The Everlasting Pursuit of Sustainable Footwear with Domagoj Boljar | Fashion Made S4E2

Through a really long process of maybe 6 years, we developed these sneakers that are based on 7 to 9 plant-based materials and New Zealand wool with the goal of creating a sneaker that's zero toxic for nature, zero toxic for humans, but also completely void of plastics and toxic chemicals. Yeah.

Welcome to another episode of Fashion Made. Delighted to have you, Domagož. Domagož, you are CEO, co-founder with your brother of Earthbound and Mira. I find it really exciting. Last time we spoke, I'm just like, yeah, I've been looking forward to this one. Not that I don't look forward to all of them, but yeah. Welcome to the podcast, Domagož. How you doing?

I'm doing great. Thanks, Steven, for having me.

Nice, nice, man. So I'd love to just kind of dive into this straight away. And just maybe if you could tell our listeners a little bit more about, first of all, what Earthbound is, because there's lots of sustainability products, uh, in, in our— or supposedly sustainable products in, in fashion at the moment. So maybe if you could just give us a bit of a background on what exactly it is you guys are doing there.

How Earthbound is primarily a vision, uh, of completely redesigning the footwear and also completely rethinking how the footwear industry operates and does things. So, we come from a footwear background, footwear developing and manufacturing background where we did the development of luxury sneakers for European high-end brands. But, at one point, we said, "Okay, it's enough of doing this and let's try to use our expertise to try to change the industry from the inside out." And so, the only way that we saw going forward and actually changing the industry is leading by example. So, we decided to use our expertise to redesign shoes from the bottom up. And, what we did is we created Radically Ecological Sneakers. So, a physical manifestation of our vision are the sneakers that we create. So, they are 97% carbon bio-based and our primarily filter how we do anything is ecology first. Human health second and everything else is third. So, yeah, through a really long process of maybe 6 years, we developed these sneakers that are based on 7 to 9 plant-based materials and New Zealand wool with the goal of creating a sneaker that's zero toxic for nature, zero toxic for humans, but also completely void of plastics and toxic chemicals. Yeah. That's the gist of it. Amazing.

Amazing. And in terms of how you and your brother came to have this as your sort of lifelong life's work, how did that come about?

We can talk about several stages. Stage number one is that we grew up in an entrepreneurial family in Croatia. Our dad was an entrepreneur even before Croatia became independent. He was a tech entrepreneur, but Then, in the '90s, he switched to building his own local regional shoe brand, Classical Shoes, and building his own factory. After that, we decided that we want to pursue in our father's footsteps, no pun intended. Even he was actually opposed to that because he wanted us to move beyond the footwear industry, but we were persistent. So, my brother studied, he's a master of industrial design and I'm a schooled entrepreneur actually by education and by vocation. So, we always as kids did projects together, be it a band or restoring an old-timer or doing all sorts of things together. So, in 2008 when we were like halfway through college, we decided to help our father build the business even further. But it kind of coincided with the Great Recession, which Croatia was severely, severely hit by. And at the same time, our father got sick. And so, from going to building his company, we were actually involved in crisis management and trying to turn around the business that was inevitably failing. So, we were kind of at a really young age, stuck with running a business that we were really not happy with. But then, at one point in 2011, '12, just about the time our dad died, we kind of transformed the business into a development studio for luxury brands from France and Holland. We became the go-to guys for developing and producing something crazy and companies would approach us with a design or a sketch or a project. And our goal, our mission, our task was to bring this idea to a prototype and then also to serial production. And we were quite good at it. But my brother especially, he was quite discontent with that. It was a tough Tough job. It was rewarding because we made a name of ourselves, but financially it wasn't that good. But also from the value standpoint, my brother had a real issue with it because we had this rare opportunity to see the industry from the inside out. Now, we saw the industry from the production side, from the development side, but also we saw it from the consumer side. And also we saw it from the side of material manufacturing, sourcing, waste management, all the nooks and crannies of the industry, with all the good, bad, and the ugly. And my brother on an emotional side just couldn't pursue it anymore. So, as he asked me like in 2016, like, would you He asked me would I provide him with some resources, with some time to try to develop something totally different. So I always kind of, when I look back, I say that we were like 99% emotionally invested in this project, but we only had 1% of finances and 1% of time to actually pursue it. We were always working on the sidelines, after hours on this project, trying to bring it to life. And in 2018, we were almost there and we wanted to create a spin-off company and have this as a side project that would have a life of its own. And then we had a black swan event where our industry and our clients were having a really tough year and we had a sudden drop in orders. And so in 2018, in spring, we had to decide to close down our workshop, closed down our factory, which was really, really painful emotionally, financially. And we had to take a year to kind of try to wind down that operation as— what would be the word— as dignified as possible. So, we actually— yeah, it was tough. It was tough, but we kind of we kind of kept our face, you know. But after that 2018, we came into 2019 completely emotionally drained, financially drained, and we were on the verge of splitting ways and completely abandoning what we did. And then, there was this spark, this light at the end of the tunnel where a good friend of ours who was deeply into, and still is deeply into zero waste, Lifestyle. He shared an application, a call for applications for an accelerator program, and this accelerator program was run by an incubator in Zagreb but was supervised by European Institute of Technology, and it's called ClimateKick. It's basically for early, early startups to develop ideas on for climate and sustainability projects and try to bring them to life or maybe try to get a product market fit or an MVP accelerated and to see where it goes. And we were quite reluctant at that point. As I said, we lost this sense of direction, sense of self-confidence, but we applied and we did our first ever pitch deck and we actually got in the program. And that was, yeah, that was a pivotal moment because we kind of first, it was the first time that we understood that people value this and see value in the project, but also gave us a slight push. It was, it was, it was minute. It was like €15,000 and some mentoring and stuff. But from that moment on, it kind of snowballed and it was also a really good point in time because Croatia, not just Croatia entered the European Union in 2013, but in 2019 we were also getting close to adopting the euro and some investment funds, VCs and private equity funds started operating in Croatia. Also at that time, sustainable fashion was becoming a thing. Awareness was growing among customers, industry and all other stakeholders. And yeah, that's the shortest way. How can I tell the story?

Yeah. So that's really interesting. And I think we know, Domagož, that fashion has a pretty destructive footprint on our planet, whether you believe climate change and carbon tunnel vision is really what we— you know, there are two factions there. There's no doubt that we have a responsibility to mankind, to humankind, to the planet. And so I'd be interested in your time in footwear because obviously as a family, you've been in this sector for many, many years. What are some of the more sort of shocking things that you've seen specifically in the footwear sector?

So mind that all of the things that we've seen and experienced were in the EU. So this is local. We're not talking about third world countries. And in EU, like human rights are a given, you know, like minimum wage, agenda and work safety, but ecology really isn't a thing. So, things that we've seen, I'm going to tell you a couple of things. One is when you use leather, we are not opposed to leather per se. We are opposed to the leather being tanned by heavy chemicals and tanneries being really, really chemical intensive. This is just something that cannot be avoided. So, when my brothers have seen tanneries or factories pouring out excess glue or what's the English word, solvents in the drain because why not. We have seen factories using excess outsoles or components in their heating system like, okay, we use firewood and then we also use outsoles. We've seen tanneries in our region just piling up waste and not disposing it, just keeping it behind the factory. There is one crazy fact that when you cut leather for shoes, the usage, the maximum usability is like 75 to 85% of the surface because it's impossible to use all the surface in a shoe. So, the rest 15 or 25% is waste. This waste is considered to be hazardous. Hazardous. So, you need to pay extra to actually have it separated in a landfill in a special place so it doesn't affect the groundwaters. But where is the other 75% and 85%? It's on our feet. So, why is the rest considered hazardous and what we wear on our feet is not hazardous? Okay. But then, when we use the shoes, you have to throw them away because at the end of the life cycle, they're thrown away. Maybe you give them to a thrift store or maybe you really use them to the max, but in the end, it becomes waste. So, you throw it in the bin because there is no other way to use it. So, in the bin, all of these parts are fused together in a way that you cannot separate it. So, there's leather, there's lining which may be another kind of leather or some polyester, there are sponges which are also plastic-based, there's the outsole which can be rubber or which can be plastic. So, all of these 7, 8 kinds of glue, all of these cannot be separated. And have to be thrown away as a package, but parts of it are considered hazardous waste. So, that's a shocking revelation. So, and then the next shocking revelation is how many shoes are bought each year, like 20 billion pairs. There's only 8 billion people in this world and most of them don't even have money to wear shoes. So, overconsumption, the way those materials are made, the way they're disposed, the way that the factories cut corners, All of these segments are crazy. So I couldn't put my finger on a single thing, but if I would do that, that would be using waste as heating fuel.

Yeah, that's pretty shocking. And I mean, as you're talking, it just gets me thinking because we've been in this space for a long time and we work with a lot of inspection software, supply chain inspection software companies, and some of them, you know, behind closed doors or at the bar will tell us about some of the factories they visit and, you know, echo some of the things you've said there. One thing that I think— well, I certainly haven't seen much on it— is the fact that, you know, our skin is permeable, right? That we are a living, breathing, functioning, permeable entity. And I'd be interested to know whether that's something you've ever explored, like the effect effects that these chemicals have when they're entering our children's bodies and our bodies through sweat, for example. Is that something you've ever looked at? I mean, it's a bit macabre, but it is a fact, right, that we're wearing chemically covered clothing, right?

I haven't gone that deep personally. That would be a question for my brother who's gone much deeper in that. But I can tell you from my personal experience, when I wore shoes, even with the highest quality leather, chromium-free, and and whatnot, I always had problems with my feet. I always had some blisters, always had sweating, I always had something, always had something, always had a rash of some kind. Since I've been wearing our Ecotex-certified sneakers, I don't have these issues anymore. It's not just a commercial for our shoes, but it's a wake-up call. When we buy shoes for our kids, we really look into the materials that are used for pacifiers, for underwear, for diapers. But, shoes are like not something that's really getting that level of attention even for ourselves or for our children. So, that is one of the things that we take care of. Your question was, what are the effects? I personally don't know, but the effects are long-term. I'm not going to go into the conspiracy theories, but there are a lot of chronic diseases and chronic illnesses that we cannot really put a finger on where do they originate. And, I think we live in a toxic heavy world with food that we ingest, with air that we breathe, and also with anything that touches our skin. So yeah, I think—

I couldn't agree more. I think it feels like humanity's at a bit of an inflection point, which is kind of being driven by AI, but politically as well. Kind of your mitochondria and your metabolic health is coming to the fore. And of course, you know, there is going to be origin sources for that, that are, as you rightly say, to do with the way that we live in this sort of modern world. So one thing I'm really interested in, because I love the look of the shoe, right? The sneaker. And I wear, like, personally I will wear like Chelsea boots or trainers, or, and I have certain brands that I like. Um, how, how scalable across different sort of sub-verticals of footwear do you see your methodologies in this protocol becoming? Which is to say, at the moment we can make a lovely sneaker, but if I want a smart Chelsea boot that has the same level of of fastidious sustainability and ecological footprint. Is that going to be possible?

Oh, I think it's a long route. It's going to be quite difficult. I think I can start answering your question by saying that sustainability in footwear and fashion is still an umbrella term. There is no real one perfect solution for sustainability. And I think all the companies and all brands that are really tackling sustainability are tackling it in their own way. So, we are, I would say, just one school of thought. This radical ecology is just one school of thought. Like, high quality is also one direction. Repairability is another, or buying something that's high quality even though it's not maybe completely sustainable, but wearing it for a longer period of time is also one direction. Another direction is like really taking care of of the social aspects and of the suppliers and the whole chain in a social sense. So our ways, our direction of radical ecology is maybe not so easy to scale, but even if companies adopt some part of this recipe, it would on a grand scale bring impact. But design-wise, definitely what we had to do do is completely revamp the way that technically the shoe is made. So, for example, when we used to work with high-end luxury brands and we were able to develop a completely new style of complex design and bring it to a prototype level anywhere from a month or 3 months, for this shoe to work on a technical level, it took us basically 5 years. Which just shows the limitation of ecological materials to reach the same level of technical ability, of durability or whatever that a classical shoe or a plastic shoe even has. So, what we've been trying to do is find suppliers that will help us go into this, as you said, Chelsea boot or a classical shoe or a sport trainer, but it's been quite difficult. For us, it's even more difficult because of the insane high level of ecological filter that we put in our process. For someone else, it might be easier if they don't have such high standards. You know, we took the more difficult road for sure. Uh, and it's, yeah, but we are sticking to it and we'll see where it gets us.

No, it's awesome, man. And if something's worth doing, you know, if something's worth doing, do it properly. And, um, I'm sure that there will be some brand partnerships that you'll, they'll work on over the coming years. And that possibly opens up larger development teams and larger resource. Um, but I think that, I think that the fact is that what you've done, you and your brother have done is, is not accept any halfway house, right? And so those ecological standards, whilst they're very hard to meet, you know, you can hold your head up high and say, we've done something that nobody else has done. Nobody else has these certifications. No other company has gone to the lengths that we have to make this viable. So I think it's really awesome, man.

What's really cool is that some of our investors are not impact investors originally. And, at one point, I think it was a year ago, we are offered some kind of collaboration where we would have to make certain adjustments. Let's say, okay, our shoe wouldn't be 97% carbon-based but rather would have to be somewhere around 70%. And, I was considering, should we do it, should we not? And then, I talked to my investor and he said, "No, no, no, no, don't do that. Don't do that. Don't dilute your vision and mission," which was completely opposite of what I expected from my investors to say. You would normally expect for them to say like, oh no, if you have the opportunity to sell, sell, it's a business. Yeah, but they were like, no, no, no, keep the vision, keep your, yeah, keep your vision and stick to it and see where it gets you. Exactly. But it's not just about the materials, it's also, as you said, resources because we are based where we are based. We are based in Croatia, which is part of the EU. EU is much slower in in funding innovation compared to the US. Croatia is much slower than the average of the EU. So it's definitely a tougher road even with that.

And in terms of sustainability, Tamara Gaš, obviously we've seen and we're seeing constantly the kind of proliferation of of fast fashion, and it's almost a race to the bottom in terms of cost. And you know, you see some of the, some of these organizations, the bigger, more disruptive ones, you look at some of the chemicals that are in some of the clothing. And of course, listen, they have shareholders and they have, you know, margins to hit. And of course they're going to continue with what you would classify probably as reckless abandon. For to make more money, to make their shareholders happy. How do we change that? How do we change real, really change consumer behavior? I mean, I know I have my opinion on it and I think it's gonna be imposed rather than happen naturally. I don't think humanity based on the way our structure is, I can't see things changing unless they're forced to. Do, but I'd be interested to get your take on it as well.

Oh, it's one of the biggest conundrums of our time. When we, in 2020, we kind of saw this shift and we saw this momentum for sustainability. And I think we were really on a good track as I'm talking about the West and then Corona hit and then these geopolitical instabilities hit and you could see a sudden huge swift switch or regression on the Maslow scale. People were immediately abandoning these, I'm not talking about individuals, but on a general level, you could see people again trying to fulfill their basic needs, safety, food, basic clothing or whatever because of fear, because of falling disposable income, but also this insecurity. And you could see that still, unfortunately, the pursuit of sustainability, ecology, and fight for the common or greater good is something that people tend to abandon quite fast when they're faced with existential issues. But there's another big thing that happened is like also fast fashion was being singled out as an evil that needs to be rooted out. But then came Temu, then came Shein. So I think it's part of a trade war. It's part of geopolitical war that we are being flooded by garbage, but also I I think our industrial base and our trade base is also being destroyed by it. And I think governments will need to take action, not just because of sustainability, but also for our future. I think it's a bigger and wider picture. But being imposed, I'm not so sure about that. And I'm not sure if that's a solution. So our approach was one of We are not speaking against other brands, but rather providing an alternative. So consumers need out-of-the-box solutions for their problems. But if that problem also tackles an environmental issue, that's a bonus. So people, consumers should not be the ones responsible for educating themselves, should not be the ones responsible for paying more more to contribute, but rather should be provided with solutions that cover all of these at once. So, a sustainable shoe in that sense needs to be comfortable, needs to be durable, needs to be affordable, and needs to cover ecology and human health at the same time. So, what needs to happen is that the industry should see that there is money to be made. So I still believe that capitalism in its true form is a solution to problems and should be. So will it happen and how fast it will happen? I'm not sure about that.

Yeah, no, it's an interesting point and there's a lot to unpack there, but basically, you know, the idea that like whilst the fashion sector is very much— should hold itself to account, that there are much bigger forces at play that drive consumer behavior, right? Much, much bigger. And some of those, you know, the fashion industry itself just has to sort of learn to work around rather than change fundamentally. But yeah, I mean, I think that the other part of that is just everybody having a bit more agency. And like you say, the reality is we still want to look good. That's the human condition is we want to look good and we want to make sure that what we're wearing on our feet and what we're wearing on our bodies is sort of speaks to who we are. And so I'm really intrigued. I mean, listen, I love the look of your shoes. I think they look amazing. And I know that you're actually coming to one of our events next year, aren't you? You're speaking for us in Portland at Stride. Is that right?

Yeah. Finally. Finally across the pond.

Yeah. Awesome.

I'm quite excited on sharing my vision with our peers from major corporations and trying to make an impact. But we're also developing something that by then should be quite interesting in that sense. And maybe that's a subject for another podcast in a couple of months.

Okay. Can you give us a tease? Can you give us a tease of what it's going to be?

I will. We are trying to to move beyond just selling shoes and into providing technology. And I'm going to be as vague as possible and as precise as possible here. So, I think the global consumption will move into more regional or localized production and consumption. And we want to provide the technology that will enable smaller brands to be able to customize outsole production and also produce it on-site and also produce it in an ecological sustainable way. And I think that will be, if we manage to develop this to an extent where we hope we will, it will open up possibility for smaller brands to increase their design capability and not be really dependent on huge development costs. So I think that will also drive sustainability. I think we didn't finish the last question is, as you said, design. I'm going to just maybe focus a bit more on the consumer. And I think we should never blame the consumer because he's a part of the zeitgeist, you know. And in our view, we tend to live in bubbles, communication bubbles. So, if we are into sustainability and we are startups, so we are basically in a startup bubble and also in a sustainability bubble. So, when you talk to people who understand sustainability or learn about sustainability, you get this idea that people, that the level of awareness has really risen. But I think it hasn't, but it's just a part of the population that's really into that. But that's fine. Even people who buy our sneakers or other sustainable products and invest in these companies in a way indirectly without having this ecology or sustainability or the social component in mind, they're still part of the solution. So, it really doesn't matter if people are buying our sneakers, for example, because they like them or because they like the vision. I think it's equally okay. And I think it's more for the industry to change and offer people more of what they like, which is also sustainable. That's my view. And the government, I don't trust in government. Government tries to offer solutions, but in the end, often it produces the opposite, like the road to hell is paved with good intentions. I think the role of government should be minimal still.

With that in mind, what's your opinion on the digital product passport that's being pushed in through the EU at the moment? Do you have much of an opinion on what's happening there?

I have no knowledge of that because—

Okay. Well, it's gonna cause some difficulties, I think, from some of the enterprise brands that we're talking with, it's another layer. I mean, the idea behind it is, I think, as you say, is probably wedded in goodwill. But the reality of these situations when you're dealing with billion-dollar brands with suppliers all over the world— and one thing I do find quite interesting is this idea of greenwashing, right? And that will be a term that's very familiar to you. And this idea of sustainability in fashion and traceability, right? Not that blockchain's used much, but let's just talk about traceability. So if I'm buying this jumper and the wool and different elements are coming from different places, quite often it seems to me that traceability doesn't actually start at the beginning, at the materials, because quite often I think some of the— you know, I think there there is— what do I want to say? I want to say this nicely— some skullduggery around the different farms that are used to source different materials. And so I'd love to know about your experience of that over the past sort of 15 years. Yeah.

We've been into this ecological sphere since 2014, '15, were like the first steps. So it's basically less than 10 years, but I want to go back 10 years ago, one of the biggest issues that we faced is not just finding suppliers who have some materials that we could use, but availability of their— so how to get their data sheets or lab results or anything. There was no transparency. And that was the most difficult part because we were often presented materials from the industry that were labeled this and that and this and whatnot. And that was all either greenwashing or pure blatant lying or there were no standards. Then, there still are very limited standards and certifications available, especially for a small brand. And then, if you want to go into traceability to the farm or to the— then, you have to just— for a small brand, it's almost impossible. Then, you'll again trust certifications and certifications such as Cradle to Cradle or something that should be trusted. So, to what extent can you trust certification? To what extent not? It's a mess, you know, and having all of this certified in the end will again drive cost, which will cause green products to become even more expensive. You know, like you have this thing called the green premium and Basically, we also have it because if we want to prove our claims, we need to get certified. If we want to provide quality, we need to choose these materials that are high-tech, new, and really expensive because the raw materials that are in, uh, weaved into these materials are also expensive. So I don't know, I don't know.

What's, uh, it's a, it's a, it's an interesting one. I mean, and from your perspective then, so what, so what's next then for, uh, for Earthbound? Obviously I know we're gonna have you, um, join us at Stride, which is a really exciting event. And I'm excited. And, and obviously you've told us that there, there's a possibility that there's some, a technology that can be implemented for some of the smaller brands. But, uh, and I'm assuming that there's, you are open to working with the enterprise brands as well and possibly doing collaborations? And what's the sort of 5-year plan? Where do you want to be in 5 years with the brand?

I think you already kind of outlined it. We want to pursue two rails, or I don't know if that's the right word. Yeah. So we want to continue building our direct-to-consumer business and using it as a showcase and expand it into collabs. So, collabs with major brands would be perfect where we utilize our recipe approach, our certification, and try to incorporate that into a company that can actually utilize their brick and mortars and their web shops and their exposure into a collab. So, how we see ourselves is sort of like Gore-Tex for sustainability. So we want to put our stamp on someone's new development that we would then approve in a sense. And the other rail is to be a technology provider in producing and developing new ecological materials that can then be implemented by everyone. And those are the two directions where we want to go. We would like to stay independent But I don't know if that's going to be a feasible route for us because getting the amount of working capital that a small company would need to grow is quite difficult because it's from my side, it's hard to get working capital from VCs because they basically don't fund working capital. And on the other side, it's hard to get funding from traditional financing institutions such as banks because you don't have the the revenue or the collateral needed. So, what we want to do is find a strategic partner that would help us grow, that would help us in a way that the partner provides infrastructure that we don't have. But it's really important for us to keep our vision and mission. And this is why we became the first Croatian B Corp certified company. Number one, it was to find a way to preserve our mission in the steps that lie ahead.

Amazing, man. Amazing, man. I also wonder from a science perspective, probably more a question for your brother, but whether discovery of novel sustainable materials that have the density or the functionality that one needs for a jacket or a raincoat or a pair of shoes, choose, I wonder how quantum computing and AI are going to affect the speed of those discoveries. Because if you look at some of the things that I've been reading, that our world is going to change in terms of discovery exponentially over the coming few years, specifically with quantum computing. So that's very exciting as well. And it'll be great for you guys because you're here. You've done it with the tools that we have had available over the last 5 5 years, and I suspect that it might be— it might become easier for you to branch out on that second rail into that material world. And, and I, of course, then I guess it doesn't have to stay with footwear, right? It can— it can—

exactly, exactly. Yeah, as I said, as I said, the brand and the shoes are a physical manifestation of the values behind it, and it turned out to be shoes just because we had the technology and the knowledge of the industry. But exactly, I think with using the same mindset, you can really branch out into other stuff. Yeah. Amazing. Amazing.

It's exciting.

It's difficult to build this as a startup, but it's quite exciting. And I think going to Stride and being in such esteemed company there quite soon in 4 months is something that I'm not just excited to experience, but it kind of shows that we have a place at the table and that we have a voice and we're going to try to use it.

Amazing. As much as we can. Well, we're excited to have you and I think I'll be there as well. So that'll be fun. You can buy me lots of beers and yeah. But yeah, really, really nice to have you on, Damir Gračić. I just find it really, really exciting and well done for where you've got to now. And we're excited to be with you as that journey in 2025 continues, man. Um, so yeah, thank you very much for joining us today.

Thank you, Stephen. It's been a pleasure.