Jayanth Kashyap: Biggest Investment Opportunities for GFF in Home Textile Would be in Wet Processing

The Good Fashion Fund (GFF) is a one-of-its kind initiative to create systemic change in the textile & apparel industry by financing the implementation of highly impactful & disruptive production technologies in Asia. GFF is managed by FOUNT. Jayanth Kashyap, Investment Lead, GFF, in this conversation with Divya Shetty, says more about the company’s operations  and how they are gearing up with the industry trends.

Could you briefly share how the Good Fashion Fund is supporting the textile industry and highlight any recent collaborations you’d like to discuss?

GFF is the only global impact fund directly investing in the textile supply chain to help adopt sustainable manufacturing practices. We provide dollar based financing for the long-term and bring access to expertise, help improve visibility of the suppliers and showcase our investees as ‘front-runners’ in sustainability. We are active in India and Bangladesh and recently partnered with KKP Fine Linen, from Namakkal, Tamil Nadu for their new wet processing unit in SIPCOT, Perundurai. KKPFL is a fast growing manufacturer and exporter of bedding and made-ups catering to markets in North America, Europe and Asia. We will shortly announce our final and 6th investment of the GFF, also in home textiles, in the coming weeks.

How do you anticipate the recently announced budget will affect your operations in India?

The budget’s vision for accelerating growth through investment in people, innovation, and sustainable manufacturing is a welcome step for the textile and apparel sector. The Rs 200 billion investment in innovation and the establishment of a Deep Tech Fund will be instrumental in driving the adoption of next-gen technologies. This, combined with the five-year Mission for Cotton Productivity, will ensure a resilient, sustainable, and high-quality raw material pipeline—critical for advancing responsible fashion. Additionally, the Saksham Anganwadi and Poshan 2.0 initiative reinforces the need for human capital development, ensuring long-term economic resilience. At Good Fashion Fund, we remain committed to supporting manufacturers in India’s textile ecosystem by facilitating access to capital for sustainable and disruptive production solutions, aligning with ⁠India’s ambition to become a global hub for sustainable fashion.

One of the key challenges for sustainable production technologies is access to funding. How does the Good Fashion Fund support innovators in scaling up their solutions?

Access to funding is dependent on the scale and operations of the companies. In general, we believe that our target investees, typically SMEs with revenues between $10m – $100m are generally well capitalised and have access to bank or Fi funding. What is missing though, is smart and tailored capital to support the sustainability ambitions – this gap is being addressed by the Good Fashion Fund. As an impact investor, we are the center of the innovator, supplier and the brand. In our investments with Sri Kannapiran Mills and KKP Fine Linen, we were able to facilitate the introduction of innovative technologies that have a positive impact on energy efficiency, waste reduction and lower pollution load.

What key factors will drive the growth of the home textile industry in this fiscal year, and where do you see the biggest investment opportunities in this segment?

The growth of the home textile industry is linked to the financial health and disposable income of domestic and international households, and further supported by the construction and real estate industry. In our recent visit to Heimtextil ‘25, we learnt that healthy growth is expected in the Asia Pacific, North America and Western Europe regions with popular segments being bedroom linen for the residential segment. We also expect a big push for sustainability, with a focus on natural fibres and more sustainable manufacturing practices in general, although polyester would continue to be a key raw material in use by the industry. The biggest investment opportunities for GFF in home textile would be in the wet processing stages, especially in reducing the impact of synthetic and salt-based dyeing technologies.

Investing in zero discharge technologies is critical for a cleaner fashion industry. How does the Good Fashion Fund evaluate and support such initiatives, and what are the major roadblocks in their widespread adoption?

We work with an extended network of international and in-country advisors and experts, for complicated and contextual technologies such as the ZLD system. While ZLD has been prevalent in India for many years, the adoption is fairly recent in countries like Bangladesh where GFF is also active. We conduct detailed initial assessments of the ZLD plans and understand the process steps involved to evaluate the expected impact, operational complexities and economics of the project cost. Incidentally, 2 out of 6 GFF investments include investments focused on installation and upgradation to ZLD systems.

The common roadblocks relate to the cost of funding as it may cost a supplier upwards of $2 million depending on the capacity of the ZLD system. Furthermore, such systems are more energy intensive due to the consumption required for removing the final percentages of dissolved solids. The energy intensity is also true for achieving a higher percentage of wastewater recovery. While the system ensures zero-liquid discharge, the brine-concentrate, a result of the ZLD system, is not easy to dispose of sustainably.

From an investment perspective, how do you define a “just transition” in the textile industry, and what role does financing play in ensuring sustainability without economic disruptions?

For GFF, ‘just transition’ means moving towards an economy that is less extractive and impactful on the planet, while ensuring that the communities and people involved are treated in a fair and inclusive way. It is widely acknowledged that climate change has exacerbated existing inequalities and inequities so it is vital to make sure that the planet and people are kept in balance. Finance has an important role to play and should not selectively focus on certain aspects of the transition alone – in which case, it would not be ‘just’. For instance, GFF values the wellbeing and improvement of textile industry factory workers who are most affected by climate change. For instance, in factories devoid of any health and safety measures, workers may succumb to high heat conditions and experience strokes that may lead to even heart failures, in extreme conditions. Women workers, who constitute more than 55 per cent of the workforce are the worst affected.

With evolving regulations and growing investor interest in sustainable fashion, how are financing strategies adapting to align with compliance and ethical manufacturing?

At GFF, our focus has always been on the environmental and social aspects of the supply chain. In general, financing strategies or other solutions in the market seem to focus on reducing emissions or the environmental footprint of the supply chain alone – this is not sustainable. The regulations from different parts of the world (e.g. EU CSDDD, EPR) and nationally in India have a strong focus on environment, human rights and better governance. Afterall, the climate crisis is not an environmental crisis alone but also a humanitarian crisis. For us, we will continue furthering our mission and strategy to ensure that we can enable a ‘just transition’ for the textile industry.