Foot Locker Invests $100 Million in Goat
Foot Locker Inc. is giving the kicks a hand.
Recognizing the unrelenting demand for sneakers, the athletic retail giant said Thursday that it is making a $100 million strategic minority investment in Goat, a managed marketplace for sneakers that operates company-owned stores, e-commerce sites and mobile apps for Goat and Flight Club. Both brands are resale platforms, which according to the company authenticate products offered for sale. Foot Locker’s investment will bring to $197.6 million the total raised by Goat Group since it was founded in 2015.
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Foot Locker is in good company. LVMH Luxury Ventures last February made an investment in Stadium Goods, a streetwear and sneaker resale site and brick-and-mortar retailer. The amount of the investment was not disclosed at the time, but was intended to hasten the brand’s already rapid growth.
Foot Locker and Goat Group eventually plan to combine their efforts across digital and physical retail platforms to create exclusive customer experiences, the companies said. Goat Group is obviously hoping to leverage the power of Foot Locker’s global footprint, which includes more than 3,000 stores in 27 countries.
Goat Group’s innovative technology — it began testing an augmented reality app last year — and digital capabilities will allow the two companies to provide “an unmatched experience and elevate customer engagement across the entire sneaker industry,” the brands said. The investment is expected to help accelerate Goat Group’s global reach by expanding its operations, including omnichannel experiences. In addition to North America, Foot Locker has a presence in Europe, Asia, Australia and New Zealand. The retailer operates a number of nameplates, including Kids Foot Locker, Lady Foot Locker, Champs Sports, Footaction, Runners Point, Sidestep and Six:02, and Eastbay.com.
The landscape for athletic retailers has been just as unforgiving as it is department stores. Sports Authority in March 2016 filed for Chapter 11 bankruptcy protection. At the time, the chain said it had strong interest from buyers for all or part of its assets. Sport Authority was also considering debt restructuring with its creditors. The company was liquidated instead.
“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,” said Richard Johnson, Foot Locker’s chairman and chief executive officer. “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. Together, Foot Locker and Goat Group’s shared commitment to trust and authenticity in the sneaker industry will provide consumers with unparalleled experiences and diversified offerings.”
“We pioneered in 2015 the ship-to-verify model with a mission to bring a seamless and safe customer experience to the secondary sneaker market,” said Eddy Lu, cofounder and ceo of Goat Group. “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.”
Scott Martin, Foot Locker Inc.’s senior vice president --of strategy and store development, will join Goat Group’s board of directors. Foot Locker has made other recent investments in digital-first companies including Carbon38, a women’s luxury activewear brand, Super Heroic, a tactical play and children’s lifestyle brand, and footwear design academy Pensole.
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