Shloop is The Sustainable Footwear Manufacturer of The Future

No plastic? No problem! This algae-based footwear manufacturer makes sustainable shoes to save the planet.

Shloop fights climate change through the manufacturing of sustainable footwear. The company’s manufacturing process replaces plastics with algae-based pellets, and their mission to stick to local manufacturing and locally sourced materials reduces emissions from shipping. 

I spoke with Co-founder & COO Ryan Hunt about the company, his career path leading him to this point, and plans for growing into a new-age manufacturer of sustainable shoes. 

Jacob Sheldon: Can you tell me about your company and its purpose?

Ryan Hunt: Our company, Shloop, is known as the shoe loop. We specialize in sustainable and locally produced footwear. Our operations encompass the entire shoe manufacturing process, from design to mass production. Our primary focus lies in utilizing sustainable materials, implementing innovative manufacturing techniques, and creating distinctive designs. Our mission is to expedite the integration of sustainable materials and advanced recycling processes into the footwear industry's supply chain.

Jacob: What motivated you to start Shloop?

Ryan: Over the past 12 years, we have been at the forefront of sustainable materials derived from algae. Algae is an incredibly fast-growing organism, surpassing the growth rate of plants and trees. It plays a vital role in our environment, accounting for over half of the world's oxygen production and carbon sequestration.

During this period, we founded Algix, a company dedicated to using algae biomass from environmental restoration projects to replace traditional plastics, foams, and rubber compounds. Our initial focus was on footwear brands, collaborating with industry leaders like Adidas, Vivo Barefoot, and Merrell, among others, starting around 2016. Today, we have expanded our reach, with over 100 footwear brands and over 400 footwear factories incorporating and selling our algae-based material.

However, we discovered that most footwear brands do not manufacture their own shoes. Instead, the production is outsourced to Chinese-owned or Vietnamese-owned factories, with around 80 to 90% of shoe factories in China. This became a significant issue when the COVID-19 pandemic hit, leading to supply chain disruptions. Moreover, the trade war and tariffs between the US and China added further challenges to adopting our product in China's established supply chain. Despite the headwinds we faced in previous years, the impact of COVID-19 on the industry was profound. Many small and medium-sized brands struggled to manufacture shoes due to factory closures and other pandemic-related difficulties.

During this crisis, we realized that our mission to revolutionize the footwear industry through algae-based materials was inextricably tied to convincing Chinese factory owners to embrace our product. It became clear that the best path forward was controlling our destiny. Thus, we established Shloop approximately two years ago. Since then, we have assembled a team of footwear experts with extensive experience in design, prototyping, scaling up, and high-level production innovation. Our vision is to build the footwear factory of the future, one that incorporates sustainable material libraries as a core component. Every shoe we create will be crafted from local and environmentally friendly materials.

Additionally, we are integrating cutting-edge technology, including robotic and automated machines for cutting, stitching, sewing, molding, and assembly. We are also implementing state-of-the-art knitting machines and robotic knitting technology. By adopting these advancements, we strive to offer our customers a product we can confidently stand behind.

The journey of Shloop originated from the challenges we encountered in manufacturing shoes in Asia and the realization that taking matters into our own hands would put us in a better position to serve our customers.

Jacob: What is the current stage of development for Shloop?

Ryan: Research and development remains integral to our daily operations as we construct the factory. We constantly engage in R&D activities, assessing new sustainable and innovative materials. Our experimentation extends to exploring alternative methods for 3D printing molds and tooling, allowing us to manufacture parts distinct from the current practices prevalent in Asia.

One area of our focus is the production of insoles, midsoles, outsoles, and other components that form the core of a shoe. Typically, these rubbery parts present challenges as they are predominantly sourced from Asia, with limited availability from Italy and Portugal. However, we have developed a groundbreaking technology that significantly reduces costs while enhancing our speed and flexibility in designing and manufacturing new molds and parts. This breakthrough empowers us to progress from sampling and beta testing to full-scale production swiftly. We anticipate gaining a competitive advantage in the marketplace by pioneering this technology.

Jacob: What did you do before Algix and Shloop?

Ryan: I was a physics and bioengineering student. I earned my degrees from the University of Georgia, and in 2010, I started the first company called Algix out of the university. My work focused on converting algae into products, ultimately leading to the creation of 3D printing filament. We began producing filament made from algae and biodegradable bioplastic formulations in 2015. Later, we started collaborating with footwear brands, which required us to adjust our formula. Although we still produce PLA and biobased filament materials, we no longer extrude filament. Instead, we produce pellets in EVA formulations, or elastomers, which are more flexible and rubbery. These resin pellets are shipped to factories that convert them into either foam blocks or molded injection parts. With Shloop, we buy foam parts directly from Algix or one of their converters, and then we finish the shoe by cutting, assembling, and packaging it. Our business model is premium products through mainly wholesale, as we offer a Made in America alternative to the traditional Chinese-dominated supply chain.

Jacob: What is the specific problem that Shloop is solving?

Ryan: Shloop is addressing several issues in the supply chain, including the challenge that brands face in accessing transparent and sustainable products at a fair price. Traditionally, as a product is shipped to China and then converted in factories before being shipped again, the cost increases with each step. Due to the high demand for footwear manufacturing in China, it becomes challenging for brands to create unique and innovative products and get them through the supply chain.

We provide the brands a sustainable and transparent product that they can rely on and obtain locally. We offer smaller batch runs, allowing them to start with as few as 1,000 pairs of shoes, and we also offer prototyping services. Their designers can work with our team without having to fly to China, which saves time and money.

Our approach provides an environmental benefit and improves the manufacturing and distribution of shoes. It's a great way to combine sustainability with process improvement.

Jacob: So, if I understand correctly, your solution for Bloom focuses on commercializing the Algix materials.

Ryan: Yes, that's correct. We focus on getting Algix materials into the market through Bloom, our material brand. When we talk about the pellets, we refer to them as Bloom material. Using these materials to replace traditional plastics or pellets containing recycled content, we can create finished foams with over 50% recycled greenhouse film content. Depending on the end-use application, our different formulations can have varying algae levels, recycled content, and performance metrics. For high-performance applications, less algae may be used, while more can be added for lower-impact shoe parts, for example.

Jacob: How would you describe your target customer?

Ryan: We have identified footwear brands as our best-case customers. These brands, especially the big publicly traded ones, have reputations to uphold and are under increasing pressure to invest in environmentally friendly materials to reduce their carbon footprint and improve their ESG (Environmental Social Governance) policies. We secured Adidas as one of our first major adopters because they have been measuring their ESG and their shareholders are asking about how they're improving their carbon footprint. Using Bloom, our material brand, footwear brands can easily incorporate and improve their ESG metrics. However, it's important to note that the materials only make up about 30% of the impact of a shoe, while the manufacturing process accounts for almost 60%. We are working on solving the bigger sustainability problem these brands face, which includes the need for more transparency and high carbon footprint associated with manufacturing in China. Using sustainable materials and manufacturing locally, we can dramatically reduce the carbon footprint and create a product with a massive value proposition at a competitive price point. Our focus on footwear brands is because we can help solve a specific problem they have. Our solution is geared towards dramatically improving the efficiency and sustainability of footwear manufacturing.

Jacob: Let's talk about sustainability. How do you measure and track your climate impact?

Ryan: We quantify our environmental impact using the lifecycle assessment (LCA) method. We conducted two major LCA reports in 2014 and 2021 for the raw material at Algix, which underwent third-party peer review to evaluate the CO2 emissions, water ecosystem impacts, human health impacts, and energy impacts. We have peer-reviewed data for the raw material, but we're just starting for the factory, and it's more of an estimation until we optimize and refine our processes. Nonetheless, as we are a primary data provider, we plan to continue this work to provide accurate measurements for our customers and enhance their confidence in our data. We have attempted to obtain information from some Asian factories, but getting this kind of information is challenging.

Jacob: It seems like the big footwear brands could really benefit from your work. How active have they been in supporting you?

Ryan: They haven't been very active at all, to be honest. We're not even targeting the big brands at this point. It's too early for us to try to land a deal for a million pairs of shoes from one of the big companies. We're focusing on smaller to medium-sized brands instead. We've met with them, received letters of support, and have continued to receive feedback and calls from them. These are startups  or small brands with some shoe experience, but we're not bringing in new people who have no idea what they're doing. Working on these types of projects helps us get our training wheels spinning and off the ground. Eventually, the big players may come knocking on our door, but we're still getting ready for them.

Jacob: Tell me about your team.

Ryan: We have a really cool team of 18 people now, which is quite a leap from the four of us less than a year ago. Our core team consists of some of the original members of Bloom Algix, including two co-founders and two former employees. We've combined that with two highly experienced footwear professionals: one specializing in luxury Italian craftsmanship and high-end products, with expertise in prototyping and turning design concepts into actual samples; the other, Peter, is a sneaker guru with experience in innovation, scaling up, and mass production, having worked for major brands such as Nike, Converse, Asics, Timberland and New Balance. By working together, we can seamlessly go from novel design concept to mass production without relying on external development and factories in China. This is because most footwear brands, especially recently, have lost a lot of their development expertise and instead rely on Asian factories to handle the details. This approach creates a lot of problems and limits creative possibilities. For example, if a design concept is outside the box and the factory doesn't want to figure out how to produce it, they may decline the project. This has happened to us before, but we push for more creative freedom and flexibility.

We heavily rely on our two footwear experts to guide us since we've only been in the business for five or six years as a supplier. We were fortunate to find competent and high-quality stitching talent when the Lazy Boy factory closed in our town in Mississippi, and we're now almost 90 days into training them. They're picking it up and turning things around, which is a big factor for our success. We've also strategically brought in robotic technology for knitting and stitching to support the human workforce and take some pressure off them. This helps us make products consistently and without quality issues, especially for higher volume production.

Our most recent initiative is training a team of a dozen shoe technicians in their early 20s to make shoes from scratch. These jobs are long gone, and we're excited to teach young people everything from designing and patterning to cutting, folding, cementing, stitching, lasting, and sewing. We have a creative team of men and women looking to scale up our efforts to make more sustainable and interesting local products.

Jacob: How do you see your costs and margins scaling?

Ryan: It's tough right now because we're just starting out. But once we get past this initial hurdle of setting up the factory, acquiring equipment, and fulfilling some orders, we can keep chipping away at costs by incorporating automation and efficiency-building software, particularly around our molding technology. As we become more self-sufficient and less reliant on importing soles and uppers, we can improve our cost position, making us more competitive with China. Even though our labor costs are higher, we can offset some of these inflationary costs by cleverly managing shipping costs, tariffs, and duties. Inflation in China is not going down, and as a result, we see the overall trajectory of cost upward. This makes it easier for us to hedge inflationary costs in China, maintain our competitive position, and make shoes that are unavailable in China. We can also customize and create unique shoes using new sustainable materials not widely available in Asia. So, even if we cost more, we provide a way better product than you can’t get from China, which is much more Italian than Chinese. We don't want to be an alternative to cheap products; we want to make premium, unparalleled, luxury products.

Jacob: How much will the end consumer pay for your products?

Ryan: That depends on the style and brand of the product. Our low-end products will range from $80 to $100 per pair, while our high-end products will be priced at $500, $1,000, or $2,000 per pair. We're designing limited-edition shoes, and working with celebrities and influencers. The prices vary depending on the product.

Jacob: What is one thing your team does really well?

Ryan: Well, because we're merging different philosophies, mindsets, and capabilities, we're ending up with something that is the key to innovation. It's not necessarily coming up with something totally new, which is more like research or invention. It's more like taking what we have here, what we have, and what we have over here and combining these proven elements into a new product that works differently. And that's what we've been doing. We've been merging classical Italian quality craftsmanship with robotics, automation, digitalization, 3D printing, natural materials, and disruptive design - designs that don't look like something you would find at DSW. They're very different. We're designing shoes that are still beautiful but just different. One of the key things we're doing right now is putting our own twist on things, which keeps us competitive. You won't see this in other China factories yet. Eventually, they may copy us, but we want to be the first. Since we're using interesting materials and have proprietary conversion technologies and processes, we can make things that can't be made any other way. We have exclusive licensing of this technology in the US and worldwide, which puts us in a very competitive spot in terms of making things that others can't do.

Jacob: What's one thing you've struggled with and overcome?

Ryan: It was the driving force behind the company's breakthrough in the status quo supply chain by getting factories in Asia to adopt our model. The development of our materials has brought us to this point where we are almost ready to open our factory. We have design studios here that make prototypes, and we have a range of shoe styles, some of which are normal-looking while others are more unique. However, our current struggle is getting brands to understand our vision. Some brands view us as a US-based Chinese factory replacement, which is not what we are. We want to be treated differently, and we want our customers to use our abilities to differentiate themselves. We have only talked to a few brands, selectively choosing those with a large portfolio. They could use what we offer to stand out and be competitive against their competitors. But, for this to work, they need to take the bait and try new things. Some brands want us to make a normal shoe at a low cost, but we question whether that's our best use of time. Educating our customers on our value proposition, including both the brands and retailers, is key. Once we are ready to go to market directly, we plan to build our own brand, which we have trademarked. We can't release the name yet, but the idea is the Black Swan - a small event that changes the course of history. That little nugget of information that changes everything is what we're after.

Working with algae, we discovered its potential as a material for consumer products. Before, it was mostly an idea for biofuel or a spirulina supplement for smoothies. Now, over 100 brands use it daily in their products. However, adoption has been slower than we hoped, and we think Shloop is the next-level thing. It's in response to COVID-19, which disrupted our supply chain. We are developing a new manufacturing model that is different from anything done before. This will inspire others to do similar things and inspire footwear brands to rethink the possibilities of manufacturing, product design, and sustainability.

Jacob: What's one piece of advice you have for other entrepreneurs?

Ryan: I've always liked the Steve Jobs quote, "Stay hungry and stay humble." Starting a business is all about people, relationships, and a lot of hard work. Everyone wears many different hats and needs to be flexible, delivering results on multiple fronts. As a leader, it's essential to lead, not boss people around. Being humble is also important. From a business perspective, there's the 10x rule. Our business could try to make shoes the same way China does and maybe be successful, but we can't rely on doing things the same way as everyone else. To succeed, we need to find ways to be 10 times better, whether it's cutting faster, being more environmentally conscious, or having quicker time to market. The goal is to find that next order of magnitude on as many fronts as possible to differentiate ourselves and increase our chances of success. One good differentiation factor is great, but having several is even better.

Jacob: What's currently keeping you up at night?

Ryan: Right now, the delay in getting our occupancy permit for the factory is causing stress and anxiety. Once we're in the factory and everything is rolling, I'll be able to sleep better. However, my biggest concern is how to create an iconic product and build a brand around it. We don't want to make more cheap shoes; we want to make high-quality, beautiful shoes that people seek out. Our goal is to build a brand around disruption, sustainability, local manufacturing, and customized customer experiences. I think about this in the evenings - how to reach our ultimate potential and create a brand that truly stands out. If we can achieve this, then I'll be able to rest easier at night.

Jacob: What’s the biggest challenge you’re facing right now? 

Ryan: Raising capital is always the toughest one for us. The markets have been weird, and after starting a company and meeting customers and brands, getting grants, and doing a bunch of stuff, we went to the bank to fund our sneaker factory. However, getting traditional banks to fund us took a lot of work. They saw us as just a startup company and said we needed to find a VC to partner with because they were not our partners. Being in a conservative area like Mississippi, we struggled and it took us a year and a half to finally get funded. We were fortunate to have angel backers who were interested in what we stood for and liked what we were doing to invest into growing the local community. The next challenge is hiring and training the right people and ensuring we have the proper operational policies and standardized processes to get the job done.

Jacob: What is your overall vision for the company?

Ryan: The mission of Shloop is to accelerate the adoption of sustainable materials and technologies for footwear manufacturing, and that's really our main goal.

Jacob: What’s the best way for people to connect with you?

Ryan: You can connect with us on our website and find me on LinkedIn. 

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