It’s been hard to read the news over the past year without seeing another headline proclaiming the death of a big box retailer. From household names like Sears to JCPenney to Radioshack to Macy’s, an estimated 3800 U.S. stores are expected to close in 2018.
This situation has been building for some time. Part of the answer is the internet, smartphone penetration, and that e-commerce behemoth in the Northwest. But partly it’s because retailers have not been listening. Stores used to serve customer needs - baby boomers wanted convenient access to mass-produced, global, status products. The new generations want something different. They want authenticity, community connection, and experiences.
This shift could not be more true of toys - a category rich in consumer emotion, engagement and spend. Overall toy industry sales grew by 7% year over year in the first half of 2018 to $7.9 billion. Yet despite this strong demand, brick and mortar has been flailing. With companies like Mattel laying off workers and Toys ‘R’ Us filing for bankruptcy, the supply void is more apparent than ever.
Enter CAMP, a modern retail chain built to engage and inspire young families. At RRE, we believe the CAMP team has hit on how to deliver a magical experience that responds to customer preferences while also abandoning the cost structures of legacy retail. Their fresh approach reimagines store design, combining merchandise with play and media and offering themed, curated, and immersive experiences. They also fundamentally rethink the retail model, with a more modular, agile approach that reduces dependence on third party IP and spans multiple lines of business from sponsorship to licensing, ticketing, and e-commerce.
The team of big-kid creators, designers, architects and operators behind CAMP is uniquely positioned to build a bold new retail chain. We have known founder Ben Kaufman for over a decade, from his days as a visionary leading Quirky to his recent years as Chief Commerce Officer at our portfolio company Buzzfeed, where he has driven meaningful revenue (Buzzfeed will also be backing CAMP and serving in a partnership capacity.) One of the great things about being a VC is getting to work with brilliant product people who have a strong point of view on how the world works. Ben is exactly that. He understands each side of the puzzle - from his deep empathy for the customer to his product instincts to his ability to nurture partnerships. He is also good at building community, and this investment serves as another example of our thesis around building joyful, community-centered brands - something our portfolio company BarkBox has successfully demonstrated with dogs.
These team attributes combined with recent market trends make for the right people and the right timing to build a new brand in retail. Today we are excited to announce our investment in CAMP. And we are thrilled to work with Ben again and help him build his new venture alongside co-investors Lerer Ventures and individual angels like Rachel Schechtman, founder of Story. CAMP’s flagship store will be launching here in the heart of New York City on December 15th - next time you’re in NYC, please come by and see it for yourself at 110 5th Avenue 😀