Circulose’s story underlines the magnitude of the challenges facing those trying to reduce fashion’s impact on the environment at scale.
Formerly known as Renewcell, it was the next-gen materials startup that seemed to hold the most promise — thanks in large part to its high-profile brand partners including H&M, Inditex, Levi’s and Ganni. But Renewcell filed for bankruptcy in February, sending shock waves through the sustainable fashion community.
Now, the company has risen from the ashes with a new backer in the form of private equity firm Altor. It has been renamed after its hero product Circulose — a pulp made from 100 per cent textile waste that can be used to replace high-impact raw materials like cotton and viscose — and has hired a new top team that includes former H&M Group CEO Helena Helmersson, who joined as chair on 1 December.
“I was devastated when I saw Renewcell go bankrupt. I felt something had to be done,” said Helmersson, speaking at Vogue Business Fashion Futures in London on 4 December. Helmersson had been following Renewcell closely: H&M Group — where she worked for 26 years before departing at the start of 2024 — was one of its investors, as well as a customer. “The [Renewcell] team did something remarkable with developing this technology and bringing it to scale,” she said.
Helmersson offered a simple explanation for the bankruptcy: the pandemic took a toll, but above all, the price was too high. “When looking at feedback from brands — and, of course, I have my own experiences from my time with H&M Group — the biggest point has been that it was very expensive.”
The strategy has been updated in two ways. Firstly, the renewed focus is on improving the customer offer. For the Fashion Futures audience, Helmersson set out some of the biggest questions it is seeking to address: “What can we do to get down in price? How can we get up in volume quicker? How can we make the offer broader by adding services, like coordinating a [brand’s] supply chain?” The latter would help its onboarding of larger brands and increase production volumes, she said — which would result in greater efficiencies and, by extension, better prices.
Secondly, the team is reviewing its production processes, including the feedstock. “So far we’ve been using industrial waste, but the long-term vision is to deal with post-consumer waste. It’s part of the strategy to find the right partnerships [to enable that],” said Helmersson.
Production ground to a halt in February, though Circulose said at the time that it had enough pulp and fibre in stock to fulfil brand orders for 18 to 24 months. The ambition is to get it back up and running by the start of 2026. “We will ramp up the production when we know the demand,” explained Helmersson.
Circulose’s success relies on that demand. Brands only had so much appetite to support Renewcell — has that changed? “More brands have targets [to use] sustainably sourced or circular materials,” Helmersson said. But she acknowledged that Circulose’s biggest challenge will be to convince brands that their feedback has been heard, especially on the price. “We’re going into a phase where that dialogue will become more and more active.”
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