Arcade, First-Ever AI Physical Product Marketplace, Raises $25M Series A and Expands Into Home Goods

Company Raises Series A From Canaan Partners and Forerunner Ventures

SAN FRANCISCO, March 25, 2025 /PRNewswire/ -- Arcade, a generative AI marketplace where what can be dreamed can be made, today announced a $25 million Series A fundraise, bringing its total fundraise to $42 million. The company also announced its launch of home goods, marking a major expansion from its beta launch in jewelry a few months ago. Arcade is at the forefront of a major AI-driven shift in commerce, where with just a few words or an image, consumers can instantly receive unique AI-generated design suggestions or design something themselves.

The funding round and category expansion come just months after Arcade's beta launch in September 2024. The platform has seen rapid adoption among consumers and makers, and in just three months, users on Arcade have created the largest jewelry assortment in the world - with 650,000 jewelry designs created.

Expansion into Home Goods and Launch of 'Magic Match' Feature

Arcade's home goods category launches today with custom-made rugs, bridging centuries-old craftsmanship with AI technology. Through text or image prompts, users can create their dream rug for any space, which is then handwoven by a curated network of high-quality artisans across several countries. 

With this launch, users have unprecedented control over every design element of their ideal rug— the exact colors, size down to the inch, shape, material, fringe and texture.

Users can type out a description of their rug, or use Arcade's new "Magic Match" feature to upload a photo of their room to have a rug designed for them. Arcade's AI models, trained on makers' individual data, generate instantly buyable and manufacturable rug designs that complement the room's colors and style and are specific to each maker's look and feel. Beyond product generation, Arcade now serves design advice that understands individual environments and aesthetic preferences, offering personalized design suggestions.

Arcade shifts the rug-buying process by offering honest direct-to-maker pricing and unprecedented customization options that put creative control squarely in the hands of users. From flatwoven cashmere to high-pile alpaca, a wide range of luxurious textures and materials are on offer from makers which Arcade has carefully vetted. Customers receive free custom samples of rugs that they order in order to approve the samples before production begins.

"I'm thrilled to not only be bringing home goods onto our platform, but also be working with such a powerful group of investors to bring our vision for AI commerce to life. This braintrust, along with expanded capital, allows us to move quickly to launch a critical mass of categories and invest in differentiated AI technologies," said Mariam Naficy, Co-Founder and CEO, Arcade.  "We'll now be able not just to build a product creation tool, but the marketplace and magical shopping experience around it.  This is the end of the 'null search result' in shopping."

Arcade's Investors

 Arcade has now raised $42M in total funding. The newly announced Series A was raised from Laura Chau of Canaan Partners and Kirsten Green of Forerunner Ventures, with April Underwood of Adverb Ventures and Sol Bier of Factorial Funds participating.  Current investors Reid Hoffman, Offline Ventures (Brit Morin), Sound Ventures (Ashton Kutcher), Inspired Capital (Alexa von Tobel), and Torch Capital (Jonathan Keidan) made new investments in this round. New angel investors Sara Beykpour, Kayvon Beykpour, Anna Veronika Dorogush, Eugenia Kuyda and Marissa Mayer joined existing angel investors Christy Turlington Burns, Colin Kaepernick, Karlie Kloss, David Luan, and Jeff Wilke.

"The magic of Arcade lies in its bold vision: empowering consumers to create, not just consume. Mariam's unparalleled experience, from Minted to Arcade, demonstrates her mastery of building platforms that marry artistry and innovation at scale," said Laura Chau, partner, Canaan. "With AI at the helm and a robust supply chain, Arcade bridges the gap between digital creativity and physical product, offering consumers a unique opportunity to bring their ideas to life in ways never before possible."

"Today, every category is up for reimagination, with AI fundamentally reshaping consumer product experiences and business models. One immediate and profound opportunity is to truly deliver on personalization for consumers, proactively surfacing the best possible options tailored to someone's unique tastes, budget, and intents," said Kirsten Green, Founder and Managing Partner of Forerunner. "Arcade is delivering on the premise and taking it one step further by enabling the consumer to participate in the creative process through a dynamic co-creation experience that provides entirely customizable end products."

"As someone who loves design, I could not be more thrilled for Arcade to build the first-of-its-kind platform that empowers designers and tastemakers to go past content creation and shift into full-blown product," says Alexa von Tobel, Founder and Managing Partner at Inspired Capital. "Imagine being able to describe the product that you want and instantly find someone who can make it. This represents a platform shift that can change the way we shop. With Mariam's deep expertise in product customization at Minted, she is the perfect founder to embark on this."

Entrepreneur Program

Arcade is expanding its creator program designed specifically for influencers and creators with established audiences. With Arcade, budding and seasoned entrepreneurs can create designs that can then be sold to people in their networks or shared on social media. The program enables anyone to easily build and monetize their own AI-generated product lines without traditional barriers like manufacturer sourcing or inventory risk. Early adopters of the program include a diverse group of creatives such as print designer Amber Vittoria, architect Tim Fu, and AI artist Damilola Awoyomi, who are all leveraging Arcade's AI technology to create products for their communities that reflect their personal style and brand identity.

Arcade's home goods category is now available at https://arcade.ai. The platform continues to accept applications from qualified makers at https://arcade.ai/makers and creators at: https://www.arcade.ai/sell.

About Arcade
Arcade is co-founded by Mariam Naficy with the team from her incubator, Heretic Ventures. Naficy, pioneer of the creator economy and founder of Minted and Eve.com, has transformed how products are created, sold and purchased online since 1998.

Arcade brings together the power of generative AI with a global community of independent makers and brands to turn user needs into personalized, immediately priced physical products in a quantity of one.  The company enables consumers to speak to manufacturers with images, bridging language and geographic divides.  Arcade aims to redefine commerce by offering unprecedented personal choice, expression, and meaning in products.

SOURCE Arcade