Estonian manufacturing startup Fractory has raised funding from SmartCap Green Fund to spur growth in the UK and Scandinavia.

Fractory’s mission is to make the resource-intensive metal industry more efficient and, through that, more sustainable.

The undisclosed round joins the previous round. Last November, Fractory secured €4.8 million in funding, led by Finnish early-stage fund Kvanted. The funds will be used to further expand in existing markets while preparing for a larger Series B round.

The investment will be used in part to grow the UK and Scandinavian teams, enabling Fractory to meet increasing business demands across Europe. Over a dozen engineering and commercial roles will be recruited to manage an increasing number of customer projects, growing the international team to over 90.

The funding will also be used to build supplier visibility and environmental impact of manufacturing and transportation into the platform. ‘‘The data is already there, we just have to make accessing it clear and simple.’’ says Martin Vares, Fractory’s CEO.

Fractory helps companies decrease their environmental impact

‘‘In Fractory’s case, sustainability and efficiency go hand in hand. Efficiency for us means making use of the existing capacity and capabilities the market has to offer—sustainability is a very welcome additional benefit,” he said.

The company has a lot of data—both current and historic—that can aid their customers in their pursuit of meeting the EU’s climate regulations. “Tracking the environmental impact of supply chains with precision is a challenge because getting reliable data is difficult. It’s not uncommon for companies to regularly use tens or even hundreds of manufacturers, further adding to the difficulty,” Vares noted.

GOOD TO KNOW
Fractory is an on-demand manufacturing service provider. Founded in 2017 by mechanical engineer-turned-entrepreneur Martin Vares, along with co-founders Joosep Merelaht and Rein Torm, Fractory operates a one-stop platform for on-demand manufacturing services that helps discover, compare, and fulfil metal fabrication production orders regardless of the manufacturing method. From CNC machining to welding and beyond, it speeds up production and saves costs, covering marine, industrial automation, automotive, and many other industries.

“We’re well positioned to tackle this problem because the data we already process for all our orders enables us to also calculate an accurate environmental footprint—this is soon to become mandatory for businesses in the manufacturing industry,” mentioned Vares. “We’re able to utilise this data, share it, and ultimately help companies decrease their environmental impact.’’

The company that enhances supply chain dynamics

Backed by the Estonian Government, the SmartCap Green Fund focuses on sustainable innovation and identified Fractory as a key player in the digital manufacturing sector.

‘‘Fractory is emerging as a promising player in the digital manufacturing sector, leveraging its advanced platform to streamline metal fabrication services,” said Sille Pettai, Fund Manager at SmartCap.

“This investment is a crucial step in our strategy to support innovative startups that are driving efficiency and growth within the manufacturing industry. Fractory’s platform enhances machine utilisation rates in factories across their supplier network by up to 80% and decreases material waste. By backing Fractory, we are endorsing their commitment to revolutionising production processes and enhancing supply chain dynamics.’’

FACTS
Fractory took the 32nd position in last year’s FT 1000 ranking, compiled by the British business magazine Financial Times and market and consumer data platform Statista.

SmartCap Green Fund is funded by the European Union’s NextGenerationEU. The fund is focused on investments in greentech companies operating in the fields of energy, agriculture, food, transport, logistics, materials, chemicals, and the environment.

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