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Regeneration backs Smarter Sorting

Illustration of three cardboard boxes forming the arrowheads on a recycle symbol.

Illustration: Gabriella Turrisi/Axios

Smarter Sorting, a circular commerce data company, locked down an additional $7 million in funding from Leonardo DiCaprio-backed Regeneration.VC, an extension to its $25 million Series A raise in March, CEO Jacqueline Claudia tells Axios.

Why it matters: Renewed focus on ESG has led to the proliferation of data-oriented startups that aim to help companies get a better view – as well as some insights – into the environmental impact of their supply chains.

Details: The growth round comes from Regeneration.VC, a climate venture fund that invests in early-stage companies tied to the circular economy and regenerative consumer brands.

  • The latest injection brings its total funding to $55.2 million to date.
  • G2 Venture Partners led the round in March.

How it works: Smarter Sorting acts as a retail waste management platform, helping companies determine whether a product should be donated, recycled or thrown away in a landfill.

  • It leans on a massive database of physical and chemical properties on millions of consumer products that can inform retailers and brands on how to safely handle, store or market those items.
  • This is particularly useful for products that can be a target for environmental regulations, such as those that are flammable, toxic or corrosive.

Of note: Companies risk hundreds of thousands of dollars in fines for handling products improperly, Claudia says.

  • "Having the right data can drive a lot of cost efficiency in the supply chain," she adds.
  • Smarter Sorting works with over 1,700 brands and 24 retailers, she says, including Costco, Albertsons and Wegmans, as well as food banks and shelters that have been the beneficiary of retailers’ diverted food, clothing and goods.

State of play: “These are really valuable data sets to bring back to the brands when they're either formulating new products, considering how to make improvements and so on,” Regeneration.VC general partner Michael Smith tells Axios.

  • He says he hasn’t seen many competitors doing something similar to what Smarter Sorting does.
  • “Also, by focusing on waste spend, and areas of cost for retailers, they become a real ally and benefit as companies get more efficient,” he adds.

What's next: Smarter Sorting will use the funds to enhance its master chemical data set and continue to develop tools that will allow retailers "to answer their own questions about their products," Claudia says.

  • “We've spent the last five years building the infrastructure and building the technology,” she says. “And now we're just starting to see the impact of putting more volume through the machine.”

Editor's note: This story has been corrected to note Smarter Sorting has raised $55.2 million (not $52 million) to date.

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