After a couple of subdued years, investors are warming back up to fashion startups.
Fashion companies globally have raised $1.1 billion in venture capital investment so far this year, according to startup data platform Dealroom, which is already equal to the total amount invested in 2024.
Some of the largegest notable venture rounds raised this year are: India’s cross-border sourcing and supply chain startup Geniemode, which completed a $50 million series C round in February; Portugal’s textile defect detection software startup Smartex AI, which raised $40 million in May; and California’s Archive, a software startup that enables existing brands to add an omnichannel resale strand to their business, which raised $30 million in series B funding in February.
It may come as little surprise that many of the fashion tech startups that investors are backing this year are built around AI — from consumer-facing personal shopping AI agents to B2B software startups that promise to build brands’ supply chains more sustainable. The fresh wave of fashion tech startups that have raised funding in 2025 have also been launched by a cohort of experienced founders — from AI personal styling agent startup Alta, whose founder Jenny Wang cut her teeth at Doordash and Re-Inc, to AI avatar virtual test-on startup Doji’s Dorian Dargan and Jim Winkens, who between them held previous roles at Apple, Meta, DeepMind and Google.
Thanks to the AI boom — and the fact that plenty of retail’s pain points remain unsolved — a new crop of fashion tech startups are ripe for funding. Here’s who investors are eyeing.
AI-powered shopping
Nectar Social
Launched: October 2022
HQ: New York
Latest round: $10.6 million combined pre-seed and seed in June, led by GV and True Ventures. Joined by Bam Ventures, Charge Ventures, Fab Ventures, Flying Fish Ventures, Mercury Fund, Trust Fund by Sophia Amoruso and XRC Ventures.
What does it do?
Nectar Social describes itself as an “agentic community management and social listening platform” that’s aiming to funnel consumers’ social media interactions with brands into direct purchases.
Why Nectar Social?
Just like affiliate marketing, sometimes brands struggle to measure how much their traction on social media actually converts to sales. “Misbah and Farah Uraizee, ex-Meta product leaders and sisters, are tackling one of the thorniest pain points in modern retail: how do brands keep up with millions of conversations happening in comments, DMs and UGC across TikTok and Instagram?” declares Amy Wu Martin, partner at Menlo Ventures, who invests in consumer-facing startups across AI, fashion and gaming. “They’re building the connective tissue between real-time customer interactions and brand response — so high-growth brands can turn comments into conversion and DMs into a curated customer journey. I see this as part of a broader shift towards one-to-one, high-context commerce, where loyalty is won in micro-moments.”
Alta
Launched: 2023
HQ: San Francisco
Latest round: $11 million seed in June, led by Menlo Ventures. Joined by the Arnault family-backed Aglaé Ventures, Benchstrength Ventures, Conviction, Phenomenal Ventures, and angels including Doordash co-founder and CEO Tony Xu and Poshmark founder and CEO Manish Chandra.
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