Foot Locker Buys into Sneaker Resales
Foot Locker is expanding its digital footprint through a $100 million strategic investment aimed at further innovating the sneaker-buying process across sales platforms.
The specialty athletic retailer is investing in Goat Group, an operator of mobile and e-commerce marketplaces for sneaker resales under the Goat and Flight Club names. Fight Club also operates retail stores in New York, Los Angeles and Miami. Both brands, which merged last February, authenticate and verify products from independent sellers, ensuring a safe platform for people to buy and sell rare sneakers. Goat Group is a subsidiary of 1661, Inc.
Foot Locker will gradually collaborate with Los Angeles-based Goat across digital and physical platforms to bring shoppers an “unmatched” shopping experience while also elevating engagement in the sneaker industry at large, according to a media release announcing the investment.
According to goat.com, the company has logged over 75,000 sneakers in its database and has data to accurately verify the authenticity of each one. It also uses specialists to inspect everything including the label, stitching, texture and color.
"At Foot Locker, we are constantly looking at new ways to elevate our customer experience and bring sneaker and youth culture to people around the world," chief executive officer Richard Johnson said in the release. "We are excited to leverage Goat Group's technology to further innovate the sneaker buying experience and utilize their best-in-class online marketplace to help meet the ever-growing global demand for the latest product."
The investment, which is Foot Locker’s largest to date and brings Goat Group’s total funding to $197.6 million, is also expected to “help accelerate Goat Group's global operations, expanding its omnichannel experience and innovative technologies,” according to the release.
"In 2015, we pioneered the ship-to-verify model with a mission to bring a seamless and safe customer experience to the secondary sneaker market," Eddy Lu, Goat Group co-founder and ceo said. "With over 3,000 retail locations [in 27 countries], Foot Locker will support our primarily digital presence with physical access points worldwide, bringing more value to our community of buyers and sellers. Having Foot Locker as a strategic partner will also expand our business as we continue to scale our operations both domestically and internationally."
This investment is only Foot Locker’s latest in digital-first companies. The retailer has also invested $15 million in women's luxury activewear brand Carbon38; $3 million in tactical play, entertainment and children's lifestyle brand Super Heroic; and $2 million in footwear design academy Pensole.
Foot Locker executives are joining the boards of directors for these new companies. Senior vice president, strategy and store development Scott Martin will sit on Goat Group's board.