Flush with cash, bamboo-based toilet paper company Cloud Paper makes it rain
With toilet paper and kitchen rolls in its product portfolio for now, and a lot more coming down the pipe, Cloud Paper is a sustainable, bamboo-based alternative to toilet paper made from whatever toilet paper is usually made from. The company raised a $5m round from an impressive cadre of investors to expand its product line, and start going after more commercial applications for its products; commercial-size toilet paper, and paper for touchless dispensers, for example. The company is playing celebrity bingo with its investors, attracting checks from a star-studded set of investors.
“Cloud Paper is on a mission to transform the paper products industry to switch to tree-free products,” said Ashton Kutcher of Soundwaves. “We want to be part of that mission and further cement our position in this space as Cloud Paper expands into retail and pursues an aggressive B2B strategy, alongside growing their DTC offering.”
The $5m round includes investments from Bezos Expeditions (the personal investment company of Jeff Bezos), Marc Benioff’s TIME Ventures, Presight Capital, Soundwaves, and Jeff Wilke.
The company’s two founders have been following each other around from company to company, starting with Uber, then Convoy, before calling it a day and starting a clean-tech company that wipes the slate — and our bottoms — clean.
“My co-founder and I met working at Uber in the early days when Uber was first rolling out Uber X and ride-sharing across the globe. We were there at an incredibly unique time and saw hyper-growth happen. Then we worked together at Convoy — it’s kind of an Uber for trucking and supply chain — and we spent six or seven years at these pretty quickly growing startups,” explains Ryan Fritsch, CEO and co-founder at Cloud Paper. We sat down and said ‘I think now’s the time to leverage this experience we built. What are we going to do? We knew we wanted to get into sustainability in a big way. The research led us into the impacts of the paper and pulp industry. Fast forward — we started the company in the spring of 2019. We did a seed round at $3 million led by Greycroft.”
From there, the company set its targets higher; having sold more than 3m rolls of toilet paper to date, with a staff of just 8, the company is tooling up to make a much bigger splash.
“This year we are going to make a big push into B2B. That’s where we started, but we shifted into direct-to-consumer during COVID. Certain industries — especially across hospitality and travel — are starting to open back up. The commercial products that those entities want are much different than what you see on our website right now,” says Fritsch. “There will be all kinds of variations of paper towels and toilet paper. An arena, for example, doesn’t want a little 350 sheet roll. They want that 3,000-sheet high capacity jumbo roll. We are working on building out our catalog — that’s our focus for the next year.”
The numbers make a lot of sense for the company, too; Cloud Paper delivered 930% more rolls since its Seed Round and grew its direct-to-consumer customer base by 230%. Business customers, the company reports, are up by 400%. The brand also saw an over 800% increase in revenue during this period.
That’s a lot of rolls of paper, resulting in 10,000 trees saved, the company suspects. It sources its bamboo for the paper from China, where it can be hard to trace the supply chain all the way back to the bamboo plants themselves; How does Cloud Paper know that it’s actually getting sustainably farmed, renewable bamboo? The founder has a solid answer.
“We have a reliance on trusted third parties. That can validate the supply chain, especially the sustainability of the supply chain. Last year, we were one of the first — if not the first — 100% Bamboo brand to be FSC certified. If you look at our direct competitors, you’re going to see the same three or four names. We’re the first that checks the FSC box in terms of sustainability of the harvesting and the growing of the bamboo,” explains Fritsch. “There’s also an annual report from the Natural Resources Defense Council (NRDC) called ‘the issue of tissue’. Last year was the first year they included some of the newer bamboo-based brands. We got the top marks from them last year. We continue to look at additional third-party audit organizations as well to make sure that we have the transparency that we need. We recently just got the USDA biobased certification and we are looking at others as well.”
The company claims that its tree-free bamboo paper towels and toilet paper saved over 10,000 trees last year alone. This raise will allow Cloud Paper to make significant investments in its supply chain, product development, and hiring.