Reimagined department store concept Neighborhood Goods on Wednesday said it will open in early 2020 its third location, a 10,000-square-foot unit in Austin, Tex. The retailer in November 2018 opened its first store, a 14,000-square-foot space at Legacy West in Plano, Tex. Later this year, a 4,500-square-foot store will bow at Manhattan’s Chelsea Market.
The retailer also said it has completed a Series A funding round that raised $11 million and was by Global Founders Capital with participation from long-term investors including Forerunner Ventures, Serena Ventures, NextGen Venture Partners, Allen Exploration and Capital Factory, among others. Matt Alexander, cofounder of Neighborhood Goods, said he expects the fund to expand a bit in the next few weeks. With $14.5 million in seed funding previously raised, the new financing brings Neighborhood Goods’ total funding to $25.5 million.
Alexander said the Plano store continues to experiment with the ratio of discreet spaces for brands and blending brands, which can create a sense of discovery. The Plano store’s assortment includes Rothy’s, Dollar Shave Club, Fossil, Cynthia Rowley, Taschen, and long-term mainstays Stadium Goods, Draper James, Buck Mason and Primary, among others. About 16 new brands will launch in Plano over the next six weeks.
“We’ll have close to 60 brands in Plano,” Alexander said. “That’s close to triple what we had when we opened. Stadium Goods and Buck Mason have discreet spaces. At Chelsea Market, the brands will be almost entirely blended. The Austin store will be a bit of a hybrid. In many respects, Austin is going to become the template for us as we move forward.”
Neighborhood Goods’ address on Austin’s South Congress Avenue is a new mixed-use development, Music Lane, where tenants include Texas’ first Soho House and the city’s first Equinox, as well as Allbirds, Lululemon, Le Labo and Reformation.
“We’re introducing a beauty and wellness concept we developed, called The Residency,” Alexander said. “It’s a sub-brand of our in-house brand. We’re starting to develop a lot more concepts and producing private label. There’s certainly an opportunity for women’s apparel and maybe kids.”
Alexander said there’s also a push to create exclusive products in collaboration with brands.
The Series A funding will be used to significantly expand store and headquarters teams. Neighborhood Goods’ web site experience will be overhauled so customers can peruse brands, products and events across multiple locations, and for enabling in-store pick-up. A digital platform for brands to access real-time data, analytics and feedback will also be launched.
An important element of Neighborhood Goods in Plano is its Prim and Proper restaurant, and food will be pivotal to the Chelsea Market and Austin stores with Neighborhood Goods-owned restaurants developed for each location.
“The goal is to open a few more stores next year, in addition to Austin,” Alexander said. “We’ll look to strike a balance between major metro areas, secondary and tertiary markets. We’re keen to keep doing really vibrant, interesting streets in suburban markets, and a handful of malls.”