Matt Alexander

Neighborhood Goods

www.neighborhoodgoods.com

Year founded: 2017

Industry: Retail

This feature comes on the heels of an exciting week of press for Neighborhood Goods. Last week saw the announcement of a physical location at Legacy West and an impressive $5.75 million in seed funding. We recently sat down with the company’s founder, Matt Alexander, to talk about his innovative retail concept, his path to entrepreneurial self-realization, and more. This feature is jam-packed with advice for all you aspiring entrepreneurs as well as something to look forward to for anyone who appreciates experiential shopping adventures. Enjoy!

 

 

Where did the inspiration to start Neighborhood Goods come from?

Retail is often described as being “dead.” I do not believe this is entirely true.

Rather, I believe traditional retail has become mundane, complacent, and stagnant, altogether failing to keep pace with consumer taste and preference.

But that’s not to say retail, as a whole (or as a concept), is dead. Far from it. The industry is simply overdue for change.

Despite record retail bankruptcies in recent years, for instance, we’re also witnessing a tremendous number of young, digitally-native brands entering the world of physical retail. Well-regarded brands like Warby Parker and Peloton are opening stores at a rapid pace and, in doing so, they’re beginning to generate more revenue from their stores than they are on the web.

It’s clear that there’s remarkable opportunity and obvious value in physical retail, but the barrier to entry continues to be exceptionally high for most brands.

With Neighborhood Goods, we looked at this landscape and were inspired to approach it with the audacious notion of reinventing the department store for the modern age. Working with these hungry, creative, and relevant brands, we’d create a physical (and digital) framework through which they can test new product types, gain sales and exposure, acquire new customers, and more. Meanwhile, we’d orient the store to focus on experience and engagement, just as much as it’s oriented toward sales.

More succinctly, we were inspired to create something new and relevant for consumers and brands alike, whilst also invigorating real estate across the country. Rather than trying to con you into visiting us, we were inspired to create something more communal, social, and editorially-driven.

So, that’s what we’re doing.

 

Tell us a little about your background and what you were doing prior to Neighborhood Goods. Do you have previous experience in business/entrepreneurial endeavors?

I began dabbling with “entrepreneurial endeavors” from a young age, although I never really identified them as such.

From building and selling computers to neighbors to starting an oddly-popular blog, I was always experimenting and learning. It was never out of desire for money, but, rather, to make things and put them out into the world. It wasn’t until I was in my twenties that I realized this was an expression of entrepreneurship.

Equipped with that knowledge — and suddenly keen to start building things in earnest — I began producing a blog again. It was an effort to write my way into relevancy in the world of business, in the hope that it’d provide me with sufficient credibility to build my own company one day. The plan ended up moving much faster than I’d anticipated, leading me to resign from my full-time corporate position in 2012 and, ultimately, start my first company.

Specifically, I started two editorially-driven e-commerce brands, Need (later Imprint) and Foremost, which were a part of a larger corporate umbrella called Edition Collective. Alongside those, I co-founded a non-profit pop-up series, Unbranded, offering free retail and event space to independent entrepreneurs, artists, chefs, and more in Dallas. Meanwhile, I co-hosted a popular podcast, in a series of iterations across 70 Decibels, 5by5, and, ultimately, Relay FM.

 

You guys are coming out of the gates strong with your recent announcement of $5.75 million in seed funding. What was that process like? Any advice for other business owners trying to raise their own capital?

Honestly, there’s no science to it.

For us, we were fortunate to be working on an idea that — as it turns out — many investors had been contemplating. So, when it came time for us to raise money, we were lucky to have some easier conversations in that regard.

In terms of some actual advice, I’d strongly encourage entrepreneurs to be extremely selective about their investors. (In the same way that investors are selective about their investments.) There’s a lot of money available to entrepreneurs in a lot of different shapes and sizes, but, ultimately, it has to be from someone you enjoy, someone you can work with, and someone who is keen to be helpful as you’re building your business.

Although there’s no real science to it, I would say that there’s a lot of wisdom to having smart, supportive people around you, rather than those only looking out for themselves.

 

What differentiates your business from the competition?

Well, there are a number of different approaches to physical retail and pop-ups at the moment:

  • Traditional retailers — Nordstrom, Neiman Marcus, and the like — are experimenting with in-store pop-up activations and bringing in more digitally-native products.
  • Digitally-native brands, themselves, are investing in physical retail networks and pop-up activations.
  • Real estate providers are dabbling with new concepts to invigorate their developments, while other spin-off services like AppearHere are trying to make the process easier and more understandable for brands.

With Neighborhood Goods, we’re seeking to provide something different. Rather than focusing on traditional wholesale to fill enormous spaces (i.e., traditional retailers), we’re focusing on crafting experiences and more beneficial relationships with our brands and partners. It requires less inventory from them (and risk for us), whilst also creating something more meaningful and modern (i.e., data informed) for the customer.

Meanwhile, for the brands investing in the space, it’s an incredibly costly endeavor with a high barrier to entry. Hosting a pop-up — of significant size and with sufficient exposure — can cost hundreds of thousands of dollars. And, at the end of that experience, you have sales and some new customers, but it’s inherently limited. Equally, for those with their own stores, they have to invest heavily in bringing customers inside. With Neighborhood Goods, on the other hand, we’re able to drastically lower the price for these activations by providing furnished and fully-staffed space, access to robust in-store data, and more.

We’re different insofar as we’re playing a different game than much of the industry. Rather than focusing on sales per square foot, we’re focusing on engagement and storytelling. Rather than delineating between sales channels and creating animosity between web and physical, we’re treating them as a unified channel. Rather than charging absurd prices with complicated contracts, we’re creating flexible and straightforward relationships with brands.

Plus, we’re developing our own restaurant and bar, facilitating exclusive collaborations between brands, creating amazing new technology, and launching a very special new media outlet.

And so on.

 

How has being a part of the WeWork community helped to grow your business?

We’ve just closed $5.75 million of seed funding, which has required a lot of travel in recent months.

With WeWork, I’ve been able to use their spaces around the country — and abroad — seamlessly. It makes such a difference to know you have reliable internet, coffee, and office-space during those trips, rather than having to confine myself to a hotel room or perch in a coffee shop for hours.

Equally, as we’ve begun to hire, we’ve not had to worry about the complexities of scaling office-space or leases. It’s been easy to scale within the WeWork ecosystem.

Beyond that, it’s just been good to be around some friends — both new and old — who are all endeavoring to build things. Entrepreneurship can be lonely, so it’s good to be surrounded by like-minded and uplifting people.

 

What can we expect to see from your business in the next 2 years?

Well, first, we’re planning to open our inaugural location at Legacy West in Plano, Texas later this year. Alongside that opening — both for store and restaurant — we’ll launch on the web and on iOS simultaneously.

From there, we’ll be looking to expand. We’re pouring a lot of thought and effort into the first location and will then take some time to observe and assess many of those decisions. Once we have a good sense of the thing, we’ll press forward into some other exciting markets around the US and, at some stage, abroad.

For it all, you’ll see some mistakes, as well as, hopefully, some successes. We are learning as we go with this project and plan to share much of that story with our friends, partners, and customers.

 

What is one piece of advice that you can offer to aspiring entrepreneurs?

There’s no fixed blueprint for success. Trust your instincts, listen to wisdom from people around you, and realize that no one really knows what they’re doing in the first place.

 

Follow along as the exciting journey of Neighborhood Goods continues to unfold!

neighborhoodgoods.com

instagram.com/neighborhoodgoods

facebook.com/neighborhoodgoods

twitter.com/nbhdgoods

 

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