Arcade Raises $25 Million in Series A, Launches "Match My Room" Feature Allowing Users to Create Rugs Matching Existing Living Spaces.
Arcade, an AI-generative marketplace platform known for personalized jewelry design services, has announced an expansion into home goods with its first product being premium floor rugs. This move marks the company's strategic step in building a comprehensive AI-designed product ecosystem for living spaces.
Along with the product portfolio expansion, Arcade also revealed completing a Series A Capital round worth $25 million, raising its total Capital to $42 million. This investment round was led by Laura Chau from Canaan Partners, with participation from Kirsten Green from Forerunner – renowned investors in technology and e-commerce.
AI Personalization Technology for Home Goods
The highlight of this expansion is the newly introduced "Match My Room" feature on Monday. This tool allows users to upload images of their living spaces, after which AI analyzes existing color palettes and styles to suggest matching rug designs. Although the technology cannot precisely replicate patterns from other furniture, it helps users easily create products harmonizing with their current space.
Arcade's rug design and production process is similar to its jewelry service. Users select rug materials, input design prompts, and AI generates design drafts based on Midjourney and Stable Diffusion models. The design is then connected to manufacturers who send free samples to customers for approval before finalizing the order.
Arcade's rug prices start around $400 for a 3x9 hand-woven wool rug, with premium options like cashmere, alpaca, and mohair being more expensive. However, the company asserts their products remain more affordable compared to traditional luxury rug retailers, who typically sell similar items for thousands of dollars.
Besides expanding product categories, Arcade has upgraded its seller program, increasing commission rates from 2.5% to 5% per product sale. The company also launched a new entrepreneur program aimed at attracting content creators and influencers with over 25,000 Watchers.
Mariam Naficy, Arcade's founder who previously established cosmetics retailer Eve and design marketplace Minted, stated that the new Capital will be used for hiring personnel, platform development, and introducing additional product categories like ceramics, pillows, and potentially clothing, leather goods, and chain belts in the future.
Since launching its jewelry service beta in September 2024, Arcade claims to have created 650,000 jewelry designs, though the company has not disclosed specific details about actual customer purchases or seller commission revenues.
