Arcade, the generative AI marketplace known for revolutionizing jewelry design, is now expanding into home goods—starting with custom rugs. The company unveiled this exciting expansion on Monday, alongside a fresh $25 million Series A funding round, raising its total funding to $42 million.
The newly launched rug design tool allows users to create personalized rugs by simply entering a text prompt. Powered by Midjourney and Stable Diffusion, the AI generates unique rug designs based on the material and user description. Once completed, Arcade connects users with a manufacturer who produces a free sample for approval before purchase.
Rug prices begin around $400 for a 3×9 hand-tufted wool option—the platform’s most budget-friendly material. Costs rise with premium materials like cashmere, alpaca, and mohair. Despite this, Arcade insists it offers far more affordable options than traditional luxury rug retailers that charge thousands.
To complement this launch, Arcade introduced a unique feature called “Match My Room.” Users can upload photos of their rooms, and the AI analyzes color schemes to generate designs that blend seamlessly with existing decor. While the tool matches colors effectively, it still struggles to recreate intricate patterns from other items like pillows or blankets. However, it remains a helpful way to ensure the new rug enhances a room’s style.
Arcade’s mission is to make generative AI design both fun and accessible. For users looking to create for pure enjoyment, the platform offers “Dream Boards”—inspirational mood boards similar to Pinterest. These collections showcase themed creations, from Hollywood-inspired earrings to creative home decor ideas. Users can browse Dream Boards, save favorites, and purchase directly through the platform.
The company is also ramping up its monetization features. Sellers on Arcade can now earn a 5% commission per sale—double the previous rate. Additionally, creators can boost earnings by joining Arcade’s affiliate program. The company recently introduced a special entrepreneur program designed for influencers and content creators, offering even higher commission rates. Influencers with over 25,000 followers or major media outlets are invited to apply directly via Arcade’s marketing team.
Although Arcade only launched its jewelry design beta in September 2024, the platform has already generated more than 650,000 unique jewelry designs. However, it has yet to reveal how many of these designs have converted into sales or what sellers are earning through commissions.
Founded by Mariam Naficy—the serial entrepreneur behind Eve Cosmetics and design marketplace Minted—Arcade is now charting its path toward becoming a one-stop AI design hub.
The Series A round was led by Laura Chau of Canaan Partners, with participation from Kirsten Green at Forerunner Ventures. Arcade plans to use the new funding to hire more talent, develop its platform, and expand into fresh product categories, including ceramics, pillows, apparel, leather goods, and even chain belts—a new category teased on its website.
The startup has also attracted notable backers. Early funding came from Ashton Kutcher’s Sound Ventures, Offline Ventures, and Reid Hoffman, LinkedIn’s co-founder. Other investors include Inspired Capital, Torch Capital, and David Luan, CEO of Adept AI Labs and a former VP of Engineering at OpenAI.
With new features, funding, and ambitious plans for expansion, Arcade is positioning itself at the forefront of AI-powered product design—pushing generative AI from jewelry to home decor and beyond.
