In a recent interview with World Textile Information Network (WTiN), SOSV General Partner Po Bronson spoke about the state of innovation in materials and textiles. See the full Q&A below:

Q: In the context of the industry’s materials transition, what factors and focuses do you see as being critical over the next five years?

I’ve been an investor at SOSV for eight years and have overseen a lot of our investment in materials, and have seen both exciting breakthroughs and troubling gaps.

Fewer VCs are deploying money in this space, generally, than they used to. Right now, “pure AI” is sucking up all the money. And I don’t mean the kind of AI that might make a textile machine smarter, but AI for its own sake. That shift makes it harder to advance the textile innovations the world urgently needs.

VCs are very frustrated with some very huge notable brands for never converting pilots into meaningful revenue. VCs are giving up on the fashion brands because of it. In turn, if brands depend on VC-backed startups alone, they risk losing the momentum needed to meet their commitments.

Here’s a thought exercise I encourage every innovation team at every brand to do during their annual off-sites: ask yourselves, “What if VCs put US$0 in our sector for the next five years? How would we innovate differently?” That scenario planning forces companies to confront the meager economic benefits they provide materials startups.

The result is, VCs back new brands using new materials in innovative ways rather than fund materials companies to be just materials companies.

Q: If that’s the case, what do you feel the industry’s priorities should be for the next decade?

As an industry, people need to rethink how innovation moves forward – both inside and outside the startup world.

Too often, I see promising technologies end up trapped in endless “innovation pipelines.” Startup products will be used by a designer or get put into a capsule collection that generates tiny revenue. For startups, those pilots look great in a press release but don’t scale into meaningful sales. For VCs, it’s a dead end: small orders don’t justify continued investment, and so capital pulls back. The result? Startups creep along at unsustainable revenue levels, brands get to experiment without real commitment, and the whole system teeters on collapse.

Not all startups survive. That’s normal. Some technologies aren’t economical or high-performance enough. But when a breakthrough is real, it shouldn’t be funneled into a process that guarantees it will stall out. The “innovation pipeline,” as it’s currently structured, is essentially a walk of death. It simply doesn’t convert revenue fast enough to satisfy VCs. So, something different needs to be thought out. That means putting some teeth behind offtake agreements. Use take-or-pay penalties. Buy more of these companies earlier vs. waiting years. Co-invent. Get big, long exclusivities.

There’s lots of possibilities here, with no one way to do it. But what the industry is about to see is that the innovation pipeline has dried up with the current process.

Q: Aside from its stagnant pace of adoption, how else does the innovation pipeline hamper emergent innovators? Which stakeholders are responsible?

Rational innovation is the enemy of innovation itself. By that I mean when corporations decide on a narrow set of “rational” priorities and ignore everything outside those boundaries, they think they’re being disciplined and efficient. But that’s exactly how big firms get disrupted. The real breakthroughs almost never come from the categories you were looking at. They come from the blind spots. And over time, those blind spots are what take entire industries by surprise.

The textile industry has built a similar trap. Its innovation system is designed around dabbling… ‘We’ll use a little of this, we’ll order a small run of that, we’ll get some free press out of it.’ Meanwhile, it takes three years to move from those tiny pilots to anything resembling scale, and by then the startup may be dead.

The tragedy is that some of these technologies are exactly what the industry needs: they’re economical, they save money, they deliver the sustainability brands have publicly pledged to achieve, and they meet or exceed the required performance standards. When an innovation checks all those boxes, it should be adopted system-wide—not strung along for years in a marketing pipeline that kills momentum and starves the startup.

If the industry wants to meet its sustainability goals and remain competitive, it has to learn to recognize the difference: when something is real, stop testing it to death. Use it. Scale it. Now.

Q: What topline strategies or solutions do you feel would best help the industry achieve its 2030 ESG goals and beyond?

Open-loop circularity.

There’s a dream that the industry can do what’s called closed-loop circularity: garments can become new garments. It’s dreamy, it’s utopian for sure. But it will not work. It’s not grounded in physics or chemistry. If you design a garment to be endlessly recycled into another garment, you’ll end up with something that falls apart in three months.

Go for impact over ease.

The industry likes to prioritise innovation spaces that they see as doable and is kind of quiet about stuff they think is going to be harder. For example, how do companies make sure they’ll meet emissions guidelines? Take adipic acid, a key ingredient in nylon and polyester production. Its manufacture produces nitrous oxide, which is 100 times more damaging than CO₂. That means even small amounts have an outsized climate impact.

So, we’ve backed a company that makes what we call a “green adipic acid” and a “blue adipic acid”. The green is entirely biobased. The blue starts with normal chemistry, petrochemistry, but has no nitrous oxide emissions in it; that one is basically the same cost of existing adipic acid, which makes up half of nylon. So, all nylons, all polyesters using adipic acid, adopt the blue or the green adipic acid immediately and you will meet all your 2030 goals. What do you think is a barrier? The innovation pipeline. Customers love the solution, but instead of adopting it broadly, they test it in capsule collections, pilot runs, or small batches. By 2030, at this pace, the industry will still be showing off a few pairs of yoga pants while missing its actual climate goals.

Q: Where do you see the greatest potential for disruption and systematic change?

The single biggest potential for disruption in textiles are used textiles, which are growing really, really fast. The industry is thinking we need to recycle more of our clothing back into clothing and then we’ll make people happy, and they’ll buy from us again rather than buy from Goodwill or Salvation Army. So, there’s no doubt that that sector is, in my mind, the most disruptive sector of the textile industry. And it is where fortunes will be won and lost.

Q: What would be your key takeaway for the industry?

What no one wants to say out loud is that the entire innovation system in textiles has been structured to give startups virtually no revenue. And without revenue, startups simply can’t survive. If that dynamic doesn’t change, we’re headed back to where the industry was in 1995 when VC-backed startups in textiles effectively didn’t exist. I’d say we’re only about two years away from that point.

The upside? The shakeout is already happening. The posers are gone. What’s left are founders and investors who are genuinely serious. We’ve seen this play out in the food sector too: less capital overall, fewer players deploying it, but the money that is being put to work is smarter, more disciplined, and more likely to back the right companies.