SYLIA’s Presentation

SYLIA’s presentation opened with the question: What is luxury to you? From the point of view of the fashion world, luxury is often synonymous with leather goods, such as handbags, that aim to represent specific ideas of luxury, such as exclusivity, craftsmanship, and high-quality materials. In contrast, the reality of the supply chain used to create such goods is hidden, and far from luxurious. Giulio, who founded SYLIA, a mycelium textile company looking to compete with leather as an alternative material, explained the glaring issues a material such as leather has on land, animal, and human rights, in order to meet the demand of consumerism and companies willing to make such compromises in the name of profit. With this as the catalyst, and a genuine desire to do better by the planet and all that inhabit it, we were introduced to SYLIA and the world of Fungal development, specifically in the context of textile material creation.

“Right now we find ourselves in the mycelium era,” Giulio related, guiding us into the basics of mycelium and its vast potential. He explained that regarding fungal material, mycelium has significant advantages as it is passive when growing and creates very dense networks, feeding off of dead organic matter. Within SYLIA, they have been experimenting with feeding their mycelium sterilized agricultural waste, such as sawdust, hemp, and hay, all of which yield differing final results. Along with this, they are integrating organic textile waste, including cotton, hemp, and linen, which helps strengthen the final material.

This process rivals that of leather production, offering benefits such as up-cycling agricultural and textile waste as feed, using only 1% of the water used for producing cow leather, and significantly faster growth times, 4 weeks instead of 12-24 months, all while taking up far less physical space for production. All of these reasons, which benefit the planet, are also of interest to investors. Giulio stressed the importance of developing new materials that make economic sense. To secure investors and R&F funding, a convincing business strategy is essential. SYLIA originally began focusing on mycelium leather because it has the most promising economic potential: with leather being a relatively expensive raw material, finding a substitute could yield significant profits. He then laid out that the leather goods market is valued at $ 752 billion. Mycelium leather represents a growing niche—currently valued at $1.4 billion, with significant growth expected by 2030.

While SYLIA sees significant potential for developing leather alternatives, its experiments have yielded other interesting avenues for development. They have also been growing Tetris-style blocks under similar conditions, which can be fused together with mycelium fusing to itself, acting like an organic glue, able to create larger structures. When tested, these blocks could withstand 400 kg of pressure, notably the strongest parts being where the mycelium fuses to itself. This experimentation leaves room for further development in other sectors outside of the fashion world.

Giulio then went on to position his company, SYLIA, within the context of a small handful of other companies that are all working towards developing mycelium alternative leathers and textiles. The existing players offer high-quality mycelium leather, but at prices nearly 3x higher than that of animal leather, making it a hard sell, specifically for smaller brands. SYLIA is taking a different approach, using a B2B2C model that is designed to help support sustainable designers by working directly with them to co-create products: sharing the production costs and revenues in order to bring goods to the market. With this approach, SYLIA looks to cultivate young customers looking for sustainable fashion, and designers who value innovation and environmental ethics. Ultimately, SYLIA hopes to redefine ideas of luxury, to reflect ethical, ecological, and social values that include respect for nature and animals, and fairness for people and labor industries, resulting in a fully transparent supply chain.

Giulio then walked us through SYLIA’s pitch to investors, opening up a discussion around how to think about pitching. Firstly, he stressed that investors will always want to know the problem you are trying to solve. “You will need to talk about the market. They want to know exactly how big the problem is, in economic terms, and what the niche is that you're looking to target. You have to consider the total obtainable market and the addressable market. You don't have to be an expert in economics, but it needs to be convincing.” He then discussed their business model and the importance of clearly understanding how your business plans to make money while also understanding your competitors and how they make money. In general, Giulio encouraged anyone looking to do something similar to familiarize themselves with grants and funding provided by the German government, which are less concerned with immediate investment returns.

Giulio talked about several funding options that can help transition school research to the marketplace. Exist is the government grant that SYLIA used. There is also the Berlin Startup Stipendium for graduates and soon-to-be graduates, as well as the program Creative Prototyping at the University of the Arts, which you can apply for from any university. Still, the idea must originate from within your studies.

Giulio discussed with us that SYLIA is looking to make the transition to investors, now that its initial funding has run out. They’re interested in finding private investors rather than venture capitalists. Private investors are investment funds run by families and tend to be more idiosyncratic than venture capitalists. The only problem with private investors is that they are less interested in R&D. With research, it will take years to get a product to market, and you will see revenue very late.

Summary and Conclusion

The presentation ended with students asking questions. A few students were interested in how they might extend their student research into the field beyond school, while others were interested in the dynamics and day-to-day realities of running a business. The essentials we gleaned from the follow-up conversations are below:

- Look into government funds to transition school research into the marketplace. Many traditional investors won't be interested in funding something that won't see returns on the investment for a long time, so getting familiar with government grants is a good way to go about it.

- Exist - the grant SYLIA used, is a government fund in Germany that helps make these realizations.

- Berlin Startup Stipendium is for graduates or soon-to-be graduates who want to develop an innovation.

- Develop a market strategy.

- Buying fashion objects means buying into the whole supply chain

- Find people you can work with who fill the different needs of the company. You need people with different skills and who enjoy working on different aspects of the company.

- Your values and your team will determine your business.

Thank you!