelligence, modular systems, and automated processes, Cyclothe offers a groundbreaking solution for collecting and sorting end-of-life textiles, making their reuse and recycling easier and more efficient.

Cyclothe’s high-tech solution optimizes waste handling and digitizes the entire textile value chain, enabling stakeholders to align with a more circular and sustainable economy, while ensuring a streamlined, traceable, and fully digital process. The system integrates seamlessly with existing recycling infrastructure, offering a smooth transition to greener practices.

Cyclothe’s long-term vision is to fuse technological innovation with sustainability to create lasting impact: transforming the textile industry into a more responsible sector, redefining circular economy standards by setting higher benchmarks for resource management and textile recycling, and making textile reuse a common and accessible practice for all players in the value chain.

Impact

> Carbon Footprint Reduction :

Cyclothe helps reduce 2.6 million metric tons of CO2 emissions by 2030 and enables the recycling of 0.1 million tons of textile waste.

> Resource Optimization :

The project contributes to saving 900 billion liters of water, 0.8 million MWh of energy, and 0.5 million barrels of diesel fuel through efficient textile recycling.

> Consumer Engagement and Transparency :

Every collected textile is assigned a Digital ID, ensuring full traceability while educating consumers on the environmental impact of their disposal choices.

> Economic and Social Impact :

Cyclothe supports the creation of over 50 jobs and engages more than 100,000 post-consumers through digital campaigns promoting sustainable practices.

> Alignment with Sustainability Goals :

These points align with SDG 12 by promoting responsible consumption and production through innovative textile waste collection and recycling. Cyclothe also contributes to SDG 13 by reducing CO2 emissions and optimizing resource use, helping mitigate climate change impacts..

Why Invest in Cyclothe?

> By investing you :

✅ Support real circular innovation.
✅ Enter a fast-growing market driven by urgent regulation.
✅ Help scale measurable environmental impact.
This is more than a raise. It’s a call to system change.

> A Rapidly Growing Market:

The circular economy is a key strategic priority for the EU, with regulations pushing players to adopt innovative solutions, especially in textile waste management. Cyclothe is positioning itself as a key player in this booming sector, addressing both the ecological and economic needs of an increasingly eco-conscious market.

> Advanced Traceability & Logistics:

Unlike traditional methods, Cyclothe enhances textile reuse through smart traceability and advanced logistics. This approach enables more efficient material recovery, ensuring greater sustainability and a significant reduction in textile waste.

> Scalable Innovation:

Leveraging AI, blockchain, and IoT, Cyclothe delivers a flexible and easy-to-deploy solution, seamlessly integrating with existing infrastructure. Following two pilot projects in 2025, the company aims to expand to over 200 municipalities by 2029, with strong international growth potential.

> Measurable Positive Impact:

By 2030, Cyclothe aims to avoid 700,000 tons of CO₂ emissions and save 500 billion liters of water annually through textile reuse. These efforts support global goals to reduce the environmental footprint of the textile industry, while helping to preserve natural resources and minimize waste.

Problem

The textile sector represents one of the most pressing environmental and economic challenges of our time.
► In Europe alone, 5.8 million tons of textile waste are discarded every year, with only a small fraction effectively recycled. The dominant linear model ("produce, consume, discard") results in massive resource waste and significant strain on ecosystems.

Textile waste management remains inefficient at every level, creating not only environmental issues but also major lost revenue opportunities for industries and municipalities. Due to a lack of sophisticated sorting solutions, a large portion of end-of-life textiles is still landfilled or incinerated—even though they could be reused in the circular economy. Meanwhile, demand for high-quality recycled materials is growing, driven by stricter regulations and shifting consumer expectations.

This gap between the lack of effective solutions and growing demand is a major barrier to building a truly viable circular economy.

To address these urgent challenges, the market needs more efficient collection and pre-sorting solutions—ones that can extract value from textiles from the very first step, while reducing operational costs for public and private stakeholders. Cyclothe answers this call by combining optimized collection technologies, advanced pre-sorting systems, and innovative business models.
This approach not only improves textile recycling from the point of collection, but also lowers associated costs and actively supports the transition to a more sustainable circular economy.

Solution

Cyclothe offers a unique tech-driven approach to automate and streamline end-of-life textile management—a turnkey solution for municipalities, NGOs, producers, and recyclers to collaborate efficiently on a shared digital platform.

Thanks to an innovative digital and physical ecosystem, the company ensures full traceability and optimizes textile sorting, enabling reuse or recycling and helping stakeholders comply with European waste directives.

Textiles deposited in Cyclothe bins are then analyzed and sorted by category, condition, and reuse potential. Advanced technology evaluates each item to determine whether it can be reused, upcycled, or recycled into new raw materials.

The goal is to maximize textile value and minimize waste, avoiding landfill and incineration whenever possible. This process helps reintegrate textiles into the economic loop, supporting a more circular and sustainable fashion industry.

Cyclothe stands out in the textile waste market with an innovative approach combining advanced tech, traceability, and reuse optimization:
► A major differentiator from traditional solutions, where collected textiles are often poorly tracked
► Real-time logistics management that lowers operational costs and carbon footprint
► Prevention of bin overflow and optimized storage, preserving textile quality
► Prioritization of second-hand and upcycling over recycling, cutting energy and water consumption

Technology

Cyclothe’s smart collection system is powered by advanced IoT technologies, optimizing sorting, storage, and textile handling with real-time monitoring of key parameters. This enables rapid operational response and better resource management throughout the value chain.
With integrated Digital ID and blockchain, each item is accurately and transparently tracked from collection to revalorization.

Unlike traditional recycling-focused approaches, Cyclothe places special emphasis on textile reuse. This focus not only amplifies environmental impact, but also drastically reduces textile waste by extending the life of garments and fostering a more efficient and sustainable circular model.

Cyclothe’s solution consists of three core components:

> A recycled and recyclable bag:

Designed to hold up to 7 kg of textiles, it includes a QR code and RFID chip ensuring full traceability throughout the recycling process.

> A digital platform:

The Cyclothe app assigns a unique digital ID to each item, ensuring total traceability and pre-sorting to streamline recycling workflows. Built on blockchain, the platform enables full lifecycle tracking and enhances transparency for both users and partner companies.

> Smart collection bins:

These solar-powered IoT bins analyze incoming items, collect data on condition (humidity, fill level, etc.), and optimize storage. The bin lid only opens with Cyclothe bags, ensuring security and operational efficiency.

Business Model

> Cyclothe generates revenue through:

► Monthly subscriptions to municipalities.
► Sale of collection bags and points.
► Sorting services.
► Textile data and analytics.

> Core Business Model:

► Cyclothe’s business model primarily targets municipalities, offering pilot projects priced below the public procurement threshold (~€62K).
► When transitioning from a pilot to a full-scale rollout, volumes increase tenfold, resulting in proportional revenue growth.
► At the same time, Cyclothe operates as a subcontractor for recycling centers like Stena and works directly with major producers such as H&M and IKEA, helping them comply with current regulations.

> Geographic Presence:

► Cyclothe has already launched two pilot projects in Sweden and is actively targeting 85 municipalities in the country.
► Building on successful pilot results and strategic partnerships with local authorities, the company plans to expand into other European countries starting in 2027.

> Revenue Streams:

► Textile Collection and Sorting: Cyclothe charges municipalities variable fees based on the number of bags and kilograms of textiles collected.
► Bin Management: Monthly fees are charged for the management of each smart bin. These fees cover installation, maintenance, supervision, and connectivity to ensure real-time deposit tracking.
► Impact Measurement: Municipalities can also subscribe to a monthly package providing analysis and detailed environmental reports on the impact of collection efforts in terms of waste reduction, reuse, and recycling.

> Customer Segments

► Waste Management Operators & Municipalities: Growing demand for efficient sorting solutions, regulatory pressure, and commitment to the circular economy.
► Recyclers & Industry Players: Strong need for accurately sorted textile materials.
► Public Institutions: Support for innovation to meet new environmental obligations. Cyclothe facilitates the collection and routing of textiles toward reuse or recycling circuits, contributing to circular economy goals and waste reduction.

Market and Competitive Landscape

The textile recycling and circular economy market is experiencing strong growth, driven by regulatory changes, rising consumer awareness, and major technological advances.
The sector is expected to reach $9.2 billion by 2027, with a compound annual growth rate (CAGR) of 5.2%.

Cyclothe focuses primarily on the European market, where the regulatory framework around textile recycling is becoming increasingly strict, prompting industry players to rethink their waste management strategies. The European Union is setting more ambitious recycling targets, with mandatory separate textile collection coming into force in several countries by 2025.
Extended Producer Responsibility (EPR) regulations require brands to take responsibility for their products’ end-of-life and incorporate recycled materials into their production. These legal requirements are a key driver of sector transformation, pushing companies to invest in innovative solutions to improve the recovery of used textiles.

The evolving expectations of consumers are also a major growth factor. ESG (Environmental, Social, and Governance) strategies adopted by major fashion and textile brands are fueling demand for recycled materials. An increasing number of companies are aiming to lower their environmental impact by integrating recycled materials into their collections. However, this demand is hindered by a still limited supply, due to the current limitations of sorting technologies, which don’t always ensure recycled material quality equivalent to virgin fibers. This gap between demand and supply represents a significant opportunity for players offering more effective and high-quality solutions.

In parallel, technological innovation is a key factor in shaping the textile recycling market. New sorting technologies such as artificial intelligence and advanced spectroscopy are improving textile identification and processing, enhancing the profitability and quality of recycled materials. Automation also increases processing capacity and lowers costs, making systematic textile recycling possible, even for complex fabric blends. As a result, technology not only addresses rising market needs, but also paves the way for more cost-effective and scalable textile recycling.

The textile recycling market is undergoing a profound shift, with growing demand for innovative and economically viable tech solutions. Companies that provide efficient sorting and recycling capabilities are positioning themselves as key players in this rapidly growing sector. Cyclothe’s digital, traceable, and automated solution is particularly well-positioned. By integrating with existing infrastructure, it helps industry stakeholders comply with EU collection and reuse requirements, while optimizing resource management and minimizing environmental impact.

Traction & Roadmap

► €300K pre-seed raised
► €100K EU grant
► 2 cities signed (SorTex project)+ 2 in progress
► Goal: 10 cities in 2025, 200 by 2029

Team

Financials

> Equivalent in Euros (€):

► 2025: €213,700
► 2026: €1,197,017
► 2027: €3,573,947
► 2028: €7,456,228
► 2029: €13,281,842

The funds raised will support the final research and development efforts needed to launch two pilot projects in partnership with municipalities in Sweden and Denmark, and then accelerate the development of additional partnerships across Europe, particularly in the following areas:

> Software Development:

Approximately 40% of the funds will be allocated to software development. This includes costs related to design, coding, testing, maintenance, and continuous improvement of the digital product.

> Hardware Development:

Around 20% of the funds will be invested in the development of Cyclothe’s smart bins, covering the design, manufacturing, and testing of the physical components necessary for their proper operation.

> Administration and Operational Support:

The remaining 40% will be used to cover operational expenses and essential human resources, ensuring the smooth running of the company.

Risks Involved in the Operation

> Technological Risk:

The textile recycling sector is constantly evolving, with new methods and technologies emerging regularly. Cyclothe may face a risk of technological obsolescence if the solutions they implement are not updated, or if more efficient techniques become available after adoption. This could lead to a continuous need for investment to stay competitive.

> Financial Risk:

Textile recycling can be expensive, particularly due to the investment required in machinery, infrastructure, and waste management. Cyclothe’s business model must prove profitable in the long run, which may be difficult if production costs are too high or if demand for recycled textiles remains low.

> Regulatory Risk:

Textile recycling is subject to specific regulations that vary across EU member states. Although Cyclothe complies with current EU standards, the company may face local regulatory requirements in certain countries, which could impact the rollout of its services in those markets.

> Market Risk:

Other solutions such as chemical recycling or textile reuse may represent direct competition to Cyclothe. Additionally, major fashion brands may develop their own recycling initiatives, potentially reducing the available market share.

Discover Cyclothe in video

A few minutes to share Cyclothe’s vision and ambition, told by those who bring the project to life.