Osaka-based PEEL Lab ushers in sustainable leather

Eco-friendly fashion is making its way into our wardrobes

PEEL Lab wants to help save the world and make everyone look fashionable in the process. 

On the surface, the Osaka-based startup’s utopian vision sounds outright audacious: Create leather products from fruit peels discarded at juice factories that, ultimately, leads to the reduction of waste, emissions and other pollutants. If its plan bears fruit, the company expects to replace 1% of the current global $100 billion animal and synthetic leather market by 2030. 

The two-year-old business-to-business green tech company is manufacturing plant-based leather in a bid to win over eco-friendly millennials and Gen-Z consumers shopping for affordable leather.

“Our environmental impact is huge compared to the traditional leather industry and we look for ways to build a green supply chain and biodegradable products,” PEEL Lab co-founder and chief executive Jim Huang told TechNode Global in a 2022 interview.

Huang, who previously helmed two other startups, envisions a socially-conscious company that lessens the carbon footprint, while preventing animal cruelty.

Greenwashing society

He isn’t the only one. A corporate sprint toward eco-friendly policies – some of it mandated by the government, but mostly driven by consumer choice and social activism – has upturned the fashion industry, with more designers looking at alternatives to animal leather. The trend toward developing fabrics through orange peel fibers, algae and invasive lionfish skin, a nod to the industry’s notorious waste of resources, was underscored earlier in May at the Met Gala in New York. This year’s dress code instructed guests to wear clothing for “The Garden of Time.” 

PEEL Lab has plenty of competition. Vegan leather has blossomed from a niche alternative to a viable, even thriving, part of the greenwashing wave that extends to meat alternatives (Beyond Meat, Impossible Foods) and other vertical markets to combat climate change.

Using only low-impact materials sourced from producers with eco and sustainability credentials, PEEL Lab lays out comparisons between its product and conventional leather. Its material comes from pineapple, recycled polyurethane (PU) leather and recycled resin, while animal leather (cowhide) comes from cows and synthetic leather is polyurethane leather. Equally significant, the cost of PEEL Lab Pineapple Leather products (totes and wallets, table mats, yoga mats, and furniture) can be less than half the price of animal leather, PEEL claims.

The plant-based leather merchandise is water- and scratch-proof and lasts up to a decade without treatment. Animal leather, conversely, is not 100% water proof nor scratch proof, and requires regular oiling to last up to 30 years.

But the kicker is its climate-friendly product: PEEL’s wares emit only 2.75 kilograms (kg) of carbon dioxide, compared with 110 kg from comparable animal leather products.

The rise of sustainable fashion

Socially-conscious younger consumers seem as motivated by the latter statistic as price and product durability. The market for vegan leather is forecast to mushroom to an estimated $74.5 billion in the U.S. by 2030, according to Vantage Market Research.

Vegan leather’s appeal comes in large part from its smaller carbon footprint. The faux leather replicates animal leather (cows, pigs, snakes, sheep, horses) through synthetic materials or plant-based fibers like pineapple leaves, cactus, cork, and apple peels to achieve a similar consistency. Still, the majority of vegan leather is made out of petroleum-based plastics like PU and polyvinyl chloride (PVC).

The most visible eye candy on the market arguably is from Kylie Jenner’s Khy brand, which uses vegan leather. But an eclectic group of vendors like PEEL are pursuing the vegan option with different approaches.

Desserto (Mexico) is turning Nopal cactus into vegan leather rich in colors and textures. Banofi Leather (India) is converting banana crop waste. Ananas Anam (London), which uses pineapple leaf waste, has struck up partnerships with Hugo Boss, H&M, and Bohema Clothing. Mylo Unleather (California) relies on mycelium, the root-like structures of fungi. Malai Eco’s (southern India) material is derived from bacterial cellulose that grows on coconut water.

Meanwhile, high-end fashion brands John Galliano, Prada, and Christian Dior have dabbled in fish skin options.

The trend isn’t entirely new. In 2021, Stella McCartney, Hermès, and Adidas released products, from shoes to handbags, made using mushroom materials.

Saving the planet

A key selling point for vegan leather vendors is a predilection among a growing wave of consumers who are pursuing a vegan lifestyle and more eco-friendly options amid climate change.

The environmental hazards of leather are well-documented. According to PETA, the production system necessary to raise animals for leather (and food) requires an inordinate amount of pastureland cleared of trees, water, feed, and fossil fuels – leading to serious collateral damage. In fact, the Environmental Protection Agency warns livestock-created pollution is the greatest threat to waterways.

Indeed, the clothing industry is responsible for 10% of global greenhouse gas emissions from its supply chain and production, according to the United Nations.

Tannery waste, in particular, is laced with large concentrations of pollutants like salt, lime sludge, sulfides, and acids, environmentalists point out. And people who work in tanneries are 35% more at risk for cancer caused by exposure to toxic chemicals used to process and dye the leather, such as arsenic.

For example, cases of leukemia among residents near one tannery in Kentucky was five times the U.S. average, according to the Centers for Disease Control and Prevention.

Vegetable tanning generally avoids harmful chemicals and instead uses natural materials like tree bark. There is a drawback, of sorts, however: This form of leather is generally more expensive and not as durable as animal leather. Vegan leather products tend to have a short lifespan of just two to five years, a fraction of the decades-long lives of real leather.

For that reason, and a bevy of vegan leather contenders, the pathway to success won’t be easy. But when asked to assess his company’s three biggest challenges, Huang was blunt. "Pricing, pricing and pricing," Huang told TechNode Global. "We want to remove the stigma that innovation is expensive so we are constantly reviewing our business model to stay competitive and relevant."

But he strongly believes sustainability is the “single most important ingredient for a profit-driven organization” in today’s green-powered world. 

(This profile is part of our series of brief overviews of late-stage startups that are part of Startup Genome's Hypergrowth, a late-stage scaling program in partnership with the Tokyo government)