Nordstrom Inc. has joined an investor group pumping $15.5 million in Series B funding into Shoes of Prey, the Los Angeles-based brand that enables women to design their own shoes.
The round of funding, the largest to date for Shoes of Prey, was led by BlueSky Venture Capital. Nordstrom — as well as Greycroft, which has invested in Trunk Club, The RealReal and Baublebar — came on board as equity partners.
Khosla Ventures, which led Shoes of Prey’s $5.5 million series A-2 funding in 2014, added to its investment in the brand, which has raised a total of $24.6 million in funding.
Nordstrom began rolling out Shoes of Prey Design Studio shops in its stores a year ago and currently has six. Nordstrom.com also sells Shoes of Prey and there is one Shoes of Prey shop inside the David Jones department store in Australia. The Shoes of Prey Web site generates the bulk of the brand’s volume, which the company does not disclose.
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In revealing the new round of funding, Shoes of Prey did not break out how much Nordstrom and the others are contributing or specify the equity stakes. But Shoes of Prey continues to be privately owned and controlled by its three founders: Michael Fox, Mike Knapp and Jodie Fox.
Earlier this year, the company relocated its headquarters to Los Angeles from Sydney, Australia, to expedite growth across its different channels of distribution. The company opened a factory in the Dongguan province of China on Christmas Eve of 2014.
With Shoes of Prey, women can custom design their shoes by choosing from different shoe styles, materials, lasts, heel heights, details, colors and a wide range of sizes. The company says that the process of self-designing takes about 30 to 40 minutes and that the shoes are delivered anywhere around the world within three weeks.
Nordstrom’s participation in the Shoes of Prey funding reflects the Seattle-based retailer’s ongoing willingness to invest in new technologies and online businesses and strengthen two areas where it excels — shoes and service. It also reflects the growing trend of product personalization. The department store group also offers made-to-measure men’s suiting and monogramming and since early 2011, has acquired HauteLook and Trunk Club and has taken a stake in Bonobos.
Shoes of Prey’s new funding will help the firm meet what it sees as rapidly increasing demand for its products. The company also said it eventually will broaden the offering into other product categories, such as handbags, that customers can design themselves as they do with the footwear. Shoes of Prey says that since its launch in 2009, it has created more than 5 million pairs of shoes.
“We need to stay focused on shoes for the next 12 months, particularly boots. It’s very difficult to find boots that fit comfortably around your calves,” said Jodie Fox. “Ask any woman.”
It can be a particular problem if you are a runner or some other kind of athlete and have muscular calves, she added. Typically, in boot construction, Fox pointed out, the width of the calf is determined by the size of the foot. The plan at Shoes of Prey is to offer a range of calf widths, similar to how Shoes of Prey foot widths are sized — narrow, extra narrow, regular wide and extra wide.
Regarding its retail presence, Fox said Shoes of Prey currently does not have any plans to increase its presence in Nordstrom or David Jones. “We’d like to put that into discussion,” she said, characterizing developing the in-store shops as “such a big experiment and a costly one as well.”
She believes that those women shopping Shoes of Prey “know exactly what they want in shoes, regardless of whether it’s in stock or in season…We’re proud to deliver a solution that caters to their otherwise unserved need.”
Scott Meden, Nordstrom’s executive vice president and general merchandise manager of shoes, said, “We want to serve customers in many different ways to deliver highly relevant experiences. With personalization becoming more important to how the customer views good service, it’s important for us to find opportunities to stay increasingly relevant and deliver a great customer service experience.”
“You can look at Shoes of Prey as either a logistics and manufacturing business that has solved a fashion problem, or a fashion company that has solved a logistics and manufacturing problem,” said Elaine Stead, investment director at BlueSky.
“The traditional mass manufacturing model is designed to cater to the masses and not to individual styles and preferences,” said Benjamin Ling, investment partner at Khosla. “By manufacturing on demand, [Shoes of Prey] enables consumers to define their own style and get shoes that meet their individual tastes.”